Which of the following is the major disadvantage of a straight salary plan quizlet?
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Terms in this set (112)The most commonly used definitions of motivation include these three dimensions: C The amount of mental and physical effort put forth by the salesperson is referring to D __________ implies that salespeople choose where their effort will be spent among various job activities.
E The salesperson's choice to expend effort over a period of time, especially when faced with adverse conditions is referred to as B The
motivation task is incomplete unless salespeople's efforts are B A salesperson who is intrinsically motivated C A
salesperson who is extrinsically motivated E Reward system management involves the selection and utilization of
organizational rewards to A Compensation rewards might include all of the following except D Noncompensation rewards include E ___________ rewards are those that are given in return for acceptable performance or effort. E Which of the following is not one of the desired outcomes of an optimal reward system? B According to a survey of sales executives reported in the text, the most popular sales incentive is D What change in the firm's salesforce reward system might be in response to customers' needs? B According
to the text, which of the following is not one of the reward categories typically offered to salespeople? A Current spendable income includes C The reward system practiced by the majority of consumer and industrial firms is B Advantages of straight-salary compensation plans include all of the following except B If the nonselling administrative duties of the salesperson are of major importance, this compensation plan is recommended: A The most serious disadvantage of a straight-salary compensation plan is C Industries that have traditionally used a straight-commission-based compensation pay plan include all of the following except E A large direct sales company such as Avon would most likely compensate their salespeople in this manner C Which of the following is not a factor to be considered when developing a commission-only plan? C This form of commission rate may actually result in overselling and higher selling costs to the
company: E When it is difficult for the salesperson to secure the first order from the customer, but reorders are virtually automatic, this form of commission rate would be appropriate: A An example of a selling situation requiring a commission split would be C Which of the following is not an advantage of the commission compensation plan? E Which of the following is an advantage of a
straight-commission compensation plan? A Perhaps the most serious shortcoming of straight-commission plans is that B When determining the financial compensation mix, the sales manager must C Which of the following conditions would indicate to the sales manager that the proportion of the salesperson's total pay that is salary should be relatively low? B Which of the following conditions would indicate to the sales manager that the proportion of the salesperson's total pay that is salary should be relatively high? B Which of the
following is not an advantage of combination plans? B pgs. 235-236Flexibility has been cited as both an advantage and a
disadvantage of this compensation pay plan: B A common criticism of combination pay plans is that they C With regards to determining appropriate financial compensation levels, all of the following
are true except B Which of the following is not a form of nonfinancial compensation? B Which of the following conditions is not typically associated with higher pay levels? D This form of nonfinancial reward is generally considered to be more desirable to younger salespeople than to older salespeople: B When
a sales manager assures salespeople that they fulfill a critical role in revenue production and other key activities within the company, he/she is offering this non-financial reward: C All of the following are steps suggested for facilitating a sense of
accomplishment in the salesforce except E A
firm offering a college tuition reimbursement program has made a commitment to providing this nonfinancial reward: A The Million Dollar Roundtable designation in the insurance industry is an example of this type of nonfinancial
reward: D Formal recognition programs can provide all of the following benefits to a salesforce except D Formal recognition programs have a better chance of success if sales managers do all of the following
except: B According to the text, controls typically used by companies to ensure judicious spending by the salesforce include all of the following except C All of the following are typical reimbursable expense items except C Expense account padding C Which of the following does not help deter expense account abuse? E Which of the following statements regarding sales contests is true? D Which of the following is not a guideline for optimizing the use of sales contests? E A salesforce reward system is one of the most important determinants of both short-and long-term sales performance. T
Salespersons' choices of which activities warrant action are less important than how hard they work or how well they persist in their efforts. F A salesperson's overall motivation is either a function of extrinsic or intrinsic motivation, but cannot be both. F Organizational rewards are classified as compensation rewards and reimbursement rewards. F Noncompensation rewards include factors related to the work situation and well-being of each salesperson. T Practicing a supportive leadership style is an example of a noncompensation reward. T Job design factors such as skill variety and feedback are forms of nonfinancial compensation rewards. F The optimal reward system would balance the needs of the organization, its salespeople, and its customers. T From the organization's perspective, the reward system should attract and retain competent salespeople. T From the organization's perspective, the reward system should reward salesperson performance based on measurable criteria that are easy to comprehend. T Most salespeople prefer some stability in their reward system and care little about incentive rewards. F The most productive salespeople have the best opportunities to leave the firm for more attractive work situations. T The motivational power of various rewards is dependent on individual salesperson preferences. T A comprehensive study of salesforce financial compensation practices found that the salary-only plan and the salary-plus-bonus plan were equally popular. F The chosen compensation system often depends on the organization's strategy, competitive offerings, and products or services sold. T A straight-commission compensation plan is suggested