solution

Name a job field and explain which end of the continuum of compensation philosophies (as shown in Figure 7-3 in the etext) you feel best describes the compensation process of that job. Explain how each of the two motivation theories apply to your job choice and reasoning.

For the purposes of this discussion, the two compensation philosophies that should be discussed are the entitlement philosophy and the performance philosophy.As a general definition, the entitlement philosophy assumes that individuals who have worked another year are entitled to pay increases with little regard for performance differences. A pay-for-performance philosophy assumes that compensation decisions reflect performance differences.

The motivation theories required to be discussed in the discussion are the expectancy theory and equity theory. As a general review, according to expectancy theory, an employee’s motivation is based on several factors: the rewards that are valued by the employee and when not delivered as expected will decrease motivation. As an example, think of National Lampoon’s Christmas Vacation and the annual bonus. The equity theory of motivation states that employees judge fairness or equity in compensation by comparing their efforts and rewards against the efforts and rewards of other employees. Efforts include not only time and skill, but loyalty, commitment, and enthusiasm. Rewards are not just in direct compensation, but also job security, indirect benefits, and recognition.