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Chapter 2—Strategic HR Management and Planning
MULTIPLE CHOICE
1.The flawed assumption underlying the creation of the “Job Bank” at GM, Ford and Chrysler in the 1980s was that
a. / the excess workers could be retrained for new “high tech” positions in the auto plants that would be created as the car manufacturing process was automated.b. / the auto unions would trade job training for laid-off workers for reductions in the pension plans for retired auto workers thus reducing the labor cost burden per car.
c. / the Job Bank would be a temporary benefit to employees who took voluntary severance packages that would be phased out as the manufacturers achieved the optimal workforce size.
d. / demand for American-made cars would increase and the excess workers could return to their factory jobs.
ANS:DPTS:1DIF:ChallengingREF:p. 35
OBJ:1NAT:AACSB AnalyticLOC:Strategy
TOP:Application
2.____ refers to organizational use of employees to gain or keep a competitive advantage resulting in greater organizational effectiveness.
a. / Manpower planningb. / Strategic HR management
c. / HR forecasting
d. / Operational HR
ANS:BPTS:1DIF:EasyREF:p. 36
OBJ:1NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Definitional
3.Which of the following statements is FALSE?
a. / The organization’s existing employees limit the organization’s choice of strategy.b. / Organizations survive and grow by choosing the strategy that will allow them to achieve low costs and innovative products.
c. / Most competitive strategies depend heavily on the quality of the organization’s human capital.
d. / Organizations in which the CEO dominates the selection of the organization’s strategy are less successful than organizations in which strategy is developed by a formal committee process.
ANS:BPTS:1DIF:ChallengingREF:p. 35
OBJ:1NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
4.In order to add value to the human capital of the organization,
a. / HR must have good metrics about the HR side of the business.b. / HR managers must be focused on reducing the total cost of labor.
c. / the HR function must form the interface between the external environment of the organization and its internal environment.
d. / HR policies and practices should result in the workforce with the minimum quantity and maximum quality needed to achieve productivity goals.
ANS:APTS:1DIF:ChallengingREF:p. 36
OBJ:1NAT:AACSB Reflective ThinkingLOC:Creation of Value
TOP:Conceptual
5.In order for any organizational strategy to work, the HR strategy must
a. / align with the “one best way” to achieve worker productivity.b. / move beyond the traditional HR focus on effectiveness and efficiency.
c. / generate the right people in the right place at the right time.
d. / develop the needed human competencies in the organization’s existing workforce.
ANS:CPTS:1DIF:ChallengingREF:p. 36
OBJ:1NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
6.Georgiana, the vice president of HR in an Ohio-based firm, is in a meeting with the other top level corporate executives. They are discussing whether it is a good strategy for the firm to open a branch in Amsterdam. In her role as head of HR, Georgiana must
a. / warn the executives against operating in the European Union due to restrictive labor laws.b. / frankly communicate whether the firm’s current human resources have the capabilities to handle such a strategy.
c. / raise the ethical issues of opening a branch in a country known for legalization of soft drugs, prostitution, and other “alternative lifestyles.”
d. / meet the strategy’s requirement no matter what the current state of the company’s human resources.
ANS:BPTS:1DIF:ChallengingREF:p. 37
OBJ:1NAT:AACSB AnalyticLOC:Strategy
TOP:Application
7.As an HR consultant calling on businesses, you can expect that
a. / most of the organizations will have a strong link between overall strategic planning and HR.b. / most the organizations will not monitor effectiveness and productivity statistics.
c. / fewer than one-quarter of the businesses will have an HR strategy.
d. / top management of most of the firms actively assesses HR on its strategic contributions to the organization.
ANS:BPTS:1DIF:ChallengingREF:p. 37
OBJ:1NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Application
8.All of the following are considered HR best practices EXCEPT
a. / paying employees high wages and incentives.b. / high focus on training and cross-training employees.
c. / allowing workforce levels to fluctuate with product/service demand.
d. / promoting employees from within.
ANS:CPTS:1DIF:ModerateREF:p. 37
OBJ:1NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
9.As an ambitious young HR professional, you want to advance to the top HR executive position in your organization by having the perspective and expertise to contribute to the strategic planning process. You should
a. / hone your skills in a technical HR area such as compensation or HR information systems.b. / learn the financials of your organization and the key drivers of its success.
c. / learn to think like a lawyer because most HR functions are driven by employment law.
d. / ask to be transferred into areas of the organization that are proven training grounds for top executives, such as finance and marketing.
