Case Study: Cummins Inc
With a workforce of 28,000 Cummins Inc has 56 manufacturing locations in 17 countries, including China, India, Brazil and Japan as well as the US and the UK. The power engineering firm has a worldwide grading structure covering staff down to senior professional levels.
A new pay information system was introduced two years ago. Jose Pottinger, HR director for Europe, Middle East and Africa, says: "You can’t say you won’t need more than one [provider] resource, because the data for a given country could be thin. The main purpose is towards model pay outcomes.
"Our primary concerns were that the comparative data should be robust, and flexible of use. We don’t compare total reward, and realistically I don’t believe that’s possible given the huge variations there are in benefits, especially pensions, in different parts of the world," adds Pottinger.
However, the primary need is internal. "The key thing is to have some arrangement to draw up job specs for comparative purposes. Whether these specifications are detailed or broad brush depends on the firm, but they need to instill confidence." Cummins does not have a global payroll system, or provider, and does not feel that this an obstacle. "We don’t need to compare all jobs and review all data. We have benchmark jobs in different grades for which we make comparisons.
The only exception would be if we were concerned about a particular hotspot, when we would have to input the data. "The issue to beware of is inadequate comparative data, for example, the population in the different countries, as you would with a printed salary survey (always remembering that in some locations the number of comparators is bound to be limited). But you do need to be comfortable that you have your own data properly aligned," she adds