Test Bank for Managing Human Resources, Ninth Canadian Edition

Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning 1. What is the first step in the strategic planning process? a. putting together the human resource management team b. executing the human resource plan c. establishing the mission, vision, and values of the organization d. aligning the human resource plan and the strategic plan ANSWER: c 2. What is the relationship between human resource planning and strategic human resource management? a. Strategic human resource management is narrower in scope than human resource planning. b. Strategic human resource management is broader in scope than human resource planning. c. Human resource planning is the same as strategic human resource management. d. Human resource planning is more important than strategic human resource management. ANSWER: b 3. Which of the following is a typical activity undertaken by human resource management professionals in a SWOT analysis? a. gauging the external supply of labour b. analyzing the organization’s core competencies c. reconciling labour supply and demand d. analyzing the industry and competitors ANSWER: a 4. Which of the following is a typical activity undertaken by human resource management professionals at the strategy implementation stage? a. conducting human resource forecasting for the demand of labour b. helping to capture the underlying business philosophy c. helping to analyze the workforce’s culture d. using performance management to achieve organizational strategy ANSWER: d 5. HR planning requires HR managers to focus more on an alignment between HR plans and which of the following? a. the organization’s financial strategy b. the organization’s marketing position c. the organization’s strategic plan d. the competitive environment ANSWER: c 6. On the entrance to Mac Pencils’ factory are the words “to provide the world with high-quality and dependable pencils.” What is this an example of? a. strategic vision b. mission c. core values d. core resources ANSWER: b 7. Which of the following best captures the strategic intent of the organization? a. its mission b. its vision c. its core values d. its strategic human resource plan Copyright Cengage Learning. Powered by Cognero. Page 1 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning ANSWER: b 8. Which of the following best describes the core values of a company? a. They represent the alignment of the strategic plan with the human resource plan. b. They are strong enduring beliefs and principles of the company. c. They are the basic purpose of the organization. d. They provide a perspective on where the company is headed. ANSWER: b 9. During its strategic retreat, the top management team at IAMME Gold Corporation pondered on the question “What’s the organization reason for being?” What was the team most likely focusing on? a. the firm’s strategic vision b. the firm’s core values c. the firm’s mission d. the firm’s competitive position ANSWER: c 10. As part of its strategic planning process, TJX Corporation is involved in a systematic, regular monitoring of major external forces influencing the organization. What is this process called? a. external forecasting b. human resource planning c. Markov analysis d. environmental scanning ANSWER: d 11. Which of the following is NOT generally considered a component of a firm’s competitive environment? a. rival firms b. new entrants c. labour laws d. suppliers ANSWER: c 12. Which of the following deliberations on the competitive environment generally involves an active role by HR managers? a. an analysis of new entrants b. an analysis of the supply and demand for labour c. coordination with suppliers d. minimizing the technical advantages of rival firms ANSWER: b 13. What do we call integrated knowledge sets within an organization that distinguish it from its competitors and deliver value to customers? a. core capabilities b. competitive advantage c. human capital d. organizational competencies ANSWER: a 14. An organizations’ core capabilities consist of three components. Which of the following is NOT one of them? a. processes b. systems c. people d. cultural audit ANSWER: d Copyright Cengage Learning. Powered by Cognero. Page 2 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning 15. What do we consider the firm’s resources to be when they improve the efficiency or effectiveness of the company? a. difficult to imitate b. valuable c. organized d. rare ANSWER: b 16. Which statement best describes strategic knowledge workers? a. They have skills that are valuable but not unique. b. They have firm-specific skills directly related to company strategy. c. They have unique skills directly linked to the company’s strategy. d. As consultants, they have strategic skills. ANSWER: c 17. Which statement best describes the skills of core employees? a. Their