Chapter 01 Human Resource Management: Gaining a Competitive Advantage Answer Key
True / False Questions
1. (p. 5) Companies have historically looked at HRM as a means to contribute to profitability, quality, and other business goals through enhancing and supporting business operations.
2. (p. 5) The human resource department is most likely to collaborate with other company functions on outplacement, labor law compliance, testing, and unemployment compensation.
3. (p. 6) The three product lines of HR include a) administrative services and transactions, B) financial services, and c) strategic partners.
4. (p. 9) The amount of time that the HRM function devotes to administrative tasks is decreasing, and its roles as a strategic business partner, change agent, and employee advocate are increasing. TRUE
5. (p. 9) Advances in technology have allowed HR services to be offered more on a self-service basis than in the past.
6. (p. 9) HR functions related to areas such as employee development, performance management, and organizational development are outsourced most frequently.
7. (p. 11) Evidence-based HR provides managers with data to make decisions, instead of just relying on intuition.
8. (p. 14) Stakeholders of a company are shareholders, the community, customers, employees, and all of the other parties that have an interest in seeing that the company succeeds.
9. (p. 19) Companies are now more and more interested in using intangible assets and human capital as a way to gain an advantage over competitors.
10. (p. 22) A learning organization places the highest emphasis on completion of formal employment training.
11. (p. 22) The psychological contract describes what an employee expects to contribute and what the company will provide to the employee in return for these contributions.
12. (p. 25) The use of alternative work arrangements, which include independent contractors, on-call workers, temporary workers, and contract company workers, is shrinking.
13. (p. 27) To be effective, balanced scorecards must be customized by companies to fit different market situations, products, and competitive environments.
14. (p. 27) The balanced scorecard should not be used to link the company's human resource management activities to the company's business strategy.
15. (p. 30) Corporate cultures within companies that successfully implement TQM typically emphasize individualism, hierarchy, accountability, and profits.
16. (p. 31) ISO 9000 certification is an integral component of W. Edwards Deming's quality control process.
17. (p. 34) The skills and motivation of a company's internal labor force determine the need for training and development practices and the effectiveness of the company's compensation and reward systems.
18. (p. 37) Because the workforce is predicted to become more uniform in terms of age, ethnicity, and racial background, it is likely that one set of values will characterize all employees.
19. (p. 39) Cultural diversity can provide a company competitive advantage regarding problem-solving. TRUE
20. (p. 42) The Sarbanes-Oxley Act of 2002 sets strict rules for corporate behavior and sets heavy fines and prison terms for noncompliance.
21. (p. 43) Every business must be prepared to deal with the global economy.
22. (p. 48) One of the disadvantages of technology is that it does not allow older workers to postpone retirement.
23. (p. 51) E-HRM is more applicable to practices associated with recruiting and training than those associated with analysis and design work, selection, and compensation and benefits.
24. (p. 54) An HR dashboard is a series of indicators that managers and employees have access to on the company intranet or human resource information system.
25. (p. 58) Compensating human resources involves measuring employees' performance.
Multiple Choice Questions
26. (p. 4) _____ refers to a company's ability to maintain and gain market share in its industry.
D. Empowerment27. (p. 4) _____ refers to the policies, practices, and systems that influence employees' behavior, attitudes, and performance.
A. Total quality management
B. Financial management
C. Human resource management
D. Production and operations management
28. (p. 5) Strategic HR management includes all but one of the following. Name the exception.
A. Financial planning
B. Training and development
C. Performance management
D. Recruiting talent
29. (p. 6) Which of the following is NOT a responsibility of HR departments?
C. Community relations
D. Production and operations
30. (p. 6) Which of the following is NOT a product line of human resources?
A. Administrative services and transactions
B. Strategic partner
C. Human capital partner
D. Business partner services
31. (p. 8) Which of the following best describes a cultural steward?
A. Shapes the organization.
B. Delivers results with integrity.
C. Facilitates change.
D. Recognizes business trends and their impact on the business.
32. (p. 8) A strategic architect is one who:
A. facilitates change.
B. recognizes business trends and their impact on the business.
C. implements workplace policies conducive to work environment.
D. develops talent and designs reward systems.
33. (p. 9) Giving employees online access to information about HR issues such as training, benefits, and compensation is known as:
B. continuous learning.
D. strategic planning.
34. (p. 9) The practice of having another company (a vendor, third-party provider, consultant) provide services traditionally associated with the administrative role of HR is known as:
35. (p. 10) Traditionally, the HRM department was primarily a(n):
A. proactive agency.
B. finance expert.
C. employer advocate.
D. administrative expert.
36. (p. 11) Which of the following statements about evidence-based HR is FALSE?
A. It helps show that the money invested in HR programs is justified and that HR is contributing to the company's goals and objectives.
B. It emphasizes that HR is being transformed from a broad corporate competency to a specialized, stand-alone function in which human resources and line managers build partnerships to gain competitive advantage.
C. It requires collecting data on such metrics as productivity, turnover, accidents, employee attitudes and medical costs and showing their relationship with HR practices.
D. It refers to demonstrating that human resources practices have a positive influence on the company's bottom line or key stakeholders.37. (p. 12-13) Which one of the following statements about the HR profession is FALSE?
A. A college degree is required of HR specialists, but not of generalists.
B. Generalists usually perform the full range of HRM activities, including recruiting, training, compensation, and employee relations.
