Question

DesignX, an architecture design and consultancy firm which has been operating in Malaysia, Thailand, and Singapore for 10 years has acquired regional recognition for its works in residential design and development. DesignX is looking to expand to China, in the second-tier cities of Hangzhou and Xi’an. The management team is considering transferring 6 of its 20 senior architects to these Chinese cities to spearhead its business development in some large residential development projects there.

Andrew Toh, the Head of Human Resources was in discussion with Debra Lim, the Senior Manager for Total Rewards in planning for its first international rewards package for the 6 senior architects. The current senior architects, besides those who were part of the pioneer team, were hired locally in the country of operation. The compensation components for the senior architects comprised of the basic monthly salary and the annual performance bonus that is based on individual performance targets and the overall company performance. The annual performance bonus is in the range of 1 to 1.5 months’ basic salary for average performers and 2 to 3 months for above-average performers. The benefits components comprised standard mandatory leave, outpatient and inpatient medical benefits, basic annual health screening, and transport allowance to cover work-related on-site meetings with clients. DesignX’s base salary level is benchmarked at the 50th percentile while total compensation, including variable components, is below the market at the 40th percentile. The benefits level is below the market provision in the industry standard.

1. Examine TWO (2) contextual factors that Andrew must consider as DesignX plans to expand into the Chinese cities.
2. Propose THREE (3) compensation or benefits components that Debra should incorporate in the remuneration package to ensure its market competitiveness for employees transferring to the Chinese cities.
3. In the long-term plan for DesignX’s talent management program, Andrew is proposing using long-term performance-related rewards to incentivize its team of senior architects.
4. Recommend TWO (2) long-term performance-based rewards plans that would be appropriate for DesignX as it expands further in Asia.