comp ch 9

When a company moves from an individual incentive plan to a group incentive plan, the company is most likely to experience

higher turnover among high performers.

Available evidence indicates that managers believe the most important factor for pay increases is

performance.

The ability triangle includes

selection.

Droppiece, Inc. is a company that provides more performance-based pay and less base pay than its competitors. Who among the following is most likely to join Droppiece?

Stella, a recent college graduate who loves to take on a challenge

When employee performance measures are ambiguous and vary from time to time, but the organization's performance is fairly stable over time, the most effective type of compensation is to offer

a variety of rewards with significant incentive pay.

The corporate performance of Yellow Corp. is fairly stable. However, it is difficult to measure individual performance. In this case, the most effective compensation mix is to offer

a wide range of awards beyond just money.

The motivation triangle includes

culture.

The amount of fairness given to employees refers to

distributive justice.

According to ________ theory, relative pay is important as employees evaluate the adequacy of their pay via comparisons with other employees.

equity

Company X pays for performance. Allan, an employee of the company, is not in favor of this reward system and, therefore, leaves Company X in search of another company with different rules for getting rewards. This is an example of the:

sorting effect.

One review of the evidence suggests that employees do not begin to consider changing their behavior unless raises are at least an increase of ________ percent.

6-7

________ is a nonpermanent (variable) payment (bonus or lump sum) form of variable pay granted to employee as function of some (typically primarily subjective) assessment of individual employee performance.

Merit bonus

Which of the following is an example of the sorting effect in action?

An employee leaving a high-paying job for one that provides more work/life balance

In the context of a pay-for-performance plan, which of the following questions is related to equity?

Do employees view the amount of compensation received as fair?

In the context of pay influencing turnovers, which of the following is a result of too little pay?

Feelings of unfair treatment among employees

________ is employees' beliefs that higher job performance will be rewarded by the organization.

Instrumentality

When an organization's performance has regular and large swings and individual performance is unclear and hard to measure, the most effective compensation mix is to offer

a base pay with low incentives and a wide array of awards.

When an organization's performance has frequent highs and lows, but individual performance is fairly stable and performance measures are clear, the most effective compensation mix is to offer

a large base pay and low incentive pay.

A person with low self-esteem is likely to seek

a large, decentralized organization with little pay for performance.

According to the ________ theory of motivation, employees prefer certain or fixed income flows, such as wage or salary, to variable income flows, such as performance-based pay.

agency