Deck 17: Motivation, Compensation, Leadership, and Evaluation of Salespeople

Question 1

A bonus is a financial reward given in addition to what is usually earned over an extended period of time.

Answer 1

True

Question 2

Praise, recognition, and challenging work assignments are classified as non-financial rewards.

Answer 2

True

Question 3

Although it is difficult to administer the straight commission plan, many organizations prefer to use this plan because selling costs are kept in proportion to sales.

Answer 3

False

Question 4

Under the straight salary compensation plan, salary is distributed in proportion to the sales made.

Question 5

Under the straight salary compensation plan, a salesperson's pay is directly related to sales performance.

Question 6

A straight salary compensation plan tends to increase work norms within the sales group.

Question 7

A drawback of the straight salary compensation plan is the lack of direct monetary incentive.

Question 8

According to the text, it is critical that sales managers be driven by integrity, trust, and morality because they have a significant impact on the compensation and careers of salespeople.

Question 9

With a regressive commission plan, commission rates decrease as total sales increase.

Question 10

A straight salary compensation plan can be effectively used to curtail salespeople from concentrating on easy-to-sell products.

Question 11

Salespeople under a straight commission plan are frequently reluctant to split territories after building rapport with customers.

Question 12

A salesperson working under a combination salary plan receives both a base salary and a commission or bonus.

Question 13

The use of regressive compensation plans would discourage top performing salespeople from accepting management positions.

Question 14

Achievement awards are special financial incentives used to motivate salespeople.

Question 15

Handling returned goods and bad debts is a greater administrative problem for firms that pay salespeople using a commission plan than for firms that pay straight salaries.

Question 16

A major disadvantage associated with drawing accounts is that the amount given to salespeople is not based on the individual needs of the salesperson.

Question 17

Under the straight salary compensation plan, management is able to project compensation expenses several years in advance.

Question 18

The two levels of motivation that sales managers are concerned with are the motivation of the individual salesperson and the motivation of the entire sales force.

Question 19

Under the progressive commission plan, commission rates increase as the sales increase.

Question 20

A straight salary plan can increase sales expenses because the salary does not vary directly with the sales.

Question 21

The main evaluator of a salesperson should be the salesperson's immediate supervisor.

Question 22

Robin, a pharmaceutical sales representative, was recently given a key account. She is excited about the challenging assignment. Robin's sales manager is most likely motivating Robin with a:

A) nonfinancial reward.
B) achievement award.
C) salary increase.
D) commission.
E) fringe benefit.

Question 23

Immediate supervisors typically establish procedures for who will do the evaluation and how it will be done.

Question 24

The motivation mix consists of all of the following components EXCEPT:

A) management control procedures.
B) special financial incentives.
C) nonfinancial rewards.
D) leadership techniques.
E) hygiene factors.

Question 25

In a participating leadership style, the sales manager makes all decisions for the salesperson.

Question 26

An organization's salespeople are experiencing declining sales due to the introduction of a competitor's new product. Participative leadership is best suited in this situation.

Question 27

Salespeople should receive evaluations at the end of every performance cycle.

Question 28

Coaching refers training a salesperson in the home office and rarely involves a manager accompanying a salesperson on a sales call.

Question 29

A salesperson's ability to overcome objections is an example of quantitative criteria.

Question 30

The 'tells' leadership style has both high task orientation and low relationship behavior.

Question 31

Performance evaluation is a part of the _____ element of a sales manager's motivation mix.

A) basic compensation plan
B) special financial incentives
C) synergistic techniques
D) nonfinancial rewards
E) management control procedures

Question 32

Sales contests serve as incentives to achieve long-term sales goals, but they typically lead to high levels of absenteeism and turnover.

Question 33

The task behavioral form of leadership is characterized by two-way communication.

Question 34

The persuasive style of leadership is characterized by above-average levels of task and relationship behavior.

Question 35

Each salesperson at a firm should receive at least one formal evaluation every year.

Question 36

A delegating leadership style is characterized by below-average levels of both task behavior and relationship behavior.

Question 37

Praise and recognition are part of the _____ element of a sales manager's motivation mix.

A) basic compensation plan
B) special financial incentives
C) synergistic techniques
D) nonfinancial rewards
E) management control procedures

Question 38

According to the text, more firms use incentive travel programs than merchandise awards to motivate salespeople.

Question 39

Which term refers to the arousal, intensity, direction, and persistence of effort directed toward job tasks over time?

A) Enrichment
B) Direction
C) Motivation
D) Influence
E) Simulative response

Question 40

The relationship form of leadership can include activities such as listening, providing clarification, and giving positive feedback.

Question 41

Which of the following compensation plans is considered the simplest?

A) Straight commission
B) Structured combination
C) Straight salary
D) Drawing account
E) Performance bonus

Question 42

Kia Lang's pay plan reduces her commission as her sales increase. She receives a 10 percent commission on the first $250,000 and 6 percent on sales over that amount. For sales of $500,000, she would receive 5 percent. This is an example of a _____ plan.

