PROJECT REPORT
COMPENSATION AND BENEFITS- EXPECTATIONS OF
CURRENT MBA STUDENTS
Submitted to:
Prof. Sajeet Pradhan
On
October 04, 2021
In
Partial fulfillment of the Fundamentals of Human Resource
Management course in Post Graduate Programme in Management 2021
Submitted By:
Section: HR
Group: 05
Gaury K- 2104008
Jibin C Varghese- 2104010
Siddharth Mohapatra- 2104019
Trishank Sharma- 2104021
Mohamad Aamir Raza – 2104027
1
TABLE OF CONTENTS
1
Introduction
3
2
Background
4
3
Study questions and initial assumptions
5
4
Data collection
6
4.1
Approach
6
4.2
Participants
6
4.3
Method
6
5
Findings of the study
7
5.1
Overview of the CTC expectation of the whole sample
7
5.2
CTC expectation above the college average
7
5.3
CTC expectations with respect to prior work experience
8
5.4
Variable component acceptable with respect to prior work experience
8
5.5
Preferred industry to work
9
5.6
Preference to work in start-ups
9
5.7
Prior work experience with respect to graduation background
10
5.8
Non-monetary benefits expectations of MBA students
10
5.9
Analysis of least preferred benefits
11
5.9.1
One-on-one meetings
11
5.9.2
Time allowance for personal projects
11
5.10
Analysis of work-life balance preference
12
6
Implications of the study
13
7
Conclusions
13
8
References
14
9
Exhibit
15
2
1. Introduction
Employee compensation refers to all forms of financial consideration and material benefits and
allowances that employees receive in the context of an employment relationship, which also
includes matters related to wages or salary schedules; For example, salary ranges for job
descriptions, performance-based programs, bonus programs, commission-based programs,
short-term or long-term incentive programs, etc. Employee benefits include allowances, income
protection, life insurance, life balance sheets, vacations, etc. Benefits are other forms of value
than the payments the employees receive in exchange for their contribution to the organization to
accomplish their work.
Why are compensation and benefits so important to all employees? Compensation and Benefits
are vital factors that can impact employee job satisfaction by targeting both hygiene factors and
motivating factors. As we know, everyone works in anticipation of some rewards; Employees may
view compensation as a consideration in the exchange between the employer and themselves,
as a right to be an employee of the company, and as a reward for good work. Satisfied employees
are key to drive the growth of the organization. Offering the proper compensation and benefits
plan is the key to attract and retain the best talent. This is particularly important during the
prevailing times of COVID-19, which has severely impacted the job market, and the phenomenon
of 'Great Resignation.' So, it is imperative to understand what future employees want in regards
to this.
Our group has attempted to understand the perspective of MBA students joining the workforce in
2022 or later. The primary purpose of our study is to gauge the expectations MBA students have
about the compensation and benefits plans and examine whether they are correlated with factors
such as college studied in, previous work experience, preferred industry to work in, and individual
preference of work-life balance.
3
2. Background: Employee compensation and benefits are one of the main tasks of human resource management.
Compensation is important to both employers and employees to attract, retain and motivate
employees. Compensation is considered necessary for employees since that is one of the main
reasons why people work. Numerous studies also show a positive relationship between
compensation and benefits and job satisfaction. So, it becomes essential for employers to gain
insight into how employees' views are regarding existing compensation and benefits practices, as
well as their motivations and aspirations.
For this study, after reviewing the academic material of the subject, we considered certain basic
assumptions in terms of factors deciding expectations of MBA students with regards to
compensation and benefits packages to start with and then augmented them with findings from
the analysis of data collected and from various articles and journals. The aim was to evaluate the
validity of our assumptions by correlating with the data analysis.
The methodology followed while making this report included primary data collection through
surveys which generated more than 250 responses from MBA students in some of the country’s
best B-Schools, secondary data from industrial reports, salary surveys, and journals (Science
Alert, Scientific Research, ` Research Gate), data analysis in Microsoft Excel, and then drawing
on our academic knowledge to make inferences and find trends in the dataset and explain the
same. A more detailed explanation is given in the subsequent sections of the report.
4
3. Study Questions and initial assumptions: There are relatively few studies exploring the perspectives of MBA students based on existing
compensation & benefits practices. The primary purpose of this report was to determine the
impact of compensation & benefits on MBA students joining the workforce in 2022 or later.
Quantitative methods and surveys were used in this study, and the following questions were
explored: 




Will MBA students with more work experience expect higher compensation and benefits?
What would be the impact of preferred specialization on the compensation and benefits
expectations?
Are MBA students' expectations different depending on which B-school they attend?
Do MBA students' expectations differ regarding the variable components of CTC?
Are MBA students more concerned with work-life balance than the amount of money they'll
earn?
