Question 1

Frank is the CEO of Telex Inc., a company that has a team-oriented culture in which people perform as groups and complete short-term projects to earn revenue. After studying his company's structure, Frank feels Telex's current processes are inefficient. As a result, Frank decides to downsize the organization and then use the profits to enhance the organization's efficiency. What is a disadvantage of this approach?

Accepted Answer

Downsizing often leads to a decrease in employee morale, job insecurity, and mistrust among remaining employees, which can negatively impact the effectiveness of teamwork in the organization.

Question 2

What is a step a downsized company can take to counter negative employee emotions?

Accepted Answer

Building confidence in the future plans of the company is a positive step towards countering negative employee emotions. This can help employees see that the downsizing was necessary for the long-term health of the company and that their jobs are secure. It can also help to boost morale and motivation. The other options, such as demonstrating that downsized employees deserved it or encouraging employees to work harder, may only serve to further alienate employees and increase negative emotions. Pursuing a commitment to customers over the community may also come across as callous and insensitive. Showing commitment to management alone may not be enough to address the concerns and emotions of downsized employees.

Question 3

Why is temporary employment popular with employers?

Accepted Answer

Temporary employment provides employers with flexibility in operations. They can hire workers on an as-needed basis and adjust their workforce to meet changing demand or project timelines. This can save costs on employee benefits, training, and other expenses associated with full-time employees.

Question 4

Identify a disadvantage of using temporary and contract workers.

Accepted Answer

Temporary and contract workers tend to have less commitment to an organization as they know that their employment is not permanent.

Question 5

Trinkets Inc., a manufacturer of widgets, has entered into a contract with a third party to perform services related to processing orders, managing inventory levels, and shipping products to customers. The company is engaged in

Accepted Answer

Trinkets Inc. has entered into a contract with a third party to perform services related to processing orders, managing inventory levels, and shipping products to customers, which is the definition of outsourcing.

Question 6

Taryn, an HR manager at NetHint Inc., hires employees who provide a specific set of knowledge and skills that will give her company advantage over its competitors. In the context of strategic planning, Taryn is

Accepted Answer

Hiring individuals with a core competency aligns with the goal of strategic planning, which is to gain a competitive advantage. By hiring individuals with specific knowledge and skills, Taryn is ensuring that her company has a strong foundation of expertise in areas that directly contribute to the success of the organization.

Question 7

Identify the similarity between the outsourcing and overtime strategies for avoiding a labor shortage.

Accepted Answer

Both outsourcing and overtime strategies have high revocability, meaning they can be easily reversed or adjusted as needed.

Question 8

Betty heads the production department at Riffer Inc., a firm that stresses the importance of maintaining regular contact with customers. Betty is expecting a labor surplus in the future. Mike, a supervisor, recommends downsizing as an option to deal with this labor surplus, however, Betty rejects this option. Which statement will validate that Betty made the right decision?

Accepted Answer

Downsizing can have negative impacts on long-term organizational effectiveness, including loss of valuable skills, decreased employee morale, and potential damage to the company's reputation, which can affect customer relationships and overall performance.

Question 9

Identify the correct statement regarding downsizing.

Accepted Answer

Downsizing often disrupts the social networks through which people are creative and flexible. This can cause negative effects on the morale and motivation of remaining employees, as well as on collaboration and innovation within the organization. While downsizing may result in short-term cost savings, it may also have long-term detrimental effects on organizational effectiveness.

Question 10

What are the most widespread methods for eliminating labor shortages?

Accepted Answer

Hiring temporary workers and outsourcing work are the most widespread methods for eliminating labor shortages. Downsizing and merging with other organizations may eliminate jobs instead of shortages, retrained transfers and turnover reduction take time and may not be applicable in all situations, and overtime and new external hires may not address the root cause of the shortage. Temporary workers and outsourcing allow for immediate access to additional labor without long-term commitments or investments.

Question 11

Tex Tools applies its in-depth understanding of the challenges facing manufacturers to design and build custom machine tools that are highly valued by business customers. To maintain its competitive advantage, Tex Tools also wants to avoid spending more than is necessary on administrative activities such as managing employee benefits. What would be the most effective way for Tex Tools to minimize administrative expenses without sacrificing quality?

Accepted Answer

Outsourcing administrative work to a specialized organization can help Tex Tools minimize administrative expenses. This option can provide access to expertise, technology, and resources that are not available internally at Tex Tools, resulting in cost savings and improved efficiency. It also allows Tex Tools to focus on its core business of designing and building custom machine tools. Hiring new employees with administrative skills, downsizing the workforce, moving to a new location, or hiring temporary workers may not be effective in reducing administrative expenses in the long run.

