Management and Organizational Studies 1021A/B Lecture Notes - Lecture 5: Equity Theory, Availability Heuristic, S&P 500 Index

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 1021A/B
• Professor: James O' Brien

Document Summary

Median ceo compensation in s&p 500 was 9m in 2010; profits rose 41% Pay for workers grew 3% in 2010, twice the rate of inflation: however, average wage was less than 0. 5% of what the typical ceo made. Growth in top 1% income earners is much more pronounced than the rest for past 30 years. Equity theory observe other people to see how hard they work and see how much they receive for that work; ratio between inputs and outputs compared between self and reference groups; look at data. Job satisfaction: drivers: challenging work, interesting assignments, equitable rewards, competent supervision, rewarding careers. Pay and benefits: direct compensation: wages and salaries, incentives, bonuses, and commissions. Indirect compensation: dental plans, insurance coverage, nonfinancial compensation. 20-80% of operating costs represented by compensation big portion!! What is the total rewards approach ? (important, strategic) Aligning future performance with organizational goals (signalling effect from organization to employees to emphasize what is important)