Chapter 7 Motivation: From Concept to Applications MULTIPLE CHOICE Motivating by Job Design: The Job Characteristics Model 1.

Which of the following is not one of the core job dimensions in the job characteristics model (JCM)? a. task significance b. feedback c. autonomy d. status e. skill variety (d; Moderate; Job Characteristics Model; pp. 215-216) {AACSB: Analytic Skills} 2. In the job characteristics model (JCM), what three core job dimensions combine to create meaningful work? a. autonomy, task identity, and feedback b. skill variety, autonomy, and task significance c. skill variety, autonomy, and feedback d. feedback, task identity, and task significance e. skill variety, task identity, and task significance (e; Moderate; Job Characteristics Model; p. 216) {AACSB: Analytic Skills} 3. According to the job characteristics model, which of the following results in the maximum internal rewards for an individual? a. when they are given tangible rewards b. when they learn that they personally have performed well on a task that they care about c. when they initiate a program that enables them to work with a variety of like-minded colleagues d. when their training is realized and their expectations are met e. when they are singled out for praise for successfully completing an arduous task (b; Challenging; Job Characteristics Model; p. 216) 4. How is the motivational potential score (MPS) calculated? a. skill variety task identity task significance autonomy feedback b. 3(skill variety + task identity + task significance) + autonomy + feedback c. (skill variety + task identity + task significance)/3 autonomy feedback d. skill variety task identity task significance + autonomy + feedback e. (skill variety + task identity + task significance + autonomy + feedback)/5 (c; Moderate; Motivating Potential Score; p. 217) How Can Jobs Be Redesigned? 5. What is another term for cross-training? a. work enrichment b. job sharing c. work enlargement d. job enhancement e. job rotation (e; Easy; Job Rotation; p. 218)

133

6.

A trucking company routinely makes all of its office staff work for a week in the warehouse area: loading trucks, cleaning trucks, and doing other work which they are capable of. This program is an example of which of the following? a. job rotation b. job enlargement c. job enrichment d. job sharing e. flextime (a; Moderate; Job Rotation; p. 218) {AACSB: Analytic Skills} 7. What is the main strength of job rotation? a. It eliminates boredom on the job. b. It increases motivation. c. It increases productivity. d. It decreases training costs e. It decreases supervisor workload. (b; Moderate; Job Rotation; p. 218) 8. A company redesigns the jobs of the workers in accounts receivables, so that instead of simply billing customers, they will also be responsible for following up on non-payment, liaising between customers and the departments billing them, and other related tasks. What term would best be used to describe these changes? a. job rotation b. job enlargement c. job enrichment d. job sharing e. flextime (b; Moderate; Job Enlargement; p. 219) {AACSB: Analytic Skills} 9. How do most employees react to job enlargement efforts? a. unqualified approval b. somewhat enthusiastically c. with a lack of enthusiasm d. mixed reaction e. very little reaction (c; Easy; Job Enlargement; p. 219) 10. Job enrichment increases the degree to which the worker controls the _____. a. planning, execution, and evaluation of his or her work b. planning, execution, and evaluation of company plans c. horizontal integration of his or her tasks d. feedback that a worker receives from his or her supervisor and peers e. evaluation of his or her peers (a; Moderate; Job Enrichment; p. 220)

134

11.

Which one of the following is not one of the guidelines for enriching jobs? a. form job redesign units b. establish client relationships c. open feedback channels d. combine tasks e. expand jobs vertically (a; Challenging; Job Enrichment; p. 220) {AACSB: Analytic Skills} 12. A firm introduces job enrichment in order to motivate its employees. Evidence would suggest that which of the following is the most likely result of this change? a. reduced absenteeism and turnover costs b. lower fixed costs c. a drop in quality d. a decrease in productivity e. an increase in productivity (a; Challenging; Job Enrichment; p. 220) {AACSB: Analytic Skills} Alternative Work Arrangements 13. Beyond redesigning the nature of the work itself and involving employees in decisions, another approach to making the work environment more motivating is to alter work arrangements. Which of the following is designed to give an employee greater control of their schedule? a. flextime b. job sharing c. job rotation d. telecommuting e. job enrichment (a; Moderate; Flextime; p. 221) 14. Which of the following has not been shown to be a benefit of flextime? a. reduced absenteeism b. improved productivity c. increased meaningfulness d. increased satisfaction e. improved promptness (c; Moderate; Flextime; p. 222) {AACSB: Analytic Skills} 15. Which of the following is a job that does not lend itself to telecommuting? a. an attorney who spends most of her time researching on the computer b. a writer of copy for an advertising firm c. a car salesman who demonstrates the features of a new model of car d. a telemarketer who uses the phone to contact clients e. a product support specialist who fields calls from irate customers (c; Easy; Telecommuting; p. 223)

135

16.

