Question 1. 1. (TCO A)
The new CEO of your company, who just came from a competitor, has just asked
you to discuss the organizations compensation system. As the compensation
manager, you tell him about the organizations nearly 500 employees in about 70
different job titles who are located in three locations in L.A. He asks you to
describe the strategy used to guide compensation system decisions. You explain
that ordinarily, pay models are guided by several strategic policies. Describe
what goals a compensation system should have and how four strategic pay
policies apply to the organization. (Points : 30)

Question 2. 2. (TCO B)
The VP for HR met with you, the compensation manager, to go over the new
strategies for attracting new employees for the offshore oil recovery division.
The division works with oil production companies to help prevent oil spills and
recover oil where leakages have occurred. The division employs many engineers
and scientists with expertise in hydraulics, oil production, chemistry, and so
forth. Employee assignments are often for 3 to 6 months in different countries
around the world. The VP for HR indicates that you should use a job-based point
method.

Question 3. 3. (TCO B)
You are the compensation manager for Middle Financial Services. The
organization buys, repackages, and sells financial instruments. The
organization’s five major units are sales and marketing, new products
development, legal services and compliance, IT services, and management.

You need to develop a
job evaluation plan for the organization. Describe the difference between
person-based plans and job-based plans. Explain which one you would use. What
factors would you consider? What is one advantage and disadvantage of each?
(Points : 30)

Question 4. 4. (TCO C)
You are the new compensation manger in an established plastic silverware
organization. As you become familiar with the organization, you find that there
is a significant problem in turnover in two of the three units in the company.
Exit interviews indicate that seasoned employees with good performance records
are leaving for other companies. The HR director asks you to prepare a plan for
dealing with the turnover problem.

In order to prepare
your plan, what additional information would you like about the company? Given
the information you have now, what competitive market pay policy would you
recommend for the company to use? Identify four competitive market pay
policies, describe them, and give an example of when each would be appropriate
to use by an organization. (Points : 30)

Question 5. 5. (TCO D)
You are a consultant who specializes in compensation. You are working with
Midwest Highway, Ltd, a road construction company housing five plants that
produce materials for road building. The CEO of the company wants to know what
type of performance measurement tool should be used in its production
facilities in the future. The main production job in the five plants (about 85
out of the total of 125) involves operation of machines that mix and form the
surfacing materials. The production lines are well established and product
lines are consistent. The job appears to you to be a low-level one with
prescribed routines.

The CEO asks you the
following question: Should we consider a straight ranking approach, a rating
system such as a behavioral anchored rating scale (BARS), a management by
objectives (MBO) format, or a 360-degree multirater approach? Describe the four
types of performance assessment approaches. Recommend one and justify why you
have chosen it. (Points : 30)

Question 6. 6. (TCO D)
The new HR VP is concerned about the performance appraisal process in the
hand-held video game company where you are the compensation manager. You then
review the results of the last performance appraisal cycle. It appears that
supervisors and managers may be having difficulty in doing the appraisals. You
are concerned about validity and reliability of the process.

In preparation for a
training program for supervisors and managers, identify at least three common
errors in the performance appraisal process and describe them. In addition,
describe steps to minimize these errors. (Points : 30)

Question 7. 7. (TCO H)
You are a compensation consultant working with a Top 100 bank on the east coast
of the United States. The Board of Directors of the bank is in the process of
hiring a new CEO. They indicate that they are concerned about public
perception. You are invited to a compensation committee meeting to recommend an
executive compensation strategy.

Describe the
components of an executive compensation plan, and explain how these components
can help support the organizational strategy. (Points : 30)

Question 8. 8. (TCO G)
As HR Director, you have implemented a series of brown bag lunches for the HR
staff members on things that will help them understand the legal and regulatory
environment of human resources. You will be conducting the first one on the
Fair Labor Standards Act (FLSA) because it is probably the most comprehensive
and far-reaching legislation that affects compensation.

aDescribe the four key
requirements and why they are important in compensation. (Points : 30)

Question 9. 9. (TCO E)
As a compensation consultant, you have been asked by a client organization to
brief their management group on incentive plans like gain-sharing and
profit-sharing plans.

