Theory
Compensation Programs
Best Fits
Potpourri
Let's Think About It
100
Emphasizes the importance and immediacy of a reward following a certain behavior
What is Reinforcement Theory?
100
A compensation program that pays better performers more over the course of time.
What is Merit Pay?
100
Organizations that link pay to individual performance are more likely to attract this type of employees.
What is Individualistic?
100
Rewards such as pay, benefits and promotion are examples of this type of motivation.
What is Extrinsic Motivation?
100
Intertwined effects of pay and process refers to the idea that this is just as important as the way workers are paid.
What is the way workers are treated?
200
Agency theory is of particular value in compensation management because of its emphasis on this trade-off.
What is risk-reward trade-off?
200
The pay system that motivates performance by measuring physical output.
What is an individual incentive system? These are relatively rare—why?
200
The compensation program more likely to attract a learning-oriented employee.
What is Skill-based pay?
200
Interesting work that utilizes a person's various skill sets is an example of this type of motivation.
What is Intrinsic Motivation?
200
A below-market short-term pay level best fits with this business strategy.
What is a Growth strategy?
300
Says motivation is a function of expectancy, instrumentality, and valence.
What is Expectancy Theory? Compensation systems differ according to their impact on the dimensions of expectancy theory, but, generally speaking, they have their greatest impact on which dimension?
300
The Scanlon plan is an example of this.
What is Gainsharing?
300
The compensation program that would best fit in any company regardless of its organizational structure or the independence of jobs is.
What is profit sharing?
300
This can be described as a function of ability and motivation.
What is Job Performance?
300
In order to control compensation costs, administrators of merit pay programs must closely monitor the compa-ratio and this factor.
What is the distribution of performance ratings?
400
Because most profit-sharing plans are of the deferred type, their motivational impact is reduced. This argument is most consistent with this theory.
What is Reinforcement theory?
400
By law, an ESOP must invest at least this percent of assets in its company's stock.
What is 51%?
400
The compensation program that would best reinforce a culture that supports cooperation and problem solving.
What is Gainsharing?
400
Pay level and benefits have been seen as a way to influence these behaviors, which refer to decisions about whether to join or remain with the organization.
What are Membership behaviors?
400
From an agency theory perspective, the goal of owners(shareholders) is to encourage the agents(managers and executives) to act in the best interests of the owners. Therefore, linking executive pay to organization performance may mean less emphasis on this and more emphasis on outcome-oriented contracts.
What is noncontingent pay?
500
According to Agency Theory, this factor would support the use of a behavior-based contract between principals and agents. (For example, agents are less willing to have their pay linked to profits, because there is a risk of low profits.)
What is Outcome Uncertainty?
500
In this type of compensation plan, payments are based on a measure of organizational performance and do not become part of the employees' base salary.
What is profit sharing? Discuss two advantages of profit sharing, as well as some drawbacks.
500
If an organization desires to implement a compensation program that "locks in" employees, you might recommend this type of program.
What is Stock Options?
500
Three of the 5 characteristics of most merit pay programs, as discussed in your textbook.
What are: reflect individual differences in performance most info collected from supervisor pay increases linked to performance appraisal feedback infrequent feedback from supervisor to subordinate
500
Researchers have suggested that these two factors are critical to encouraging self-monitoring and peer monitoring.
What are monetary incentives and an environment that fosters trust and cooperation?
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