skills are not directly related to company strategy. b. They have firm-specific skills directly related to company strategy. c. They have skills that are valuable but not unique. d. Their skills are available to all firms. ANSWER: c 18. From an organization’s perspective, what is an important shortcoming of having to rely on part-time employees? a. limited benefits b. costs of continuous replacement c. lack of training d. no job security ANSWER: b 19. As part of the strategic planning process, XYZ Inc. recently examined the attitudes and activities of the company’s workforce. What was XYZ doing? a. an environmental scan b. a cultural audit c. a trend analysis d. a demand forecast ANSWER: b 20. Which of these groups is a secondary stakeholder of an organization? a. investors b. employees c. suppliers d. news reporters ANSWER: d 21. What is values-based hiring? a. hiring employees whose values correspond to their corporate cultures b. hiring employees based on good ethical values c. hiring decisions that lead to new values being adopted by the company d. hiring executives who then instill their values in the company ANSWER: a 22. Which of the following best describes forecasting human resources needs? a. It is scientific and relatively error-free. Copyright Cengage Learning. Powered by Cognero. Page 3 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning b. It is difficult and should only be done on rare occasions. c. It should rely strictly on quantitative approaches, which utilize sophisticated analytical models. d. It estimates the number and type of people that are needed to meet organizational objectives. ANSWER: d 23. Which of the following should you take into account when forecasting demand? a. absenteeism b. turnover c. business cycles d. labour mobility ANSWER: c 24. Which of the following is used in forecasting the demand of labour? a. replacement charts b. Markov analysis c. trend analysis d. succession planning ANSWER: c 25. XYZ Corporation wants to track the percentage and actual number of employees who remain in each of the firm’s job from one year to the next. Which of the following would XYZ Corporation benefit from? a. a replacement chart b. a skills inventory c. a Markov analysis d. a succession plan ANSWER: c 26. Manning Logistics laid off nine employees from data-entry positions in its finance division. Two weeks later, it hired 15 employees into data-entry positions in the inventory division. What mistake has the company committed? a. faulty cultural audit b. not forecasting properly c. faulty goal alignment d. not analyzing the internal labour force ANSWER: b 27. What is the difference between trend analysis and management forecasts? a. Trend analysis is used to analyze the business environment and management forecasts predict labour needs. b. Trend analysis uses organizational indexes and management forecasts utilize statistical techniques. c. Trend analysis is quantitative and management forecasts are qualitative. d. Trend analysis has proven success and management forecasts have major shortcomings. ANSWER: c 28. Which of the following is a graphical representation of all organizational jobs along with the numbers of employees currently occupying those jobs and future employment requirements? a. a Markov analysis b. a trend analysis c. a skills inventory d. a staffing table ANSWER: d 29. What is the most important information obtained from a Markov analysis? a. human capital readiness b. what types of attitudes employees have c. what positions are going to be coming open and will require a new hire d. how many individuals are ready for promotion Copyright Cengage Learning. Powered by Cognero. Page 4 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning ANSWER: c 30. Which of the following is NOT a qualitative approach to demand forecasting? a. trend analysis b. Delphi technique c. soliciting expert opinion d. management forecast ANSWER: a 31. Which of the following is the process of identifying, developing, and tracking key individuals so that they may eventually assume top-level positions? a. target forecasting b. predicted change c. succession planning d. replacement selection ANSWER: c 32. As part of the SWOT analysis, the internal analyses of the firm would include an analysis of which of the following? a. opportunities b. strategy c. threats d. weaknesses ANSWER: d 33. Which of the following is included in an external analysis of an organization in a SWOT analysis? a. An analysis of its strengths. b. An analysis of its core capabilities. c. An analysis of its weaknesses. d. An analysis of its opportunities. ANSWER: d 34. Which of the following is a cooperative strategy pursued by firms? a. joint ventures b. mergers c. acquisitions d. diversification ANSWER: a 35. In what way can HR best help ensure that a strategic alliance or joint venture goes smoothly in the