C. Professional certification in HRM is less common than membership in professional associations.
D. The primary professional organization for HRM is the Society for Human Resource Management.
38. (p. 13) All of the following competitive challenges faced by companies will increase the importance of human resource management EXCEPT:
A. the global challenge.
B. the challenge of sustainability.
C. the political challenge.
D. the technology challenge.
39. (p. 14) _____ refers to the ability of a company to survive and succeed in a dynamic competitive environment.
D. Resource management
40. (p. 14) Sustainability includes all of the following EXCEPT:
A. expanding into foreign markets.
B. the ability to deal with economic and social changes.
C. engaging in responsible and ethical business practices.
D. providing high-quality products and services.41. (p. 19) Which of the following statements about intangible assets is FALSE?
A. They include human capital.
B. They are less valuable than physical assets.
C. They are equally or even more valuable than financial assets.
D. They are difficult to duplicate or imitate.
42. (p. 20) Tacit knowledge is an example of _____ capital.
43. (p. 21) Which of the following is NOT true of knowledge workers?
A. They often contribute specialized knowledge that their managers may not have, such as information about customers.
B. They have many job opportunities.
C. They are in high demand because companies need their skills.
D. They contribute to the company through manual labor and intellectual labor.
44. (p. 21) Empowering is defined as:
A. the movement of women and minorities into managerial positions.
B. giving employees responsibility and authority to make decisions regarding all aspects of product development or customer service.
C. leading employees by the strength of one's charisma.
D. the act of continually learning and improving one's skills and abilities.
45. (p. 22) A(n) _____ contract describes what an employee expects to contribute and what the company will provide to the employee for these contributions.
46. (p. 25) All of the following are examples of alternative work arrangements EXCEPT:
A. independent contractors.
B. current labor force.
C. on-call workers.
D. temporary workers.47. (p. 27) The balanced scorecard:
A. is similar to most measures of company performance.
B. uses indicators important to the company's strategy.
C. is a standardized instrument of company performance.
D. should not be applied to HR practices.
48. (p. 27) The balanced scorecard presents a view of company performance from the perspective of:
A. its customers only.
B. its employees only.
C. its employees and customers only.
D. its employees, customers, and shareholders.
49. (p. 28) According to the financial perspective of the balanced scorecard, which of the following questions should be answered?
A. How do customers see us?
B. Can we continue to improve and create value?
C. What must we excel at?
D. How do we look to shareholders?
50. (p. 28) Increasingly, companies are trying to meet shareholder and general public demands that they be more socially, ethically, and environmentally responsible. Thus, companies are recognizing the importance of:
A. a balanced scorecard approach to business.
C. total quality management.
D. social responsibility.
51. (p. 30) TQM focuses on:
A. designing processes to meet the needs of external customers only.
B. reducing variability in the product or service.
C. preventing errors rather than correcting errors.
D. tying pay to employees' total output less rejects
52. (p. 31) "How senior executives create and sustain corporate citizenship, customer focus, clear values, and expectations, and promote quality and performance excellence" is the definition for which Malcolm Baldrige National Quality Award criterion?
A. Strategic planning
B. Workforce focus
C. Customer and market focus
Malcolm Baldrige National Quality Award is an award established in 1987 to promote quality awareness, to recognize quality achievements of U.S. companies, and to publicize successful quality strategies.
53. (p. 33) Which one of the following is NOT true of the Six Sigma process?
A. The objective of the process is to create a total business focus on serving the customer.
B. Training is an important component of the process.
C. The process is one of seven categories evaluated within the Malcolm Baldrige Quality Award.
D. The process involves measuring, analyzing, improving, and controlling processes once they have been brought within six quality standards.
54. (p. 33) Which of following holds TRUE for lean thinking?
A. It is a way to do more with less effort, time, equipment, and space.
B. It is a way to compete for quality awards and certification.
C. It includes offering no-frills goods and services to customers.
D. It is working for zero inventories.
55. (p. 34) The skills and motivation of a company's _____ labor force determine the need for training and development practices and the effectiveness of the company's compensation and reward systems.
56. (p. 34-37) Which of the following statements about the composition of the U.S. labor force in the next decade is TRUE?
A. Labor force growth is greater than at any other time in U.S. history.
B. The largest proportion of the labor force is expected to be in the 16-to-24-year age group.
C. There will be fewer white males than minorities or women in the labor force.
D. The number of "baby boom" workers will increase faster than any other age group.
57. (p. 35) Which of the following statements about older workers is FALSE?
A. Worker performance and learning are adversely affected by aging.
B. The aging labor force means companies are likely to employ a growing share of older workers.
C. An emerging trend is for qualified older workers to ask to work part-time or for only a few months at a time as a means to transition to retirement.
D. Older employees are willing and able to learn new technology.
58. (p. 37) Baby boomers:
A. like the latest technology, are ambitious and goal-oriented, and seek meaningful work.
B. want to be noticed, respected, and involved.
C. tend to be uncomfortable challenging the status quo and authority.
D. value unexpected rewards for work accomplishments, opportunities to learn new things, praise, recognition, and time with the manager.
59. (p. 38) Regardless of their background, most employees' value:
A. the ability to challenge the status quo.
B. simplistic tasks requiring few skills.
C. managerial positions.
D. work that leads to self-fulfillment.