ANS:BPTS:1DIF:ModerateREF:p. 38
OBJ:1NAT:AACSB AnalyticLOC:Strategy
TOP:Application
10.A ____ is a unique capability that creates high value and differentiates the organization from its competition.
a. / core competencyb. / critical capability
c. / value-creating characteristic
d. / competitive advantage
ANS:APTS:1DIF:ModerateREF:p. 38
OBJ:1NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Definitional
11."The shared values and beliefs of a workforce" is called the organizational
a. / climate.b. / culture.
c. / atmosphere.
d. / persona.
ANS:BPTS:1DIF:EasyREF:p. 38
OBJ:1NAT:AACSB Reflective ThinkingLOC:Group Dynamics
TOP:Definitional
12.Which of the following is TRUE in forming HR strategy?
a. / The past is irrelevant.b. / The past can help predict the future.
c. / The present is the best guide to the future.
d. / The impact of strategy is limited to the present.
ANS:BPTS:1DIF:EasyREF:p. 38
OBJ:1NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
13.As vice-president of HR, you are helping your company’s executive committee plan a highly-experimental manufacturing process. It will be using unusual, non-traditional technology and work structure to produce an innovative product. There is a significant possibility the venture will fail, but if it is successful, the profits will be immense. Your company has manufactured a related product line for over 50 years using traditional methods. With your knowledge of organizational culture you suggest that
a. / it would be best to try this process in an existing plant with senior employees selected to form the core workforce.b. / since this is a new manufacturing process, the appropriate HR policies and procedures will not be apparent until the plant is actually up and operating.
c. / although a new location would be best, it is important that HR policies and practices promote the organization’s traditional and unique culture in the new plant.
d. / it would be best to try this process with new employees in a separate location with new HR policies and practices.
ANS:DPTS:1DIF:ModerateREF:p. 38
OBJ:1NAT:AACSB AnalyticLOC:Strategy
TOP:Application
14.Clement, the director of HR for an engineering firm, has noticed a high level of turnover by key engineers. In his investigation, he has found that they are moving to competing organizations for similar pay and benefits. Clement should
a. / increase the number of engineers hired to offset the high turnover rate.b. / be more careful to hire engineers with a stable employment history.
c. / implement higher pay and benefits for key engineers.
d. / investigate how key engineers view the firm’s culture.
ANS:DPTS:1DIF:ChallengingREF:p. 39
OBJ:1NAT:AACSB AnalyticLOC:Group Dynamics
TOP:Application
15.People can be a core competency to a firm if they
a. / have thoroughly internalized the organization’s culture.b. / have consistently high levels of performance.
c. / have training unique to a particular industry.
d. / have special skills that cannot be easily imitated by competitors.
ANS:DPTS:1DIF:ModerateREF:p. 39 | Figure 2-3
OBJ:1NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
16.Perspectivo, Inc., is a new company that is growing rapidly both in sales and in numbers of employees. The culture of the firm is informal and highly-collaborative. The employees are highly psychologically invested in the success of the organization and tend to subordinate their personal lives to the organization’s needs. Selene is interviewing for a position at Perspectivo.
a. / If Selene joins Perspectivo, she can expect that the organization will demand a “workaholic” lifestyle for as long as she remains with the firm.b. / The Perspectivo culture will give Selene clear and consistent indications of how she should behave.
c. / Selene should not assume that the corporate culture of Perspectivo will be the same in 10 years as it is now.
d. / Selene should choose another organization if she values change and thrives on ambiguity.
ANS:CPTS:1DIF:ModerateREF:p. 39
OBJ:1NAT:AACSB AnalyticLOC:Group Dynamics
TOP:Application
17.The ____ of a workforce can be measured as the total cost of people per unit of output.
a. / profitabilityb. / effectiveness
c. / productivity
d. / efficiency
ANS:CPTS:1DIF:ChallengingREF:p. 40
OBJ:2NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
18.____ is computed by dividing the average cost of workers by their average levels of output.
a. / Profitabilityb. / Unit labor cost
c. / Cost effectiveness
d. / Production effectiveness
ANS:BPTS:1DIF:ModerateREF:p. 40
OBJ:2NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
19.Which of the following statements is TRUE?
a. / Productivity affects total costs in a not-for-profit organization.b. / Unit labor costs are irrelevant for not-for-profit organizations.
c. / For-profit and not-for-profit organizations are both responsible to shareholders..
d. / Not-for-profit organizations must operate in such a way that operating costs equal revenues.
