chapter 19, 20, 21, 22, 23

Question 1

What are 2 objectives of HR management?
4 ethical principles

Answer 1

• Company performance (competitive advantage achieved through people)
• Concern for people (attracting, developing, and retaining the right people and developing culture)
• 4 ethical principles:
  
  • Respect for the individual
  • Mutual respect
  • Procedural fairness
  • Transparency

Question 2

What are 3 components of success?
(sketch)

Answer 2

Technical component; Economic component; Human component

Question 3

What are 3 process categories of HRM?
sketch

Answer 3

Meta Functions:
* Corporate Identity
* Human Resource Policy
* Strategic HRM

Core Functions:
* HR Planning
* Recruitment and Selection
* HR Development
* Operational Use of Personnel and Motivation
* Personnel Administration and Maintenance
* Release from Organization

Support Functions:
* Labor Law
* Personnel and Organizational Development
* Leadership
* Personnel Marketing and Controlling
* Communication Program
* Knowledge Management

Question 4

What is corporate identity and which 4 subcategories exist?

Answer 4

• Explicit management of company’s presentation to the audience
• Philosophy and history of the organization
• Multidisciplinary field
• Based on corporate personality of the organization

subcategories
* Communication and Visual Identity
* Behavior
* Corporate culture
* Market Conditions

Question 5

What is human resource policy?
expressed through

Answer 5

HR policy defines the way things are done around here

It is expressed through:

• Equity (treating employees fairly and justly)
• Consideration (taking into account individual circumstances when making decisions concerning people)
• Quality of working life
• Working conditions

Question 6

What are areas of HR policy and what influences need to be considered.

Answer 6

• Employment policy
• Reward policy
• New technology policy
• Harassment policy
• Health and Safety policy

Influences to consider:
* Legal norms
* Owners
* Trade unions
* Customers/Suppliers

Question 7

What is strategic HRM?

Answer 7

• Strategic HRM encompasses decisions and actions
• It concerns the management of employees at all levels in the business
• Its focus is on creating and sustaining competitive advantage.

Question 8

Which types of competences do you know (HR Development)?

Answer 8

• Professional competences (knowledge, capabilities, and skills acquired through education, training, or experience)
• Methods competences (ability to apply professional competences in an aim-oriented manner, problem-solving skills, information gathering and understanding, training through seminars, practical experience)
• Social competences (capacity to coordinate adaptive responses to interpersonal demands, effective organization of social behavior, conflict resolution skills, effective communication and collaboration)
• Action competence (intersection of professional, methods, and social competence, aims to enhance action competences at all levels of the company)

Question 9

Why is HR development of high importance for company.

Answer 9

• Technological change (new skills are required, new methods and tech developed)
• Speeding up response time – more decisions in shorter time
• Flexibility – concerning environmental factors
• Innovation in higher frequency – need as product life cycles are getting shorter
• Conflict management – key competence for managers

Question 10

Name 4 activities of HR development.

Answer 10

• Learning: Permanent change in behavior
• Education: Development of knowledge and values
• Development: Personal growth and advancement
• Training: Modification of behavior through instruction and practice

Question 11

What is relationship between Motivators and Hygiene factors?

Answer 11

Motivators:
* Recognition
* Achievement
* Personal growth

Hygiene factors:
* Job security
* Salary
* Insurance
* Vacation

Relationship between motivators and hygiene factors:
* If motivators are low and hygiene factors are high, the job is viewed as a paycheck.
* If motivators are high but hygiene factors are low, the job is challenging and exciting, but work conditions are not satisfactory.
* If both motivators and hygiene factors are high, employees are highly motivated and satisfied.

Question 12

What is HR administration and maintenance?

Answer 12

Administration – tracking existing employee data which traditionally includes personal histories, skills, capabilities and salary.
Maintenance – related to employee benefits (services, vacations…), health and safety and worker-manager relation.

Question 13

What are reasons for releasing from the organization?

Answer 13

Internal (Reduction of overtime, transition to flexible work hours, short-time work, retraining, transfer of employees)
External (cancellations, reduction of staff, early retirement, voluntarily resignation, pension, golden shake hands)

Question 14

Which 2 approaches of organizational development are there?

