Test Bank for Strategic Compensation, 10th Edition, Joseph J. Martocchio
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Strategic Compensation: A Human Resource Management Approach, 10e (Martocchio) Chapter 6 Building Internally Consistent Compensation Systems
1) This clearly defines the relative value of each job among all jobs within a company.
A) internally consistent compensation system
B) generalized work activities
C) intra-organizational job markers
D) market comparison standards
Answer: A
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.1: Explain the concept of internal consistency.
2) Which of the following describes job duties, tasks, and pertinent factors needed to perform a job adequately?
A) job content
B) job structure
C) job summary
D) job context
Answer: A
Difficulty: Moderate Skill: Concept
AACSB: Reflective Thinking
LO: 6.1: Explain the concept of internal consistency.
3) This is the systematic process for recognizing differences in the relative worth among a set of jobs and for establishing pay differentials accordingly.
A) job analysis
B) job content
C) job evaluation
D) job-relatedness
Answer: C
Difficulty: Moderate
Skill: Concept
AACSB: Analytical Thinking
LO: 6.1: Explain the concept of internal consistency.
4) Which is the fundamental principle of internally consistent compensation systems?
A) Pay rates should mirror pay rate differences among the competition.
B) Jobs that require higher qualifications should be paid more than jobs that require lower qualifications.
C) All jobs should be valued equally because every job directly contributes to competitive advantage.
D) All jobs should be valued according to need.
Answer: B
Difficulty: Moderate
Skill: Concept
AACSB: Analytical Thinking
LO: 6.1: Explain the concept of internal consistency.
5) Who leads the process of analyzing jobs?
A) compensation generalists
B) HR specialists
C) HR generalists
D) compensation specialists
Answer: B
Difficulty: Moderate
Skill: Concept
AACSB: Analytical Thinking
LO: 6.1: Explain the concept of internal consistency.
6) ________ is a descriptive process.
Answer: Job analysis
Difficulty: Easy
Skill: Concept
AACSB: Reflective Thinking
LO: 6.1: Explain the concept of internal consistency.
7) Compare and contrast job analysis and job evaluation.
Answer: Job analysis is a systematic process for gathering, documenting, and analyzing information in order to describe jobs. Job analysis describes job content, worker requirements, and working conditions. Job evaluation is used to systematically recognize differences in the relative worth among a set of jobs and establish pay differentials accordingly. HR professionals create internally consistent job structures through job analysis and job evaluation. Job analysis is a descriptive procedure; however, job evaluation reflects value judgments. Through job analysis HR specialists write job descriptions that describe job duties and minimum qualifications required of individuals to perform their jobs. Job evaluation reflects the values and priorities that management places on various positions. Job evaluation is key for casting internally consistent compensation systems as strategic tools.
Difficulty: Moderate
Skill: Concept
AACSB: Analytical Thinking
LO: 6.1: Explain the concept of internal consistency.
8) This is a systematic process for gathering, documenting, and analyzing information in order to describe jobs.
A) job characterization
B) job description
C) job evaluation
D) job analysis
Answer: D
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
9) One of the essential skills that software development engineers must have is the proficiency in at least one of the modern computer programming languages, such as Java or C++. This must be indicated in which part of the job analysis description?
A) working conditions
B) job evaluation
C) worker requirement
D) job content
Answer: C
Difficulty: Moderate
Skill: Concept
AACSB: Application of Knowledge
LO: 6.2: Summarize the practice of job analysis.
10) Which source is generally able to provide the most extensive and detailed information about how job duties are performed?
A) job analysts
B) supervisors
C) job incumbents
D) benchmark jobs
Answer: C
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
11) A job analysis method is ________ if it accurately assesses each job's duties.
A) reliable
B) complete
C) valid
D) market-based
Answer: C
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
12) These indicate the name of each job within a company's job structure.
A) job specifications
B) job summaries
C) position headings
D) job titles
Answer: D
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
13) This section concisely summarizes the job with two to four descriptive statements.
A) job summary
B) job duties
C) job titles
D) job preview
Answer: A
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
14) What was the main effect created by the revisions to the ADA regulations passed in 2008?
A) Costs will be contained much more than in the past.
