Case: Compensation and Performance Management at Transcendence… Case: Compensation and Performance Management at Transcendence Education C

Case: Compensation and Performance Management at Transcendence… Case: Compensation and Performance Management at Transcendence Education Consultancy Transcendence Education Consultancy Co. Ltd is a startup enterprise that focuses on assisting students from Hong Kong, Macau, and Mainland China to further their education abroad in the United Kingdom, the United States of America, Canada, Australia, New Zealand, Switzerland, Singapore, etc. This firm was co-founded by three passionate education professionals who are experienced in educational consultancy services. They all graduated from the world’s most prestigious universities. The firm is small but fast-growing. All team members graduated from esteemed overseas programmes and universities. They have years of study abroad planning experience, and they can give appropriate academic advice to prospective students and parents.  The mission of Transcendence is to enable students to broaden their horizons and fulfill their individual academic and career ambitions by following the education path that suits them best. To achieve this mission, the qualified education consultants provide high-quality advice which is individually tailored to meet the needs of students and their families. The studying abroad consulting service includes several steps. First, every student customer is assigned a professional personal counselor, who puts effort to understand the student’s needs. In the light of the student’s scholastic capabilities, background, vocation objectives, the counselor provides tailored packages to meet requirements and assist the student to be admitted to the best possible course and institution based on their profile. Second, the counselor helps the student shortlist the programmes, universities, locations that would best suit their personal, academic, and financial profile/parameters. The third step is document preparation and editing. The goal is a well-presented, error-free application. Counselors assist with important aspects of the application such as essays, statements of purpose, grammar, tone, structure content, recommendation letters. Counselors also help students prepare for the interviews and provide students with mock interview experiences. The firm provides value-added services, such as organizing educational seminars, exhibitions, student sharing sessions, and pre-departure seminars regularly; aiding student visa applications; airport pick up and accommodation arrangement; following up on students’ overseas study situations.  The main job duty of consultants is to provide personalized and professional education consulting services. They need to develop specialties and connections with certain programmes, universities, and countries, as well as a comprehensive understanding of overseas education and graduate employment. They also need to support the firm’s innovation initiatives, such as internship and camp education. Furthermore, they need to have strong data analytical skills to analyze customer data. This helps them keep up with the fast-changing market.  Due to the strong competition of this industry, it is vital for the firm to hire and retain talents. Top talents can bring in resources, including customers and connections with tertiary institutions, to the firm. If they leave, they will also take away these key resources. Competition for top talents is fierce in this industry as human resources are the key assets for this business. As a small-sized start-up, hiring and keeping talented employees is a big challenge for the firm that is limited in the amount of cash flow they can commit to competitive salaries. However, this fast-growing startup develops an incentive programme that aggressively rewards those top contributors. For example, this firm offers equity incentive compensation. It invites top-performing consultants to be a partner of the firm, and provides them with ownership interest that gives the holder the right to a share of future profits and appreciation of the firm.  Moreover, the firm provides an attractive rate of commission. Consultants are expected to close three deals every month. Their pay includes two parts: commission and base pay. If a consultant closes three or fewer deals in a month, the commission is 3%. If a consultant closes four or more deals in a month, the commission is 5%. Based on the firm’s experiences, support, and resources, achieving the performance expectation is challenging yet the pressure is acceptable. This commission is highly incentive, and high-performing consultants can attract many customers and earn handsome commissions. They will see the high pay as the recognition of their effort and competence. Base pay and share interest are also based on competencies and resources (customer resources and connections with tertiary institutions).  On a monthly basis, the firm conducts work and performance reflection to understand the sales and service performance of the firm and individual consultants. Table 1 is the performance appraisal form for educational consultants of Transcendence Education Consultancy. Consultants are assessed monthly with five dimensions: (1) sales, (2) service to customers, (3) customer base development, (4) service to tertiary institutions, and (5) professional knowledge and skills. For the assessment items of dimensions (2) – (5), assessments are made based on five-point scales, namely, 5 = Much above average, 4 = Above average, 3 = Average, 2 = Below average, 1 = Much below average. The scores are given based on the comparison of one’s performance against colleagues’ performance.  During the monthly reflection sessions, consultants work together to listen to and understand each other’s work challenges. They share their views of how to address these challenges and improve performance. To cope with market turbulence and competition, consultants must be self-motivated to learn new knowledge and enhance their competencies. For example, they need to update their knowledge about programmes offered by universities, be trained with detailed knowledge about admission processes across institutions and countries and also assist in connecting with students at the institutions they plan to enroll in, be familiar with the specific requirements necessary for a application by various colleges and universities. Specialists offering mock interviews must also be very much familiar with the type of questions that universities ordinarily ask.  How to measure and reward competences is a managerial challenge for the firm. The firm is also thinking about how to develop a more energizing working environment to help employees develop themselves and enjoy their work, and a viable way is to encourage teamwork. A stronger teamwork climate is also critical for the firm’s long-term success, because the firm sees the increasing need for knowledge/resource sharing and integration. Currently, the firm is not doing well in encouraging and rewarding teamwork. High-performing consultants sometimes have too many customers that they can handle well. The heavy workload prevents them from attending networking and training activities and reduces service quality. The firm can better reallocate customer resources if a better teamwork mechanism exists. Moreover, with stronger teamwork, consultants can better obtain support and advice from members if they encounter any problems and difficulties during their service to customers. Question 2:What is external competitiveness for compensation management? Please explain all the competitive pay policy and pay mix alternatives. Moreover, which competitive pay policy and pay mix would you suggest that Transcendence should use? (25 marks) Business Management Human Resource Management Share QuestionEmailCopy link