Answer 14

Personnel approach – change of inner situation, goal to work better in team and provide more autonomy
Structural approach – change of external situation (decentralization, communication) – goal is more autonomy and more flexibility of organization

Question 15

Difference between Corporate Governance, Leadership and Executives (Managers/Leaders)

Answer 15

Corporate governance is a system by which companies are directed and controlled. Determine company objectives and underlying strategies.
Leadership is the ability to persuade other to voluntarily act in accordance with predetermined company’s objectives.
Executives/Managers are persons whose job is to plan and direct work of others and to take corrective actions when needed.
Executive/Leaders need to satisfy task needs, group maintenance needs and individual needs.

Question 16

What is personnel marketing?

Answer 16

• Personnel marketing applies marketing principles to attract candidates for company positions.
• The goal of personnel marketing is to enhance the company’s appeal to both internal and external candidates.
• Internal personnel marketing focuses on communication with employees, incentive systems, and workplace design.
• External personnel marketing involves strategies such as job advertisements, recruiting events, internet presence, and customer service.

Question 17

What motivates employees and what does internal communication analyze?

Answer 17

• Employees are motivated by both extrinsic rewards (external incentives) and intrinsic rewards (satisfaction from the work itself).
• Managers want to effectively communicate proposals to ensure understanding and acceptance, and to gain employee commitment to the objectives.
• Employees want to hear about working methods and any changes in their employment, ability to mention concerns
• Communication channels with personnel include oral, print media, **electronic ** media, and external media.

Question 18

What is public limited company?

Answer 18

• PLC (deutsch: AG) is a legal entity with its own legal personality
• Shareholders participate in the share capital through contributions
• Shareholders not personally liable for company liabilities

Question 19

What goes in memorandum of association and what is minimal capital?

Answer 19

• Company name and registered office
• Purpose of the company
• Amount of share capital (minimum of 70k euros, 1€ or multiple/share)
• Composition of the board of directors
• Form of publication of the company

Question 20

Which 4 bodies does PLC need to have?

Answer 20

1. Board of Directors
2. Supervisory Board
3. General Meeting
4. Auditor

Question 21

What are most important resolutions of general meeting?

Answer 21

• Annual meeting held once a year
• Chaired by the chairman of the supervisory board
• Agenda items include:
  
  • Distribution of profit
  • Discharge of the board of directors, supervisory board, and auditor
  • Adoption of resolutions presented by the board of directors or supervisory board
  • Appointment of special auditors
  • Changes in the memorandum of association
  • Assertion of compensation claims

Question 22

What is the purpose of supervisory board, board of directors and auditor?

Answer 22

Board of Directors:
* Represents the monopoly of the PLC
* Appointed for a maximum of 5 years
* Must have at least 1 member
* Responsible for the management of the business

Supervisory Board:
* Consists of at least 3 members
* Appointed by the general meeting
* Meets quarterly
* Work council entitled to representation
* Tasked with controlling management and other duties outlined in the memorandum of association

Auditor:
* Elected by the general meeting
* Audits annual accounts and management reports
* Ensures compliance with statutory accounting regulations

Question 23

difference between merger and acquisition?

Answer 23

• Merger: Legal consolidation of two entities into one entity.
• Acquisition: Occurs when one entity takes ownership of another entity’s stock, interest, or assets.

Question 24

Explain different types of mergers.

Answer 24

Loose merger:
* Each company retains its independence after the merger.

Tight merger:
* Companies merge but maintain independent factories.
* Under a single management structure.

Fusion:
* Merger where companies abandon their independence.
* Fully integrated under a single entity.

Horizontal integration:
* Acquisition of additional businesses operating at the same level of the value chain.
* Expands market share or eliminates competition.

Vertical integration:
* Expansion of a company’s business into different steps of the same production path.
* Involves owning distributors, suppliers, or other related entities.

Question 25

What is a cooperation (business alliance)?

