BUS 424 Chapter Notes - Chapter 2-5: Internal Audit, Job Design, Data Management

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 424
• Professor: Johnny Jermais

Document Summary

In an ideal world, control system is not needed. Reasons to implement: to influence behavior, goal congruence individual vs. organization. Minimize the gaps between employee and company goals. Increase motivation of the managers and the company. Underlying theories: agency theory, expectancy theory, equity theory. Principal-agent (p-a) relationship in which p assigns responsibility to a, and a is contracted to work on behalf of p. Information asymmetry: age(cid:374)ts" a(cid:272)tio(cid:374)s are u(cid:374)o(cid:271)ser(cid:448)a(cid:271)le or (cid:272)ostly, self-interest individuals, which maximize own wealth, dislike work. Control mechanisms monitoring or incentive compensation. Pays manager on the basis of the performance report. People are motivated to get the rewards that they desire and prevent the. To motivate people to behave in a particular way, employment contract must contain two things: provide rewards that are desirable, provide a high probability that efforts will lead to performance, and in turn, rewards. Perceptions of fair and unfair distributions of resources within interpersonal relationships.