mgmt test 2

3 Theories Explain Compensation's Effects:

- Reinforcement Theory - Expectancy Theory - Agency Theory

efficiency wage theory

A theory stating that wages influence worker productivity

Ajzen's Theory of Planned Behavior 3 key general motives that predict/influence intention and behavior

Attitude toward the behavior, subjective norm, perceived behavioral control

Comparable Worth (Equal Pay Act of 1963)

Based on the idea that individuals should obtain equal pay, not just for jobs of equal content, but for jobs of equal value or worth.

cognitive component

Beliefs "I believe"

emotions

Complex human reactions to personal achievements and setbacks that may be felt and displayed

Consequences of external equity

External employee movement, labor costs; employee attitudes, retention

affective component

Feelings "I feel"

Internal locus of control

I make things happen, i can determine my future, i accept personal responsibility for failures.

who is the majority of the information on individual performance collected by

Immediate supervisor

behavioral component

Intentions "I intend"

Delayering

Reducing the number of job levels for more flexibility

Organizational citizenship behavior

Represents discretionary individual behaviors that are: Typically not directly or explicitly recognized by the formal reward system And can, in the aggregate, promote effective functioning of the organization This behavior is voluntary

self-esteem

a general belief about your self-worth

self-efficacy

a person's belief about his or her chances of successfully accomplishing a specific task

Benchmarking

a procedure in which an organization compares its own practices against its own competition

emotional intelligence

ability to monitor one's own emotions and those of others, to discriminate among them, and to use this information to guide one's thinking and actions

empathy

ability to sense and read emotions of others

Intelligence

an individual's capacity for constructive thinking, reasoning, and problem solving

Extraversion

assertive, social, talkative, energetic

Counterproductive Behavior

behaviors that harm other employees, the organization as a whole, or organizational stakeholders such as customers and shareholders

Key Jobs

benchmark jobs that have relatively stable content and are common to many organizations so that market-pay survey data can be obtained. (ex: store management)

3 components of attitude

cognitive, affective, behavioral

Personality

combination of stable physical, behavioral, and mental characteristics that give individuals their unique identities

external equity

compares the pay of the same job in different organizations and judges if it is fair

Outcomes of organizational commiment

continued employment and greater motivation = higher productivity

Expectancy Theory

focuses on the effects of incentives

4 core self-evaluation traits

generalized self-efficacy, self-esteem, locus of control, emotional stability

conscientiousness

has the strongest effect on job performance and job satisfaction

emotional stability

how relaxed, secure, and unworried one is. leads to higher job performance

Goals

inform people about performance standards and expectations so that they can channel their energies accordingly. (must be specific)

benefits

insurance, retirement, paid vacation

Merit pay

link performance-appraisal ratings to annual pay increases

cash compensation

merit pay

intrinsic motivation

naturally satisfying to the individual, makes you happy

Feedback

objective information about performance shared with those in a position to improve the situation

extrinsic motivation

obvious external rewards

Big 5 Personality Traits

openness, conscientiousness, extraversion, agreeableness, neuroticism

4 attitudinal measures

organizational commitment, employee engagement, perceived organizational support, job satisfaction

Stock options

plan that give employees the opportunity to buy company stock at a previously fixed price

Agency Theory

principals are owners and agents are expected to act on the behalf of the principal

Withdrawal Cognitions

process when an employee begins to think and feel like they should quit an organization

cognitive dissonance

psychological discomfort experienced when simultaneously holding two or more conflicting cognitions (ideas, values, emotions)

job enlargement

puts more variety into a worker's job by combining specialized tasks of comparable difficulty (diversify and motivate)

Attitudes

relate to behavior toward specific targets (people, place, or object)

psychological contracts

represent an individual's perception about the reciprocal exchange between him or herself and another party. (the employee's belief about what they are entitled to receive in return for what they provide to the org)

Values

represent beliefs that influence behaviors across all situations

FLSA (Fair Labor Standards Act)

requires that employees be paid at a rate of one and a half times their hourly rate for each hour of overtime worked beyond 40 hours in a week. The hourly rate includes base wage plus other components such as bonuses and piece-rate payments.

Agreeableness

tendency to get along well with others

practical intelligence

the ability to solve everyday problems by utilizing knowledge gained from experience in order to purposefully adapt to, shape, and select environments

job evaluation

the administrative tool organizations use to design job structures

organizational commitment

the extent to which an individual identifies with an organization and commits to its goals

percieved organizational support

the extent to which employees believe their organization values their contributions and genuinely cares about their well-being

Employee engagement

the harnessing of organization members' selves to their work roles; where people employ and express themselves physically, cognitively, and emotionally during role performance

Motivation

the psychological processes that underline the direction, intensity and persistence of behaviors and thoughts

Equity Theory

the way people value their current position. (fairness, comparing to others)

external locus of control

things happen to me, i blame others for failures, i can't control the future

What is the Employer's POV?

•Pay is a powerful tool in attaining strategic goals. •Pay impacts employee attitudes & behaviors. •Can help recruit talented employees •Can help with retention •Employee compensation is significant organizational cost.(it can run anywhere from 9% to 46%, depending on the company.)