Samantha was hired by Dewey and Howe, a multinational law firm, as an associate and is...

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Samantha was hired by Dewey and Howe, a multinational law firm, as an associate and is starting her seventh year of employment. Typically, at the end of the eighth year, associates are offered partnership in the firm or are asked to leave. Partnership brings with it not only a larger base salary, but also an ownership interest in the firm that entitles the partner to a portion of the profits generated by the firm. Samantha has nearly identical productivity-as measured by billable hours as the rest of her associate class. Similar to others in her associate class, Samantha has brought only a handful of small clients to the firm in the past six years. At the annual partners meeting at the beginning of Samantha's seventh year of employment, Tom Dewey, one of the senior partners of the firm, proposes to offer Samantha early partnership at the end of her seventh year. Dewey states that the early partnership offer to Samantha is justified based on his assessment that "she probably has the potential to bring in some high-profile clients and we can't afford to lose her-and those potential clients-to our competitors." Given this information, is the organization paying for performance or paying for potential? Paying for potential Paying for performance 2 points Little Red Widgets has been struggling to maintain its market position over the last three years. This has had a significant effect on the financial position of the organization. The board of directors decided that a change in management was necessary to get the organization back on track in terms of cost control and quality improvements. The board of directors hired Jamie to replace the existing CEO. Jamie came to Little Red Widgets after serving as the CEO of AnyWidget International for 12 years. Jamie's departure from Any Widget International was the result of AnyWidget International being acquired by CongloMerger Inc., a holding company. As a result of the acquisition, CongloMerger Inc. installed its own executive management team at AnyWidget International. During his 12 years of service, Jamie led AnyWidget International to become the leading widget producer in North America and delivered considerable returns to shareholders. Given Jamie's experience, the board of directors offered Jamie a compensation package consisting of a base salary of $250,000 (the same salary as the previous CEO) and stock options valued at $750,000 at the time of the grant (the previous CEO was not given any stock options during his tenure). Given this information, is the organization paying for performance or paying for potential? ● Paying for potential Paying for performance Raushaun is a recent graduate from one of the top MBA programs in the country. He was hired by Franklin Technologies earlier this year as a Management Analyst to provide feedback on the organization's efficiency and profitability. Franklin Technologies has two other employees-Caroline and Damian-in the Management Analyst role. Both Caroline and Damian came to Franklin Technologies with three years of prior experience at other organizations and hold Certified Management Consultant designations. Raushaun has no prior experience and does not hold the Certified Management Consultant designation. Raushaun's base salary is approximately 3% higher than the base salaries of Caroline and Damian. Given this information, is the organization paying for performance or paying for potential? Paying for performance O Paying for potential 2 points Mary Ellen has worked as an elementary school teacher for 23 years. She has a very successful track record as a teacher; her students regularly exceed the average scores on statewide achievement tests, she has made numerous contributions to elementary education pedagogy, and she has received several statewide and national peer-recognition awards for her work in the classroom. The Anytown School District is searching for a new principal for its elementary school, and Mary Ellen is one of the finalist candidates. The superintendent of Anytown School District is convinced that Mary Ellen is the right choice and has convinced the school board to offer Mary Ellen a compensation package that is 15% greater in value than the compensation packages offered to other principals within the school district at hire. Given this information, is the organization paying for performance or paying for potential? Paying for performance O Paying for potential 2 points Simha was hired by PhytoLogic as a biochemical engineer. Her starting salary was set at 2% above market, consistent with PhytoLogic's policy regarding starting salaries for its scientific personnel. During her first year, Simha was responsible for developing and bringing to market four new herbal supplements. The average number of new supplements developed and brought to market by biochemical engineers within PhytoLogic is two per year. At the end of her first year, Simha was awarded a 4% increase in base salary. Other scientific personnel received only the standard 2.5% increase in base salary. Given this information, is the organization paying for performance or paying for potential? Paying for potential ● Paying for performance Samantha was hired by Dewey and Howe, a multinational law firm, as an associate and is starting her seventh year of employment. Typically, at the end of the eighth year, associates are offered partnership in the firm or are asked to leave. Partnership brings with it not only a larger base salary, but also an ownership interest in the firm that entitles the partner to a portion of the profits generated by the firm. Samantha has nearly identical productivity-as measured by billable hours as the rest of her associate class. Similar to others in her associate class, Samantha has brought only a handful of small clients to the firm in the past six years. At the annual partners meeting at the beginning of Samantha's seventh year of employment, Tom Dewey, one of the senior partners of the firm, proposes to offer Samantha early partnership at the end of her seventh year. Dewey states that the early partnership offer to Samantha is justified based on his assessment that "she probably has the potential to bring in some high-profile clients and we can't afford to lose her-and those potential clients-to our competitors." Given this information, is the organization paying for performance or paying for potential? Paying for potential Paying for performance 2 points Little Red Widgets has been struggling to maintain its market position over the last three years. This has had a significant effect on the financial position of the organization. The board of directors decided that a change in management was necessary to get the organization back on track in terms of cost control and quality improvements. The board of directors hired Jamie to replace the existing CEO. Jamie came to Little Red Widgets after serving as the CEO of AnyWidget International for 12 years. Jamie's departure from Any Widget International was the result of AnyWidget International being acquired by CongloMerger Inc., a holding company. As a result of the acquisition, CongloMerger Inc. installed its own executive management team at AnyWidget International. During his 12 years of service, Jamie led AnyWidget International to become the leading widget producer in North America and delivered considerable returns to shareholders. Given Jamie's experience, the board of directors offered Jamie a compensation package consisting of a base salary of $250,000 (the same salary as the previous CEO) and stock options valued at $750,000 at the time of the grant (the previous CEO was not given any stock options during his tenure). Given this information, is the organization paying for performance or paying for potential? ● Paying for potential Paying for performance Raushaun is a recent graduate from one of the top MBA programs in the country. He was hired by Franklin Technologies earlier this year as a Management Analyst to provide feedback on the organization's efficiency and profitability. Franklin Technologies has two other employees-Caroline and Damian-in the Management Analyst role. Both Caroline and Damian came to Franklin Technologies with three years of prior experience at other organizations and hold Certified Management Consultant designations. Raushaun has no prior experience and does not hold the Certified Management Consultant designation. Raushaun's base salary is approximately 3% higher than the base salaries of Caroline and Damian. Given this information, is the organization paying for performance or paying for potential? Paying for performance O Paying for potential 2 points Mary Ellen has worked as an elementary school teacher for 23 years. She has a very successful track record as a teacher; her students regularly exceed the average scores on statewide achievement tests, she has made numerous contributions to elementary education pedagogy, and she has received several statewide and national peer-recognition awards for her work in the classroom. The Anytown School District is searching for a new principal for its elementary school, and Mary Ellen is one of the finalist candidates. The superintendent of Anytown School District is convinced that Mary Ellen is the right choice and has convinced the school board to offer Mary Ellen a compensation package that is 15% greater in value than the compensation packages offered to other principals within the school district at hire. Given this information, is the organization paying for performance or paying for potential? Paying for performance O Paying for potential 2 points Simha was hired by PhytoLogic as a biochemical engineer. Her starting salary was set at 2% above market, consistent with PhytoLogic's policy regarding starting salaries for its scientific personnel. During her first year, Simha was responsible for developing and bringing to market four new herbal supplements. The average number of new supplements developed and brought to market by biochemical engineers within PhytoLogic is two per year. At the end of her first year, Simha was awarded a 4% increase in base salary. Other scientific personnel received only the standard 2.5% increase in base salary. Given this information, is the organization paying for performance or paying for potential? Paying for potential ● Paying for performance

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