Question 1

Which of the following perspectives is NOT used when measuring an organization's strategic performance under the balanced scorecard approach?

Accepted Answer

All of the perspectives mentioned (financial, internal business processes, learning and growth) are used in the balanced scorecard approach. However, the competitive perspective is not typically used as a separate perspective. Rather, competition is considered as a factor within the other perspectives.

Question 2

Firms using a focused strategy attempt to achieve either a cost advantage or differentiation in a defined market segment.

Accepted Answer

Firms using a focused strategy aim to excel in a particular market segment either by offering products or services at lower costs than competitors or by differentiating their products from others in the market.

Question 3

Tina, the director of HR, is disturbed at the high level of turnover at her company. From exit interviews, she suspects that certain supervisors may have higher turnover than others may. How should Tina analyze turnover in order to verify this hunch?

Accepted Answer

Analyzing turnover by department would be the best way to verify Tina's hunch. If certain supervisors are contributing to high turnover, it would likely be evident in their department's turnover rates. This approach will also allow Tina to identify any other departments with high turnover and target interventions accordingly. Analyzing turnover by employee performance rating, job title, or race and gender may not necessarily reveal any patterns related to certain supervisors.

Question 4

It is critical that HR executives be included immediately after top management has made strategic decisions.

Accepted Answer

HR executives should ideally be involved in the strategic decision-making process from the beginning, not just informed after decisions have been made, to ensure that the implications for human resources are considered throughout.

Question 5

The new CEO of the firm has told the vice president of HR that all HR activities must use the cost of capital as the benchmark against which the returns from their activities are measured. Which measure of effectiveness is the new CEO implementing?

Accepted Answer

The measure of effectiveness being implemented by the new CEO is economic value added (EVA). EVA measures the financial return of an investment or activity against the cost of capital, which aligns with the CEO's directive to use the cost of capital as the benchmark. The balanced scorecard involves multiple measures of effectiveness beyond just financial metrics, while subjective HR metrics may not be specific or standardized enough to use as a benchmark. Return on assets (ROA) is a financial ratio that measures a company's profitability, but it does not explicitly factor in the cost of capital.

Question 6

The goal is to calculate the cost of absenteeism. Which of the following is NOT part of the calculation?

Accepted Answer

The cost of recruiting new employees is not directly related to the cost of absenteeism. The costs associated with absenteeism typically include overstaffing to cover absences, paying overtime for replacements, and the time supervisors spend managing the absences, but not the recruitment of new employees, which is related to turnover rather than absenteeism.

Question 7

In one approach to assessing how effective HR is, specific measures of performance are compared against data on those measures in other organizations. Which of the following is the name of that approach?

Accepted Answer

Benchmarking involves comparing an organization's performance measures to those of other organizations in order to identify best practices and areas for improvement. This approach can be useful in assessing the effectiveness of HR practices by comparing HR-related performance measures to those of other organizations in the same industry or with similar characteristics. Option A, ROI (Return on Investment), is a financial metric used to evaluate the efficiency of an investment. Option B, EVA (Economic Value Added), is a measure of a company's financial performance based on the idea that shareholder value is created when a company generates returns above its cost of capital. Option C, the balanced scorecard, is a management tool that provides an organization with a comprehensive view of performance across multiple areas, but is not specifically focused on HR effectiveness.

Question 8

As director of HR for a large regional car dealership with 10 locations, Ed must calculate the potential return on investment (ROI) of implementing a new training program to improve car salespeople's effectiveness in convincing new car buyers to finance their cars through the dealership. Which of the following data does Ed NOT need to collect in order to make his calculation?

Accepted Answer

While it is important to consider the cost of developing and implementing the new training program, as well as the costs of running update seminars for a year after the initial training, and the potential additional revenue from new car financing, the cost of alternative productivity enhancing training programs is not relevant to calculating the ROI of this specific training program.

Question 9

An advantage of family-owned businesses is that succession planning is unnecessary if the founder has children and/or grandchildren.

