Birlas beat Tatas on salary front
For the first time, the Birlas inched ahead of the Tatas in terms of the compensation offered to the employees.
By Namrata Singh and Reeba Zachari, TNN |
MUMBAI: For years, the Tata group has stayed ahead of the Birlas on various parameters. Whether it be the number of businesses they operate in, the turnover they post or for that matter salaries.
Last year, however, there was a subtle shift. For the first time, the Birlas inched ahead of the Tatas group in terms of the compensation offered to its employees.
The average cost-to-company for a chief executive officer at the AV Birla group was in the region of Rs 5.5-6 crore per annum.
As against this at Tata, chief executive officer level salaries were in the region of Rs 70 lakh to Rs 3 crore, depending on the size of the company they manage. When contacted the Tatas declined to comment.
Interestingly, the average age at the AV Birla group has also come down. Nearly 50% of the group’s 17,000 managers are under 40. Only 6% are between 55-60. These changes at the AV Birla group have come only after some changes and become apparent only over the last two years after significant reshuffling at the senior levels.
So what explains a younger bunch of people with higher salaries at the AV Birla group?
A human resource consultant, who has followed the AV Birla group for a long time, points out that in the older days the Birlas were largely in commodity driven businesses. To that extent, the talent to run the business came from traditional, old world disciplines. But over time, the group started to focus on new businesses. Running these businesses demanded different talent.
This kind of talent wouldn’t come into an organisation that did not have modern day human resource practices in place. This compelled the AV Birla group to do a rethink on the people’s front and implement a set of policies to attract the kind of talent it needed. The outcome is beginning to show now.
A senior official at the company, however, pointed out that the new crop of managers also came with a downside. Unlike the old guard which was fiercely loyal, the younger generation doesn’t think much of it.
Last year, however, there was a subtle shift. For the first time, the Birlas inched ahead of the Tatas group in terms of the compensation offered to its employees.
The average cost-to-company for a chief executive officer at the AV Birla group was in the region of Rs 5.5-6 crore per annum.
As against this at Tata, chief executive officer level salaries were in the region of Rs 70 lakh to Rs 3 crore, depending on the size of the company they manage. When contacted the Tatas declined to comment.
Interestingly, the average age at the AV Birla group has also come down. Nearly 50% of the group’s 17,000 managers are under 40. Only 6% are between 55-60. These changes at the AV Birla group have come only after some changes and become apparent only over the last two years after significant reshuffling at the senior levels.
So what explains a younger bunch of people with higher salaries at the AV Birla group?
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A human resource consultant, who has followed the AV Birla group for a long time, points out that in the older days the Birlas were largely in commodity driven businesses. To that extent, the talent to run the business came from traditional, old world disciplines. But over time, the group started to focus on new businesses. Running these businesses demanded different talent.
This kind of talent wouldn’t come into an organisation that did not have modern day human resource practices in place. This compelled the AV Birla group to do a rethink on the people’s front and implement a set of policies to attract the kind of talent it needed. The outcome is beginning to show now.
A senior official at the company, however, pointed out that the new crop of managers also came with a downside. Unlike the old guard which was fiercely loyal, the younger generation doesn’t think much of it.
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