After completing cooking school with very similar grades, Joe and Gary both looked forward to working in restaurants. Joe found work as a short-order cook in a cramped diner. On many shifts he worked alone, and had to cook a large number of meals on outdated equipment. Gary found work in a modern hotel kitchen. He had a small staff helping him prepare a small number of elaborate meals to order. Gary became a highly regarded chef, while Joe left the restaurant industry. This example illustrates that an individual needs what in order to perform well? a. ability b. motivation c. opportunity to perform d. adequate compensation e. feedback (c; Moderate; Opportunity to Perform; p. 225) {AACSB: Analytic Skills} Employee Involvement 17. What term is used for a participative process that uses the entire capacity of employees and is designed to encourage increased commitment to the organizations success? a. MBO b. employee involvement c. reengineering d. OB Mod e. job sharing (b; Moderate; Employee Involvement; p. 225) 18. The underlying logic of employee involvement is that by involving workers and increasing their autonomy and control over their work lives, employees will become all of the following except more ________. a. motivated b. competent c. productive d. satisfied e. committed (b; Moderate; Employee Involvement; p. 225)

19.

What is the distinct characteristic common to all participative management programs? a. joint decision making b. autonomy c. empowerment d. productivity enhancement e. quality awareness (a; Challenging; Participative Management; p. 225) 20. Participative management is a method of management where ________. a. subordinates make corporate decisions and management helps carry out those decisions b. upper management participates in the organizations strategic planning c. subordinates share a degree of decision-making power with their immediate superiors d. low-level workers meet occasionally with the CEO to discuss problems within their department e. low-level workers are responsible for making corporate policy decisions (c; Moderate; Participative Management; p. 226)

136

21.

A manager introduces participative management in an effort to boost morale and productivity. If he wants to make sure that it has as great a chance of success as possible he should ensure all of the following except ________. a. the issues decided upon must be relevant to the employees b. the employees must be informed and competent enough to make decisions c. the employees must be trusted by the manager d. the manager must be trusted by the employees e. there is representative participation through work councils and board representatives (e; Challenging; Participative Management; p. 226) {AACSB: Analytic Skills} 22. Research studies conducted on the participation-performance relationship show that the use of participation _____. a. enhances job satisfaction b. increases motivation c. has only a modest influence on employee productivity d. greatly influences employee attitudes e. lowers costs considerably (c; Moderate; Participation-Performance Relationship; p. 226) 23. Research shows that works councils tend to be ineffective for which of the following reasons? a. Members of works council tend to side with management when making decisions for fear of being punished. b. Works councils represent the wishes of employees that are often at odds with the best direction of an organization. c. Works councils are dominated by management and their input has little impact on employees or the organization. d. Works councils insert an extra element into decision making which slows the response of an organization to changing conditions. e. Members of works councils are in general not qualified to make large decisions concerning the direction of an organization. (c; Moderate; Work Councils; p. 226) {AACSB: Analytic Skills} 24. What does legislation require almost every company in Western Europe to do? a. have a form of representative participation b. provide employee ownership c. provide flextime d. set up quality circles e. have flexible benefit options (a; Easy; Representative Participation; p. 226) 25. What is the goal of representative participation? a. for workers to own the firms where they work b. to help workers self-esteem c. to provide greater motivation and productivity d. to redistribute power within the organization e. to empower high level managers (d; Moderate; Representative Participation; p. 226)

137

26.