Accepted Answer

Even if the founder has children and/or grandchildren, succession planning is still necessary as they may not be interested in taking over the business or may not have the necessary skills to run it. It is important to have a plan in place to ensure the long-term success of the business.

Question 10

A differentiation strategy is more appropriate in a stable environment than in an environment of change.

Accepted Answer

In an environment of change, a differentiation strategy can be highly effective as it allows a company to stand out among competitors and respond quickly to evolving customer needs and preferences. This is because differentiation allows a company to offer unique features and benefits that are not easily replicated by competitors, leading to customer loyalty and market share growth. However, in a stable environment, a differentiation strategy may not be as effective as there may not be significant changes in customer preferences or industry trends, leading to fewer opportunities for differentiation. In this case, a cost leadership strategy may be more appropriate.

Question 11

Which of the following terms refers to a formal means to assess the current state of a firm's HR management through research?

Accepted Answer

An HR audit is a formal means to assess the current state of a firm's HR management through research. EVA assessment, ROI calculation, and utility analysis are methods of calculating the financial impact of HR activities, rather than assessing the current state of HR management.

Question 12

A firm following a cost-leadership strategy may employ a high number of contract and part-time workers, offer little-to-no training, and pay below market rates.

Accepted Answer

A cost-leadership strategy focuses on offering products or services at the lowest possible cost. To achieve this, the firm may use a variety of tactics, including employing contract and part-time workers, offering minimal training, and paying lower wages than competitors.

Question 13

The differentiation strategy requires an organization to "build" its own employees to fit its specialized needs.

Accepted Answer

The differentiation strategy focuses on offering unique products or services to stand out in the market, not specifically on building employees to fit specialized needs.

Question 14

Five employees quit Acme Homes during August. If on August 15 there are 30 employees, which of the following is Acme's turnover rate?

Accepted Answer

To find the turnover rate, we need to divide the number of employees who left by the average number of employees during the month and then multiply the result by 100 to express it as a percentage. 
The average number of employees during August can be found by adding the number of employees at the beginning of the month and at the end of the month, and then dividing by 2. In this case, we have: 
(Starting employees + Ending employees) / 2 = (30 + 5) / 2 = 17.5
Now we can calculate the turnover rate: 
(5 / 17.5) x 100 = 28.57%
However, the question is asking for the turnover rate as a percentage rounded to one decimal place. The closest option is B) 16.7 percent.

Question 15

Companies categorized as defenders in their industry lack a consistent strategy, structure, or culture relationship.

Accepted Answer

Defenders in their industry are characterized by a consistent strategy, structure, and culture relationship.

Question 16

Prospectors have broad lines that focus on product innovation and search for new market opportunities.

Accepted Answer

Prospectors are companies that focus on product innovation and are constantly searching for new market opportunities.

Question 17

Three components of the simplified turnover costing model are typical annual pay for the job, percentage of pay for benefits, and the number of voluntary quits. Which of the following represents the fourth component?

Accepted Answer

The fourth component is the number of months it takes an employee to become fully productive, as it directly impacts the cost associated with turnover by affecting how long it takes for a new hire to reach the productivity level of the departing employee.

Question 18

In most organizations that do HR planning, the main responsibility for this planning is given to the top HR executives and subordinate staff specialists.

Accepted Answer

HR planning is typically the responsibility of top HR executives who oversee subordinate staff specialists that may assist in the planning process.

Question 19

Which of the following is synonymous with the term "separation"?

Accepted Answer

Separation refers to leaving the organization voluntarily or involuntarily. The term "leaving the organization" is synonymous with separation. A) voluntary quitting is a specific example of separation, but not synonymous with it. C) dysfunctional turnover refers to negative or involuntary turnover caused by issues within the organization. D) termination refers specifically to involuntary separation initiated by the employer.

Question 20

Carlos, the director of HR for a large paper manufacturing company, is studying the financial costs of turnover of plant personnel at all levels. The calculable costs are sobering, but Carlos is also concerned about the hidden costs of turnover. Which of the following is included in the hidden costs?

Accepted Answer

The answer of Carlos, the director of HR for a...

Quiz 2: Strategic HR Management and Planning