Ch 10 Pay for Performance: Perf. Appraisal and Plan Design*Done

Question 1

What are the three techniques to identify the value a firm places on it’s jobs?

Answer 1

1. Job analysis
2. Job evaluation
3. Job pricing

Question 2

What is pay for performance plan?

Answer 2

a pay plan that links individual pay to some measure of performance on the job

Question 3

What are the 3 factors that employee performance depends on?

Answer 3

Ability
Motivation to perform
E Supportive environment

Question 4

What behaviours do employers care about?

Answer 4

join
stay
perform well
develop skills

Question 5

What motivates employees?

Answer 5

What’s important to a person
Offering it in exchange for something
desired behaviour

Question 6

What is the MARS model for individual behaviour?

Answer 6

Motivation
Ability
Role perceptions
Situation factors

Question 7

What is Content Theories?

Answer 7

What is important to a person

• Maslow’s need hierarchy
• Herzberg’s 2-factor theory

Question 8

What is process theories?

Answer 8

The nature of the exchange

• Expectancy theory
• Equity theory
• agency theory

Question 9

What are reinforcement theories

Answer 9

Desired behaviours

• goal setting
• reinforcement

Question 10

What should performance measurement and compensation strategy be based on?

Answer 10

Variability/ease of measurement of:
individual performance
organizational performance

Question 11

What is total rewards system?

Answer 11

All financial and non financial rewards provided by organizations to their employees

Question 12

Common errors in appraising performance

Answer 12

Observations (Attention)
storage and recall
actual evaluation

Question 13

What are the components of a total rewards system?

Answer 13

Compensation
benefits
social interaction
security
status/recognition
work variety
workload
work importance
authority/control/autonomy
advancement
feedback
work conditions
development opportunity

Question 14

What are the wage components?

Answer 14

base pay
across the board increase
cost of living increase
merit pay
lump-sum bonus
individual incentive
group incentive
gain sharing plans
profit sharing plans
risk sharing plans

Question 15

What are gain sharing plans?

Answer 15

The employee get’s a reward for increase in organizational performance - they get a portion of the extra amount earned because of money saved by the new work activity.

Question 16

Do people leave or stay in a firm because of pay?

Answer 16

yes

Question 17

Should pay increase be tied to performance?

Answer 17

yes (managers and employees alike agree)

Question 18

What are the performance appraisal formats?

Answer 18

Comparative - ranking, alternation ranking, paired comparison
Behvioural - BARS
Results/outcomes - Mgmnt by objective

Question 19

What are the strategies to better understand and measure performance?

Answer 19

• Dimensions should be relevant to strategy
• Involve the employees
• raters must be trained
• raters must be motivated to rate accurately
• raters maintain a diary of ee performance
• diagnose in advance if problems are due to motivation, skill, deficiency, or external enviro.

Question 20

What are the three variables in merit pay grids?

Answer 20

1. level of performance
2. Distribution of employees within pay ranges
3. Merit budget increase percentage.

Question 21

What are the three things that determine the effectiveness of a rewards system?

Answer 21

Efficiency
Fairness
Legislative Compliance

Question 22

What three things contribute to the efficiency of the effectiveness of a rewards system?

Answer 22

Strategy
Structure
Standards

Question 23

What are the two types of fairness that employers must consider in making the rewards system effective?

Answer 23

Distributive justice

Procedural justice