B) There are more hurdles for individuals seeking protection under the ADA to pass through in order to weed out false claims.
C) It is now easier for an individual seeking protection under the ADA to establish a disability within the meaning of the ADA.
D) Companies may no longer perform job analyses to see if they comply with the Americans with Disabilities Act.
Answer: C
Difficulty: Challenging
Skill: Concept
AACSB: Application of Knowledge
LO: 6.2: Summarize the practice of job analysis.
15) Generalized work activities, organizational context, and work context are requirements under which O*NET category?
A) experience
B) occupation
C) requirements
D) labor market characteristics
Answer: B
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
16) Abilities, interests and work styles are elements for which O*NET category?
A) occupation
B) experience
C) worker characteristics
D) worker requirements
Answer: C
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
17) Valid and reliable job evaluations result from which two conditions?
A) consistent results; using multiple collection methods
B) consistent results; data obtained under similar conditions
C) data from multiple sources; using multiple collection methods
D) data from multiple sources; data obtained under similar conditions
Answer: C
Difficulty: Challenging
Skill: Concept
AACSB: Analytical Thinking
LO: 6.2: Summarize the practice of job analysis.
18) ________ are the social context or physical environment where work will be performed.
Answer: Working conditions
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
19) In an auto manufacturing company, installing a windshield on the assembly line represents a(n) ________.
Answer: job task
Difficulty: Challenging
Skill: Concept
AACSB: Application of Knowledge
LO: 6.2: Summarize the practice of job analysis.
20) A(n) ________ is a collection of tasks constituting the total work assignment of a single worker.
Answer: position
Difficulty: Easy
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
21) A reliable ________ yields consistent results under similar conditions, when multiple analysts reach the same conclusion about the major duties that comprise a position.
Answer: job analysis
Difficulty: Challenging
Skill: Concept
AACSB: Analytical Thinking
LO: 6.2: Summarize the practice of job analysis.
22) According to the EEOC, ________ refers to a present competence to perform an observable behavior.
Answer: ability
Difficulty: Easy
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
23) ________ information describes physical and social factors that influence the nature of work.
Answer: Work context
Difficulty: Challenging
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
24) ________ describe preferences for work environments and outcomes.
Answer: Interests
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
25) ________ skills information describes developed capacities that facilitate learning or the more rapid acquisition of knowledge.
Answer: Basic
Difficulty: Easy
Skill: Concept
AACSB: Reflective Thinking
LO: 6.2: Summarize the practice of job analysis.
26) Summarize the five main activities of job analysis work.
Answer:
First, determine a job analysis program. A company must decide between using an established system and developing its own system tailored to specific requirements. Both established and custom job analysis programs vary in the method of gathering data. The most typical methods for collecting job analysis information are questionnaires, interviews, observation, and participation. Administrative costs often represent a major consideration in selecting a job analysis method.
Second, select and train analysts. Job analysts generally must be able to collect job-related information through various methods, relate to a wide variety of employees, analyze the information, and write clearly and succinctly. A task force of representatives from throughout the company ideally conducts the analysis, and HR staff members coordinate it. Although some companies rely on HR professionals to coordinate and conduct job analysis, many use teams to represent varying perspectives on work because virtually all employees interact with coworkers and supervisors.
Third, direct job analyst orientation. Before analysts start specific job analysis techniques, they must analyze the context in which employees perform their work to better understand influencing factors. In addition, analysts should obtain and review such internal information as organizational charts, listings of job titles, classifications of each position to be analyzed, job incumbent names and pay rates, and any instructional booklets or handbooks for operating equipment. Job analysts may also find pertinent job information in such external sources as The Standard Occupational Classification System, trade associations, professional societies, and trade unions.
Fourth, conduct the study, focusing on data collection and sources of data. Once analysts have gathered and made sense of these preliminary data, they can begin gathering and recording information for each job in the company. Analysts should carefully choose the method of data collection and the sources of data. The most common methods are questionnaires and observation.
