Exam 12: Pay for Performance and Financial Incentives

Behavior modification principles can be useful to managers who seek to change employee behavior through rewards or punishments linked to performance.

When hired by Delmar Designs,Shane agreed to forego 6% of his normal pay if he didn't meet his goals in return for a 12% bonus if he exceeded his goals.In which type of plan does Shane most likely participate?

All merit raises become part of an employee's base salary.

Ryobi is a large,international power tool manufacturer that develops affordable,high-quality products,such as drills,circular saws,and routers,for both homeowners and craftspeople.As the company continues to grow,its top executives want to ensure that employees are appropriately paid for their performance and that financial incentives are both fair and effective.Currently,the firm provides merit raises based on performance appraisals; however,executives are considering changing the current incentive plan. Which of the following questions is most relevant to the decision by Ryobi executives to discontinue all merit raises?

Elaine,the HR manager at Western Enterprises,has been assigned the task of implementing a gainsharing plan.What does Elaine most likely need to do first?

Behavior modification is based upon the principles of rewards and punishments advanced by ________.

The employees at DataMax participate in a profit-sharing plan.DataMax distributes 15% of its profits as profit shares to employees at regular intervals.Which of the following is most likely used at DataMax?

According to the FLSA,merit pay can only be given to exempt,nonmanagement employees at a company.

Frederick Taylor referred to the tendency of employees to work at the slowest pace possible and to produce at the minimum acceptable level as ________.

According to Victor Vroom,expectancy could also be referred to as the ________.

All of the following are disadvantages of straight commission plans EXCEPT ________.

Edward is the new sales manager at Wilson Auto Mart.The previous sales manager set commission rates informally without considering how much each sale covered expenses.As a result,Wilson Auto Mart barely breaks even on each car sale once commissions are paid.Edward wants to motivate his sales force but avoid having excessive commissions. All of the following questions are relevant to developing an effective sales compensation plan EXCEPT ________.

The Scanlon plan is a type of gainsharing plan.

According to Vroom's theory,if expectancy,instrumentality,or valence is equal to zero,there will be no employee motivation.

Top executives at DYS Enterprises are considering the idea of implementing an employee incentive plan.Which of the following suggests that an incentive plan would NOT be appropriate at DYS Enterprises?

Common stock is the most common payment form used in gainsharing plans.

The perceived relationship between successful performance and obtaining the reward is referred to by Vroom as ________.

The Lincoln incentive system is an incentive plan that ________.

Which of the following terms refers to financial rewards paid to workers whose production exceeds some predetermined standard?

Cash,stock,stock options,stock appreciation rights,and phantom stock are known as "golden handcuffs" because they are long-term incentives for executives.