What is the name for employees who sit on a companys board of directors and represent the interests of the firms employees? a. board representatives b. works councils c. quality circles d. union representatives e. board leaders (a; Easy; Board Representatives; p. 226) 27. Experience shows that the greatest value of representative participation is which of the following? a. increased motivation b. increased satisfaction c. symbolic d. decreased absenteeism e. increased commitment (c; Moderate; Representative Participation; p. 226) 28. What term is used for work groups of employees and supervisors who meet regularly to discuss their quality problems and recommend solutions? a. department teams b. cooperative groups c. evaluation teams d. quality circles e. mixed-motive decision teams (d; Moderate; Quality Circles; p. 226) 29. While _____ is/are likely to increase productivity, it shows little or no effect on employee satisfaction. a. ESOP b. MBO program c. quality circles d. job redesign e. social reconstruction (c; Moderate; Quality Circles; p. 226) 30. Participative management is compatible with all of the following except _____. a. ERG theory b. Theory X c. stimulating the achievement need d. MBO e. success needs (b; Moderate; Employee Involvement and Motivation Theories; p. 227) {AACSB: Analytic Skills} 31. Which of the following is Theory X is consistent with? a. the autocratic style of managing people b. participative management c. ERG theory d. the cognitive evaluation theory e. none of the above (a; Challenging; Employee Involvement and Motivation Theories; p. 277) {AACSB: Analytic Skills}

138

32.

Which of the following is not true? a. Theory Y aligns with the participative management style. b. Employee involvement programs provide intrinsic motivation. c. Theory X aligns with the autocratic management style. d. Employee involvement is incompatible with ERG theory. e. Implementing decisions can help satisfy an employees needs for achievement. (d; Moderate; Employee Involvement and Motivation Theories; p. 227) {AACSB: Analytic Skills} Using Rewards to Motivate Employees 33. Which of the following are all forms of variable-pay programs? a. piece-rate, wage incentive plans, gainsharing b. profit-sharing, lump-sum bonuses, extended vacations c. wage incentive plans, flextime, piece-rate d. retirement benefits, extended vacations, wage incentive plans e. wage rate increases, bonuses, flextime (a; Easy; Variable-Pay Programs; pp. 228-233) {AACSB: Analytic Skills} 34. Which of the following is not one of the most widely used variable-pay programs? a. piece-rate wages b. merit-based pay c. flat pay d. employee stock ownership e. profit sharing plans (c; Easy; Variable-Pay Programs; pp. 228-233) {AACSB: Analytic Skills} 35. Which of the following is one advantage of variable-pay plans to management? a. They turn fixed labor costs into variable labor costs. b. They turn low producers into high producers. c. They turn slow employees into fast employees. d. They turn high fixed costs into low fixed costs. e. They turn lower performance into fewer employees. (a; Challenging; Variable-Pay Programs; p. 229) 36. Which of the following is an example of a piece-rate plan? a. time and a half for overtime b. $2 for each unit produced c. productivity bonus d. commission e. none of the above (b; Moderate; Piece-Rate Plan; pp. 229-230) {AACSB: Analytic Skills} 37. What is the term used for a pay plan where pay levels are based on how many skills employees have or how many jobs they can do? a. a variable pay plan b. flexible pay c. competency-based pay d. gainsharing e. ISOP (c; Moderate; Skill-Based Pay; p. 231)

139

38.

A certain corporation ties its compensation for front-line operations managers to developing their skills in leadership, workforce development, and functional excellence. What is this sort of compensation scheme called? a. job-based pay b. training-based pay c. individual merit-based pay d. skill-based pay e. development-based pay (d; Moderate; Skill-Based Pay; p. 231) {AACSB: Analytic Skills} 39. Which of the following is not a downside of skill-based pay? a. People can top out. b. Skills can become obsolete. c. Ambitious people can confront minimal advancement opportunities. d. People are paid for acquiring skills for which there is no immediate need. e. It doesnt address the level of performance (c; Moderate; Skill-Based Pay; p. 231) 40. What is an advantage of bonuses over merit pay? a. Employees dont view bonuses as pay. b. Pay levels are based on employees skills. c. Bonuses are paid based on a formula. d. Bonuses are based on an objective output. e. Employees are rewarded for recent performance. (e; Moderate; Bonuses; p. 231) 41. Much of the compensation of traders at Synalco, a metals trading company, is in the form of stock options. The amount of options distributed is based on the companys net profits. What sort of compensation plan is this? a. profit-sharing b. gainsharing c. merit based d. ESOP e. employee ownership (a; Moderate; Profit-Sharing; pp. 231-232) {AACSB: Analytic Skills} 42. What is the name for an incentive plan where improvements in group productivity determine the total amount of money that is allocated? a. ESOP b. gainsharing c. profit-sharing d. piece rates e. employee ownership (b; Moderate; Gainsharing; p. 232)

140

43.