ANS:APTS:1DIF:ChallengingREF:p. 40
OBJ:2NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
20.Which of the following activities would NOT be recommended for productivity improvements?
a. / recomputing unit labor costs so that some labor cost factors were reassigned to other factors of productionb. / outsourcing work to vendors
c. / replacing workers with labor-saving machinery
d. / redesigning the work so that fewer workers can perform multiple job tasks
ANS:APTS:1DIF:ModerateREF:p. 40
OBJ:2NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
21.Productivity
a. / is purely a function of quantity of output.b. / is a measure of both quantity and quality.
c. / measures are possible for jobs with a tangible product, but not for jobs with an intangible output, such as services.
d. / is best measured at the organizational level.
ANS:BPTS:1DIF:ModerateREF:p. 40
OBJ:2NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
22.Herman is the newly-hired director of HR for a department store. Herman’s major objective is to improve sales staff productivity. After careful observation, Herman has discovered that the sales staff is paid by commission on each sale and that staffing levels in each department are maintained at the bare minimum in order to save labor costs. The store’s competitive strategy is reflected in the motto “Quality Customer Service: Each Time, Every Time.” Herman concludes that
a. / the job description of sales staff must be redesigned so that the staff can perform both sales and customer service activities.b. / the organization should be restructured so that sales staff do not have to report to a sales manager.
c. / the HR activities of the store are not aligned to contribute to organizational effectiveness.
d. / the company should consider hiring contractors to increase the number of sales staff in each department.
ANS:CPTS:1DIF:ChallengingREF:p. 40
OBJ:2NAT:AACSB AnalyticLOC:Strategy
TOP:Application
23.Which of the following actions would have the most NEGATIVE impact on customer service?
a. / implementing Balanced Scorecard processes which focus on high manufacturing quality.b. / focusing on HR as a financial contributor to the organization.
c. / reducing staffing levels.
d. / slowing the rate of employee turnover.
ANS:CPTS:1DIF:ModerateREF:p. 41
OBJ:2NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
24.As organizations expand operations world-wide they go through three stages. Which of the following is the FIRST of these stages?
a. / importing and exportingb. / transnational operations
c. / multi-national enterprises
d. / global operations
ANS:APTS:1DIF:EasyREF:p. 42
OBJ:3NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Conceptual
25.If a school of veterinary science meets its goal of graduating 50 doctors of veterinary medicine every year, it can be said to be
a. / efficient.b. / effective.
c. / achieving a strong ROI.
d. / profitable.
ANS:BPTS:1DIF:ChallengingREF:p. 42
OBJ:2NAT:AACSB AnalyticLOC:Strategy
TOP:Application
26.In order to calculate the return on investment of a new applicant skills testing procedure, all the following EXCEPT ____ would be included in the calculation.
a. / legal expenses before and after implementation of the testing procedureb. / the cost of testing materials and HR staff time spent in conducting the tests
c. / productivity levels of employees hired using the testing procedure
d. / promotion rates of employees hired using the testing procedure
ANS:APTS:1DIF:ModerateREF:p. 42
OBJ:2NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Application
27.ROI is the organization’s
a. / return on interest.b. / return on investment.
c. / return on innovation.
d. / return on intangible assets.
ANS:BPTS:1DIF:EasyREF:p. 42
OBJ:2NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Definitional
28.A retail pharmacy chain is experiencing low profitability. It is looking into ways to cut costs. One of the members of the executive committee suggests reducing the number of pharmacists on staff, since they are the most highly-paid of the store employees. As director of HR, you are most concerned whether this move would
a. / be efficient in the short run.b. / be effective in the long run.
c. / result in the obsolescence of the firm’s succession plans.
d. / be consistent with the organizational culture.
ANS:BPTS:1DIF:ModerateREF:p. 42
OBJ:2NAT:AACSB AnalyticLOC:Strategy
TOP:Application
29.Rebecca, the vice president of HR for Ginx Enterprises, is in the process of learning the employment-related laws and regulations of the European Union, so that she knows how staffing, training, compensation, health and safety, and labor relations practices at Ginx Enterprises must be adapted when the company opens a new plant in the EU next year. Hilliard Enterprises is about to become a/an
a. / importer-exporter to the EU.b. / expatriate firm.
c. / multi-national enterprise.
d. / global organization.