beginning? a. plan labour supply needs for both organizations b. systematically monitor employee morale for both organizations c. teach employees about the other organization d. assess the compatibility of the two organizational cultures ANSWER: d 36. What do we call the internal alignment of HR practices to establish a configuration that is mutually enforcing? a. vertical fit b. horizontal fit c. HR alignment d. enforcing fit ANSWER: b 37. What do we call reducing the workforce through the departure of employees who resign or retire? a. attrition b. contraction c. contracting out d. termination ANSWER: a Copyright Cengage Learning. Powered by Cognero. Page 5 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning 38. Organization Y is a unionized textiles manufacturing company that is downsizing. What will Organization Y most likely use when deciding whom to lay off first? a. seniority b. the payroll c. what skills and abilities the company needs to thrive d. talent ANSWER: a 39. Severance pay is usually calculated based on which of the following? a. the employee’s years of service and salary b. complex formulas administered by the federal government c. the employee’s skills and abilities d. the employee’s education and performance ANSWER: a 40. ATM Company has experienced a recent growth in its business. Which of the following is NOT a likely response to its new HR demands? a. Hire full-time employees b. Ask employees to work over-time c. Allow for attrition d. Use contract workers ANSWER: c 41. What is an HR “dashboard”? a. a strategic tool developed by the Boston Consulting Group b. a SWOT analysis at the HR level c. a balanced scorecard d. a software that tracks and graphically displays HR statistics ANSWER: d 42. What is the term for the process that is used to identify “best practices”? a. benchmarking b. balancing the scorecard c. HR “dashboard” d. Markov analysis ANSWER: a 43. Which term refers to an enthusiastically adopted tool for mapping a firm’s strategy in order to ensure strategic alignment? a. target forecasting b. predicted focus c. balanced scorecard d. replacement selection ANSWER: c 44. Which of the following is an important use of the balanced scorecard? a. to help balance internal and external fit b. to help managers translate their firms’ strategic goals into operational objectives c. to help managers balance the costs and benefits of HR strategies d. to help with the SWOY analysis Copyright Cengage Learning. Powered by Cognero. Page 6 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning ANSWER: b 45. Which of the following can be used to translate strategic goals to operational objectives? a. a Markov analysis b. a replacement chart c. a skills inventory d. a balanced scorecard ANSWER: d Scenario 2.1 Blockbuster Canada was the first of its kind in Canada in the movie and games rental business and operated for more than 21 years. However, with the advent of more modern technology accessible mainly through Netflix and Rogers On Demand, Blockbuster struggled to stay relevant in a tech-savvy environment where videos and games could now be rented conveniently from the comfort of one’s couch via computer or TV. Despite efforts to try to stay relevant, Blockbuster did not leverage technology that had become an important part of their consumer base’s daily lives. As a result, Blockbuster was not able to fight off the competition. 46. Refer to Scenario 2.1. To remain competitive, Blockbuster Canada needed to systematically monitor the major external forces influencing the movie/game rental business. Which of the following would be important to its success? a. analysis of the internal environment b. environmental scanning c. changes in demographics d. changes in its mission, vision, and values ANSWER: b 47. Refer to Scenario 2.1. Blockbuster Canada managers could have successfully advanced the company and remained relevant by focusing on which of the following? a. an environmental analysis b. what they do best, traditional rentals c. technological changes including information technology and innovations d. incentives to keep consumers coming back ANSWER: c 48. Refer to Scenario 2.1. What is one of the most important assessments a firm like Blockbuster could have made in order to stay relevant? a. identifying the needs of its customers b. identifying the needs of its producers c. identifying the needs of its employees d. teaming up with the competition ANSWER: a 49. Refer to Scenario 2.1. Blockbuster’s competitive environment includes which of the following? a. its customers, HR strategy, new entrants, core capabilities b. its environmental scanning and analysis c. its environmental analysis, strategic planning, and HR strategy d. its customers, rival firms, new entrants, substitutes, and suppliers ANSWER: d 50. Refer to Scenario 2.1. For years, Blockbuster survived as a successful