How is gainsharing an improvement on profit sharing? a. It focuses on productivity gains rather than profits. b. It rewards specific behaviors. c. It does not distribute profits, only gains in profits. d. It rewards behaviors that are less influenced by external factors. e. Superior employees can receive incentive awards even when the organization isnt profitable. (a; Moderate; Gainsharing; p. 232) 44. In what sort of companies is gainsharing most popular? a. large manufacturing companies b. large service organizations c. small, non-unionized manufacturing companies d. small, privately-held companies e. non-profit organizations (a; Challenging; Gainsharing; p. 232) 45. What sort of plan is a company-established benefit plan where employees acquire stock as part of their benefits? a. MBO program b. job redesign c. ESOP d. quality circle e. piece-rate (c; Moderate; Employee Stock Ownership Plan; p. 232)

46.

Research on employee stock ownership programs indicates that they are clearly successful in doing which of the following? a. increasing employee satisfaction b. reducing salaries c. reducing stress d. increasing productivity e. increasing employee expectations (a; Moderate; Employee Stock Ownership Plan; p. 232) Flexible Benefits: Developing a Benefits Package 47. What is the term used for the situation where employees are allowed to pick and choose from among a menu of benefit options? a flexible pay b. benefit menu options c. flexible benefits d. benefit participation e. flextime (c; Easy; Flexible Benefits; p. 234)

141

48.

Why are flexible benefit plans consistent with expectancy theorys thesis? a. They allow organizations to minimize costs associated with benefits. b. They provide a suite of tangible rewards that can be offered as motivation. c. Organizational rewards should be linked to each individual employees goals. d. They make employment at firms providing such programs more attractive. e. The motivation to gain extra benefits promotes productivity. (c; Challenging; Flexible Benefits; p. 234) 49. The average organization supplies fringe benefits worth approximately what percent of an employees salary? a. 25 b. 30 c. 35 d. 40 e. 50 (d; Challenging; Flexible Benefits; p. 234) 50. Which of the following is not a typical option in a flexible benefit program? a. additional life insurance b. disability insurance c. expanded health coverage. d. tax free health care spending accounts e. mortgage relief (e; Easy; Flexible Benefits; p. 234) {AACSB: Analytic Skills} 51. What are modular benefit plans? a. essential benefits and a menu-like selection of other benefits b. pre-designed packages of benefits c. they employees to set aside funds up to the dollar amount offered in the plan to pay for services d. a scheme designed for single employees with no dependents e. a scheme designed for employees with families (b; Moderate; Modular Benefit Plan; p. 234) Intrinsic Rewards: Employee Recognition Programs 52. Laura only makes minimum wage, but she loves her job. Her supervisor regularly compliments her and she has been chosen employee of the month twice this year. Which of the following is Lauras attitude most likely a function of? a. recognition b. motivation c. goal setting d. involvement e. reactance (a; Moderate; Employee Recognition Programs; p. 235) {AACSB: Analytic Skills}

142

53.

Which of the following is a form of recognition? a. personal congratulations b. job enlargement c. job sharing d. flexible benefit packages e. profit sharing (a; Easy; Employee Recognition Programs; p. 235) 54. Researchers report that which of the following was considered by employees to be the most powerful workplace motivator? a. recognition b. money c. opportunity for advancement d. autonomy e. vacation time (a; Moderate; Employee Recognition Programs; p. 235) Global Implications 55. According to one study, you would expect that the relationship between intrinsic job characteristics and job satisfaction would be weaker for employees from which country? a. United States b. Britain c. China d. Germany e. Canada (c; Moderate; Job Characteristics Model; p. 237) {AACSB: Multicultural and Diversity} 56. Today, what are offered by almost all U.S. corporations and are becoming the norm in other countries? a. employee involvement b. variable-pay programs c. ESOPs d. flexible benefits e. employee recognition programs (d; Moderate; Flexible Benefits; p. 238) {AACSB: Multicultural and Diversity} 57. Why were managers in India rated low by employees? a. They changed their pay to piece-rate pay. b. They changed the traditional benefits package to a flexible benefits plan. c. They tried to empower their employees through employee involvement programs. d. They refused to allow them to telecommute. e. Their jobs had more intrinsic motivators than extrinsic motivators. (c; Challenging; Employee Involvement Programs; p. 238) {AACSB: Multicultural and Diversity} TRUE/FALSE Motivating by Job Design: The Job Characteristics Model 58. The JCM model consists of task significance, feedback, meaningfulness, and autonomy. (False; Challenging; Job Characteristics Model; pp. 215-216)

143

59.

