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Exam 12: Pay for Performance and Financial Incentives

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Question 51

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Craig is a line manager at a paper supply company. All of the following are methods that Craig should most likely implement to motivate his subordinates EXCEPT ________.

A) recognizing an employee's contribution
B) encouraging workers to earn overtime pay
C) gaining agreement on goals with employees
D) using positive reinforcement on a daily basis

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Question 52

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Which of the following found that extrinsic rewards could detract from an employee's intrinsic motivation?

A) Frederick Taylor
B) Frederick Herzberg
C) David McClelland
D) Edward Deci

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Question 53

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Annual bonus plans are long-term incentives, and stock options are short-term incentives.

You are the CEO of Blue Bay Motor Boat Company, a mid-size firm that manufactures speed boats. What incentive plan would you implement for the firm's engineers? What incentive plan would you implement for the firm's managers? Explain why.

Rebecca's manager wants to acknowledge her outstanding service record for the past quarter. The manager decides to give Rebecca a bonus of $1000 as a reward. According to Edward Deci, which of the following will most likely occur as a result?

Robert Katz popularized the use of financial incentives for workers whose production exceeds some predetermined standard.

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?

Which term refers to payments companies make in connection with a change in ownership or control of a company?

The work of Edward Deci suggests that managers should primarily rely on extrinsic rewards to motivate employees.

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

According to Herzberg's theory, a manager would be able to motivate an employee with challenging tasks.

Which of the following terms refers to an incentive plan that ties a group's pay to the firm's profitability?

A straight salary is most appropriate when a salesperson's primary duties involve ________.

Sometimes managers need to reinforce positive behavior but cannot turn to a cash incentive to do so. Identify some positive reinforcement rewards that a manager could use on a day-to-day basis to reward employees.

The complicated nature of piecework makes it an unpopular individual incentive plan among employers.

Enterprise incentive management systems enable firms to ________.

Which of the following is the primary advantage of piecework plans?

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

Employers may award merit pay as traditional merit increases that increase an employee's base pay or as a lump sum merit raise. Explain the pros and cons of these two choices.

In order for a firm to have an effective incentive plan, there should be a clear relationship between employee effort and quantity or quality of output.