Fifth, summarize the results by writing job descriptions. Job descriptions summarize a job's purpose and list its tasks, duties, and responsibilities, as well as the skills, knowledge, and abilities necessary to perform the job at a minimum level. Effective job descriptions generally explain:
• What the employee must do to perform the job
• How the employee performs the job
• Why the employee performs the job in terms of its contribution to the functioning of the company
• Supervisory responsibilities, if any
• Contacts (and purpose of these contacts) with other employees inside or outside the company
• The skills, knowledge, and abilities the employee should have or must have to perform the job duties
• The physical and social conditions under which the employee must perform the job
Job descriptions usually contain four sections:
• Job title
• Job summary
• Job duties
• Worker specifications
Difficulty: Moderate
Skill: Concept
AACSB: Analytical Thinking
LO: 6.2: Summarize the practice of job analysis.
27) Which of the following two are considered job evaluation techniques?
A) market-based and appeals-based
B) compensable content and job-based
C) market-based and job content
D) compensable content and job content
Answer: C
Difficulty: Moderate
Skill: Concept
AACSB: Analytical Thinking
LO: 6.3: Describe the practice of job evaluation.
28) These are the salient job characteristics that are the general basis for job evaluations and are used to establish relative pay rates.
A) job descriptions
B) compensable factors
C) occupation descriptions
D) ranking plans
Answer: B
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.3: Describe the practice of job evaluation.
29) Universal compensable factors are derived from which federal Act?
A) Fair Labor Standards Act
B) Civil Rights Act of 1963
C) Equal Pay Act
D) Americans with Disabilities Act
Answer: C
Difficulty: Challenging
Skill: Concept
AACSB: Analytical Thinking
LO: 6.3: Describe the practice of job evaluation.
30) Which of the following is one of the four "universal compensable factors"?
A) cognitive ability
B) personality
C) effort
D) motivation
Answer: C
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.3: Describe the practice of job evaluation.
31) Market-based job evaluation uses which approach to collect data to determine prevailing pay rates?
A) behavioral observation
B) interviews
C) self-assessment
D) surveys
Answer: D
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.4: Summarize various job evaluation techniques.
32) A human resource manager of a company decides to change the current job-content valuation technique by using a quantitative methodology. He thinks that the old approach fails to balance internal and external considerations while evaluating jobs. Which type of job evaluation technique do you suggest for this HR manager?
A) job-content evaluation
B) market-based evaluation
C) point method
D) simple ranking plan
Answer: C
Difficulty: Moderate
Skill: Concept
AACSB: Application of Knowledge
LO: 6.4: Summarize various job evaluation techniques.
33) Which type of jobs provides reference points to judge against other jobs within a company?
A) standardized jobs
B) high-value jobs
C) benchmark jobs
D) hierarchical jobs
Answer: C
Difficulty: Easy
Skill: Concept
AACSB: Analytical Thinking
LO: 6.4: Summarize various job evaluation techniques.
34) George owns a small public relations firm and customer courtesy is considered to be the most important factor in all of the jobs. Which job-content evaluation approach is George likely to use?
A) alternation ranking
B) simple ranking plans
C) paired comparison
D) classification plans
Answer: B
Difficulty: Easy
Skill: Concept
AACSB: Application of Knowledge
LO: 6.4: Summarize various job evaluation techniques.
35) Which job evaluation method entails ordering jobs on the basis of extremes?
A) paired comparison
B) alternation ranking
C) classification
D) factor comparison
Answer: B
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.4: Summarize various job evaluation techniques.
36) Which type of organizations use classification plans most prevalently?
A) private sector organizations
B) non-profit organizations
C) multi-national organizations
D) public sector organizations
Answer: D
Difficulty: Challenging
Skill: Concept
AACSB: Analytical Thinking
LO: 6.4: Summarize various job evaluation techniques.
37) Sarah works at a federal government agency. Her pay rate is determined by her GS level and work seniority. Which type of job-content evaluation approach was used to categorize her job?
A) alternation ranking
B) simple ranking plans
C) paired comparison
D) classification plans
Answer: D
Difficulty: Moderate
Skill: Concept
AACSB: Application of Knowledge
LO: 6.4: Summarize various job evaluation techniques.
38) Which of the following type of job evaluation plans is used when the company chooses to assign job pay rates that are neither too low nor too high relative to the market?