The dimensions of the JCM that create meaningfulness include task identity, skill variety, and task significance. (True; Moderate; Job Characteristics Model; p. 216) 60. Jobs that are high on motivating potential must be high on at least one of the three factors that lead to experienced meaningfulness, and they must be high on both autonomy and feedback. (True; Moderate; Motivating Potential Score; p. 216) 61. Jobs that have the intrinsic elements of variety, identity, significance, autonomy, and feedback are more satisfying and generate higher performance from people than jobs that lack these characteristics. (True; Easy; Job Characteristics Model; p. 216) How Can Jobs Be Redesigned? 62. Job enrichment, job sharing, and job rotation are all job redesign options. (False; Moderate; Ways to Redesign Jobs; pp. 218-220) 63. The strengths of job rotation are that it eliminates boredom, increases motivation, and increases productivity. (False; Challenging; Job Rotation; p. 218) 64. In job rotation, the nature of the work performed is changed. (False; Moderate; Job Rotation; p. 218) 65. Most employees do not view efforts at job enlargement enthusiastically. (True; Moderate; Job Enlargement; p. 219) 66. Job enrichment increases the degree to which the worker controls the execution of company plans. (False; Moderate; Job Enrichment; p. 220) 67. The overall evidence on job enrichment generally shows that it increases satisfaction, reduces absenteeism, and reduces turnover costs. (True; Moderate; Job Enrichment; p. 220) Alternative Work Arrangements 68. The scheduling options of flextime, job sharing, and telecommuting are all approaches to make the workplace environment more motivating. (True; Moderate; Alternative Work Arrangements; p. 221) 69. Job rotation, flextime, and job sharing are all designed to increase employee flexibility. (False; Moderate; Alternative Work Arrangements; p. 221) Employee Involvement 70. Participative management implies joint decision making and equal decision-making roles. (False; Moderate; Participative Management; p. 225) 71. Participative management has had a profound influence on employee productivity and motivation. (False; Moderate; Participative Management; p. 226) 72. Participation typically has only a modest influence on variables such as motivations and job satisfaction. 144

(True; Easy; Participation-Performance Relationship; p. 226) 73. The laws of the United States require companies to have elected representatives from their employee groups as members of their board of directors. (False; Moderate; Representative Participation; p. 226) 74. If one is interested in changing employee attitudes or in improving organizational performance, representative participation would be a good choice. (False; Challenging; Representative Participation; p. 226) 75. The two most common forms that representative participation takes are works councils and board representatives. (True; Moderate; Representative Participation; p. 226) 76. Work councils are employees who sit on a companys board of directors and represent the interests of the firms employees. (False; Moderate; Work Councils; p. 226) 77. Quality circles became popular in North America during the 1980s. (True; Moderate; Quality Circles; p. 226) 78. Quality circles have the authority to find problems, assess alternative actions, and implement a solution. (False; Moderate; Quality Circles; p. 226) 79. Quality circles have been a big success in businesses using them. (False; Moderate; Quality Circles; p. 226) 80. The lack of planning and top management commitment often contributed to quality circle failures. (True; Challenging; Quality Circles; p. 227) 81. Theory X is consistent with participative management. (False; Easy; Employee Involvement and Motivation Theories; p. 227) 82. Theory X aligns with autocratic management while Theory Y aligns with participative management. (True; Moderate; Employee Involvement and Motivation Theories; p. 227) 83. Employee involvement programs could provide employees with intrinsic motivation by increasing opportunities for growth and responsibility. (True; Moderate; Employee Involvement and Motivation Theories; p. 227) 84. Employee involvement is compatible with ERG Theory and efforts to achieve the affiliation need. (False; Challenging; Employee Involvement and Motivation Theories; p. 227) Using Rewards to Motivate Employees 85. Variable-pay compensation pays people for the time they spend on the job and seniority. (False; Easy; Variable-Pay Programs; p. 228) 86. Employee compensation will decline if performance declines in variable-pay programs. (True; Moderate; Variable-Pay Programs; p.228) 87. Piece-rate wages are a traditional form of variable pay compensation. (True; Moderate; Piece-Rate Plan; p. 229) 145

88.

