Case Notes/Answers
Colgate-Palmolive Determining a Salary Offer By Zubin
R. Mulla, L. Gurunathan
Discussion Questions:
1. What are the key business challenges for Colgate-Palmolive at the Sri City plant?
a. What human resources responses can help Colgate-Palmolive best deal with business
challenges?
b. What compensation philosophy and specific compensation strategies would you recommend
for the Sri City plant?
2. Considering the job descriptions provided in the case (see case Exhibit 4), identify
compensable factors for a point-based job evaluation plan. Define each compensable factor.
a. Determine an appropriate weight for each compensable factor. Explain the chosen weight.
b. Develop a numerically scaled factor degree for each compensable factor. Define each degree
for the various compensable factors.
c. Evaluate all the job descriptions provided in the case (see case Exhibit 4) using your point-
based job evaluation plan, and develop a structure that clearly shows the hierarchies across all
job families.
3. For three specific positions—shift in charge (team leader), area leader of moulding, and
operations manager—identify the closest matching jobs on the O*NET OnLine database.1 For
each position, record the code number, occupation name, and median annual salary.
4. For three specific positions—shift in charge (team leader), area leader of moulding, and
operations manager—identify the appropriate level and position code using the Aon Hewitt
Limited framework2 (see accompanying Student Excel Spreadsheet).
a. For these three positions, determine pay level and pay ranges. Use total annual remuneration
(with target variable pay) as the anchor value.
b. Assume that the organization has six managers, 13 area leaders, and 21 shifts in charge.
Calculate the total salary cost for the plant, if the average salary paid to individuals falls at the
organization’s median level of total cost, including target variable pay plus long-term incentives
and gratuities.
5. What aspects should be considered in determining an appropriate salary for candidates who
join the organization in mid-career?
a. For each of the five candidates discussed in the case—Selvaraj, Neeraj, Ganesh, Venkat, and
Nilesh (see case Exhibit 2)—determine the appropriate compensation elements, according to
the ColgatePalmolive salary structure. In all cases, identify the non-monetary rewards that can
be offered to entice the candidates.
b. What short-term and long-term initiatives should be taken to ensure good teamwork and high
motivation in the Sri City factory for years to come?
, W20392
Teaching Note
COLGATE-PALMOLIVE: DETERMINING A SALARY OFFER
SYNOPSIS
Aditya Singh, head of compensation for Colgate-Palmolive (India) Limited (Colgate-Palmolive), has to
decide on a compensation structure for the green-field factory of the large multinational corporation. The
initial problem is to determine a pay level and pay mix for five potential new employees at the factory. To
create a fair and appropriate pay structure, Singh must follow three guidelines: (1) determine a
compensation strategy; (2) focus on internal fairness, equity, and alignment; and (3) use job evaluation
results and market data to determine appropriate salary ranges. Singh begins the process by applying a
hierarchy of positions based on job evaluations. He then uses benchmarking from the market to determine
an appropriate salary structure.
LEARNING OBJECTIVES
After working through the case and assignment questions, students will be able to achieve the following
objectives:
Determine a compensation philosophy and strategy for a plant, considering environmental conditions
and business strategy.
Design a job evaluation plan using compensable factors that are aligned to the organizational strategy
and business realities.
Use the technique of policy capturing to determine weights of compensable factors.
Explain the process of job matching using publicly available databases (e.g., O*NET OnLine) and
consulting products (e.g., Aon Hewitt Limited’s level mapping and position codes).
Analyze an industry’s compensation benchmarking report and determine pay levels and pay ranges for
each grade in an organization within this industry.
Describe the dynamics involved in determining an appropriate salary for experienced candidates, while
matching the candidate’s requests with the organization’s pay policy.
, Page 2 8B20C026
POSITION IN COURSE
This case is suitable for undergraduate- and graduate-level courses on compensation management,
organizational behaviour, or human resources management. The case can be used to discuss the three
aspects of any compensation design: internal alignment, external alignment, and salary suitability.
Instructors can choose to stretch the case over five to seven sessions of a course, with each session covering
one of the learning objectives.
RELEVANT READINGS
George Mikovich, Jerry Newman, and Barry Gerhart, Compensation, 11th ed. (New York: McGraw-
Hill Irwin Management, 2014), chapters 2–8.