A) linear
B) integrated
C) conservative
D) reinforcement
E) regressive

Question 43

Which of the following statements about compensation for salespeople is most likely true?

A) Compensation refers only to monetary motivational tools.
B) A sales reward system is the only means of motivating salespeople.
C) Studies show that nonfinancial compensation fails to motivate salespeople.
D) Straight salary plans are complex to implement and provide minimal motivation.
E) Money is a powerful performance motivator if used with the right compensation plan.

Question 44

From a salesperson's point of view, which of the following describes an advantage inherent in a straight salary compensation plan?

A) The plan facilitates team selling.
B) The plan gives salespeople financial security.
C) The plan minimizes the financial burden on employers.
D) The plan clearly links high performance with compensation.
E) The plan typically increases work norms within the sales group.

Question 45

A straight salary plan:

A) increases the work norms within a sales group.
B) includes all monetary and non-monetary incentives.
C) encourages friendly competition among salespeople.
D) makes it difficult for a firm to take corrective actions.
E) enables a company to direct salespeople to important activities.

Question 46

With a regressive compensation plan, a:

A) salesperson's commission rate decreases as total sales increase.
B) salesperson calls on more accounts each week until reaching saturation.
C) salesperson's territory is increased exponentially as total sales increase.
D) salesperson earns a base amount plus bonuses for meeting superlative goals.
E) salesperson is financially disciplined for spending too much time on nonselling activities.

Question 47

In an effort to overcome the problems typically associated with the straight salary compensation plans, many companies:

A) ask salespeople to resort to high-pressure selling tactics.
B) reduce the number of accounts assigned to salespeople.
C) employ only college graduates as sales representatives.
D) increase the number of sales managers.
E) eliminate all commissions.

Question 48

An organization would most likely use a regressive commission plan to:

A) reward newly-hired salespeople during training periods.
B) motivate the highest-performing salespeople.
C) encourage top sales performers to be managers.
D) decrease fixed costs of maintaining the sales force.
E) maintain a drawing account for customer returns.

Question 49

From management's point of view, which of the following describes an advantage inherent in a straight salary compensation plan?

A) Selling costs are kept in proportion to sales.
B) Salespeople are less resistant to reassignments of accounts.
C) Salespeople are highly motivated and employee turnover decreases.
D) A straight salary plan increases the work norms within the sales group.
E) Straight salary plans foster the development of highly productive salespeople.

Question 50

The commission rates of sales decreases as the sales increase. This is an example of the _____ commission plan.

A) progressive
B) regressive
C) parabolic
D) negative
E) curvilinear

Question 51

Sales performance is rewarded in three fundamental ways. They are:

A) drawing accounts, bonuses, and fixed salaries.
B) commission, salaries, and nonfinancial awards.
C) financial compensation, bonuses, and national awards.
D) extrinsic rewards, intrinsic rewards, and special group memberships.
E) direct financial rewards, career advancement, and nonfinancial compensation.

Question 52

Louise Hunt receives $250 per week in anticipation of the commissions she is expected to earn in the coming week. This payment is called a(n) ____.

A) draw against commission
B) award advancing
C) judgmental incentive
D) progressive payment
E) regressive payment

Question 53

Which of the following statements about progressive commission plan is most likely true?

A) Salespeople are given an increased number of territories based on annual performance.
B) A salesperson must call on more accounts each week until saturation is reached.
C) A salesperson's commission rate increases as total sales increase.
D) Salespeople earn a fixed salary plus additional annual bonuses.
E) A salesperson is rewarded for increasing nonselling activities.

Question 54

Which of the following statements describes a disadvantage inherent in the straight salary compensation plan?

A) The straight salary plan causes the salesperson to experience uncertainty and insecurity of payment.
B) The plan makes it difficult for an organization to take corrective action to improve sales if the performance of the salesperson is low for a prolonged period.
C) A lack of incentive may cause efficient, high-performing salespeople to change jobs.
D) Directing salespeople toward tasks the company believes are important becomes difficult.
E) Management cannot project future compensation expenses of the sales force.

Question 55

For most salespeople, which of the following provides the greatest motivation?

A) Sales achievement awards
B) Co-worker recognition
C) National sales meetings
D) Positive evaluations
E) Financial rewards

Question 56

The _____ plan is a complete incentive compensation plan.

A) structured commission
B) salary and commission
C) straight commission
D) straight salary
E) salary and bonus

Question 57

Which compensation plan most likely discourages the use of high-pressure selling techniques?

A) Straight commission
B) Salary and commission
C) Structured commission
D) Straight salary
E) Salary and bonus

Question 58

The _____ combines the incentive of a commission plan with the security of a fixed income.

A) regressive account
B) drawing account
C) performance bonus
D) group incentive
E) progressive incentive

Question 59

The two basic types of commission plans are straight commission and:

A) non-financial commission.
B) draw against commission.
C) quota-based commission.
D) experience-based commission.
E) performance bonuses.

Question 60

The commission rate increases as the salesperson sells an increasing amount of product. This is called a(n) _____ commission plan.

