Questions and Answers
Providing unlimited compensation choices to employees would meet with disapproval from the U.S. Internal Revenue Service.
True
In Japan, the traditional characters for the word 'compensation' are based on the symbols for logs and water, suggesting that compensation provides the necessities in life.
False
Procedural fairness suggests that the way a pay decision is made is of less importance to employees than the results of the decision.
False
________ refers to the process used to make pay decisions.
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Fairness is affected through employees' comparisons of their pay to the pay of others in the organization.
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The innovator business strategy stresses on delighting customers and bases employee pay on how well they do this.
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What is an example of relational return?
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A compensation system using market-based pay is most likely to be part of a(n) ________ strategy.
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The R2, which is an output from a regression analysis, is different from correlation in that it tells us what percentage of the variation is accounted for by the variables we are using to predict or explain.
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Internal alignment pertains to the pay rates both for employees doing equal work and for those doing dissimilar work.
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How an organization positions its total compensation against its competitors is part of external competitiveness strategic choices.
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Base wage reflects both the value of the work and individual employee skills and experience.
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The degree to which pay influences individual and aggregate motivation among employees at any point in time is referred to as a(n):
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A measure of how changes in one variable are related to changes in another variable is the:
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Research shows that ________ will effectively shift an organization in a downward performance spiral into an upward one.
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Study Notes
Compensation and Benefits Overview
- Unlimited compensation choices would be disapproved by the U.S. Internal Revenue Service.
- In Japan, the traditional characters for "compensation" do not suggest that it provides necessities in life.
- Procedural fairness indicates that how pay decisions are made is just as important as the outcomes to employees.
- Procedural fairness specifically refers to the process used to make pay decisions.
Fairness and Employee Comparisons
- Employees perceive fairness based on comparisons of their pay to that of others within the organization.
- The innovator business strategy focuses on delighting customers, but does not typically base employee pay on this metric.
- An example of relational return in compensation is employment security.
Compensation Strategies
- A compensation system that uses market-based pay is aligned with an innovator strategy.
- Internal alignment involves equity in pay rates for equal and dissimilar work roles.
- Organizations must consider how total compensation compares to competitors as part of their external competitiveness strategy.
Pay Factors and Motivational Effects
- Base wage does not solely reflect the work value and may not consider individual skills and experience accurately.
- The incentive effect describes how pay influences motivation levels among employees.
- The correlation coefficient measures the relationship between changes in two variables.
Research Insights
- It remains unclear which specific compensation practices can shift an organization from a downward to an upward performance trajectory.
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Description
Test your knowledge of key concepts from Chapter 1 of Compensation and Benefits. This quiz includes true or false statements to reinforce your understanding of compensation principles and cultural perspectives. Perfect for students studying HR management.
