Assignment 8

Question 1

What are the 3 general factors upon which an employee behavior depends?

Answer 1

1) Motivation
2) Abilty
3) Envrionmental Obstacle
Employee behaviors= f(M,A,E)

Question 2

4 questions an organization should ask themselves regarding the compensation of their employees?

Answer 2

1) How do we attract good employee prospects to join our company?
2) How do we reatin these good employees once they join?
3) How do we get employees to develop skills for current and future jobs?
4) How do we get employees to perform well on their current jobs?

Question 3

Motivation involves 3 elements:

Answer 3

1) What is important to a person
2) Offering it in exchange for
3) Some desired behavior

Question 4

Cafeteria Style

Answer 4

Flexible compensation. Develops the idea that only the individual employee knows what package of rewards would best suit his or her personal needs.

Question 5

Theories that focus on Content:

Answer 5

1) Maslow’s
2) Herzberg’s
People have certain needs, such as physiological, security and self-esteem, that influence behavior.

Question 6

Theories that focus on the nature of the exchange

Answer 6

1) Expectancy
2) Equity
3) Agency
Evaluate jobs using a common set of compensable factors in part to let employees know that an explicit set of rules governs the evaluation process.

Question 7

Theories that focus on motivation

Answer 7

Desired Behavior.
There is a positive impact of goal setting on performance. Worker’s assigned “hard” goals consistently do better than workers told to “do their best”

Question 8

Components of a total rewards system

Answer 8

1) Compensation
2) Benefits
3) Social Interaction
4) Security
5) Status/Recognition
6) Work Variety
7) Workload
8) Work Importance
9) Authority/Control/Autonomy
10) Advancement
11) Feedback
12) Work Conditions
13) Development Opportunity

Question 9

Empowerment

Answer 9

Part of a total rewards system. Authority to make decisions, control over factors that influence outcomes and autonomy to carry out decisions without overregulation of upper management are important to consider in designing reward systems.

Question 10

Good Social Environment

Answer 10

Part of a totla rewards system. Some companies promote a business culture of fun that encourages employees to find ways to make their jobs more interesting and relevant to them personally.

Question 11

Security

Answer 11

part of a total rewards system. The trend today is toward less stable and secure compensation packages. The very design of compensation systems today contributes to employee instability and insecurity.

Question 12

Base pay

Answer 12

the guaranteed portion of an employee’s wage package.

Question 13

Across-the-board increase

Answer 13

Wage increases granted to all employees, regardless of performance. Size related to some subjective assessment of employer ability to pay. Typically an add-on to base pay in subsequent years.

Question 14

Cost of living increase

Answer 14

SAme as across the board increase except the magnitude based on change in cost of living ( ie as measured by the CPI)

Question 15

Merit Pay

Answer 15

Wage increase granted to employee as a function of some assessment of employee performance. Adds on to base pay in subsequent years.

Question 16

Individual Incentive

Answer 16

Sometimes this variable pay is an add-on to a fixed base pay. The incentive component ties increments in compensation directly to extra individual production ( ie commission systems, piece rate). While measures of performance are typically subjective with merit and lump-sum components, this form of variable pay differs because measures of performance are objective.

Question 17

Sucess sharing

Answer 17

A generic category of pay add-on ( variable pay) which is tied to some measure of group performance, not indvidual performance. Not added into base pay. Distinguished from risk-sharing plans because employees share in any sucess - performance above the standard- but are not penalized for performance below standard.

Question 18

Gain Sharing

Answer 18

Differs from profit sharing in that goal to exceed is not fianancial performance of organization, but some cost index ( i.e. labor cost is most common)

Question 19

Profit Sharing

Answer 19

Add on lined to group performance relative to exceeding some fiancial goal

Question 20

Risk-Sharing Plans

Answer 20

Generic category of pay add-on (variable pay) that differs from success sharing in that employee shares not only in the successes, but is penalized during poor performance years.

Question 21

Pay is a ____________ in the whole recruitment process.

Answer 21

visible reward

Question 22

Job offers spell out

Answer 22

the level of compensation and may even include discussions about what kinds of pay such as bonuses and profit sharing participation.

Question 23

Job canidates look for organizations with reward systems that fit their

Answer 23

personalites

Question 24

There is clear evidence that poor performers are more likely

Answer 24

to leave an organization than good performers.

Question 25

Equity theory suggests that workers who feel unfairly treated in pay

Answer 25

react by leaving the firm for better situations

Question 26

Turnover is higher for poor performers when pay is based on

Answer 26

individual performance

Question 27

Pay that employees find reasonanle can help reduce

Answer 27

turnover

Question 28

SKill-based pay is intended to

Answer 28

pay employees for learning new skills.

Question 29

New skills help employees

Answer 29

perform better on current jobs and adjust more rapidly to demands on future jobs

Question 30

Linking pay to behaviors of employees results in

Answer 30

better individual and organizational performance.

Question 31

Managers and workers believe pay should be tied to

Answer 31

performance

Question 32

Unionized workers perfer that pay is based on

Answer 32

seniority. Stems from a distrust of subjective performance measurement systems

Question 33

In a pay model attention should be paid to

Answer 33

efficiency, equity, and compliance

Question 34

Efficiency involves 3 general areas of concern

Answer 34

1) Strategy
2) Structure
3) Standards

Question 35

2 types of fairness in pay model

Answer 35

1) Distributive justice- Does an employee view the amount of compensation received as fair?
2) Procedural Justice- Organizations that use fair procedures and supervisors who are viewed as fair in the means they use to allocate rewards are perceived as more trustworthy and command higher levels of committment.

Question 36

A key element in fairness is

Answer 36

communication

Question 37

Employees want to know

Answer 37

what is expected of them

Question 38

Employees want the opportunity to provide

Answer 38

input into standards or expecations

Question 39

A reward system needs to

Answer 39

maintain and enhance the repuation of the firm and be compliant.