Reichheld and Sasser (1990) Have Suggested That Annual Profits Per

question 69

Multiple Choice

Reichheld and Sasser (1990) have suggested that annual profits per customer increase every year over seven years because of various factors.Which of the following is NOT one of the factors that they discovered created incremental profits?

• A)Increased sales through price discounts to customers
• B)Profit from referrals to other customers
• C)Opportunities to cross-sell other services
• D)Profit from increased purchases
• E)Profit from reduced operating costs

---

Definitions:

Pay-for-Knowledge

A compensation strategy that rewards employees for acquiring and utilizing additional skills or knowledge that contribute to their job performance and organizational success.

Job Evaluation

The process of determining the relative value and importance of jobs within an organization to establish fair compensation levels.

Base Pay

The initial rate of compensation an employee receives, not including overtime, bonuses, or other additional payments.

Output

The amount of product or work produced by a company, employee, or process within a specific period.