A) market-based
B) internally consistent
C) job-based
D) hybrid
Answer: A
Difficulty: Easy
Skill: Concept
AACSB: Reflective Thinking
LO: 6.4: Summarize various job evaluation techniques.
39) The ________ ranking method orders jobs by extremes as committee members determine most and least valuable jobs until all jobs have been evaluated.
Answer: alternation
Difficulty: Moderate
Skill: Concept
AACSB: Analytical Thinking
LO: 6.4: Summarize various job evaluation techniques.
40) What are the considerations for choosing between a single versus multiple job evaluation methods?
Answer: Compensation professionals must determine whether a single job evaluation technique is sufficiently broad to assess a diverse set of jobs. In particular, the decision is prompted by such questions as, "Can we use the same compensable factors to evaluate a forklift operator's job and the plant manager's job?" If the answer is yes, then a single job evaluation technique is appropriate. If not, then more than one job evaluation approach should be employed. It is not reasonable to expect that a single job evaluation technique, based on one set of compensable factors, can adequately assess diverse sets of jobs (i.e., operative, clerical, administrative, managerial, professional, technical, and executive). A carpenter's job is clearly distinct from a certified public accountant's position because manual dexterity is an important compensable factor that describes carpentry work and is not nearly as central to an accounting position.
Difficulty: Challenging
Skill: Concept
AACSB: Analytical Thinking
LO: 6.4: Summarize various job evaluation techniques.
41) Narrowly defined jobs can create which type of problem?
A) bureaucracy
B) excessive flexibility
C) extremely small pay differentials based on job worth differences
D) difficulty in conducting a job evaluation.
Answer: A
Difficulty: Moderate
Skill: Concept
AACSB: Reflective Thinking
LO: 6.5: Explain how internally consistent compensation systems and competitive strategy relate to each other.
42) Developing internally consistent job structures affects the competitive strategy of a company. Which of the following is a potential constraint on competitive strategy?
A) reducing a company's rigidity to respond to moves by the competition
B) potentially causing the definition of jobs to become less fluid
C) leading to less routinization
D) potentially creating far more bureaucratization within an organization
Answer: D
Difficulty: Challenging
Skill: Concept
AACSB: Analytical Thinking
LO: 6.5: Explain how internally consistent compensation systems and competitive strategy relate to each other.
43) Which of the following is NOT true for internally consistent compensation systems?
A) Jobs that require higher qualifications and more responsibilities should be paid more than jobs that require lower qualifications and fewer responsibilities.
B) Internally consistent compensation systems are created through job analysis and job evaluation.
C) Internally consistent compensation systems may increase a company's flexibility to respond to changes in competitors' pay practices.
D) Internally consistent compensation structures result in bureaucracy.
Answer: B
Difficulty: Moderate
Skill: Concept
AACSB: Analytical Thinking
LO: 6.5: Explain how internally consistent compensation systems and competitive strategy relate to each other.
44) Explain two possible limitations associated with establishing internally consistent compensation systems.
Answer: There may be limitations; however, that hamper agility for companies that strive to differentiate themselves from their competition. For example, internally consistent pay systems may reduce a company's flexibility to respond to changes in competitors' pay practices because job analysis leads to structured job descriptions and job structures. In addition, job evaluation establishes the relative worth of jobs within the company. Responding to the competition may require employees to engage in duties that extend beyond what's written in their job descriptions whenever competitive pressures demand. In the process, the definitions of jobs become more fluid, which makes equity assessments more difficult.
Another potential limitation of internally consistent compensation structures is the resultant bureaucracy. Companies that establish job hierarchies tend to create narrowly defined jobs that lead to greater numbers of jobs and staffing levels. Such structures promote heavy compensation burdens. Employees' core compensation depends on the jobs they perform, how well they perform their jobs, or the skills they possess. Employee benefits, however, represent fixed costs that typically do not vary with employees' job performance or their skills. Employing a larger number of workers to staff a multitude of narrowly defined jobs contributes substantially to exorbitant fixed costs for employee benefits.
Difficulty: Challenging
Skill: Concept
AACSB: Analytical Thinking
LO: 6.5: Explain how internally consistent compensation systems and competitive strategy relate to each other.
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