The Case of the Unpopular Pay Plan is a Harvard Business Review Case study that looks into various leadership styles.

2. The Team
Mona Siddharth R Sumedha
Sharma Sharma
Robin Agarwal Vivek Mehta

3. Introduction
Decision Making Styles
Our Style – Consultative
The Case Study
Agenda Group Rankings & Inferences
CEO Rankings & Inferences
Takeaways – Self
Takeaways – Others
Example of a Mix of Styles

4. Introduction
Top Chemical Company is a 93-year old , $2 billion
company.
QFA (Quality For All) program was launched at TopChem
in order to make real changes in the way people work – to
make progress in speeding production marks, improving
product quality and routing out efficiencies.
Meeting held to investigate how to develop a pay system
congruent with the philosophy of QFA.
“QFA PAY PLAN 92” :BASE PAY = 75% of former pay –
determined by internal equity ,FLEXIBLE PAY = 25% of
former pay.
Different people and departments have different outlooks.

5. Decision Making
Styles
CONSULTATIVE AUTOCRATIC
COLLABARATIV
E
B - CONSULTATIVE

6. Consultative Style
Information
Gathering &
Leader takes
the decision
Ask
individual
opinions
Take your
own
decisions

7. “I developed a set “I presented my
of recommendations
recommendations” to the team”
CEO Speaks
“Robin Agarwal”
“I took a Final call on
“I Asked them for the
their recommendations –
recommendations / Stick to my own or
suggestions” modify to suit the
team ?”

8. The Participants
Robin (CEO) Sumedha (TM)
Mona (TM) Sidd (TM) Vivek (TM)

9. CEO Recommendations
• Re-evaluate the objective!
• If a plan has to be included, the
workforce needs to be educated.
• Plan should be made according to the
people’s compensation team. Gain-
Sharing model suggested.
• Non-financial motivation to be used.

10. Team Recommendations
• Tweak the Pay Plan. Segregation of the
workforce.
• Divide the workforce into backend and frontend.
• Backend - 4 % Variable Pay. Frontend - 10 %
Variable Pay.
• Segregation of the workforce. 10 %
Variable Pay.
• 5 % Company Stock Options.
• 5% team Performance.
• Segregation of the workforce.
• Flat 10 % Variable Pay.
• Teams should get incentives
over 10% according to their
performance.

11. Final Recommendations
Segregation to be implemented.
Flat Variable Pay of 10 %.
Teams should get incentive over & above this 10
%.
Different compensation benchmarks for
different departments.

12. Group Ranking

13. Comfortable
Fair, Just & Equitable
Considerate
Enjoyed Working
Understanding
Consulted
Certain members may not feel
the above

14. CEO Ranking
A B C D
Autocratic Consultative Consultative1
2 Collabrative
Comfort+ level+
with+
team+
members 5.75 6.75 6.5 5.75
Fairness+ decision+
of+ making+
methods 5.75 6.50 6.50 6.25
Consistency+ decision8
of+ making+
procedure+with+leadership+
style 5.50 6.00 5.50 5.75
Level+ enjoyment+
of+ while+
working+ with+ group 6.00 6.50 6.75 6.00
Influence+ group+
of+ members+on+
the+ final+
decision 5.00 5.25 4.50 6.00
Satisfication+
among+
group+
with+
the+decision 5.75 6.25 5.50 5.25
Understanding+ the+
of+ group+
over+ the+
decision 6.25 6.50 5.75 5.50
Comfort+ level+
with+ leadership+
style 5.75 6.50 6.50 5.75
Level+ commitment+ the+
of+ of+
group+ members+ for+the+process 6.50 6.25 5.50 5.75
Incorporation+ member's+
of+
input+into+decision 5.00 6.00 5.75 6.25
Felt+ a+
as+ part+ the+
of+ group 6.25 6.50 6.25 5.50
Level+ understanding+ group+
of+ of+
member+ about+ the+rationale+of+
the+decision 6.25 6.50 6.00 5.50
Level+ belief+ group+
of+ of+
members+ the+
in+ decision 6.00 6.75 6.50 5.50
How+just+
and+ equitable+
was+
the+
approach+ the+
of+ leader 6.00 6.50 6.25 6.50

15. Comfortable with style
Consistent
High Group Satisfaction
Enjoyed Working
High self contribution
Group members belief
Group member influence was
minimum

16. Takeaways - Self
1. Preparedness  Leader encourages the team to excel
2. Preparedness  Members helps the leader to believe in the
team
3. Involvement of each individual helps in:
 Generation of new ideas for the leader
 Chance for everyone to have a say
4. Since the final decision is taken by the leader individually, it can
lead to certain discord in team
5. Decision making styles are driven by the individual’s personality
6. Personality of an individual can make the leader to change
his/her decision making style

17. Takeaways - Others
Scores are almost equal :- Flaws in the process and not
everyone has followed the rules
COLLABARATIVE !!

18. Autocratic
1A Satisfied/wt/final/decision
Incorporated/member`s/suggestions
Leader 6 6
Participant/#/1 6 6
Participant/#/2 7 Takeaways - Others
6
Participant/#/3 5 6
Participant/#/4 7 6
Participant/#/5 7 7
Group&
2(A Satisfied/wt/final/ Incorporated/
decision member`s/suggestions
Leader 6 5
Participant/#/1 6 7
Participant/#/2 6 7
Participant/#/3 7 6
Participant/#/4 7 6
Participant/#/5 7 7
AUTOCRATIC !! 6.6 6.6
Decision making styles are driven by the individual’s
personality which affected the feedback from the team
Collobrative
Inference from the data: Consultative method scored highest
Enjoyed& dec
on both fronts – CEO & with& Fair&
Group&
8(B
Comfortable&Groups methods&
in&
working&
with&
Implementa
to
team decision&
making tion& grp
by&
Team
Leader 7 7 7 6

19. MIX OF STYLES

20. THANK YOU !!