People who sell peanuts at ballparks and keep $.75 for every bag of peanuts they sell are being paid piece-rate wages. (True; Moderate; Piece-Rate Plan; p. 229) 89. Piece-rate plans are based on group productivity. (False; Moderate; Piece-Rate Plan; p. 229) 90. Pay for performance means the employees have to share in the risks as well as the rewards of their employers business. (False; Moderate; Merit-Based Pay; p. 230) 91. Skill-based pay encourages employees to concentrate on one or two highly desirable skills. (False; Moderate; Skill-Based Pay; p. 231) 92. From managements perspective, the greatest appeal of skill-based pay plans is decreased payroll costs. (False; Moderate; Skill-Based Pay; p. 231) 93. Skill-based pay plans encourage people to specialize. (False; Moderate; Skill-Based Pay; p. 231) 94. Profit-sharing programs may be direct cash outlays or allocations of stock options. (True; Moderate; Profit-Sharing; pp. 231-232) 95. Gainsharing and profit-sharing are the same. (False; Easy; Profit-Sharing and Gainsharing; p. 232) 96. An employee in a gainsharing plan can receive incentive awards even if the organization isnt profitable. (True; Moderate; Gainsharing; p. 232) Flexible Benefits: Developing a Benefits Package 97. Traditional benefit packages were designed for the typical employee of the 1950s: a stereotype that now fits fewer than 10% of employees. (True; Moderate; Flexible Benefits; p. 234) 98. Flexible spending plans allow employees to set aside up to the dollar amount offered in the plan to pay for particular services. (True; Moderate; Flexible Spending Accounts; p. 234) Intrinsic Rewards: Employee Recognition Programs 99. Studies show that financial incentives are more motivating in the long-run. (False; Moderate; Employee Recognition Programs; p. 235) 100. One of the most expensive motivation programs is that which recognizes an employees superior performance. (False; Easy; Employee Recognition Programs; p. 235)

146

SCENARIO-BASED QUESTIONS Application of Job Redesign and Scheduling Allied General Hospital employs many individuals and has decided to try to increase motivation through job redesign and flexible scheduling. You have been hired as a consultant to help them design and implement the programs. 101. You are looking at flextime and realize that it will probably work least well for which of the following jobs? a. insurance billers b. custodial workers c. floor nurses d. equipment maintenance staff e. IT personnel (c; Challenging; Flextime; p. 222) {AACSB: Analytic Skills} 102. Members of the nighttime janitorial staff are generally low skilled and would probably be motivated by _____. a. job enrichment b. flexible work hours c. job enlargement d. all of the above e. none of the above (d; Challenging; Job Redesign and Alternative Work Arrangements; pp. 218-221) {AACSB: Analytic Skills} Application of Employee Involvement Programs Your supervisor has heard that employee involvement is important and you have been instructed to research various methods of employee involvement. You are supposed to help assist in the analysis of the probable effects of each of the programs being considered. 103. Your supervisor proposes that participative management will solve your productivity, motivation, and job performance problems. Which of the following is not a warning you should give him about this approach? a. Employees will only be motivated by decisions on issues in relevant to their interests. b. Research shows it has only a modest influence on all these variables. c. It will provide intrinsic rewards for employees. d. It is not a sure means for improving employee performance. e. Employees must have competence and knowledge if they are to make a useful contribution. (c; Easy; Participative Management; p. 226) {AACSB: Analytic Skills}

147

104.

You have decided to let employees select a small group to represent them and work with management. This is termed _____. a. representative participation b. an ESOP c. quality circles d. participative management e. an AESOP (a; Moderate; Representative Participation; p. 226) {AACSB: Analytic Skills} 105. A group of employees will meet regularly to discuss problems and recommend action. This group is a(n) _____. a. ESOP b. works council c. MBO cluster d. quality circle e. matrix team (d; Moderate; Quality Circles; p. 226) {AACSB: Analytic Skills} Application of Skill-Based Pay Plans Amalgamated Industries manufactures parts for furniture. Management has decided to change the method of payment to a skill-based plan. You are interested in increasing your current compensation and see this as an opportunity. 106. You should expect to earn more if you _____. a. volunteer for overtime b. increase your production c. cross-train in other jobs d. become a specialist e. master common skills (c; Moderate; Skill-Based Pay; p. 231) {AACSB: Analytic Skills} 107. As a manager, you like the plan because it allows _____. a. protection of territory b. flexibility c. elimination of workers d. decreased payroll costs e. increased control (b; Moderate; Skill-Based Pay; p. 231) {AACSB: Analytic Skills} 108. Which of the following may be a disadvantage of introducing this type of pay plan? a. Employees will become less motivated. b. Employees will become more specialized. c. Employees will tend not to work as hard as before. d. Your employer may pay for skills that they arent using. e. Your employer will have less control over what each employee does. (d; Moderate; Skill-Based Pay; p. 231) {AACSB: Analytic Skills}

