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Chapter 6

BUS 272 Chapter Notes - Chapter 6: Job Rotation, Job Enrichment, Job Design

Business Administration
Course Code
BUS 272
Sam Ajit Thiara

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BUS 272 – CH. 6 Applied Performance Practices
The Meaning of Money in the Workplace
- Oldest & widespread ways to reward someone in return for their skill, knowledge, labour
- Meaning of money varies from person to person, and through cultures. Some find it’s a
symbol for status & prestige, others associate anxiety w/ it
- We study money b/c it influences employee motivation, emotions & shapes/represents
an employee’s self-concept. Which is important info when employees need to distribute
financial rewards
Financial Reward Practices extrinsic rewards
- Financial rewards organized in 4 objectives: membership & seniority, job status,
competencies, performance
Membership & Seniority based Rewards (largest part of paycheque)
- Reward employees based on just being part of the organization (membership-based) &
how long they’ve remained (seniority-based) ex. More reward the longer you stay
- Attracts applicants but don’t help in improving job performance b/c creates continuance
commitment not affective commitment
Job Status Based Rewards (based on outcomes, bias of evaluator can be a problem)
- Rewards based on the difficulty, more responsibility, working conditions of the job being
performed. Tires to increase fairness in the workplace
- Level of difficulty determined through job evaluations: (rating the worth of jobs)
- Can lead to unhealthy competition, employees making it seem like their work is more
valuable than it actually is, can encourage bureaucratic hierarchy, reinforce status
Competency Based Rewards (the more you know the more compensation you get)
- Rewarding employees based on how many skills they’ve mastered, motivates
employees to learn new skills, makes workforce more flexible product/service quality
increases b/c employees posses more skills
- But expensive b/c employees spending more time learning more skills, & definition of
competencies can be vague
Performance Based Rewards (based on the input)
-Individual Rewards: Individual bonuses given to those who finish a certain task/exceed
performance goals ex. Sales people getting commission, more they sell more they get
-Team rewards: rewarding based on how well the team performs. Gainsharing plan:
type of team reward where the team’s reward comes from how much they reduce costs
& increase productivity bonuses
-Organizational rewards: rewarding all employees in an organization if a goal is reached.
ESOP employee ownership plan: employee buys company shares. Share options:
employee buys company shares at a set price, motivates employees to work hard to
increase share value. Profit sharing plan: pays bonus based on company profits
-Evaluating organizational-level rewards: creates ownership culture, but may decrease
motivation b/c individual performance doesn’t change share prices much
Improving Reward Effectiveness
- The following are ways to improve the effectiveness of rewards
- Link rewards to performance: employees who perform better get rewarded
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