What configuration issue might arise if grades are not set correctly for different business units?

Choosing the option related to interchanged grade sets highlights a critical aspect of the Oracle HCM Cloud configuration. When grades are not accurately configured for various business units, it can lead to confusion where the grade sets meant for one business unit may inadvertently get applied to another. This interchange can significantly affect employee compensation, career progression, and performance management, since different units may be structured with distinct requirements and expectations regarding job classifications and promotions.

When grade sets are mixed up, employees in differing business units may find themselves categorized improperly, resulting in discrepancies in morale and motivation. Additionally, this can complicate management's ability to create accurate compensation packages aligned with the unique demands of each unit.

Unlocking the importance of precise grade setting allows an organization to maintain the integrity of its workforce management practices, ensuring that employees are appropriately placed according to the specific criteria and standards of their respective business units.