148

Application of Flexible Benefits Your workforce is diverse in terms of their needs for benefits. Jim is married with two children and his wife is at home full time. Janet is single and supports her widowed mother. Bob is married and his wife has a high-paying job. You decide that you want to devise a benefits program which is tailored to their individual needs. 109. What sort of benefit program would probably be the best choice? a. a traditional benefit program b. a flexible benefit program c. letting them purchase their own benefits d. an ESOP e. an AESOP (b; Easy; Flexible Benefits; p. 234) {AACSB: Analytic Skills} 110. You should expect that the flexible benefits program will be all of the following except _____. a. less expensive b. consistent with expectancy theory c. more responsive to individual needs d. motivational e. effective in reducing turnover (a; Moderate; Flexible Benefits; p. 234) {AACSB: Analytic Skills} 111. What sort of plan would provide pre-designed packages of benefits, put together to meet the needs of a specific group of employees? a. flexible spending b. core-plus c. cafeteria d. modular e. customized (d; Easy; Modular Benefit Plan; p. 234) {AACSB: Analytic Skills} SHORT DISCUSSION QUESTIONS 112. What is participative management? Give some examples of its use in organizations. All participative management programs use joint decision making. That is, subordinates actually share a significant degree of decision-making power with their immediate superiors. Participative management has, at times, been promoted as a panacea for poor morale and low productivity. But for it to work, the issues in which employees get involved must be relevant to their interests so theyll be motivated, employees must have the competence and knowledge to make a useful contribution, and there must be trust and confidence between all parties involved. (Easy; Participative Management; pp. 225226) {AACSB: Analytic Skills} 113. What is a quality circle? A quality circle is a work group of eight to ten employees and supervisors who have a shared area of responsibility. They meet regularly to discuss their quality problems, investigate causes of the problems, recommend solutions, and take corrective actions. (Easy; Quality Circle; p. 226) {AACSB: Analytic Skills}

149

114.

What are skill-based pay plans? Skill-based pay is an alternative to job-based pay. Rather than having an individuals job title define his or her pay category, skill-based pay sets pay levels on the basis of how many skills employees have or how many jobs they can do. It is also called competencybased or knowledge-based pay. (Easy; Skill-Based Pay; p. 231) {AACSB: Analytic Skills}

115.

How are flexible benefits linked with expectancy theory? Giving all employees the same benefits assumes, falsely, that all employees have the same needs. Thus, flexible benefits turn the benefits expenditure into a motivator. Consistent with expectancy theorys thesis that organizational rewards should be linked to each individual employees goals, flexible benefits individualize rewards by allowing each employee to choose the compensation package that best satisfies his or her current needs. (Easy; Flexible Benefits; p. 234) {AACSB: Analytic Skills}

MEDIUM LENGTH DISCUSSION QUESTIONS 116. Explain the three job redesign options.

a) Job rotation. This is the practice of periodically shifting an employee from one task to
another. When an activity is no longer challenging, the employee is rotated to another job, usually at the same level, that has similar skill requirements. b) Job enlargement. This is the expansion of jobs horizontally; increasing the number and variety of tasks that an individual performs. Instead of only sorting the incoming mail by department, for instance, a mail sorters job could be enlarged to include physically delivering the mail to the various departments or running outgoing letters through the postage meter. c) Job enrichment. Job enrichment refers to the vertical expansion of jobs. It increases the degree to which the worker controls the planning, execution, and evaluation of his or her work. An enriched job organizes tasks so as to allow the worker to do a complete activity, increases the employees freedom and independence, increases responsibility, and provides feedback, so an individual will be able to assess and correct his or her own performance. (Moderate; Job Redesign; pp. 218-220) {AACSB: Analytic Skills} 117. Evaluate the variable-pay programs. What do studies say about their effect on employees motivation and productivity? Variable-pay programs increase motivation and productivity. For example, studies generally support the idea that organizations with profit-sharing plans have higher levels of profitability than those without them. Similarly, gainsharing has been found to improve productivity in a majority of cases and often has a positive impact on employee attitudes. Another study found that whereas piece-rate pay-for-performance plans stimulated higher levels of productivity, this positive affect was not observed for risk-averse employees. Thus, in general, what economic Ed Lazear has said seems generally right-- Workers respond to prices just as economic theory predicts. Claims by sociologists and others that monetizing incentives may actually reduce output are unambiguously refuted by the data. But that doesnt mean everyone responds positively to variable pay plans. (Moderate; Variable-Pay Programs; pp. 228-229) {AACSB: Analytic Skills}

150

118.

