Exam 11: Using Performance-Based Pay to Achieve Strategic Objectives

An executive's average incentive payout is about _____ percent of base pay compared to the average technical/professional's incentive payout of 8 percent.

What challenges does a multinational company face in using performance-based pay?

List four types of performance-based pay.

The general pattern is that proportionately less incentive pay is used for employees higher in the hierarchy.

Gain-sharing plans are premised on the assumption that:

_____ are used to determine which employees are covered by various components of a total pay plan.

Which of the following is a highly popular indicator used to evaluate the effectiveness of performance-based pay?

Which of the following statements about merit pay plans is true?

Under a merit pay system with a small merit pool, it is likely that _____ will be dissatisfied with their raises.

In the chapter opening vignette "Managing Human Resources at the United States Postal Service", the success of the USPS's approach to performance-based pay is due to:

By definition, there will be discrimination between employees in performance based pay plans. Rewards awarded contingently cause low performers to improve and high performers to be more satisfied. Which of the following answers the question "How can you do this fairly?"

How is the base pay set when merit pay plans are used?

Profit-sharing plans:

A requirement of implementing a pay for performance system is to eliminate nonmonetary rewards at an organization.

As a compensation expert in the HR department, you have been assigned the responsibility for reviewing the company's reward system developing a performance-based pay system (PBPS) system. All of the following are your responsibilities, except:

By paying for performance, a company signals that it is interested in employees who want to be paid for good performance.

_____ are among the oldest and most popular forms of incentive pay.

What are the three levels of aggregation for performance-based pay?

Stock option plans:

_____ have spurred many organizations to reevaluate their use of merit raises.