Chapter 10

which of the following statements about merit pay is true

-has a small, but significant effect on performance -departments and units with merit pay show higher performance - has a sorting effect

which of the following is an advantage of team incentives

-stimulates problem solving -may better reflect how work is performed -minimizes distinctions between team members

What of the following is true of merit bonuses

-they are viewed as less of an entitlement than merit pay -employees dislike them -they are thought to be a substitute for merit pay

which of the following is an advantage of providing stock ownership options as variable pay to employees?

it defers a portion of taxes to employees

components identified as vital to the success of both scanlon and rucker plans are

a productivity norm and effective worker comities

a penalty for poor performance rather than reward for good is an example of

a reverse incentive plan

for any task completed in standard time or less, earnings are pegged at 120 percent of the time saved under the ____ plan

gantt plan

when a firm is ____ on business risk, and its outcomes are _____, its performance is more likely to be higher without any incentive plans

high; uncertain

which of the following is NOT a long-term incentive plan

improshare

a gain-sharing plan that has proven easy to administer and communicate, which identifies the expected hours required to produce an acceptable level of output is the

improshare plan

what distinguished individual incentive plans from individual merit plans

merit pay is typically added to base, while incentives generally do not

an incentive system with three piecework rates is the _______ plan

merrick plan

what is the main difference between scanlon and rucker plans

scanlon plan focus on labor savings, rucker plan focus on a variety of savings

Surveys show the most popular type of variable pay plans are

special recognition plans

a team leader with a free-rider problem in his team can most likely maximize the performance of his team by

specifying performance levels and due dates

if you had repair work done on your car, the shop most likely used the _____ plan to pay the mechanic

standard hour plan

Which of the following is an advantage of the all-salaried work force

-increase in the quality of work life -most employees prefer a salary plan -produces more committed and loyal employees -reduces turnover

which of the following does NOT provide for incentives based on standards that are expressed in terms of time period per unit of production

-merrick system

which of the following are reasons to choose a group plan vs. an individual plan

-production methods and labor mix must adapt to meet changing resources -when work stoppages are regular and controllable -when the management information and cost accounting systems are relatively primitive -performance standards for individuals change to meet environmental pressures

which of the following is a condition favoring gain-sharing plans

-small unit; usually less than 500 employees -participative management style -little planned in terms of capital investment -old enough so the learning curve has flattened and standards can be set based on performance history

Which of the following support the use of individuals incentives

-stable individual performance standards -task accomplishment not dependent on performance of others -the independent nature of task accomplishment -the high commitment levels of workers to their profession -the readily apparent performance standards

which of the following does provide for incentives based on standards that are expressed in terms of time period per unit of production

-the gant plan -the rowan plan -the halsey 50-50 method

which of the following statements is NOT true of individual spot awards

-they are an example if long-term incentives -they are more expensive than merit pay increases -they are given to all employees as a one-time cost-of-living adjustment -a majority of companies do not feel that these awards are effective

in gain-sharing plan formulas, ____ are in the numerator and ____ are in the denominatro

labor inputs; productivity outcomes

What has the disadvantage of requiring employees to spend money too obtain their incentive

stock option plans

what has advantages of having minimal impact on the company's financial standards

stock options

which of the following is NOT an advantage of team incentives

-easy to set equitable targets for all teams

which of the following is a long-term incentive plan

-employee stock ownership plans -broad-based option plans(BBOPs) -performance plans

which of the following statements is true of individual spot awards

-given to employees for exceptional performance as an add-on bonus -smaller companies may not be more casual about recognition -someone in an organization alerts top management about performance deserving an award -smaller companies are more subjective about deciding the size of the award

an incentive payment can be BEST described as

any form of pay tied directly to achievement of performance standards

A ________ plan requires division of a task into simple actions and determination of the time required by an average skilled worker to complete each action

bedeaux plan

which plan divides a task into actions and measures the time required to perform each action? in this same plan workers receive a wage incentive for completing a task in less than standard time. this incentive is a direct function of the time saved in completing the task

bedeaux plan

which of the following is the most commonly used team incentive performance standard?

customer satisfaction measures

the best variable pay plan for employees when company financial performance is poor is _____

gain sharing

the trend in recent variable-pay design is to combine the best of ____ and ____ plans

gain sharing; profit sharing

in which of the following standard hour plans does the employee's bonus increase as time required to complete the task decreases

rowan plan

which of the following gain sharing plans is designed to lower labor costs without lowering the level of a firm's activity

scanlon plan

a complex pay guidelines ties pay not only to performance but also to position in the

pay range

which of the following is a disadvantage of gain-sharing plans

payouts can occur even if a company's financial performance is poor

which of the following is NOT a condition favoring gain-sharing plans

product costs not controllable by employees

the two most commonly used team incentive performance standards are

productivity and quality

which of the following statements about merit pay is NOT true

removal of merit pay lowers satisfaction but not performance

The most frequently used incentive system is the

straight piecework system

in which of the individual plans, is rate of determination based on units of production per time period, and wages vary directly as a function of production level

straight piecework system

paying a dime for every bottle collected and turned into a collection center is an example of a:

straight piecework system

which plan varies the incentive level (two rates) as a function of the level of production relative to a standard? in the plan, a new rate is used once production expectations are met (eg, 50/unit up to 7-10 units/hour and .70/unit of every unit over 11 and up units/hour)

taylor plan

Which of the following is NOT true of merit bonuses

they are more expensive than merit pay in the long run

the authors argue that for merit pay to live up to its potential, all of the following should be done EXCEPT

they are more expensive than merit pay in the long run

which of the following is an advantage of gain-sharing plans

they increase employees' knowledge of business

Which of the following is NOT an advantage of the all-salaried work force

union support

it is observed that _____ is/are commanding a larger share of the total compensation for all employee groups

variable pay

the authors argue that for merit pay to live up to its potential, all of the following should be done

-improving the accuracy of appraisal -allocation enough money to truly reward performance -ensuring the size of the merit increase differentiates across performance levels

Which of the following does NOT support the use of individuals incentives

Unionized work force

one common feature of all types of incentive plan is:

an established standard of performance that is used to determine the magnitude of the incentive pay