Discuss the cross-cultural differences in flexible benefits. Today, almost all major corporations in the United States offer flexible benefits. And theyre becoming the norm in other countries too. For instance, a recent survey of 136 Canadian organizations found that 93 percent have adopted or will adopt flexible benefits in the near term. And a similar survey of 307 firms in the United Kingdom found that while only 16 percent have flexible benefit programs in place, another 60 percent are either in the process of implementing them or are seriously considering it. (Easy; Flexible Benefits; p. 238) {AACSB: Multicultural and Diversity} {AACSB: Analytic Skills}

COMPREHENSIVE ESSAYS 119. What is employee involvement? Give three examples. Employee involvement is defined as a participative process that uses the entire capacity of employees and is designed to encourage increased commitment to the organizations success. The underlying logic is that by involving workers in those decisions that affect them and by increasing their autonomy and control over their work lives, employees will become more motivated, more committed to the organization, more productive, and more satisfied with their jobs. Examples of employee involvement include a) Participative management. Participative management programs use joint decision making. Subordinates actually share a significant degree of decision-making power with their immediate superiors. b) Representative participation. Representative participation refers to worker representation by a small group of employees who actually participate on the board. The goal is to redistribute power within an organization, putting labor on a more equal footing with the interests of management and stockholders. c) Quality circles. A quality circle is a group of eight to ten employees and supervisors who have a shared area of responsibility. They meet regularly to discuss their quality problems, investigate causes of the problems, recommend solutions, and take corrective action. (Moderate; Employee Involvement; pp. 225-226) {AACSB: Analytic Skills}

151

120.

List and describe different variable-pay programs. Be sure to include piece-rate plans, profitsharing plans, and gainsharing.

a) Piece-rate plans. In piece-rate pay plans, workers are paid a fixed sum for each unit of b) c) d) e) f) g)
production completed. When an employee gets no base salary and is paid only for what he or she produces, this is a pure piece-rate plan. Merit-based pay. Merit-based pay plans also pay for individual performance. However, unlike piece-rate plans, which pay based on objective output, merit-based pay plans are based on performance appraisal ratings. Profit-sharing . Profit-sharing plans are organization wide programs that distribute compensation based on some established formula designed around a companys profitably. Bonuses. Bonuses can be paid exclusively to executives or to all employees. Many companies now routinely reward production employees with bonuses in the thousands of dollars when company profits improve. Skill-Based Pay. Skill-based pay (also called competency-based or knowledge-based pay) sets pay levels on the basis of how many skills employees have or how many jobs they can do. ESOPs. Employee stock ownership plans (ESOPs) are company-established benefit plans in which employees acquire stock, often at below-market prices, as part of their benefits. Gainsharing . Gainsharing is a formula-based group incentive plan. Improvements in group productivity determine the total amount of money that is to be allocated. By focusing on productivity gains rather than profits, gainsharing rewards specific behaviors that are less influenced by external factors. Employees in a gainsharing plan can receive incentive awards even when the organization isnt profitable. (Challenging; Variable-Pay Programs; pp. 229-233) {AACSB: Analytic Skills}

121.

Discuss the cross-cultural differences in telecommuting. First, compared to the European Union, one study suggests that telecommuting is more common in the United States than in all the EU nations except the Netherlands. In the study, roughly one-quarter (24.6%) of U.S. employees engaged in telecommuting, compared to only 13.0% of EU employees. Of the EU countries, the Netherlands had the highest rate of telecommuting (26.4%); the lowest rates were in Spain (4.9%) and Portugal (3.4%). Thus, telecommuting appears to be more common in the U.S. than in Europe. What about the rest of the world? Unfortunately, there is very little data comparing telecommuting rates in other parts of the world. Similarly, we dont really know whether telecommuting works better in the United States than in other countries. However, the same study that compared telework rates between the United States and EU did determine that employees in Europe appeared to have the same level of interest in telework: regardless of country, interest is higher among employees than employers. (Challenging; Telecommuting; pp. 237-238) {AACSB: Multicultural and Diversity} {AACSB: Analytic Skills}

152