Based on our studying of past trends, we made some basic assumptions for each of these
questions. They are as follows: 




MBA students with more work experience will expect higher compensation and more
benefits
Compensation and Benefits expectations would be influenced by preferred specialization,
with the top three being FMCG, Consulting, and Banking & Finance.
The level of expectations varied depending on the B-School enrolled.
MBA students preferred the least possible variable component in CTC.
Work-life balance is not very important in the life of MBA students.
As we progressed with our study, we analyzed data to check whether our assumptions were
correct or not.
5
4. Data Collection: 4.1. Approach: - A quantitative study method and survey design were considered appropriate to
examine the compensation and benefits expectations of the MBA students. Quantitative research
deals with the facts or the answers given by the participants.
4.2. Participants: - A survey method was employed for the present study. The sample used in
this study was of more than 250 MBA students studying in the top 30 B-Schools of India.
Permission was requested from the participants, and their privacy was protected through the
anonymity of the responses. The demographic characteristics of the respondents are depicted in
Figures 1 and 2. An analysis of the demographic profile of respondents revealed that 46% males
and 54% females were interviewed with good representation by people with work experience and
those with no experience.
Figure-1 Quick overview of the work experience
Figure-2 Quick overview of the gender-ratio
spread of collected sample
of the collected sample
4.3. Method: - The data collection methods were structured questionnaires used to extract
information from the participants. The questions should give a general picture of the participants'
expectations, including examining their specific preferences. A letter was attached to the
questionnaire explaining the ethical considerations involved, particularly that participation in the
study was a voluntary exercise and that respondents can withdraw from the study at any time.
6
5. Findings of the study: The team analyzed the responses received to gain insights for the study. The main findings are
presented below5.1. Overview of the CTC expectation of the whole sample: - The survey respondents were
from Tier I and Tier II MBA colleges (Top 30). From figure-3, we can see that majority of the MBA
students expect a CTC package between 15 to 25 Lakhs. This figure matches the average CTC
of Tier I and II B-schools. So, we conclude here that the expectation of the sample is consistent
with the current trends. Interestingly, 15% expect 25 to 30 Lakhs; on the other hand, 14% expect
10 to 15 Lakhs. So, there is an equitable distribution above and below the average figure.
Figure-3 Quick overview of the CTC expectation
of the whole sample
5.2. CTC expectation above the college average: - From figure-4, we see that 63% of the
respondents expected a CTC package higher than their college average.
Figure-4 Students expecting CTC above
their institute average CTC of the previous year
7
5.3. CTC expectations with respect to prior work experience: - We found that as the prior
work experience of MBA students increased, the expectation to be paid above the B-School
average CTC package also increased. From table-1, we can see that from about 57% of students
who have 0 years of work experience wanting above average compensation, this figure increases
to 85% when the students have prior work experience of more than three years.
Work
Ex
0
<1
1-2
2-3
>3
CTC
Expectations
above
institute
average
57%
45%
65%
68%
85%
Expectations
within
institute
average
CTC
43%
55%
35%
32%
15%
Table-1 CTC expectations of students w.r.t
work experience
5.4. Variable component acceptable with respect to prior work experience: - Interestingly,
when analyzing variable component of CTC acceptable to prior work experience (Figure- 5), we
did not find any observable trend.
Figure- 5 Variable component acceptable with respect to prior work experience
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5.5 Preferred industry to work: - We found that FMCG and Retail remain the most preferred
industry to work in for MBA students, with 28% of respondents choosing it, followed by Consulting
(22%) and Banking and Finance (16%). One interesting factor was the increase in the IT/ITES
field's popularity, from its sudden drop to zero in 2018 to again be chosen by 14% of the sample.
Also, interest in the Manufacturing sector has dropped considerably from 34% to 11%. The
preference distribution can be viewed in figure-6.
Figure-6 Preferred industry to work in for MBA students
ups.
Figure-7 MBA students' preference towards start-
5.6 Preference to work in start-ups: - From figure 7, we see that a majority (51%) of students
were looking forward to working in a start-up. And 41% seemed conflicted about this decision.
Only a minority, 8%, rejected working in a start-up directly.
Priority Order
1st
2nd
3rd
4th
Higher
Salary
26%
31%
23%
21%
High
growth ESOP
opportunities
s
36%
13%
18%
31%
13%
15%
33%
41%
Flexibletiming
28%
21%
38%
13%
Table-2 Expectations of MBA students when choosing start-up
From table-2, it is seen that high growth opportunities seemed to be the top motivator for students
willing to work in a start-up, followed by flexible work hours and higher salaries. Interestingly
students seemed conflicted on the notion of ESOPs, as ESOPs have the highest percentage in
extremes (2nd and 4th priority).
