1. The top management at a new social media technology company would like to revamp its incentive compensation system to attract ambitious employees. What would be their best approach?

a. Set unrealistic performance standards, but with an equally high compensation.

b. Make the performance bonus at least 3 to 4 percent of base salary to have some impact.

c. Make the performance payoff equal for average and below-average performers.

d. Make the performance bonus at least 10 to 12 percent of base salary to have some impact.

e. Reward people who work very hard, even if they fall short of achieving performance targets.

2. Six Sigma processes:

a. can be used for developing new products or new business processes but not for improving existing products or business processes.

b. can be used for both improving existing business processes and for developing new processes or products.

c. consists of a disciplined, statistics-based system aimed at producing not more than 10 defects per million iterations for a manufacturing or assembly process.

d. are based on three principles: (1) all work is a statistically controllable process; (2) no well-controlled process allows variability; and (3) defect-free work requires tight statistical controls.

e. can be used for improving products or business processes but not for developing new products or new processes.