Which of the following is not characteristic of a compensation and reward system designed to help drive successful strategy execution?

Which of the following is not characteristic of a compensation and reward system designed to help drive successful strategy execution?

A. Tying incentives to performance outcomes directly linked to good strategy execution and financial performance
B. Keeping the time between achieving the target performance outcome and the payment of the reward as short as possible
C. Making sure that the performance targets that each individual or team is expected to achieve involve outcomes that the individual or team can personally affect
D. Generous rewards for people who turn in outstanding performances
E. A reward system that involves 50 percent non-monetary rewards and a work environment that avoids placing pressure on managers and employees to perform at high levels

Answer: E

Which of the following is not a sound guideline for designing a reward and incentive system that helps promote good strategy execution?

Which of the following is not a sound guideline for designing a reward and incentive system that helps promote good strategy execution?

A. The reward system must be administered with scrupulous objectivity and fairness.
B. The payoff for meeting or beating performance targets must be a major, not minor, piece of the total compensation package.
C. The incentive plan should extend to all managers and all employees, not just top management.
D. Ways must be found to reward deserving non-performers who, for some reason, do not fare well under the incentive system.
E. Make sure that the performance targets each individual or team is expected to achieve involve outcomes that the individual or team can personally affect.

Answer: D

The guidelines for designing an incentive compensation system that will help drive successful strategy execution include

The guidelines for designing an incentive compensation system that will help drive successful strategy execution include

A. making the payoff for meeting or beating performance targets a major, not minor, piece of the total compensation package.
B. having a bonus and incentive plan that applies to managers only (employees should generally not be included in incentive pay plans but should have attractive wages and salaries).
C. having an outside wage and salary expert administer the system, so that there is no doubt as to its fairness and impartiality.
D. basing the incentives on group performance rather than individual performance.
E. making minimal use of non-monetary incentives and rewarding people for diligently performing their assigned duties.

Answer: A

An important consideration in designing a strategy-supportive reward system is to

An important consideration in designing a strategy-supportive reward system is to

A. link the payment of all monetary rewards to the company's profitability.
B. employ incentives that will help motivate employees to put in long hours and sacrifice personal ambitions and aspirations to pursue the priorities of management.
C. choose those types of rewards and incentives that will focus employees' attention on total customer satisfaction.
D. make across-the-board wage and salary increases the cornerstone of monetary rewards.
E. make non-monetary rewards and recognition an integral part of the reward system.

Answer: E

A well-designed reward system

A well-designed reward system

A. aligns the well-being of organization members with their contributions to competent strategy execution and the achievement of performance targets.
B. should be free of elements that induce stress, anxiety, tension, pressure to perform, and job insecurity.
C. puts the primary emphasis on denying rewards to those who fail to perform tasks in the prescribed fashion.
D. emphasizes weeding out employees who are consistently low performers.
E. strives for 50-50 balance between positive and negative rewards and 50-50 balance between monetary and non-monetary rewards.

Answer: A

The most dependable way to keep people focused on strategy execution and the achievement of performance targets is to

The most dependable way to keep people focused on strategy execution and the achievement of performance targets is to

A. establish ethical compensation policies and convince employees that they are the firm's most valuable competitive asset.
B. design monetary and non-monetary incentives that boost labor productivity and help lower the firm's overall labor costs.
C. generously reward and recognize people who meet or beat performance targets and to deny rewards and recognition to those who don't.
D. pay employees a bonus for each strategic and financial objective that the company achieves.
E. allow employees to propose what rewards they would like to receive to achieve the company's stretch objectives.

Answer: C

Motivational and incentive compensation practices that aim at winning the commitment of company personnel to good strategy execution typically

Motivational and incentive compensation practices that aim at winning the commitment of company personnel to good strategy execution typically

A. use only positive rewards and never involve the use of tension, fear, job insecurity, stress, or anxiety.
B. strike a middle ground—entailing decidedly positive rewards for meeting or beating performance targets but also imposing sufficiently negative consequences when actual performance falls short of the target.
C. aim at creating a no-pressure/no-adverse-consequences work environment.
D. entail paying the highest wages and salaries in the industry and also stressing non-monetary rewards for high-performing employees.
E. put top priority on making employees happy and secure in their jobs.

Answer: B

A reward system that accentuates positive rewards for good performance

A reward system that accentuates positive rewards for good performance

A. works best in strong culture organizations, while negative motivational approaches and reward systems tend to be most successful in weak culture organizations.
B. is especially effective in aligning the well-being of organizational members with achieving the company's performance targets; reward systems with negative elements tend to be very dysfunctional in motivating employees.
C. seldom works very well because the threat of denying rewards to sub-par performers is typically the most powerful motivator.
D. works fine so long as 100% emphasis is placed on monetary incentives.
E. has considerable appeal because when cooperation is positively enlisted and rewarded, rather than strong-armed by orders and threats (implicit or explicit), people tend to respond with more enthusiasm, dedication, creativity, and initiative.

Answer: E

From the standpoint of promoting successful strategy execution, it is important that the firm's motivation and reward system

From the standpoint of promoting successful strategy execution, it is important that the firm's motivation and reward system

A. be completely free of such elements as tension, pressure, anxiety, job insecurity, and tight deadlines—a no-pressure/no-adverse-consequences work environment is essential.
B. emphasize only positive types of rewards.
C. accentuate positive rewards but also carry the risk of punishment for poor performance.
D. not deny rewards to employees who put forth good effort and try hard.
E. reduce job insecurity and give employees an incentive to stay busy and work hard.