A) linear
B) parabolic
C) regressive
D) progressive
E) curvilinear

Question 61

Ben, a computer systems salesperson, is compensated by his firm with a drawing account plan. At the beginning of each month, Ben receives $1,000. This month, Ben's sales resulted in commissions of $2,500. What will most likely occur as a result?

A) Ben will receive an additional $3,500 from the firm.
B) Ben will receive an additional $2,500 from the firm.
C) Ben will receive an additional $1,500 from the firm.
D) Ben will pay the firm $1,500.
E) Ben will pay the firm $1,000.

Question 62

Phil, an inexperienced salesperson, is nervous about his ability to close a sale. What type of leadership style would be most appropriate for Phil's supervisor to use?

A) Supporting
B) Telling
C) Delegating
D) Persuading
E) Participating

Question 63

Which of the following statements about a commission plan is most likely true?

A) Employee loyalty to the firm increases.
B) Selling costs are kept in proportion to sales.
C) Recruiting costs are significantly decreased.
D) Salespeople strive to complete nonselling tasks.
E) Team selling and territory splitting are encouraged.

Question 64

_____ involves the extent to which a leader listens, provides clarification, and gives positive feedback.

A) Autonomous leadership
B) Task behavior
C) Centralization
D) Relationship behavior
E) Directive behavior

Question 65

Performance bonuses are typically categorized by either:

A) tenure or job performance compensation levels.
B) long-term or short-term recommendations.
C) pre- or post-performance job evaluations.
D) individual or group rewards.
E) fixed or flexible rates.

Question 66

Under a _____ plan, a proportion of the salesperson's total pay is guaranteed while some of it can come from commissions.

A) straight salary
B) straight commission
C) combination salary
D) drawing account
E) operational incentive

Question 67

Morgan-Hunt Agency, a financial investment company, pays $300 to each of its salespersons as a year-end bonus, regardless of productivity. This is an example of a(n):

A) nonperformance bonus.
B) drawing account plan.
C) advance commission.
D) team-selling bonus.
E) across-the-board bonus.

Question 68

Beth, an experienced salesperson, has recently been given a key account. Beth is motivated to perform a good job but is having trouble effectively carrying out her responsibilities. Beth is having a meeting with her sales manager to address the issue. Which leadership style should Beth's manager most likely use?

A) Persuading
B) Telling
C) Consulting
D) Delegating
E) Participating

Question 69

Which of the following leadership styles is characterized by high task behavior and low relationship behavior?

A) Telling
B) Complying
C) Participating
D) Surmising
E) Delegating

Question 70

A sales manager who uses the persuading leadership style most likely:

A) shares all decision-making authority.
B) makes decisions without discussion.
C) makes and discusses most decisions.
D) seeks mutually created decisions.
E) offers no decision-making direction.

Question 71

Rachel, an experienced sales representative, was told by her sales manager how to develop a sales presentation. Rachel's manager is most likely following a _____ leadership style.

A) telling
B) persuading
C) participating
D) complying
E) delegating

Question 72

All of the following are relationship behaviors EXCEPT:

A) providing clarification.
B) giving positive feedback.
C) providing useful guidance.
D) giving appropriate encouragement.
E) describing organizational responsibilities.

Question 73

Your new boss gives very detailed instructions and closely watches your progress. This shows your boss's:

A) motivation mix.
B) qualitative performance factor.
C) task behavior.
D) participative leadership style.
E) relationship behavior.

Question 74

Which term refers to special sales programs offering salespeople incentives to achieve short-term sales goals?

A) Fringe benefits
B) Sales contests
C) Performance bonuses
D) Compensation awards
E) Organizational bonuses

Question 75

Which of the following is an advantage of the straight commission plan?

A) Typically, loyalty towards the company among the sales force is very high.
B) The plan provides a maximum incentive and the opportunity to earn top money.
C) It provides a sense of security and certainty of earning to salespeople.
D) Salespeople are discouraged from using high-pressure selling tactics.
E) Turnover in the sales force tends to be low with this plan.

Question 76

Which leadership style is characterized by low task behavior and high relationship behavior?

A) Telling
B) Persuading
C) Complying
D) Participating
E) Delegating

Question 77

_____ is a process by which the sales manager uses both task and relationship behaviors to influence the activities of salespeople.

A) Motivation
B) Engagement
C) Enrichment
D) Leadership
E) Evaluation

Question 78

A manager characterized by a high level of task behavior:

A) gives a generous amount of feedback to reinforce positive behavior.
B) closely supervises the individual or group to make sure the job is done.
C) exhibits a democratic attitude toward motivation.
D) uses two-way communication frequently.
E) prefers a flatter organizational structure.

Question 79

Which of the following is a disadvantage of straight commission plans?

A) The plans are only suitable for companies with large sales budgets.
B) The plans trigger high selling costs even without significant sales.
C) Such plans cannot be administered easily by most firms.
D) Salespeople conduct too much customer service.
E) Salespeople are reluctant to change territories.

Question 80

What two components should determine the best leadership style to use?

A) Product and situation
B) Salesperson and situation
C) Salesperson and compensation plan
D) Organization and product complexity
E) Compensation plan and organizational culture