Deck 2: Strategy: the Totality of Decisions

Question 1

According to the steps involved in formulating a total compensation strategy, which of the following is the step that follows the assessment of total compensation implications?

A)realigning as conditions change
B)mapping a total compensation strategy
C)implementing strategy
D)implementing cultural and regulatory changes
E)reassessing the fit

Answer 1

B

Question 2

A business practice or process that results in better performance than one's competitors is known as _.

A)association perspective
B)competitive advantage
C)strategic alliance
D)strategic perspective
E)planned perception

Answer 2

B

Question 3

Which of the following pay strategies is a source of competitive advantage?

A)a pay strategy that specifies low base pay and high job security
B)a pay strategy that overemphasizes on outstanding employee performance and commitment
C)a pay strategy that ignores individual attitudes and preferences
D)a pay strategy that adds value and is difficult for employers to imitate
E)a pay strategy that emphasizes on work/life programs over cash compensation and giving only limited bonuses and no stock awards

Answer 3

D

Question 4

Which of the following is the final step in the development of the total compensation strategy?

A)assessing total compensation implications
B)reassessing the fit
C)implementing strategy
D)mapping a total compensation strategy
E)implementing cultural and regulatory changes

Question 5

Which of the following is the first step in the development of the total compensation strategy?

A)mapping a total compensation strategy
B)reassessing the fit
C)implementing strategy
D)assessing total compensation implications
E)realigning as strategy changes

Question 6

A supporting compensation approach for an innovator:

A)stresses delighting customers and bases employee pay on how well they do this.
B)seldom stresses on innovations or risk taking.
C)stresses doing more with less by minimizing costs and specifying in greater detail exactly how jobs should be performed.
D)places less emphasis on evaluating skills and jobs and more emphasis on incentives designed to encourage innovations.
E)focuses on system control and work specifications.

Question 7

According to the pay model, the strategic compensation decisions regarding management involve:

A)how pay increases should be based.
B)how the different types and levels of skills and work should be paid within the organization.
C)how total compensation should be positioned against competitors.
D)how open and transparent the pay decisions should be to all employees.
E)how compensation should support the business strategy and be adaptive to the cultural and regulatory pressures in a global environment.

Question 8

Which of the following statements is true about assessing the total compensation implications?

A)The pay system seldom mirrors a company's image and reputation.
B)A highly centralized and confidential pay system controlled by a few people in a corporate unit will support a highly decentralized, flexible, open organization.
C)A pay system reflects the values that guide an employer's behaviour and underlie its treatment of employees.
D)Internationally, the role of unions in pay determination seldom varies.
E)Pay can neither play a supporting role, as in the high performance approach, nor can it take the lead and be a catalyst for change.

Question 9

Which of the following is a step in the development of the total compensation strategy that deals with competitive dynamics?

A)implementing strategy
B)mapping a total compensation strategy
C)assessing total compensation implications
D)reassessing the fit
E)implementing cultural and regulatory progress

Question 10

Which of the following organizational practices assumes that rather than focusing on only one dimension of the pay strategy, such as pay for performance or internal pay differences, all dimensions need to be considered together?

A)internal alignment
B)compensation strategy
C)external competitiveness
D)managing compensation
E)employee contributions

Question 11

Internal alignment suggests that:

A)paying higher than the average wage offered by competitors can affect results.
B)rather than focusing on only one dimension of the pay strategy, such as pay for performance or internal pay differences, all dimensions need to be considered together.
C)both smaller and larger pay differences among jobs inside an organization can affect results.
D)embedding compensation strategy within the broader HR strategy affects results.
E)performance-based pay can affect results.

Question 12

Mapping a total compensation strategy includes setting objectives and specifying policies on _.

A)contributions
B)social and political context
C)employee/union needs
D)HR systems
E)core culture/values

Question 13

A pay strategy is a source of competitive advantage:

A)if it rarely aligns.
B)if it offers stock options.
C)if it seldom provides value.
D)if it defers taxes.
E)if it differentiates.

Question 14

Which of the following is a step in the formulation of the total compensation strategy that deals with setting objectives and specifying policies on alignment, competitiveness, contributions, and management?

A)reassessing the fit
B)implementing strategy
C)implementing cultural and regulatory changes
D)assessing total compensation implications
E)deciding on a total compensation strategy

Question 15

Which of the following is a step in the formulation of the total compensation strategy that deals with employee or union needs?

A)implementing strategy
B)implementing cultural and regulatory changes
C)reassessing the fit
D)mapping a total compensation strategy
E)assessing total compensation implications

Question 16

Managing the links between the compensation strategy and the pay system as well as people's perceptions and behaviours is vital to implementing a(n):

A)organizational hierarchy.
B)strategic alliance.
C)pay strategy.
D)association perspective.
E)planned perception.