Answer: C

A motivation and incentive system that is aimed at spurring stronger employee commitment to good strategy execution

A motivation and incentive system that is aimed at spurring stronger employee commitment to good strategy execution

A. should focus on incorporating more positive than negative motivational incentives.
B. should be tied first and foremost to whether employees satisfactorily perform their assigned duties in an ethical and honorable manner.
C. must involve deliberately assigning employees heavy workloads and tight deadlines.
D. needs to put top priority on making employees happy and secure in their jobs.
E. must avoid the potential for negative consequences if performance is subpar.

Answer: A

Which one of the following is not likely to be effective in trying to gain employees' wholehearted commitment to good strategy execution and operating excellence?

Which one of the following is not likely to be effective in trying to gain employees' wholehearted commitment to good strategy execution and operating excellence?

A. Aggressive management efforts to eliminate stress, anxiety, and job insecurity from the work environment
B. Extensive use of such non monetary carrot-and-stick incentives as frequent words of praise (or constructive criticism), special recognition at company gatherings, and being given stimulating assignments
C. More (or less) job security, and opportunities for high-performing employees to transfer to attractive locations
D. Opportunities for rapid promotion (or the risk of being sidelined in a routine job)
E. Performance bonuses

Answer: A

In trying to gain employees' wholehearted commitment to good strategy execution and operating excellence, managers are well advised to use such incentives as

In trying to gain employees' wholehearted commitment to good strategy execution and operating excellence, managers are well advised to use such incentives as

A. attractive perks and fringe benefits.
B. frequent words of praise, special recognition at company gatherings, stimulating assignments, and opportunities to transfer to attractive locations.
C. more (or less) job security.
D. opportunities for rapid promotion (or the risk of being sidelined).
E. All of these.

Answer: E

Enlisting employees' sustained and energetic commitment to good strategy execution and achievement of the targeted strategic and financial objectives is best done by

Enlisting employees' sustained and energetic commitment to good strategy execution and achievement of the targeted strategic and financial objectives is best done by

A. having top executives commit to making employees the company's most valuable competitive asset.
B. developing core competencies in the use of TQM, Six Sigma programs, and business process reengineering.
C. resourceful and effective use of motivational incentives, both monetary and non-monetary.
D. clever and innovative use of benchmarking and best practices.
E. providing employees with a high degree of job security and attractive perks.

Answer: C

The strategic role of a company's reward system is to

The strategic role of a company's reward system is to

A. compensate employees for performing their assigned duties in a diligent fashion.
B. boost employee morale in ways that create widespread job satisfaction.
C. enlist employees' energetic commitment to competent strategy execution and operating excellence by rewarding them, both monetarily and non-monetarily, for their contributions.
D. relieve managers of the burden of closely monitoring each employee's performance.
E. boost labor productivity and help lower the firm's overall labor costs.

Answer: C

Management's most powerful tool for winning employee commitment to good strategy execution and operating excellence is

Management's most powerful tool for winning employee commitment to good strategy execution and operating excellence is

A. the establishment of strategy-supportive policies and procedures.
B. empowering employees and encouraging them to adopt best practices.
C. setting stretch objectives.
D. a system of rewards and incentives tied tightly to the achievement of the targeted strategic and financial performance.
E. aggressive use of TQM and Six Sigma quality control programs.

Answer: D

Management's most powerful tool for mobilizing employee commitment to competent strategy execution and operating excellence is

Management's most powerful tool for mobilizing employee commitment to competent strategy execution and operating excellence is

A. diligent and persistent use of benchmarking and best practices.
B. proper use of incentives and rewards.
C. TQM and/or Six Sigma programs.
D. periodic inspirational speeches aimed at arousing employees' emotional energy.
E. providing employees with a high degree of job security (ideally, via a no-layoff policy).

Answer: B

Information systems provide managers with a means for monitoring

Information systems provide managers with a means for monitoring

A. daily team performance in real time.
B. the performance of empowered workers to see that they are acting within the specified limits.
C. daily and weekly operating statistics.
D. All of these.
E. None of these.

Answer: D

The areas that information systems need to cover include all but which one of the following?

The areas that information systems need to cover include all but which one of the following?

A. Financial performance data
B. Corporate culture data
C. Customer data
D. Operations data
E. Employee data

Answer: B

The areas that information systems need to cover include

The areas that information systems need to cover include

A. Financial performance data
B. Supplier/partner/collaborative data
C. Customer data
D. Operations data
E. All of these

Answer: E

Well conceived, state-of-the-art information and operating systems

Well conceived, state-of-the-art information and operating systems

A. are essential because business process reengineering efforts, TQM, Six Sigma, and benchmarking programs can't be carried out effectively without them.
B. not only enable better strategy execution but also strengthen organizational capabilities (perhaps enough to provide a competitive edge over rivals).
C. make it simple and easy to spot cost overruns and inefficiencies.
D. are valuable tools for shortening a company's value chain, boosting work force morale and productivity, and simplifying the task of adopting best practices.
E. All of these.

Answer: B