entity with various competitors until Netflix and Rogers On Demand began making movies and games available online. Which of the following most likely contributed to Blockbuster going out of business? a. economic, global, political, and environmental factors Copyright Cengage Learning. Powered by Cognero. Page 7 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning b. technological, psychological, and physical factors c. technological changes, social concerns, and demographic and labour market trends d. the lack of knowledge workers ANSWER: c Scenario 2.2 Avie Products Inc. is planning to add a third shift to its production schedule. It currently has 450 workers involved in all aspects of its fertilizer business, best done in Canada. A recent surge in demand from its global customers is driving the need for more workers; however, Simi Meher, the CEO, is concerned that the surge may be temporary, especially in light of the recent economic downturns in the global environment where Avie does business. 51. Refer to Scenario 2.2. Which approach could Avie use to forecast demand for its products? a. staffing tables b. Markov analysis c. skill inventories d. trend analysis ANSWER: d 52. Refer to Scenario 2.2. What would assist Avie in determining how many additional workers it would need for the third shift? a. reconciling supply and demand b. Markov analysis c. replacement charting d. trend analysis ANSWER: a 53. Refer to Scenario 2.2. What is the best strategy for Avie to follow with respect to workers on the third shift? a. hire full-time employees to get their commitment b. hire part-time staff c. get management to do the extra work d. outsource the work to India ANSWER: b 54. Refer to Scenario 2.2. Assume that Avie goes ahead with the third shift. What can the company use to evaluate the effectiveness of this strategy in a year’s time? a. Markov analysis b. trend analysis c. skill inventories d. benchmarking ANSWER: d 55. Strategic human resource management combines human resource planning and strategic planning. a. True b. False a. True b. False ANSWER: True 56. Increased emphasis on HR issues becomes especially critical when organizations consider global strategies, relocation of plants, product innovation plans, and so forth. a. True b. False Copyright Cengage Learning. Powered by Cognero. Page 8 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning a. True b. False ANSWER: True 57. Human resources planning plays a key role in organizational strategy implementation because organizational leaders must make decisions regarding resource allocations to human capital, among other things. a. True b. False a. True b. False ANSWER: True 58. Forecasting labour supply is an aspect of human resource planning. a. True b. False a. True b. False ANSWER: True 59. Human resources planning (HRP) is the conducting of recruitment and selection methods according to a strategic plan. a. True b. False a. True b. False ANSWER: False 60. The mission statement of an organization is a description of the organization’s vision and values. a. True b. False a. True b. False ANSWER: False 61. Organizational core values are the strong enduring beliefs and principles that a company uses as a foundation for its decisions. a. True b. False a. True b. False ANSWER: True 62. Environmental scanning involves the systematic monitoring of internal factors influencing the organization. a. True b. False a. True b. False Copyright Cengage Learning. Powered by Cognero. Page 9 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning ANSWER: False 63. Economic factors in environmental scanning include general and global conditions. a. True b. False a. True b. False ANSWER: True 64. Gauging demographic trends is an aspect of the external analysis in a SWOT analysis. a. True b. False a. True b. False ANSWER: True 65. Utilizing a balanced scorecard is an aspect of the internal analysis in a SWOT analysis. a. True b. False a. True b. False ANSWER: False 66. National and regional unemployment rates are often considered a general barometer of labour supply. a. True b. False a. True b. False ANSWER: True 67. Investors are primary stakeholders of an organization. a. True b. False a. True b. False ANSWER: True 68. Suppliers are secondary stakeholders of an organization. a. True b. False a. True b. False ANSWER: False 69. Internal analysis provides strategic decision makers with an inventory of organizational skills and resources. a. True b. False Copyright Cengage Learning. Powered by Cognero. Page 10 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning a. True b. False ANSWER: True 70. A cultural audit asks questions such as “How do employees spend their time?” a. True b. False a. True b. False ANSWER: True 71. Core capabilities are integrated skills and knowledge sets within an organization that distinguish it from its competitors and deliver