Thando Maleleka is the owner and managing director of Ultimate Plastics, a manufacturing company situated in Elsies
Question:
Thando Maleleka is the owner and managing director of Ultimate Plastics, a manufacturing company
situated in Elsies River in the Western Cape. The company currently employs two administrators and
three plastic engineers. Although the company is in a growth phase, the business is expanding faster
than Thando thought it would. Due to the expansion, Thando needs to employ another engineer to
keep up with demand. The administrator positions are quite easy to fill, and Thando could remunerate
them on the same level as competitors. But it took him almost six months to find three suitable plastic
engineers that were willing to work in Elsies River. On top of that, Thando had to offer the engineers
higher salaries due to a shortage of engineers in the Western Cape. After months of searching, Thando
has finally found the perfect candidate for the engineering position, called Naledi. Naledi, who is from
Gauteng, requests a higher salary than that of the other engineers since she does not want to settle
for anything less than her current salary. In addition, she has to relocate to another province. Given
that Thando’s company is in a growth phase, he knows that he cannot afford the salary that Naledi
wants. Before Thando takes a final decision, he is going to conduct a salary survey to determine what
the going pay rate is for plastic engineers in the Western Cape.
Critically discuss the strategic issues that Thando needs to make regarding remuneration surveys
[6 marks]. Apply your answer to the case study [5 marks].
Financial Management Principles and Applications
ISBN: 978-0133423822
12th edition
Authors: Sheridan Titman, Arthur Keown, John Martin