Study of Performance and Compensation at Infosys Ltd.
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  • 1. PCM-TERM PAPER INFOSYS Ltd. Presented by: Hitaishi Gupta(043026) Sonali Verma(043054)
  • 2. ABOUT INFOSYS• Infosys Limited (NASDAQ: INFY) – started on 1981 by seven people with US$ 250.• Today, it is a global leader in the "next generation" of IT and consulting• Revenues of US$ 6.604 billion (LTM Q2-FY12).
  • 3. ABOUT INFOSYS• Vision : "We will be a globally respected corporation."• Mission : "To achieve our objectives in an environment of fairness, honesty, and courtesy towards our clients, employees, vendors and society at large.“• Values – Infosys believes that the softest pillow is a clear conscience. The values that drive it underscore its commitment to: – Client Value: To surpass client expectations consistently – Leadership by Example: To set standards in our business and transactions and be an exemplar for the industry and ourselves – Integrity and Transparency: To be ethical, sincere and open in all our transactions – Fairness: To be objective and transaction-oriented, and thereby earn trust and respect – Excellence: To strive relentlessly, constantly improve ourselves, our teams, our services and products to become the best.
  • 4. PERFORMANCE MANAGEMENT POLICY Steps for Performance Appraisal:• Evaluation of personal skills for the tasks assigned to an employee during the period of appraisal.• Evaluation of the performance, different criterias were considered.• The personal skills of the employees were also evaluated based on their learning and analytical ability etc.• Each of these criteria was measured on a scale of 1 to 5.
  • 5. PERFORMANCE MANAGEMENT POLICY• 360 Degree Feedback• Recognition for Adding Value• Employee-Management Interface• Focus on Learning• Innovation• Business Continuity Plan
  • 6. PERFORMANCE ASSESSMENT• A bi-annual process.• Various tools used are used.• The system is called Online- PerforMagic.• Consolidated relative rating is calculated.• Assessment of an individual’s performance relative to the peer group is carried.• Rating ranges from 1+ to 4.
  • 7. KEY RESULTANT AREA• KRAs are mutually set through a discussion between the manager and the employee. – Self Assessment (by appraise) – Review by Team Leader in a one to one meeting between the project manager and the software engineer. – Final review by the project Manager (Reviewer) – Finally the points are given. – The report is sent three levels higher. – Then it is sent back to the engineer to find if he/she is satisfied. – If it is agreeable then it is finalized. – There is a salary hike or a band change accordingly.• This entire system is online. Hence everyone involved in the process gets to gets track of it. This ensures transparency.
  • 8. RATINGS• Combined Ratings impact three key areas: – Performance Incentives – Salary Reviews – Promotions• Star performers awarded with STAR INFOSIAN Certificate.
  • 9. COMPENSATION POLICY• There are three basic strategies for an organizations salary policy: – In the jobs that we studied, SAP BI Consultant and Software Engineer, Infosys follows a LEAD STRATEGY.
  • 10. SALARY REVIEW OF EMPLOYEES
  • 11. SALARY REVIEW OF EMPLOYEES
  • 12. SALARY REVIEW OF EMPLOYEES
  • 13. SALARY REVIEW OF EMPLOYEES
  • 14. Sizing of the Job• Cluster approach
  • 15. • 8 Levels• Cluster approach is followed to size the job, based upon the Job evaluation.• Sizing of the job of SAP BI Consultant is done at LEVEL 4 and Software Engineer is done at LEVEL 2.
  • 16. Prizing of the Job
  • 17. Comparison of the Salary of SAP BI Consultant at Infosys with other IT Companies in India• The Average Salary offered by the Industry is INR 401232 but Infosys is following a Lead strategy and paying at the 92th percentile of the Industry (Source: Payscale.com)
  • 18. Salary Slip of SAP BI Consultant- InfosysName Departme Pers Designation Emp Account nt Level code No.xyz Finance 4 SAP BI 14000 300586303 Consultant 52Total Basic HRA Medical Travel Fixed Leave Monthly IPI Differential Bonus Allowanc Dearness Travel CPI CPI e Allowanc Allowanc e e 1760 1122 51563518 0 5 7016 2806 1100 7016 6840 5 1207.0 3553Deductions PF Contributions Professional Income Infosy GYM Tax Tax Welfare facilities Trust5060 2244 200 2391 200 25Net Pay58458
  • 19. Comparison of the Salary of Software Engineer at Infosys with other IT Companies in IndiaFor the job of a software engineer, Infosys is at 68th percentile with a salary of INR3.25 lakhs where the average is 2.77 lakhs.
  • 20. COMPARISON
  • 21. COMPARISON
  • 22. Infosys Board Compensation• The compensation committee determines and recommends to the Board the compensation payable to the directors.• All Board-level compensation is approved by the shareholders and separately disclosed in the financial statements.• Remuneration of the executive directors consists of a fixed component and a performance incentive.• The compensation committee makes a quarterly appraisal of the performance of the executive directors based on a detailed performance-related matrix.• The compensation payable to the independent directors is limited to a fixed amount per year as determined and approved by the Board, the sum of which is within the limit of 1% of net profits for the year, calculated as per the provisions of the Companies Act, 1956.
  • 23. Infosys Board Compensation
  • 24. Non-executive / independent directors remuneration• Section 309 of the Companies Act, 1956, states that a director who is neither in the whole-time employment of the Company nor a managing director may be paid remuneration by way of commission, if the Company, by special resolution, authorizes such payment.• Members of the Company at the Annual General Meeting held on June 22, 2007, approved payment of remuneration by way of commission to non-executive directors, at a sum not exceeding 1% per annum of net profits.
  • 25. Thank You