for salespeople such as missionaries and detailers. F A straight-commission compensation plan is appropriate for sales trainees who are involved in learning about the job rather than producing on the job. F With straight-salary compensation plans, there is less chance that high-pressure, non-customer-oriented sales techniques will be used. T Industries that have traditionally paid salespeople by straight commission include insurance and securities. T With a straight-salary compensation plan, the least productive members of the salesforce tend to be the most rewarded salespeople. T The most popular commission base appears to be sales volume. T A constant commission rate changes incrementally as salespeople reach prespecified target levels of sales. F A progressive commission rate declines at some predetermined point of sales. F Commission plans may attract competent results-oriented salespeople and eliminate incompetent reps. T There is general agreement that salesforce loyalty to the company may be greater with straight-commission plans. F One disadvantage of commission plans is that salespeople may neglect cultivating potentially profitable long-run customers in favor of easy sales. T One disadvantage of commission plans is that when they are based on sales volume, salespeople may be encouraged to discount unnecessarily, resulting in lower profitability. T Bonuses are typically used to direct effort toward relatively short-term objectives. T Performance bonuses may be offered in the form of cash or income equivalents such as merchandise or free travel. T An advantage of the performance bonus is that sales emphasis can be changed from period to period. T One disadvantage of the performance bonus is that sales emphasis must be changed from period to period. F Combination pay plans usually feature commission as the major source of salesperson income. F A good combination compensation plan offers a balance of incentive, control, and enough flexibility to reward important salesforce activities. T If the company relies heavily on advertising and other sales promotion activities, the salespeople's total pay should have an emphasis on commissions. F If the provision of customer service is crucial, then a combination plan with emphasis on the salary dimension is recommended. T The primary advantage of combination pay plans is the flexibility they offer.
T As compared to a straight-salary or combination plan, the straight-commission compensation plan is more complex and difficult to administer. F One disadvantage of a combination compensation plan is that mediocre salespeople are eliminated less rapidly than they would be under a straight commission plan. T Determining the appropriate financial compensation level depends upon an understanding of the duties expected for a particular sales position. T The value of nonfinancial compensation is illustrated by the considerable number of salespeople who knowingly take cuts in financial compensation to become sales managers. T Opportunities for promotion are easily varied in the short run. F Informal recognition awards are easy to administer and cost practically nothing. T Employees typically find verbal or written praise to be of little importance. F
Most recognition programs are simply popularity contests and leave salespeople feeling let down and deceived. F Salespeople appear to be fond of being recognized by their peers. T Many companies believe that money spent on recognition programs is a good investment. T Formal recognition programs have a better chance of succeeding if sales managers publicize the program before it is implemented. T The majority of sales organizations offer full reimbursement to their salespeople for legitimate sales expenses such as travel, lodging, and meals. T Expense budgets may be used to maintain expenses as a specified percentage of overall sales volume or profit. T Many sales contests are held to correct bad planning and poor sales performance. T It is generally believed that sales contests have some positive effects on salesforce performance. T Sales managers should minimize potential motivation and morale problems in sales contests by allowing multiple winners. T Encourage the winners to share their winning strategies with the salesforce. T It is relatively easy to design a sales contest that will maximally motivate every member of the salesforce. F It is a good idea to reward both individual and team performance. T Any major change in financial compensation practices is likely to produce widespread concern among the salesforce that their earnings will decline. T Management should consider how any change in compensation will affect the company's top performers and attempt to avoid a change that would hurt them. T A guideline for managing salesforce motivation would be to attempt to incorporate individual needs of salespeople into motivational programs. T Investing more time in recruiting and selection will pay off later in terms of fewer motivational and other managerial problems. T The sales job itself can be a powerful motivator. T Sales managers should be committed to uncovering potential problems in motivation and eliminating them before they develop. T Students also viewedCHAPTER 926 terms notecards_2017 Sales Management Ch.1050 terms clairerandall83 Sales Management Ch.946 terms clairerandall83 MKGT 637 Chapter 855 terms moonescape Sets found in the same folderChapter 944 terms carlyc7 Chapter 1058 terms carlyc7 Other sets by this creatorChapter 7 (Relevant)39 terms carlyc7 Chapter 7113 terms carlyc7 Chapter 6127 terms carlyc7 Chapter 1.20 terms carlyc7 Recommended textbook solutionsOperations Management: Sustainability and Supply Chain Management12th EditionBarry Render, Chuck Munson, Jay Heizer 1,698 solutions
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It does not provide any incentive for hard work. So, it does not encourage salesmen to do hard work.
What is a disadvantage of straight commission plans quizlet?Straight salary plans often do not provide strong incentive for extra effort. Under a straight commission plan, sales managers usually have less control over their reps.
What is the primary disadvantage of using the straight salary approach to pay salespeople?The primary disadvantage with straight salary is that it removes the incentive to work longer hours or to put in extra effort to close sales that would come naturally to a commissioned sales rep.
What is the main problem with a straight commission structure?Straight Commission
There's no base salary. This sales commission structure will drive behavior focused on closing business but at the risk of closing business that might not be right for the customer or your company.
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