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Increases product complexity and shorten product life

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Increases product complexity and shorten product life cycle Committed to agile, risk-taking, innovative people Market-based pay Cost cutter Focuses on efficiency Does more with less Increases variable pay Customer focused Increases customer expectations Delights customer, exceed expectations Value of jobs and skills based on customer contact The correct alternative is 4. See chapter 2, “Support business strategy”, exhibit 2.3 in the prescribed book. The innovator stresses new products and quick responses to market trends. A supporting compensation approach places less emphasis on evaluating skills and jobs and more emphasis on incentives designed to
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11 MNH306K/201 encourage innovations. The cost cutter’s efficiency-focused strategy stresses doing more with less by minimising costs, encouraging productivity increases, and specifying in greater detail exactly how jobs should be performed. The customer-focused business strategy stresses delighting customers and bases employee pay on how well they do this. Options 1, 2 and 3 are therefore incorrect. 20 A theory of equitable wage for any occupation based on that occupation’s place in the larger social hierarchy is a description of: 1 “line-of-sight” 2 just wage doctrine 3 equity theory 4 tournament theory The correct alternative is 2. See chapter 2, “Cultures and customs” in the prescribed book, as well as the glossary at the end of the book. According to the just wage doctrine , pay structures should be designed on the basis of societal norms, customs, and tradition, not on the basis of economic and market forces. Line-of-sight is an employee’s ability to see how individual performance affects incentive payout. Employees on a straight piecework pay system have a clear line of sight – their pay is a direct function of the number of units they produce; employees participating in profit sharing have a fuzzier line of sight – their payouts are a function of many forces, of which individual performance is only one. Equity theory proposes that in exchange relationships the equality of outcome/input ratios between a person and a comparison other (a standard or relevant person/group) will determine fairness and equity. If the ratios diverge, the person will perceive there to have been unfairness and inequity. Tournament theory proposes that larger differences in pay are more motivating than smaller differences. Pay increases should get successively greater as one moves up the job hierarchy. Differences between the top and the second-highest job should be the largest. Options 1, 3 and 4 are therefore incorrect. 3 CONCLUDING REMARKS I trust that you have found these explanations helpful. You are welcome to contact me if you experience any academically related problems. Wishing you every success in your studies! Mrs M Bezuidenhout Lecturer for MNH306K Department of Human Resource Management Unisa
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