Question 17

Personal satisfaction in work accomplished, security, advancement opportunity, and means to share in the company success are fostered by a company's _.

A)social and political context
B)patronage concentration
C)core culture and values
D)competitive heterogeneity
E)competitive dynamics

Question 18

According to the pay model, the strategic compensation decisions regarding external competitiveness involve:

A)how pay increases should be based.
B)how open and transparent the pay decisions should be to all employees.
C)how the different types and levels of skills and work should be paid within the organization.
D)how compensation should support the business strategy and be adaptive to the cultural and regulatory pressures in a global environment.
E)how total compensation should be positioned against competitors.

Question 19

A customer-focused business strategy:

A)stresses delighting customers and bases employee pay on how well they do this.
B)focuses on business practice or process that results in better performance than one's competitors.
C)places less emphasis on evaluating skills and jobs and more emphasis on incentives designed to encourage innovations.
D)stresses doing more with less by minimizing costs, encouraging productivity increases, and specifying in greater detail exactly how jobs should be performed.
E)stresses new products and short response times to market trends.

Question 20

Periodic reassessment of a compensation strategy's fit to changing conditions is needed to:

A)design work so that employees have opportunities to work independently without collaboration with others.
B)defer taxes by putting pay into retirement funds.
C)set objectives on alignment, competitiveness, contributions, and management.
D)specify the four policies on alignment, competitiveness, contributions, and management.
E)continuously learn, adapt, and improve.

Question 21

Of the three tests of competitive advantage-align, differentiate, add value-align is the most difficult.

Question 22

A compensation strategy emerges from the pay decisions that an organization makes.

Question 23

Managing total compensation strategically means fitting the compensation system to the business and environmental conditions.

Question 24

The underlying premise of the support business strategy is that the greater the alignment between the organization and the compensation system, the more effective the organization.

Question 25

All organizations that pay people have a written compensation strategy.

Question 26

Taking a strategic perspective requires a focus on compensation decisions that helps the organization gain and sustain competitive advantage.

Question 27

Trial and error play a major role in developing a compensation strategy.

Question 28

Which of the following is a step in the development of the total compensation strategy that involves the choosing of techniques to fit the strategy?

A)mapping a total compensation strategy
B)implementing strategy
C)assessing total compensation implications
D)reassessing the fit
E)implementing cultural and regulatory changes

Question 29

Which of the following organizational practices assumes that paying higher than the average paid by competitors can affect results?

A)internal alignment
B)external competitiveness
C)compensation strategy
D)employee contributions
E)managing compensation

Question 30

What three tests determine whether a compensation strategy is providing a competitive advantage to the organization?

Question 31

An unstated compensation strategy is inferred from an organization's compensation practices.

Question 32

The pay strategy is not influenced by how well it fits with other HR systems in the organization.

Question 33

Pay systems mirror a company's image and reputation.

Question 34

A focus on compensation decisions that help the organization gain and sustain competitive advantage is known as _.

A)strategic alliance
B)strategic perspective
C)association perspective
D)competitive heterogeneity
E)planned perception

Question 35

According to the steps involved in the formulation of a total compensation strategy, which of the following is the next step after deciding on a total compensation strategy?

A)implementing strategy
B)realigning as conditions change
C)reassessing the fit
D)assessing total compensation implications
E)realigning as strategy changes

Question 36

When business strategies change, pay systems should remain the same.

Question 37

Government relations to influence laws and regulations are never a part of compensation strategies.

Question 38

According to the pay model, the strategic compensation decisions regarding objectives involve:

A)how compensation should support the business strategy and be adaptive to the cultural and regulatory pressures in a global environment.
B)how pay increases should be based.
C)how the different types and levels of skills and work should be paid within the organization.
D)how total compensation should be positioned against competitors.
E)how open and transparent the pay decisions should be to all employees.

Question 39

Union interests are part of the environmental pressures that help shape compensation strategies.

Question 40

Pay strategies need to be adapted to the nature of the union-management relationship.

Question 41

What does the "best fit" perspective on compensation suggest?

Question 42

Describe the process of developing a total compensation strategy.

Question 43

What is meant by context in the process of formulating a total compensation strategy?

Question 44

Describe the last step of developing a total compensation strategy.

Question 45

Describe the relationship between virtuous and vicious circles.

Question 46

How do employee preferences influence the formulation of an organization's total compensation strategy?

Question 47

Define competitive advantage.

Question 48

List the aspects of alignment of the pay strategy.

Question 49

What is meant by a strategic perspective?