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HR Zone » Grievance Management » Salary or Designation? Which Is Important?

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Salary or Designation? Which Is Important?
Pradeep
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Posted 29-10-2009Reply

One of my friends who is working for a very good manufacturing concern as Senior Manager-HR has got an offer in a much more better company with a salary hike of nearly 30% which is quite a good increase as far as salary is concerned.

But he is in big dilemma now and when everything seems to be going well, he was told by the new company that they do not have a designation suitable to him and they are offering the designation of Manager-HR which is below his present position. If he accepts and join the company with that designation his growth prospects will be curbed as he has to work for nearly another 2-3 years, then only he will be considered for promotion to the next level or next higher designation which is equivalent to his present designation. Now he is not in a position to decide between the two, salary or designation and I advised him to think about the long term and told him not to compromise on designation but he is not getting convinced as he is confused and not sure whether he will get that kind of salary hike in near future in any other better organization or not. So he is hanging in between, unable to decide and the deadline is nearing as a result of which the new company people are meticulously following up with him for confirmation of yes or no.

I would like you to come out with your views and valuable advises imagining yourselves in my friend's situation and do some role play on how you are going to decide? I'll give you any other details if required.

All comments, suggestions, advises are most welcome!

Cheers!

Pradeep

jyothi
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  Rated 0 | Posted 30-10-2009

I go for designation. Salary he may increased later on also but nt to compromise with designation if he wants to go ahead with the career.

Harish
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  Rated +14 | Posted 30-10-2009

Dear Pradeep,

There are certain things that we need to understand before we address your friend's dilemma.

We all know that every organization follows its own Hierarchy, which is not standard across companies, nor across industries. Some organizations have a Manager title which is strictly given to someone with relevant experience in HR in that particular vertical (Recruitment/Generalist/CompBen/L&D etc) of a specific number of years. For example, someone with 8-10+ years of experience would map to a manager title in X organization. If this particular person is looking for a change and applies to Y organization, where the heirarchy may be different and he might be mapped to a lesser title. What it implies is that a Manager in one company is not a Manager in another company. We can see a lot of young professionals, even on our site, with 1-4 years of experience too, having titles of Managers. Some even bigger titles. So a Title is totally company specific. Your friend would be well advised to study the Hierarchy and the skill matrix of both his present company and the prospective company and draw a parallel based on his background and skill specific relevant experience. That would show him where he stands. Based on that, he can take a justifiable call, if he would like to move to an organization which may offer him a lesser title, but a better compensation. Rest assured, his growth path will not be hindered much against popular opinion. All well read HR professionals understand that Hierarchy and skill matrix is company specific and your friend wont lose his career path.

If it were me in his place, I would rather look at the role in terms of what additional responsibilities I am going to perform along with my Key Competencies for which I have been hired anyways. If he is going to perform something that he has done long back in his career, a lesser title would not be suggested, in spite of a fat pay package. If the role gives him an opportunity to do things he has not done before along with what he has been currently performing in his current company, then a lesser title is not a major hindrance. Because, when we interview HR Professionals, we look at their roles, not their titles.

I know of large MNCs where the AVP title is accessible to professionals with 2-3+ years of experience too. So an AVP of that organization would never be an AVP in another firm which has a norm of 12-15 years of relevant experience.

Btw, I was actually confused when I read the title. I thought it would be a discussion in general about what would members value more, Compensation or Designation. :)

Cheers Pradeep.

Thrivikrama Rao
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  Rated +5 | Posted 30-10-2009

Hi,
Greetings!!!
I shall advise him to accept the offer and move forward rather thinking of hanging in dilemma for designation. Every organization has its own hierarchy and the role fitment is aligned with experience of incumbent. As long as he is performing assigned tasks and opening up for additional responsibilities may fetch him in near future instead of loosing an opportunity now.

Best Wishes,
Vikram

Thrivikrama Rao
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  Rated +5 | Posted 30-10-2009

Pradeep:
Adding further to my earlier reply, would like to share my personal experience. I was referred for HR position in one of the top-notch IT company in India, and the respective company reverted with feed back saying that since I’m already at HR Manager level within 5+ years of experience, they could not proceed with my profile further as in their organization it is 8-10 years of experience to reach Manager level it seems. If Employment offered organization has a policy of Employee Band alignments, this could be one of the reasons to offer him different position.
Considering other way around, if the company had advertised for Sr. level position and your friend attended the selection process as per the advertisement, then he can always demand the concern company to give him justification as why he is been offered with one step in designation.

