MGMT 494 Ch.9

There is evidence that every 10 percent increase in the bonus paid to employees yields a_____percent increase in ROA to the firm

1.5

Research suggests that for employees to notice and work hard to perform behaviors desired by the organization, incentives need to be ____ percent

15-20

Which of the following is not true?

Companies are moving back to entitlement- oriented pay to reduce turnover

As per the ____ theory, relative pay is important as employees evaluate their pay-effort balance in comparison to other employees

Equity

For which motivation theory is it important for organizations to pay attention to the training and development needs of their employees?

Expectancy

Line of sight is an important pay implication for which theory of theories?

Expectancy and goal setting

Which of the following theories is least relevant to merit pay?

Herzberg's theory

____ theory contends that success-sharing plans will be motivating but at-risk plans will be demotivating

Herzberg's two-factor

____ is the belief that when a specified level of job performance at attained, the employee will receive a specified reward

Instrumentality

Which theories would support a higher minimum wage?

Maslow and Herzberg's two-factor

In ____ theory, incentive pay is motivating if it helps an employee gain a sense of achievement, recognition or approval

Maslow's

When developing a flexible compensation system, which theory or theories would be most useful

Maslow's theory and Herzberg's theory

A person with low self-esteem is likely to seek ____

a large, decentralized organization with little performance based pay

Which of the following best supports a culture of flexibility and innovation?

a strong commitment to job security

The most obvious sorting factor is ____

ability

____ theory argues that performance-based pay is best for complex jobs where monitoring employee performance is difficult

agency

A key factor in increasing trust in top management is ____

an acceptable appraisal system

A business has a centralized structure and a compensation system that rewards sales volume. However, sales volumes are low compared to competitors who respond more quickly to changes in consumer demand. Which of the following is the most likely source of the low sales performance?

an inappropriate organization design

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 ____

base pay with low incentives and a variety of rewards

The key ingredient in ____ is careful cost analys is to make sure the dollar cost of the package an employee selects meets employer budgetary limits

cafeteria-style compensation

Which among the following components of a reward system is a dimension of empowerment?

control

The motivation triangle includes ____

culture

The amount of fairness given to employees refers to ____

distributive justice

Theories dealing with exchange include ____

equity and agency

According to expectancy theory, effort level depends on which of these factors?

expectance, valence, instrumentality

____ theory contends that we choose to do those things that we believe are most likely to lead to desired rewards

expectancy

Growing evidence suggests that the major effect of skill-based pay is ____

high quality products

When moving from an individual to a group incentive plan, you would expect ____

high turnover among high performers

Compensation should reinforce all but which of the following behaviors?

keeping turnover to nearly zero

A ____ requires annually "re-earning" the added pay

lump-sum bonus

____ is an individual level form of performance pay

lump-sum bonus

When employee performance is easily measured and the organization's performance is fairly stable over time, the most effective type of compensation is to offer ____

monetary rewards with large incentives

____ involves identifying what is important to a person and offering it to them in exchange for some desired behavior

motivation

The key to designing a pay-for-performance system rests on standards. Specifically, managers need to be concerned about the

objectives, measures, eligibility, and funding

The primary guiding force that determines needed employee behaviors is ____

organization strategy

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

performance

Turnover tends to be highest among ____

poor performers

Compared to other incentive plans, line of sight is lowest in ____

profit sharing

The ability triangle includes ____

selection

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