Richard I. Henderson, Compensation Management in a Knowledge-Based World, 10th ed. (New Delhi,
IN: Pearson Prentice Hall, 2006).
Thomas L. Saaty, “Axiomatic Foundation of the Analytic Hierarchy Process,” Management Science
32, no. 7 (1986): 841–855.
Thomas L. Saaty, “Relative Measurement and its Generalization in Decision Making: Why Pairwise
Comparisons Are Central in Mathematics for the Measurement of Intangible Factors,” Revista de la
Real Academia de Ciencias Exactas, Fisicas y Naturales 102, no. 2 (2008): 251–318.
Mark A.P. Davies, “Using the AHP in Marketing Decision-Making,” Journal of Marketing
Management 10, no. 1–3 (1994): 57–73.
Elliott Jaques, Requisite Organization: A Total System for Effective Organization and Managerial
Leadership for the 21st Century (Arlington, VA: Cason Hall & Co., 1998).
Elliott Jaques, “Taking Time Seriously in Evaluating Jobs,” Harvard Business Review, September
1979, 124–132.
Norman G. Peterson, Michael D. Mumford, Walter C. Borman, P. Richard Jeanneret, Edwin A.
Fleishman, Kerry Y. Levin, Michael A. Campion, and Melinda S. Mayfield, “Understanding Work
Using the Occupational Information Network (O*NET): Implications for Practice and Research,”
Personnel Psychology 54, no. 2 (2001): 451–492.
ASSIGNMENT QUESTIONS
1. What are the key business challenges for Colgate-Palmolive at the Sri City plant?
a. What human resources responses can help Colgate-Palmolive best deal with business challenges?
b. What compensation philosophy and specific compensation strategies would you recommend for
the Sri City plant?
2. Considering the job descriptions provided in the case (see case Exhibit 4), identify compensable factors
for a point-based job evaluation plan. Define each compensable factor.
a. Determine an appropriate weight for each compensable factor. Explain the chosen weight.
b. Develop a numerically scaled factor degree for each compensable factor. Define each degree for
the various compensable factors.
c. Evaluate all the job descriptions provided in the case (see case Exhibit 4) using your point-based
job evaluation plan, and develop a structure that clearly shows the hierarchies across all job
families.
Colgate-Palmolive Determining a Salary Offer By Zubin
R. Mulla, L. Gurunathan
Discussion Questions:
1. What are the key business challenges for Colgate-Palmolive at the Sri City plant?
a. What human resources responses can help Colgate-Palmolive best deal with business
challenges?
b. What compensation philosophy and specific compensation strategies would you recommend
for the Sri City plant?
2. Considering the job descriptions provided in the case (see case Exhibit 4), identify
compensable factors for a point-based job evaluation plan. Define each compensable factor.
a. Determine an appropriate weight for each compensable factor. Explain the chosen weight.
b. Develop a numerically scaled factor degree for each compensable factor. Define each degree
for the various compensable factors.
c. Evaluate all the job descriptions provided in the case (see case Exhibit 4) using your point-
based job evaluation plan, and develop a structure that clearly shows the hierarchies across all
job families.
3. For three specific positions—shift in charge (team leader), area leader of moulding, and
operations manager—identify the closest matching jobs on the O*NET OnLine database.1 For
each position, record the code number, occupation name, and median annual salary.
4. For three specific positions—shift in charge (team leader), area leader of moulding, and
operations manager—identify the appropriate level and position code using the Aon Hewitt
Limited framework2 (see accompanying Student Excel Spreadsheet).
a. For these three positions, determine pay level and pay ranges. Use total annual remuneration
(with target variable pay) as the anchor value.
b. Assume that the organization has six managers, 13 area leaders, and 21 shifts in charge.
Calculate the total salary cost for the plant, if the average salary paid to individuals falls at the
organization’s median level of total cost, including target variable pay plus long-term incentives
and gratuities.
5. What aspects should be considered in determining an appropriate salary for candidates who
join the organization in mid-career?
a. For each of the five candidates discussed in the case—Selvaraj, Neeraj, Ganesh, Venkat, and
Nilesh (see case Exhibit 2)—determine the appropriate compensation elements, according to
the ColgatePalmolive salary structure. In all cases, identify the non-monetary rewards that can
be offered to entice the candidates.
b. What short-term and long-term initiatives should be taken to ensure good teamwork and high
motivation in the Sri City factory for years to come?