Comments are welcome from fraternity members…

Best wishes,
Vikram

Shipra
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  Rated +3 | Posted 30-10-2009

Many points harish has already discussed, i will like to add few more as per consultant view.

after a certain frame of time, consultants start screening the candidates in terms of package also, it has its own prominent value.

eg - VP design engg, 20+yrs exp, package upto 40 lacs

in this case i will not consider a person with less then 20 - 25lacs and i have rejected many profiles, may be those candidates were technically very good but we know person with 20+ exp and 15 las package is doubtful and company will reject him on the cv only.

Even because of package we advice candidates to change their companies even their places (if south or north indian) to get proper hike and package comparable to their exp

Also, Responsibilities (role) and Designation eg -
If you want a CA 10yrs exp from Big4 (KPMG, E&Y....) you will not think less then 25Lacs while you can get a 20yrs CA in this but we know CA working in big4 will be having more exposure then other 20yrs experienced.

other eg - GM Recruitment here you have to work mainly in recruitment \, not in generalist profile now depends on person to person - some want to be into wide scope rather then going for package only as in later stages they will suffer, while some have confidence to take care of their career for now they want a salary hike

At last summary

ask your friend to check the repo of the company in the market and his role, in next 2-3yrs he can switch over to other company then what will be his value?
how much he can be offered and which role. Please check in which situation he is into those given above

i don't think he has to wait for 2-3 yrs to reach the same designation again as market knows if you are working in this company what is the value of this role...!!!

If the company is really bigger then the current then he should join new offer plz check if relocation then this 30% is going to work or not.

Ask him to grow "vertically not horizontally", if it were a general discussion then also it must have my last sentence.
what you say?

Rajesh
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  Rated +4 | Posted 30-10-2009

I feel happy to answer your question since i have been seeing this confusion for different persons in my 4 years consulting experience. I sometimes get a situation where one of my candidate would have got a lesser designation than what he is doing now. So i would have to convince him to join the lesser designated position if the role is really good and yes many people have taken a lesser desigation like that.

As Shipra said, we should evaluate using the following points:

1). What's the Roles and Responsibilities he's going to handle?

2). Is he going to do something different in the new Company. i.e. diversification.

3). How big the new company is, what's the team size. Bcos if the new company is bigger than the old company, definitely he can have a look at. Cos as Harish said designation differs with different companies.

4). Even though he is getting 30% Hike, ask him to evaluate his Take Home salary, if it's differs hugely from his current take home, he can consider this. Cos sometimes companies gives a huge hike but cut down the Take Home.

5). Growth Path in the New Company,i.e. who is his immediate boss and Super Boss.

Hope it helps.

Regards,

Rajesh

Pradeep
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  Rated 0 | Posted 30-10-2009

Thank you so much Jyothi, Harish, Thrivikrama Rao, Shipra and Rajesh for taking your time and expressing your views.
I agree with you but with some reservations. As rightly said by Harish and others, the hierarchical levels may differ from organization to organization and it is easier to become AVP in an organization with hardly 3-4 years experience whereas it is difficult to usurp that position even after 15 years in another organization.
If my friend go ahead and accepts this offer his career graph will slightly come downward as he has to join the new organization at a lower level which will also be mentioned in his CV thereby raising lot of eyebrows and his explanation for that during any future interviews may not convince many people as they may assume that he will give more importance to mere money and nothing else.
The job description of my friend in current organization and new one are mostly similar except the number of people reporting to him in new organization are much less than the present one.
My friend also wanted to accept this offer but somehow I'm not getting convinced as it may ruin his employment chances in future. He is accepting this offer despite the fact that he is due for promotion next year with most probably a hike of 15% in the present organization but still he is interested to join the new company as HR Manager only with that 30% hike.
Thank you all once again for your wonderful response.
Cheers,
Pradeep

Pushpak
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  Rated +2 | Posted 30-10-2009

if it is about what is important in a job then i would say the job profile is the most important thing, but here we just have salary and designation. based on my experience and observation i think that designations are not so important as they differ based on the size, culture, kind, structure, etc of an organization. just for ex. i know one person who is working in a mnc and taking care of training department of indian operations and soon going to take the responsibility of few more countries but rather than having any kind of fancy or attractive designation he is designated as just a training manager. therefore i would give my vote to salary rather than thinking much about the designation.

Pradeep
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  Rated +1 | Posted 31-10-2009

if it is about what is important in a job then i would say the job profile is the most important thi... See Pushpak's complete reply


Thank you so much Pushpak for sharing your views.

Harish
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  Rated +2 | Posted 05-11-2009

Pradeep,

Its almost 7 days your friend has the offer letter in hand. Its high time he accepts the offer with 30% hike from his current sal. Considering the present market options, I would say he is lucky to get this break. wish him good luck and encourage him to go ahead.

Designation/compensation are verticals linked directly with companies.

Harish



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