What’s your Compa-Ratio?

A product manager’s CTC (cost to company) can have many components, which are mainly broken down into the following:

  • base salary
  • variable pay
  • retirals
  • stock (ESPP, RSU, Stock Grant etc.)
  • bonus (joining, annual, shipping bonus etc)

Knowing that there are so many CTC components makes it difficult to evaluate competing job offers or even “quote a salary”, as is commonly demanded by recruiters these days.

For offshore product managers, one way to benchmark your salary is to find out your compa-ratio at your firm. The Wikipedia link has the basic explanation of what a compa-ratio is, and how it is applied during recruitments and performance appraisals. In a large firm, this is the direct way to find out if you’re paid above average, at par, or below average. And actually, this also has a good correlation to your past performance, your relationship with managers and the industry performance as well. So knowing or guessing your compa-ratio puts you in a good situation during the salary negotiation time both within the firm or when you have an offer in hand.

For startups, smaller firms or Indian technology firms, you might not find this information from your HR contacts. In this case, one alternate is to trawl the web with queries such as “salary for X role” in “City Y” [ I get some traffic on the blog from these queries too!]. And thankfully, there is quite a lot of reasonably accurate information on this available in 2013, compared to the situation five years ago. These give some pointers on the potential offer, given your current compensation, the industry standards and the salary at the company in question.

One final thought, given the limited risk-reward situation in high-tech product management, it would be wise to only compare base salary as a lump and all variable components as another lump. I have posted about this before.

Advertisements

Tagged: , ,

%d bloggers like this: