Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Compensation > Midterm > Flashcards

Midterm Flashcards

1
Q

classical managerial strategy

A

an approach management that assumes most employees inherently dislike work but can be induced to work in order to satisfy their economic needs

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

compensation strategy

A

the plan for the mix and total amount of base pay, performance pay, and indirect pay to be paid to various categories of employees

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

competency-based pay

A

pay that is based on the characteristics, rather than the performance, of individual employees; usually applied to managerial or professional employees

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

contingent workers

A

workers not employed on a permanent full time basis

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

defender corporate strategy

A

focusing on dominating a narrow product or service market segment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

employee stock bonus plan

A

a plan through which employees receive shares in their employer firm at no cost to the employee

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

employee stock plan

A

any type of plan through which employees acquire shares in the firm that employs them

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

employment standards legislation

A

legislation that sets minimum standards for pay and other conditions of employment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

high involvement managerial strategy

A

an approach to management that assumes that work can be intrinsically motivating if the organization is structured properly

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

human relations managerial strategy

A

an approach to management that assumes most employees inherently dislike work but can be induced to work in order to satisfy their social needs

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

human rights legislation

A

legislation that prohibits discrimination in hiring or employment on the basis of race, ethnic origin, religion, gender, marital status, or age

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

indirect pay

A

non cash items or services that satisfy a variety of specific employee needs, sometimes knows as “employee benefits”

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

labour market constraints

A

constraints on compensation strategy flowing from the relative levels of demand and supply for particular occupational groups

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

membership behavior

A

occurs when employees decide to join and remain with a firm

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

merit raise

A

an increase to an employees base pay in recognition of good job performance

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

organizational citizenship beahavior

A

occurs when employees voluntarily undertake special behaviors beneficial to the organization

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

organizational commitment

A

the strength of the individuals attachment to his or her organiztion

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

organizational identification

A

a sense of shared goals and belongingness, and the desire to remain a member of the organization

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

pay-for-knowledge system

A

establishing base pay according to the total value of the skills and competencies an employee has acquired

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

piece rates

A

a pay system under which individuals receive a specified sum of money for each unit of output they produce or process

21
Q

product/service market constraints

A

constraints on compensation strategy caused by the nature of the product or service market in which the firm operates

22
Q

prospector corporate strategy

A

focuses on identifying and exploiting new opportunities quickly

23
Q

reward

A

anything provided by the job or the organization that satisfies an employee need

24
Q

reward strategy

A

the plan for the mix of rewards to be provided to members, along with the means through which they will be provided

25
Q

reward system

A

the mix of intrinsic and extrinsic rewards that an organization provides to its members

26
Q

sales commission

A

pay that is geared to the dollar volume of sales or transactions conducted

27
Q

skill block

A

the basic component of a skill based pay system, containing a bundle of skills or knowledge necessary to carry out a specific production or service delivery task

28
Q

skill certification

A

the testing process that determines whether an individual has masted a given skill block and should be granted the pay raise associated with that skill block

29
Q

total rewards

A

a compensation philosophy that considers the entire spectrum of rewards that an organization may offer to employees

30
Q

work motivation

A

the attitude one holds toward good job performance

31
Q

describe the key purpose of a compensation system

A

is to help create a willingness among qualified persons to join the organization and to perform the tasks the organization needs.

32
Q

explain why an effective compensation system is so important to most organizations

A

a compensation system is one of the most powerful tools available to an employer for shaping employee behavior and influencing company performance

33
Q

distinguish between extrinsic and intrinsic rewards

A

extrinsic rewards satisfy basic human needs like survival and security whereas intrinsic rewards satisfy higher-order human needs like self-esteem and achievement.

34
Q

distinguish between a reward system and a compensation system

A

a rewards system is the mix of intrinsic and extrinsic rewards given to its employees and the compensation system is the monetary part of the rewards system

35
Q

describe the key aspects of a compensation strategy

A

one aspect is the mix across the 3 compensation components (base pay, performance pay, and indirect pay), and whether and how this mix will vary for different employee groups. The other is the total amount of compensation to be provided to individuals and groups. “How should compensation be paid?” and “how much compensation should be paid?”

36
Q

explain why a compensation system must be viewed in the context of the total reward system, and the broader environment of the organiation

A

The reward system has intrinsic and extrinsic rewards, and the compensation is only the monetary part so it has to be viewed and weighed with the other rewards being given and this will be based on the environment and jobs of the organization

37
Q

identify and explain the key criteria for evaluating the success of a compensation system

A
  1. a reward system must help the organization achieve its goals
  2. it must fit with the organizations strategy for achieving its goals and support its structure for implementing that strategy
  3. it must attract and retain individuals who possess the attributes necessary to perform the required task behaviors
  4. it should promote the entire spectrum of desired task behavior for every organization member.
  5. it should be seen as equitable by all organization members.
  6. it must comply with all relevant laws within the jurisdictions in which the firm Operates
  7. it must achieve all this at a cost that is within the financial means of the organization
  8. it should achieve these objectives in the most cost effective manner possible
38
Q

Describe the steps along the road to effective compensation and explain how this book will facilitate that journey

A
  1. understand your organization and your people - understand the organizational context in within which it will operate
  2. formulate your reward and compensation strategy - to determine the mix of compensation components to include in your system and the total level of compensation to provide, relative to other employers.
  3. determine your compensation values
  4. design your performance pay and indirect pay plans
  5. implement, manage, evaluate, and adapt the compensation system
39
Q

understand the concept of “fit” and explain why a compensation system that is a success in one firm can be a failure in another

A

“Fit” refers to the alignment of strategies at various levels in an organization. A compensation that is a success in one firm may not be in another because they have different business strategies that don’t work with the compensation system of the other firm.

40
Q

explain how the strategic framework for compensation can be used as a tool for designing effective reward and compensation systems

A

this framework describes three managerial strategies (classical, human relations, and high-involement) that an organization can adopt and shows how each relates to an organizations structure and its best-fit reward system. The framework then identifies the determinate of managerial strategy, since these will ultimately determine the most appropriate reward strategy and compensation system

41
Q

describe the main elements in the strategic compensation framework, and explain how they relate to one another

A

Contextual variables: was environment ->business strategy, organization size, technology, workforce
MANAGERIAL STRATEGY
Structural Variables: job design, decision making and leadership, control system, reward system, communication and information, coordination and departmentation.

42
Q

describe the three main managerial strategies that organizations can adopt, and explain their implications for the most effective compensation systems

A

classical managerial system -

43
Q

base pay

A

base pay is the portion of an individuals compensation that is based on time worked, not on output produced or results achieved.

44
Q

advantages of base pay

A
  1. flexible
  2. allows employer to recognize and encourage important job behaviors that dont directly produce output, such as skill development
  3. can signal the relative importance of jobs within the organization
  4. creates a commitmment
  5. can support a particular managerial strategy
  6. simplicity
45
Q

disadvantages of base pay

A
  1. represents more of a fixed employer commitment than performance pay
  2. does not directly motivate task behavior
  3. does not directly contribute to citizenship behavior
  4. not self correcting
46
Q

applicability of base bay

A

good for job which the output is:

  1. easy to measure
  2. easy to price in terms of its value to the employer
  3. easy to attribute to individual employees
  4. controllable by the individual employee
  5. relatively stable
47
Q

define performance pay

A

any type of financial reward provided only when certain specified performance results occur

48
Q

advantages of performance pay

A
  1. signal key employee behaviors and motivate employees to achieve them
  2. they can reduce the need for other types of mechanisms for controlling employee behavior
  3. can raise employee interest in performance and provide employees with information about their current performance levels
  4. can support specific managerial strategies
  5. make pay more variable and thus can help link compensation levels to the firms ability to pay.

Compensation (2 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions