Week 5: Chapter 12: Recognizing Employee Contributions with Pay

According to research findings, when an organization changes from a pay strategy that has below average variability to one with above average variability, on average they will experience a return on assets of approximately ______.

2%

In measuring a team's performance, what potential drawbacks might be encountered? (Check all that apply.)

Competition between individual team members may be reduced. Plans that do not recognize individual performance differences may demotivate top performers.

Which of the following statements is true about employee productivity?

Pay incentives increase productivity.

In what type of plan are monetary bonuses paid to employees if the ratio of labor costs to the sales value of production is kept below a certain standard?

Scanlon

Which of the following increase with increasing incentive intensity? (Check all that apply.)

The possibility of undesirable outcomes Motivation The chance of unintended consequences

True or false: Merit pay exists in most organizations.

True

Which of the following focuses on how employee compensation can be used to align the divergent interests and goals of an organizations' various stakeholders?

agency theory

Which of the following encourage self-monitoring and peer monitoring? (Select all that apply.)

an environment that fosters trust and cooperation monetary incentives

The main influence of compensation is on instrumentality, which can be described as the perceived link between

behaviors and pay

Organizations should choose a pay strategy in the context of how effectively it will further the organization's ______.

business strategy

Which of the following characteristics concerning pay-for-performance programs may help increase the probability that the program has the intended effects and decrease the probability of unintended consequences and problems? (Select all that apply.)

careful alignment with organizational strategy careful alignment with human resource strategy balancing of objectives

When making changes to the company's compensation system______ is vital to combat rumors and assumptions.

communication

According to agency theory, monitoring would be cheaper and more effective if

conducted by employees

Pay plans are used in part to do which of the following? (Select all that apply.)

control employee behavior energize employee behavior direct employee behavior

Which type of plan not only provides stock ownership in the company to its employees but also potential tax and financial advantages to employers?

employee stock ownership

When considering employee compensation, Blank______ theory is focused on the effects of incentives.

expectancy

Which of the following are design features that potentially help differentiate pay-for-performance programs? (Select all that apply.)

frequency of payout ways of measuring performance payment method

When used well, pay plans have a(n)

incentive effect

The strength of the relationship between pay and performance is known as

incentive intensity

What methods are used for informing employees about changes in company compensation?

individual discussions with supervisors brochures or websites that include scenarios for typical employees video messages from the chief executive officer

For the modern corporation, ownership is nearly always separate from Blank______.

management

Ownership in the company via stock options might be less motivational to employees because they

may not realize any financial gain until they sell the stock

When measuring performance, team award plans consider which of the following? (Select all that apply.)

meeting deadlines cost savings successful completion of product design

It is important to pay high performers an amount they believe is equitable in order to Blank______ them. (Select all that apply.)

motivate attract retain

Under a profit-sharing system, payments are _____.

not part of base salary

In order to make high performance more likely in the future, employers are well advised to

offer a monetary reward for high employee performance

Pay programs that recognize employee contributions differ depending on whether payouts are Blank______. (Select all that apply.)

part of base pay a fixed cost variable

Employees are positively motivated by which of the following factors related to their jobs? (Select all that apply.)

participation in decision making desire for control pay

The compensation plan known as Blank______ involves payments being based on some measure of organizational performance, and the payments do not become part of the base salary.

profit sharing

Outcome-oriented contracts make some portion of executive pay contingent on what factors? (Select all that apply.)

profitability stock performance

According to the law of effect, rewards make responses

recur in the future

Studies show that in most companies, executive pay is significantly aligned with ______.

shareholder return

The effect pay has on workforce composition is known as a(n)

sorting effect

One way that employees can achieve ownership in the company they work for is via ______.

stock options

Which of the following conditions help gainsharing succeed? (Select all that apply.)

strong levels of cooperation commitment to continuous improvement management commitment

Which of the following make ESOPs attractive to organizations? (Select all that apply.)

the defense they offer against takeovers their financing advantages their tax advantages

Employee performance can be measured at the Blank______ level. (Select all that apply.)

unit individual organizational

Merit pay, or merit bonuses, is a form of Blank______ pay.

variable