Question 12

Which of the following best describes a phased-retirement program?

Accepted Answer

A phased-retirement program is a gradual reduction in both the number of hours worked and the cost of compensation for older employees as they approach retirement. This allows for a more gradual transition into retirement, which can benefit both the employee and employer. Options A, B, D, and E do not accurately describe a phased-retirement program.

Question 13

El Niro Inc. is automating processes so the company can meet its demand with a smaller workforce. The CEO asks Megan, the vice president of human resources, for advice on how to address the resulting labor surplus. Megan studies the workforce and observes that many employees are in their 50s and 60s. Furthermore, these employees are the highest-paid workers in every job category. Based on this information, what should Megan suggest as the most effective way of addressing El Niro's labor surplus?

Accepted Answer

Offering early retirement incentives to the older employees would allow for a reduction in the workforce while avoiding layoffs and the potential negative impact on employee morale. It would also provide an opportunity for the older employees to retire with dignity and a sense of security rather than facing uncertain job prospects. Retraining the older employees or offering performance-based pay may not be as effective at reducing labor surplus, and replacing the employees with contract workers may not be a sustainable solution.

Question 14

What is a challenge associated with an outsourcing strategy?

Accepted Answer

Quality-control problems are a challenge associated with outsourcing, as the outsourced vendor may not have the same level of quality standards as the company. This can lead to issues with product quality and customer satisfaction. The other options listed are also potential challenges, but quality-control problems are the most directly associated with outsourcing.

Question 15

Jacob, the CEO at Einstein Inc., learns that his company is perceived as low-value by customers. He plans to combat this by hiring highly skilled and knowledgeable employees in order to improve Einstein's competitive standing. In this scenario, Jacob will most likely be hiring

Accepted Answer

Jacob's aim is to improve Einstein's competitive standing by hiring highly skilled and knowledgeable employees. Thus, he will most likely be hiring employees with a core competency, which refers to a distinctive capability or advantage that a company possesses over its competitors. Such employees have expertise in specific areas that are essential to a company's success, and they can help Einstein Inc. to differentiate itself from its competitors and deliver high-value products or services to customers. Outsourced, offshored, and temporary workers may not necessarily have the same level of expertise or commitment as core employees, and having a college degree may not necessarily equate to having core competencies.

Question 16

A small company that manufactures special-order wood furniture has kept its employees busy on a 40-hours-a-week schedule for the past two years. The company just received a large contract from a Chinese company that is opening offices in the area. The Chinese company has given a month's time for completion of its order. To complete the contract in the required one month, the furniture company needs additional skilled labor on short notice. Which strategy might the company use if it wants to avoid this short-term labor shortage while finding a simple and cost-effective solution?

Accepted Answer

Overtime is a simple and cost-effective solution for addressing a short-term labor shortage, especially when the company already has skilled employees who are familiar with the work.

Question 17

Organizations use outsourcing as a way to

Accepted Answer

Outsourcing allows organizations to utilize specialized services and expertise, often at a lower cost than hiring and training in-house employees. This can increase efficiency and save money for the organization.

Question 18

Which statement best describes outsourcing?

Accepted Answer

Outsourcing refers to contracting with another organization to perform a broad set of services. This can include various services such as IT services, customer service, manufacturing, or accounting, among others. It is usually done to reduce costs, improve efficiency, or access specialized expertise.

Question 19

A manufacturing company, hit by a slump in demand, is experiencing a labor surplus. The company expects the market to improve in six months, and it does not want to lay off any of its employees. Which strategy is an equitable way to handle this issue and spread the burden more fairly?

Accepted Answer

Reducing work hours allows the company to continue employing all of its workers while also spreading the burden more fairly. This strategy avoids lay-offs and maintains employee morale, while also adjusting to the current demand for the company's products. Demotions may lower employee morale, outsourcing and temporary workers may not be cost-effective, and overtime may not be sustainable for the company.

Question 20

Allie, a human resource manager at an electronics firm, observes that many employees who are reaching the traditional retirement age are not interested in leaving the organization. Which statement best explains the reason for this trend among older employees?

Accepted Answer

Jobs are becoming less physically demanding, which means that older employees can continue to work comfortably compared to the physically demanding jobs of the past. This is a reason why many employees who are reaching the traditional retirement age are not interested in leaving the organization.

Quiz 5: Planning for and Recruiting Human Resources