Ch 1 *Vanessa - Done Flashcards Preview

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Flashcards in Ch 1 *Vanessa - Done Deck (31)
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1
Q

Compensation definition

A

all forms of financial returns and tangible services and benefits that ee’s receive as part of an ee relationship

2
Q

Compensation perspective

from society:

A
  • Measure of justice - gender age gap

* Consumers see compensation as the cause of price increases

3
Q

Compensation perspective

from stakeholders:

A

. • Compensation matters
• Some believe - Using stocks to pay ee’s increases ownership and improve performance and increase stockholder wealth
• Stock holders have an interest in executive compensation

4
Q

Compensation perspective From managers:

A

.Influence success of org.
· Major expense
· Influence ee behaviors

5
Q

Compensation perspective From employees:

A

Financial security

Entitlement, reward, return on investment/contributions

6
Q

Compensation perspective globally

A

Contrasting perspectives

7
Q

two Forms of pay

A

total rewards

relational returns

8
Q

total rewards def.

A

include cash compensation, benefits, and relational returns

9
Q

relational rewards def.

A
psychological returns ee's believe they receive in the workplace 
	· Learning opportunities
	· Recognition
	· Status
	· Challenging work
10
Q

total comp. def

A
pay received directly as cash and indirectly as benefits 
	· Base pay
	· Merit increase
	· Incentives
	· Cost of living adjustments
	· Pensions
	· Healthcare
	· Life insurance program
11
Q

Base pay def

A

cash compensation ee receives for the work performed

· Reflects value of work or skills ignores differences attributable to ind. Ee’s

12
Q

Merit increase:

A

increment to base pay in recognition of past work behaviour

13
Q

Cost of living adjustments:

A

% increment to base pay provided to all ee’s regardless of performance

14
Q

Incentive def

A

one-time payments for meeting pre-established performance obj. in a future time period

15
Q

Difference between incentive and merit increase

A

○ Incentives do not increase base pay
○ Incentive payment size is known before hand
○ Merit bay evaluates past performance, incentive pay what is expected is known before hand

16
Q

Incentives are known as variable pay, because…

A

when performance declines, incentives automatically decline

17
Q

Long term incentives:

A

focus ee efforts on multi-year results
· Stock ownership/options to buy stock
· Companies believe that having a stake in the company supports a culture of ownership

18
Q

Benefits

A

insurance and pension

Cost of providing benefits has been rising, they are regarded as an increasingly important form of compensation

19
Q

Benefits work life programs:

A

better integration of work and life responsibilities

20
Q

Benefits: Allowances

A

compensation to provide for items that in in short supply

Example, china-apartment, transportation, rice allowance

21
Q

Present Value of a stream of Earnings:

A

PV perspective shifts the choice from comparing todays initial offers to consideration of future bonuses , merit increases, and promotions

22
Q

Relational Returns of Work:

A

recognition and status, employment security, challenging work, and learning opportunities
· Apart of total awards

23
Q

The organization as a network of returns is most useful when..

A

· network of returns is more likely to be useful if bonuses, development opportunities, and promotions all work together.
· Compensation is only one of many factors affecting peoples decision about work

24
Q

Pay Model def

A

framework for examining a current pay system

25
Q

Pay model contains three basic building blocks..

A
  1. The strategic compensation obj
    1. The strategic policies that form the foundation of the compensation system
    2. The techniques of compensation
26
Q

Strategic Compensation Objectives:

A

Attract, retain, and motivate while maintaining efficiency, fairness and legal compliance

27
Q

Strategic Compensation Objectives ethical dilemmas

A

○ Manipulating results to ensure larger executive bonuses
○ Misusing statistics to measure competitors pay rates
○ Re-pricing or back dating stock options to increase value
○ Offering just enough pay to get hires in the door

Managers must make ethical decisions

28
Q

Strategic Compensation Objectives purposes…

A

guide the design of the pay system, standard for judging the success of the pay system

29
Q

Four Policy choices

A
  • Internal alignment
    • External competiveness
    • Employee contribution-relative emphasis placed on employee perf.
    • Management- policies related to managing the pay system
30
Q

Socio-cultural environment

A

Be sensitive to these choices
Individualism/collectivism
Power distance
Uncertainty avoidance

31
Q

Two views of work culture:

A

Descriptive: how people actually behave
Prescriptive: what behaviour should be