Deck 7: Cost Justifying Human Resource Information Systems Investments

Question 1

Indirect benefits are difficult to quantify because:

A)their occurrence may be less certain
B)indirect revenue enhancements result from direct benefits
C)their dollar value cannot be determined
D)the HRIS does not contain the necessary data

Answer 1

A

Question 2

In the e-learning example in Chapter 7, better customer service leading to increase in repeat sales is an indirect benefit.

Answer 2

True

Question 3

Basing the justification of a new HRIS system or upgrade on compliance with Equal Employment Opportunity (EEO)regulations is an example of:

A)the integration of the HR and legal departments
B)an organization enhancement justification
C)a risk avoidance justification
D)a compliance justification

Answer 3

C

Question 4

Which of the following guidelines should not be a guideline for a successful HRIS CBA?

A)the objective is improving effectiveness of the HR department
B)focus on functionality, not products
C)develop the best estimate possible
D)know your business

Question 5

The best approach to justify a new HRIS is to identify first what the new software
applications are included in the HRIS.

Question 6

Estimating benefits first provides a critical aspect of the business plan for the new HRIS and sets the boundaries for its functionality.

Question 7

In terms of estimating costs and benefits for a new HRIS, the critical time period is:

A)the first six months to one year
B)the first two years
C)the first 5 years
D)the first 8 - 10 years

Question 8

To use a organizational enhancement approach for the justification of new HRIS, one must use:

A)benchmarking on HR audit metrics
B)the savings from self-service employee portals as the major savings
C)the savings from decreasing the number of HR employees needed to process the HRM
D)employee information
E)a cost-benefit analysis

Question 9

An HRIS can provide the primary infrastructure used to:

A)deliver HR programs
B)ensure HR regulatory compliance
C)produce the metrics that are used to evaluate HR programs
D)all of the above

Question 10

An improved capacity to attract and retain higher-quality employees because of the implementation of a new HRIS would be considered an example of:

A)an example of an indirect benefit of the HRIS
B)an improvement due to software
C)an example of a numeric benefit of the HRIS
D)an example of a direct benefit of the HRIS

Question 11

Using HR audit metrics to measure the effectiveness of one company's HR programs against other companies is called:

A)organizational enhancement
B)baseline functionality
C)benchmarking
D)risk avoidance

Question 12

A legacy HRIS system refers to an HRIS system that was borrowed from another company.

Question 13

Investment analyses for an HRIS are based the following information:

A)sources of costs and benefits, cost of obtaining financing, the time when the organization will incur each cost
B)the time when the organization will incur each cost, the availability of the new HRIS software, cost of obtaining financing
C)an estimated dollar value for each cost and benefit, the availability of the new HRIS software, sources of costs and benefits
D)the time when the organization will incur each cost, sources of costs and benefits, an estimated dollar value for each cost and benefit

Question 14

A preliminary estimate of the CBA of an HRIS investment should:

A)calculated when the HRIS actual implementation begins
B)be presented to senior management before beginning detailed work on the project
C)be based on the reputation of the HRIS vendor
D)all of the above

Question 15

An indirect benefit of revenue enhancement from an new HRIS is:

A)increased technical support needed
B)better decision making
C)saved staff time
D)new sales

Question 16

Increased technical support needed for an HRIS implementation is an example of:

A)a direct cots
B)an out-of-pocket costs
C)an indirect costs
D)all of the above

Question 17

Average Employee Contribution and employees variance in work outcomes are used for the determination of compensation levels.

Question 18

A CBA is a comparison of the projected costs and benefits associated with an HRIS
investment.

Question 19

Variance estimates for costs and benefits are important because:

A)they provide a range of values for expectations
B)they provide the overall average for expectations
C)they allow for the use of statistical analyses
D)they provide the data for estimating transaction values

Question 20

The focus of a CBA for an investment in additional or updated HRIS functionality must be related to

A)the ease of the implementation
B)the availability of technical support in the company
C)improvements in organizational effectiveness
D)the size of the HR professional staff

Question 21

Packaging your CBA for decision makers should be done on a single page.

Question 22

What are the three approaches for estimating benefit magnitude?

Question 23

An integrated information system is one built on common platforms that permit single instances of data to be used in several applications.

Question 24

Direct costs for implementing a new HRIS application in training would include reduced absenteeism.

Question 25

What does the term FTE mean in doing a CBA for a new HRIS?

Question 26

What is the differences between direct and indirect benefits and costs?

Question 27

Indirect costs for implementing a new HRIS application in training would include Lost productivity during conversion to new system.

Question 28

Estimating indirect benefits requires assumptions about the impact of a specific HRIS functionality without any direct impact of the functionality.

Question 29

Internal assessment for estimating indirect benefit magnitude provides the most precise estimates of the baseline costs and current performance of existing processes.

Question 30

The total cost of an HRIS implementation will be driven by number of employees in the organization.

Question 31

What does average employee contribution (AEC)and Individual employee differences (variance)in work outcomes measure in a CBA?

Question 32

An HRIS CBA that includes an extensive analysis of costs matched with a single source of benefits, e.g.an estimate of direct cost reductions, is a common problem in justifying the purchase of a new HRIS.

Question 33

Time saved by the implementation of an HRIS a direct cost reduction.

Question 34

What is the difference between cost reduction and organizational enhancement as strategies for HRIS investments?