Briefly describe what
gain-sharing and profit-sharing plans involve. What conditions should exist
prior to implementation to make it easier to implement? What are the advantages
and disadvantages of group incentives like gain-sharing and profit-sharing
plans? (Points : 30)

Question 1. 1. (TCO A)
The new CEO of your company, who just came from a competitor, has just asked
you to discuss the organizations compensation system. As the compensation
manager, you tell him about the organizations nearly 500 employees in about 70
different job titles who are located in three locations in L.A. He asks you to
describe the strategy used to guide compensation system decisions. You explain
that ordinarily, pay models are guided by several strategic policies. Describe
what goals a compensation system should have and how four strategic pay
policies apply to the organization. (Points : 30) Question 2. 2. (TCO B)
The VP for HR met with you, the compensation manager, to go over the new
strategies for attracting new employees for the offshore oil recovery division.
The division works with oil production companies to help prevent oil spills and
recover oil where leakages have occurred. The division employs many engineers
and scientists with expertise in hydraulics, oil production, chemistry, and so
forth. Employee assignments are often for 3 to 6 months in different countries
around the world. The VP for HR indicates that you should use a job-based point
method. Question 3. 3. (TCO B)
You are the compensation manager for Middle Financial Services. The
organization buys, repackages, and sells financial instruments. The
organization’s five major units are sales and marketing, new products
development, legal services and compliance, IT services, and management. You need to develop a
job evaluation plan for the organization. Describe the difference between
person-based plans and job-based plans. Explain which one you would use. What
factors would you consider? What is one advantage and disadvantage of each?
(Points : 30) Question 4. 4. (TCO C)
You are the new compensation manger in an established plastic silverware
organization. As you become familiar with the organization, you find that there
is a significant problem in turnover in two of the three units in the company.
Exit interviews indicate that seasoned employees with good performance records
are leaving for other companies. The HR director asks you to prepare a plan for
dealing with the turnover problem. In order to prepare
your plan, what additional information would you like about the company? Given
the information you have now, what competitive market pay policy would you
recommend for the company to use? Identify four competitive market pay
policies, describe them, and give an example of when each would be appropriate
to use by an organization. (Points : 30) Question 5. 5. (TCO D)
You are a consultant who specializes in compensation. You are working with
Midwest Highway, Ltd, a road construction company housing five plants that
produce materials for road building. The CEO of the company wants to know what
type of performance measurement tool should be used in its production
facilities in the future. The main production job in the five plants (about 85
out of the total of 125) involves operation of machines that mix and form the
surfacing materials. The production lines are well established and product
lines are consistent. The job appears to you to be a low-level one with
prescribed routines. The CEO asks you the
following question: Should we consider a straight ranking approach, a rating
system such as a behavioral anchored rating scale (BARS), a management by
objectives (MBO) format, or a 360-degree multirater approach? Describe the four
types of performance assessment approaches. Recommend one and justify why you
have chosen it. (Points : 30) Question 6. 6. (TCO D)
The new HR VP is concerned about the performance appraisal process in the
hand-held video game company where you are the compensation manager. You then
review the results of the last performance appraisal cycle. It appears that
supervisors and managers may be having difficulty in doing the appraisals. You
are concerned about validity and reliability of the process. In preparation for a
training program for supervisors and managers, identify at least three common
errors in the performance appraisal process and describe them. In addition,
describe steps to minimize these errors. (Points : 30) Question 7. 7. (TCO H)
You are a compensation consultant working with a Top 100 bank on the east coast
of the United States. The Board of Directors of the bank is in the process of
hiring a new CEO. They indicate that they are concerned about public
perception. You are invited to a compensation committee meeting to recommend an
executive compensation strategy. Describe the
components of an executive compensation plan, and explain how these components
can help support the organizational strategy. (Points : 30)Question 8. 8. (TCO G)
As HR Director, you have implemented a series of brown bag lunches for the HR
staff members on things that will help them understand the legal and regulatory
environment of human resources. You will be conducting the first one on the
Fair Labor Standards Act (FLSA) because it is probably the most comprehensive
and far-reaching legislation that affects compensation. aDescribe the four key
requirements and why they are important in compensation. (Points : 30) Question 9. 9. (TCO E)
As a compensation consultant, you have been asked by a client organization to
brief their management group on incentive plans like gain-sharing and
profit-sharing plans. Briefly describe what
gain-sharing and profit-sharing plans involve. What conditions should exist
prior to implementation to make it easier to implement? What are the advantages
and disadvantages of group incentives like gain-sharing and profit-sharing
plans? (Points : 30)