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5.7. Prior work experience with respect to graduation background: - From figure 8, we see
that the sample of MBA students, except those having BE/BTech graduation background, was
skewed towards less prior work experience. BE/BTech-based MBA students presented a
balanced sample distribution.
Figure-8 Work experience of current MBA students pivoted over their previous Education background.
5.8. Benefits expectations of MBA students: - From table-3, we see that the most preferred
benefit seemed to be flexible working hours with 81% preference. Employer-paid healthcare and
paid holidays were the next most preferred, with 76% and 74% respectively. ESOPs (50%
preference) and corporate discounts (41%) presented conflicting preferences. The least preferred
benefits included one-on-one meetings (25% preference) and time allowance for personal
projects (36% preference).
Benefits
Paid Holidays
Employer-paid Healthcare
Corporate Discounts
Flexible Working
Extra Leave
Performance Bonus
ESOPs
Time allowance for personal
projects
One-on-one meetings
Yes
74%
76%
41%
81%
38%
69%
50%
36%
No
26%
24%
59%
19%
62%
31%
50%
64%
25%
75%
Table-3 Benefits expectation of MBA students
10
5.9. Analysis of least preferred benefits
5.9.1. One-on-one meetings: - Analyzing possible relationships of one-on-one meetings with
prior work experience, above-average CTC expectation, and willingness to trade work-life balance
for higher CTC (Figure-9), we see that MBA students are expecting above-average CTC seemed
to be more interested in this benefit than other categories. But the overall trend was that this
benefit was disliked by all
Figure-9 One-on-one meetings expectations with respect to work experience, above average expectations of work
experience, and willingness to trade work-life balance for higher CTC
5.9.2. Time allowance for personal projects: - Similarly, analyzing possible relationships of time
allowance for personal projects with the same three fields as above (Figure-10), we found that
MBA students with less than a year of prior work experience have more than a year preference
towards this benefit. It is the same case with those MBA students who are not willing to trade
work-life balance for higher CTC. They also have more preference for this benefit.
Figure-10 Time allowance for personal projects expectations with respect to on work experience, above average work
experience expectations, and willingness to trade work-life balance for higher CTC.
11
5.10. Analysis of work-life balance preference: - We analyzed the preference of work-life
balance by MBA students. Possible relationships with prior work experience and graduation
background were investigated. Respondents were asked if they would trade work-life balance for
higher CTC.
Work
(yrs.)
Experience No
0
<1
1-2
2-3
>3
60%
45%
58%
39%
46%
Yes
40%
55%
42%
61%
54%
Table-4 Willing to trade work-life balance for higher CTC
with respect to work experience
From table-4, we can see that responses did not show any observable trend. So maybe there is
no relationship between the preference of work-life balance with prior work experience.
Graduation
Background
No
Yes
BA.
B.Com.
67%
69%
33%
31%
B.E. / B.Tech.
B.Sc.
BMS/BBA/BBS
43%
75%
73%
57%
25%
27%
Table-5 Willing to trade work-life balance for higher CTC
With respect to educational background
Table-5 shows a stark contrast between BE/BTech and other background graduates. MBA
students with BE/BTech backgrounds were more willing to trade work-life balance for higher CTC
than students from all other backgrounds.
From the data analysis, we came across some possible answers to the initial questions that this
study posed. We also then validated whether our initial assumptions based on past trends were
correct or not.
I.
The higher expectation of CTC depends on prior work experience
We started with the assumption that MBA students having more work experience would
expect more CTC. From table-1 we see that our initial assumption is supported as with
increasing prior work experience, the percentage of students expecting more than the
average CTC of their B-School increased. So, our initial assumption is proven correct.
12
II.
Specialization
We assumed the top three preferred industries to be FMCG, Consulting, and Banking and
Finance. We see from figure-6 that these three remain to be the top 3 in terms of preferred
industries. So, this supports our initial assumption and proves it correct.
III.
The level of expectations depends on the B-School enrolled in.
We started with the assumption that MBA students' expectations would differ based on
the B-Schools enrolled in. But we see that expectations depend on many other factors, as
seen from the relationships derived in this report. So, there is no clear conclusion about
this assumption.
Variable Component of Pay
We started with the assumption that MBA students would always prefer the lowest variable
component possible. But from figure-5, we see that this is not always the case with MBA
students accepting higher values of the variable component in their CTC. So, this
contradicts our initial assumption and proves it wrong.
Work-Life balance
We assumed that work-life balance was not a priority for MBA students. But interestingly,
from table-4 and table-5 we see that this is not true. Further, table-5 shows that graduation
background plays a major role in MBA students wanting more work-life balance. So this
contradicts our initial assumption and proves it wrong.
IV.
V.
