Quiz 7: Building Market-competitive Compensation Systems

This term is defined as an in-depth examination of the external and internal environmental factors that are likely to have the greatest impact on the future of the company.

Compensation surveys are typically focused on which two factors?

When examining competitors' compensation offerings this term is used to describe the percentage of employer compensation costs that are applied to compensation and benefits.

As of September 2010, U.S. companies spent approximately how much per employee for discretionary benefits?

This BLS survey provides the quarterly measure of changes in labor and compensation costs, and is used as the principle economic indicator for the Federal Reserve.

The NCS provided incidence and extensive data on which two types of compensation benefits?

These are reference points against which jobs within the company are judged.

These are used as reference points for setting pay levels.

When using compensation survey data, statistical analyses are used to integrate this with the external market, in order to determine pay rates.

This causes compensation survey data to become obsolete fairly quickly.

What would Yolanda's salary of $165,000 be considered if the means salary for B42DA, Inc., is $30,000 and the median salary is $32,000?

In statistical analysis, this term is used to signify the possible extreme observations.

These are the two types of central tendency measures that are pertinent to compensation.

Which of the following are the three measures of dispersion?

Suppose that a compensation professional would like to calculate the median salary. He/she orders four salaries as follows: $20,000, $22,000, $24,000, $26,000. What is the median salary for this data set?

These are tools used by employers to determine the pay levels needed to recruit highly qualified employees.

This term refers to the distance of each salary figure from the mean.

Jose Escobar conducts a survey of salaries at UB2 Enterprises and finds that 50% of the workers fall below the market pay average of $32,000. In which quartile do the workers at ERL Enterprises fall?

What does Quartile 3 represent?

What does it mean when the distribution of data is skewed to the right?

How often is the Consumer Price Index calculated for the United States?

The Consumer Price Index represents the average price changes for the price of goods and services in how many regions?

In the regression analysis formula, what does the X represent?

In regression, what does it mean when the R2 = 1?

Compensation professionals in XYZ Company use regression analysis to determine the pay rates of its marketing professionals. There are 4 different marketing job titles in XYZ Company. Compensation professionals use job evaluation points assigned to each marketing job title and a salary survey data. In other words, they regress job evaluation points on the salary data. What does it mean when the R2 value of this regression turns out to be 0.85?

XYZ Company is a world leader in medical device manufacturing. Aiming to continue its market position in this industry, XYZ Company pursues differentiation strategy. As a result, in order to attract and retain best employees, this company compensates its employees higher than almost all competitors. What kind of pay level policy does XYZ Company follow?

XYZ Inc. pursues a low-cost strategy in its industry and generally needs lower skilled employees. As a result, their management team decided to establish a compensation policy that pays less than the marketplace. In recent years the company became susceptible to labor shortages and high turnover. What kind of pay level policy does XYZ Inc. follow?

Market match policies are generally set to which quartile in the salary survey?

Market lag policies are generally set to which quartile in the salary survey?

Companies pursuing a differentiation strategy are most likely to use which pay level policy?

________ represent the fields of potentially qualified candidates for particular jobs.

________ refers to a group of two or more jobs that are based on similar work characteristics, duties, and responsibilities.

HR professionals rely on ________ jobs as reference points for setting pay levels.

The ________ is the middle value in an ordered sequence of numerical data.

________ represents the amount of spread or dispersion in a set of data.

________ allow compensation professionals to describe the distribution of data based on four groupings.

The ________ is the most commonly used method for tracking cost changes throughout the United States.

________ analyses enable compensation professionals to establish pay rates for a set of jobs that are consistent with typical pay rates for jobs in the external market.

The market ________ policy distinguishes a company from competition by compensating employees less than most competitors.

The market ________ policy most closely follows the typical market pay rates because companies pay according to the market pay line.

Explain the role of compensation surveys. Why is it important to update survey data?

Explain market pay line. How is it used in the context of pay level policies such as market lead, market lag, and market match?

Elaborate on the link between a company's pay level policy and its strategic mandate.