ANS:CPTS:1DIF:ChallengingREF:p. 43
OBJ:3NAT:AACSB AnalyticLOC:Strategy
TOP:Application
30.A company having corporate units in a number of countries integrated to operate worldwide is called a
a. / global organization.b. / worldwide corporation.
c. / multi-national enterprise.
d. / pan-domestic firm.
ANS:APTS:1DIF:EasyREF:p. 43
OBJ:3NAT:AACSB Reflective ThinkingLOC:Strategy
TOP:Definitional
31.Angelo speaks Italian, English, and French fluently. He has lived and worked in both Italy and France and has an MBA from a prestigious U.S. university. Angelo’s friends describe him as “incredibly cosmopolitan” and a person who “blends in like a native wherever he is.” Angelo probably has a/an ____ and would be a good candidate for a company looking to build its international business.
a. / Euro-centric focusb. / Extroverted personality
c. / entrepreneurial tendency
d. / global mindset
ANS:DPTS:1DIF:ModerateREF:p. 43
OBJ:3NAT:AACSB AnalyticLOC:Strategy
TOP:Application
32.Trunkline Chemicals is considering opening a manufacturing plant in Vietnam. As director of HR, you assign a committee of HR staff to investigate all of the following factors EXCEPT
a. / how the addition of ethnic Vietnames workers will affect the company’s affirmative action goals.b. / the stability of the political environment in Vietnam.
c. / Vietnamese laws regarding compensation.
d. / the role and nature of labor unions in Vietnam.
ANS:APTS:1DIF:ModerateREF:p. 43
OBJ:3NAT:AACSB AnalyticLOC:Environmental Influence
TOP:Application
33.Hofstede defined five dimensions for classifying national cultures. Which of the following is NOT one of these dimensions?
a. / masculinity-femininityb. / secular/theocratic
c. / individualism
d. / power distance
ANS:BPTS:1DIF:EasyREF:p. 44
OBJ:3NAT:AACSB Reflective ThinkingLOC:Environmental Influence
TOP:Definitional
34.Which of the following statements is TRUE?
a. / The U.S. has the highest hourly wage rates for manufacturing production workers in the world.b. / Several northern European countries have higher hourly wage rates for manufacturing production workers than does the U.S.
c. / China’s hourly wage rate for manufacturing production workers is nearly as high as the wage rate in Mexico.
d. / A company considering moving a manufacturing production plant to Taiwan would pay approximately the same wage rate as if it moved to Brazil.
ANS:BPTS:1DIF:ModerateREF:p. 44 | Figure 2-5
OBJ:3NAT:AACSB Reflective ThinkingLOC:Environmental Influence
TOP:Conceptual
35.Global employers who manufacture products in countries with extremely low wages and substandard working conditions counter the accusation that they are “sweatshop employers” by arguing
a. / wages and working conditions were poor in the U.S. during the Industrial Revolution and this is a phase of development that all economies must eventually go through in order to advance.b. / as these countries become more prosperous because of the increased level of employment, then the wage-rates paid by all employers in those countries will rise.
c. / they are bringing the benefits of Western business practices to the workers in these countries.
d. / their operations allow these employees to have jobs and thus improve their living standards.
ANS:DPTS:1DIF:ChallengingREF:p. 45
OBJ:3NAT:AACSB EthicsLOC:Ethical Responsibilities
TOP:Conceptual
36.____ is the process of analyzing and identifying the need for and availability of human resources so that the organization can meet its objectives.
a. / Human resource planningb. / Environmental scanning
c. / Labor market analysis
d. / Strategic planning
ANS:APTS:1DIF:EasyREF:p. 45
OBJ:4NAT:AACSB Reflective ThinkingLOC:HRM
TOP:Definitional
37.The Wickham County Hospital is the only full-service hospital providing care in Wickham County. The population of Wickham Country has been increasing by 10 percent a year the last two years, and projections are that the population will grow even more rapidly in the next ten years. To serve the increased need, next year the hospital will open a new wing doubling the number of beds in the hospital. The HR planning for next year must include all of the following EXCEPT
a. / analysis of the current employees’ knowledge, skills and abilities.b. / predicting the turnover in each job description in the hospital.
c. / predicting the number of new employees needed in each job to staff the new wing.
d. / evaluation of the impact of the expansion on organizational culture.
ANS:DPTS:1DIF:EasyREF:p. 45