, W20392
Teaching Note
COLGATE-PALMOLIVE: DETERMINING A SALARY OFFER
SYNOPSIS
Aditya Singh, head of compensation for Colgate-Palmolive (India) Limited (Colgate-Palmolive), has to
decide on a compensation structure for the green-field factory of the large multinational corporation. The
initial problem is to determine a pay level and pay mix for five potential new employees at the factory. To
create a fair and appropriate pay structure, Singh must follow three guidelines: (1) determine a
compensation strategy; (2) focus on internal fairness, equity, and alignment; and (3) use job evaluation
results and market data to determine appropriate salary ranges. Singh begins the process by applying a
hierarchy of positions based on job evaluations. He then uses benchmarking from the market to determine
an appropriate salary structure.
LEARNING OBJECTIVES
After working through the case and assignment questions, students will be able to achieve the following
objectives:
Determine a compensation philosophy and strategy for a plant, considering environmental conditions
and business strategy.
Design a job evaluation plan using compensable factors that are aligned to the organizational strategy
and business realities.
Use the technique of policy capturing to determine weights of compensable factors.
Explain the process of job matching using publicly available databases (e.g., O*NET OnLine) and
consulting products (e.g., Aon Hewitt Limited’s level mapping and position codes).
Analyze an industry’s compensation benchmarking report and determine pay levels and pay ranges for
each grade in an organization within this industry.
Describe the dynamics involved in determining an appropriate salary for experienced candidates, while
matching the candidate’s requests with the organization’s pay policy.
, Page 2 8B20C026
POSITION IN COURSE
This case is suitable for undergraduate- and graduate-level courses on compensation management,
organizational behaviour, or human resources management. The case can be used to discuss the three
aspects of any compensation design: internal alignment, external alignment, and salary suitability.
Instructors can choose to stretch the case over five to seven sessions of a course, with each session covering
one of the learning objectives.
RELEVANT READINGS
George Mikovich, Jerry Newman, and Barry Gerhart, Compensation, 11th ed. (New York: McGraw-
Hill Irwin Management, 2014), chapters 2–8.
Richard I. Henderson, Compensation Management in a Knowledge-Based World, 10th ed. (New Delhi,
IN: Pearson Prentice Hall, 2006).
Thomas L. Saaty, “Axiomatic Foundation of the Analytic Hierarchy Process,” Management Science
32, no. 7 (1986): 841–855.
Thomas L. Saaty, “Relative Measurement and its Generalization in Decision Making: Why Pairwise
Comparisons Are Central in Mathematics for the Measurement of Intangible Factors,” Revista de la
Real Academia de Ciencias Exactas, Fisicas y Naturales 102, no. 2 (2008): 251–318.
Mark A.P. Davies, “Using the AHP in Marketing Decision-Making,” Journal of Marketing
Management 10, no. 1–3 (1994): 57–73.
Elliott Jaques, Requisite Organization: A Total System for Effective Organization and Managerial
Leadership for the 21st Century (Arlington, VA: Cason Hall & Co., 1998).
Elliott Jaques, “Taking Time Seriously in Evaluating Jobs,” Harvard Business Review, September
1979, 124–132.
Norman G. Peterson, Michael D. Mumford, Walter C. Borman, P. Richard Jeanneret, Edwin A.
Fleishman, Kerry Y. Levin, Michael A. Campion, and Melinda S. Mayfield, “Understanding Work
Using the Occupational Information Network (O*NET): Implications for Practice and Research,”
Personnel Psychology 54, no. 2 (2001): 451–492.
ASSIGNMENT QUESTIONS
1. What are the key business challenges for Colgate-Palmolive at the Sri City plant?
a. What human resources responses can help Colgate-Palmolive best deal with business challenges?
b. What compensation philosophy and specific compensation strategies would you recommend for
the Sri City plant?
2. Considering the job descriptions provided in the case (see case Exhibit 4), identify compensable factors
for a point-based job evaluation plan. Define each compensable factor.
a. Determine an appropriate weight for each compensable factor. Explain the chosen weight.
b. Develop a numerically scaled factor degree for each compensable factor. Define each degree for
the various compensable factors.
c. Evaluate all the job descriptions provided in the case (see case Exhibit 4) using your point-based
job evaluation plan, and develop a structure that clearly shows the hierarchies across all job
families.