6. Implications of the study: Recruiters will gain valuable insights into the expectations of current MBA students on
compensation and benefits packages offered. The major trends observed in this report cannot
be overlooked. More focus should also be given to the proper administration of benefits, and the
preference towards non-monetary benefits is an important trend that can be leveraged. Different
industries can plan their hiring based on looking at the preferred industry trends. There is also the
important trend of preference of work-life balance based on graduation background, which can
also help in recruitment decisions for various roles. The trends identified here will help recruiters
design their compensation and benefits structure to optimally utilize companies' resources while
also hire the best talent.
7. Conclusion: Offering the right compensation has definitely, been one of the best ways to attain success for an
organization. It helps a company attract, retain & motivate the best talent, which has become of
utmost importance in the current scenario. This project considers the views and analyses the
expectations of MBA students from the top colleges of the country. There have been some wellknown facts that have been proven from the findings of this project. There have also been some
contrary and surprising revelations that have come out of the findings.
It can be concluded that direct compensation, which includes base pay, merit pay, incentive pay,
and deferred pay, has been the number one factor in choosing jobs by MBA students. The
expected salary range of students from Tier1 MBA colleges of the college has been between 2213
25 lakhs, while that of Tier 2 MBA colleges has been in the range of 15-20 lakhs approximately.
An interesting fact, which has come out, is that in start-ups, the students are expecting more CTC
and fixed pay structures with a proper work-life balance instead of ESOP's. The preferred industry
streams of MBA jobs have been: -Consulting, Banking, Finance & FMCG. The most preferred
stream has been FMCG. More than half, i.e., 63% of students, expect a higher salary than the
average pay of their colleges, even in these uncertain times. Also, as the work experience of the
MBA students increases, the expectation to be paid above average CTC increases, as is
expected on the part of the students. However, no trend has been observed when variable pay is
related to work experience, which contrasts the existing data. The pandemic has also added
flexible working hours as the most preferred non-monetary benefit by the students in their pay
structures. One to one meeting has been disliked by all. Students with less than one year of work
experience or freshers are more interested in personal projects.
With all these findings, it can be said that MBA graduates, in the upcoming era, are not willing to
settle for lower pay in exchange for other benefits. These findings will definitely, be helpful for all
the industries in designing their pay structures while hiring future managers for various posts. It
will also help them meet the expectations of various talented students and devise the right
recruiting strategy for all future roles of managerial positions.
8. References: 1. Adeoye, A.O. and Z. Fields, 2014. Compensation management and employee job satisfaction: A
case of Nigeria. J. Soc. Sci.
URL:https://www.researchgate.net/publication/270578681_C_KamlaRaj_2014_Compensation_Management_and_Employee_Job_Satisfaction_A_Case_of_Nigeria.
2. AIHR, Academy to Innovate HR, 2021. Compensation Metrics Cheat Sheet.
3. Ashley Stahl, 2019.What Millennials Actually Want Out Of Their Job.
URL:https://www.forbes.com/sites/ashleystahl/2019/12/17/what-millennials-actually-want-out-oftheir-job/?sh=64a4eb1a2c78
4. Calvin Mzwenhlanhla Mabaso and Bongani Innocent Dlamini, 2017. Impact of Compensation and
Benefits on Job Satisfaction. Research Journal of Business Management.
URL:https://scialert.net/abstract/?doi=rjbm.2017.80.90
5. Ernst & Young, 2017. Republic of Armenia compensation and benefits survey.
6. IBM, 2021. What employees expect in 2021.Engaging talent in the shadow of COVID.
7. PayScale, 2021.Compensation best practices. Navigating compensation in a changing world.
8. Tanuja Bahirat, 2020.MBA Salary in India. How does an MBA Professional Earn?
URL:https://www.mygreatlearning.com/blog/mba-salary-in-india/
9. UKEssays,2018.Literature Review on Compensation & Benefits.
URL:https://www.ukessays.com/essays/journalism/relationship-between-compensation-andbenefits.php?vref=1
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9. Exhibit: The questions used for the survey1.
2.
3.
4.
5.
6.
7.
8.
9.
What is your gender?
What is your year of birth?
What is your Graduation background?
Which MBA College are you currently enrolled in?
Under which MBA Programme are you currently enrolled?
What is your prior work experience, if any?
Which of the following is your preferred industry to work in?
What is your expected CTC range?
What is the maximum percentage of variable component you would be willing to accept in
your CTC?
10. What are your preferred monetary and non-monetary benefits?
11. Would you be willing to work in a start-up?
12. If you have the opportunity to work in a start-up, how will you prioritize the following factors
(ESOPs, Higher salary, Higher growth opportunities, Flexible working hours)
13. Are you willing to trade work-life balance for higher CTC?
15