value to customers. a. True b. False a. True b. False ANSWER: True 72. Core capabilities provide a long-term basis for technological innovation, product development, and service delivery. a. True b. False a. True b. False ANSWER: True 73. In general, contract labour possesses skills and knowledge of less strategic value to the organization than core knowledge workers. a. True b. False a. True b. False ANSWER: True 74. Organizations such as Canadian Tire and CIBC conduct cultural audits to examine the attitudes and activities of the external workforce. a. True b. False a. True b. False ANSWER: False 75. A cultural audit may examine how people are empowered. a. True b. False a. True Copyright Cengage Learning. Powered by Cognero. Page 11 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning b. False ANSWER: True 76. A cultural audit asks questions such as “What is the ethnic make-up of my workforce?” a. True b. False a. True b. False ANSWER: False 77. There are two approaches to HR forecasting: quantitative and qualitative. a. True b. False a. True b. False ANSWER: True 78. Trend analysis is a qualitative approach to labour demand forecasting. a. True b. False a. True b. False ANSWER: False 79. Trend analysis relies on a single business factor. a. True b. False a. True b. False ANSWER: True 80. Forecasting may be as informal as having one person familiar with the organization anticipate HR needs. a. True b. False a. True b. False ANSWER: True 81. Management forecasts are quantitative measurements of future employment needs. a. True b. False a. True b. False ANSWER: False 82. The Delphi technique works best in organizations where dynamic technological changes affect staffing levels. Copyright Cengage Learning. Powered by Cognero. Page 12 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning a. True b. False a. True b. False ANSWER: True 83. Staffing tables provide data on external labour supply sources. a. True b. False a. True b. False ANSWER: False 84. Markov analysis is a systematic monitoring of the major external forces influencing an organization. a. True b. False a. True b. False ANSWER: False 85. Markov analysis focuses on the number of employees in particular jobs and their skill levels, compensation, and job tenure. a. True b. False a. True b. False ANSWER: False 86. Succession planning is the process of identifying, developing, and tracking key individuals so that they may eventually assume top-level positions. a. True b. False a. True b. False ANSWER: True 87. Replacement charts are listings of current jobholders who are potential replacements if an opening occurs. a. True b. False a. True b. False ANSWER: True 88. SWOT analysis includes the strengths only for strategy formulation purposes. a. True b. False a. True Copyright Cengage Learning. Powered by Cognero. Page 13 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning b. False ANSWER: False 89. For Microsoft, brand recognition can be classified as a strength in the SWOT analysis. a. True b. False a. True b. False ANSWER: True 90. Value creation is what the firm adds to a product or service by virtue of making it; it’s the amount of benefits provided by the product or service once the costs of making it are subtracted. a. True b. False a. True b. False ANSWER: True 91. Through human resources planning, organizations strive for a proper balance between demand considerations and supply considerations. a. True b. False a. True b. False ANSWER: True 92. Decisions about employee layoffs are usually based on seniority and/or performance. a. True b. False a. True b. False ANSWER: True 93. A disadvantage of overemphasizing seniority is that less competent employees receive the same rewards and security as more competent employees. a. True b. False a. True b. False ANSWER: True 94. Attrition is the fastest way to achieve workforce reduction. a. True b. False a. True b. False Copyright Cengage Learning. Powered by Cognero. Page 14 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning ANSWER: False 95. In unionized firms, layoffs are typically based on performance. a. True b. False a. True b. False ANSWER: False 96. Attrition and early retirement are means for organizations to reduce excess labour. a. True b. False a. True b. False ANSWER: True 97. Under the umbrella of layoff strategies are several work reduction options: reduced workweek, reduced shifts, transfers to related companies, and so on. a. True b. False a. True b. False ANSWER: True 98. The use of part-time employees creates a problem of labour costs at fast-food restaurants. a. True b. False a. True b. False ANSWER: False 99. Over time, organizations may try to reduce their workforce by relying on attrition. a. True b. False a. True b. False ANSWER: False 100. Severance pay is a lump-sum payment given to terminated employees. a. True b. False a. True b. False ANSWER: True 101. Benchmarking is the process of comparing the organization’s processes and practices with those of other companies. a. True Copyright Cengage Learning. Powered by Cognero. Page 15 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning b. False a. True b. False ANSWER: True 102. Internal fit (or alignment) means that HR practices are aligned with one another in a mutually reinforcing configuration. a. True b. False a. True b. False ANSWER: True 103. Describe how human resources planning is integrated with strategic planning. ANSWER: Through strategic planning, organizations set major objectives and develop plans to achieve those objectives. HRP provides a set of inputs that determine what is or is likely to be possible, given the number of available people, training needs, and other people-related issues. HR strategies and action plans are developed according to the overall strategic goals that evolve from the strategy formulation process. During the strategy implementation phase, HRP must make resource allocation decisions, and implement policy, practices, and training that support the decisions and outcomes of the strategic planning process. 104. Describe the three key elements of the HRP model. ANSWER: The three key elements in the HR planning process are (1) forecasting demand, (2) forecasting supply, and (3) balancing supply and demand considerations. Forecasting demand involves estimating in advance the number and type of people needed to meet organizational objectives. It may involve a quantitative approach using statistical analysis and mathematical models or a qualitative approach focusing on employee performance and promotability. Forecasting supply determines if there are sufficient numbers and types of employees available to staff anticipated openings. Sources of supply can be external or internal. HR planning should strive for a proper balance between the emphasis placed on demand considerations and that placed on supply considerations. Demand considerations are based on the forecast of trends in business activity. Supply considerations involve the determination of where and how candidates with the required qualifications are to be found to fill vacancies. 105. Identify and briefly describe three strategies that managers frequently use to cope with a labour shortage. ANSWER: (1) Overtime (i.e., asking employees to work extra hours) is a strategy used by most firms during peak periods. (2) Increasingly, organizations are using part-time employees to increase flexibility in scheduling and reducing payroll costs. Many organizations use part-time or contract employees to cover the absences of regular, fulltime employees. (3) In addition, nine out of ten Canadian companies—both large and small—make some use of temporary employees. “Temps” are typically used for short-term assignments, vacation fill-ins, for peak work periods, or to cover for employees taking sick leave, pregnancy leave, and so forth. 106. Explain how the balanced scorecard can be used by HR professionals in measuring a firm’s strategic alignment? ANSWER: The balanced scorecard (BSC) can be used by HR professionals to map a firm’s strategy to ensure strategic alignment. The BSC is a framework that helps managers translate their firm’s strategic goals into operational objectives. The model has four related cells: (1) financial, (2) customer, (3) processes, and (4) learning. Copyright Cengage Learning. Powered by Cognero. Page 16 Name: Class: Date: Chapter 2 – Strategy and Human Resources Planning The logic behind BSC is firmly rooted in HRM. People management and learning help organizations improve their internal processes and provide excellent customer service. Internal processes—product development, service, and the like—are critical for creating customer satisfaction and loyalty; they are also important for ensuring productivity to contain costs for better financial performance. Customer value creation, in turn, drives up revenues, which enhances profitability. At Starbucks, for example, key metrics can be used to help translate strategic goals to operational imperatives. For instance, under customer metrics, Starbucks might look at the percentage of repeat customers, the number of new customers, and growth rate. Under people metrics, HR professionals might measure the numbers of suggestions provided by employees, participation in Starbucks’ stock-sharing program, employee turnover, and training hours spent. Each of these cells links vertically. HR management issues such as rewards, training, and suggestions can be linked to efficient processes (e.g., brewing the perfect cup, delivering top-notch customer service). These processes then lead to better customer loyalty and growth. Growth and customer loyalty in turn lead to higher profitability and market value. Copyright Cengage Learning. Powered by Cognero. Page 17