Answer 25

• Motivated by cost reduction and improved service.
• Companies maintain independence.
• Collaboration for valuable resources and interaction.
• Emphasis on shared R&D.

Question 26

What is a joint venture?

Answer 26

• Business agreement between two or more companies.
• Purpose is to pool resources for a specific task, such as a new project or business activity.
• Each participant shares responsibility for profits, costs, and losses.
• The joint venture operates as its own legal entity.
• The JV agreement is a crucial document that defines the rights and obligations of the partners.

Question 27

Difference between holding and concern?

Answer 27

Concern:
* Created through the merger of multiple companies under unified management.
* Controlled enterprises maintain their legal independence.
* Relationships between controlling and controlled enterprises based on share ownership and voting rights.

Holding:
* Parent corporation (LLC or LP) that owns sufficient voting stock in another company to control its policies and management.
* Exists solely for the purpose of controlling another company.
* Holding is a single company, while a concern is a group of companies.

Question 28

What is a cartel?

Answer 28

• Collection of otherwise independent companies that collaborate to act together as a single producer.
• Ability to regulate supply and prices without facing competition.
• Negative effect on customers, resulting in higher prices and restricted supply.

Question 29

What is a Corporate Governance Report?

Answer 29

• Mandatory document for stock exchange-listed public limited companies.
• Corporate governance: System of rules, practices, processes for directing, controlling company.
• ensures: Accountability, fairness, transparency.

Question 30

What are the sub-markets of financial markets?

Answer 30

• Capital market: Long-term securities (stocks, bonds) trading.
• Securities market: Trading of various financial instruments (stocks, bonds, derivatives); Primary market, Secondary market. Security: Certificate related to a private right.
• Money market: Short-term borrowing and lending of funds. Treasury Bills, Treasury Notes, Commercial Papers, Certificates of Deposit.
• Foreign exchange market: Trading of different currencies. Foreign-currency bank deposit money.
• Derivative market: Trading of financial contracts derived from underlying assets. Derivative: Financial instrument with value derived from underlying security like securities, an index or an interest rate. Examples include options, futures, forwards, swaps.

Question 31

What are the rights of a shareholder?

Answer 31

• Property rights
• Participation rights at the annual general meeting
• Inspection rights for annual financial statements
• Right of information against the Management Board

Question 32

Stock exchange:

Answer 32

• Organized market for securities, foreign currency, goods, or derivatives.
• Sets prices based on supply and demand.
• Facilitates the interaction of investors and borrowers.
• Maintains transparency in trading activities.
• Approves new emissions of securities.
• Calculates and maintains indices to track market performance.

Question 33

Going public or Initial Public Offering (IPO):

Answer 33

• Involves placing securities on the capital market.
• Can be done through a public placement > 50M (offered to the general public, traded on the stock exchange).
• Can also be done through a private placement < 5M (offered to a selected group of investors, not traded on the stock exchange).

Question 34

What is a business portfolio?

Answer 34

collection of businesses and products that make up a company.

Question 35

What is the sequence and goal of business portfolio design?

Answer 35

1. analyzing the firm’s current business portfolio
2. deciding on investment distribution
3. developing growth strategies

goal:
create a business portfolio that best aligns the company’s strengths and weaknesses with opportunities in the economic environment.

Question 36

What is a strategic business unit (SBU)?

Answer 36

• unit of the company that can be planned independently from other company businesses
• attractiveness of SBUs is evaluated using portfolio analysis (based on market and the strength of SBU in market)

Types:
* “Dogs” SBUs generate enough cash to maintain themselves but are a low source of cash
* “Question marks” SBUs need heavy investment to hold the competitive position
* “Cash cows” SBUs need less investment to maintain the competitive position.

Question 37

What is the “Standard strategy” concept?

Answer 37

“Standard strategy” refers to strategies which are the best in a certain situation. They are deduced logically from situation conditions.

Question 38

Ansoff-Matrix

Answer 38

• Market penetration involves increasing sales of current products
• market development involves identifying and developing new markets for current products
• product development involves offering new or modified products to current markets
• diversification involves offering new products outside the company’s current markets.

Question 39

First-mover
advanteages and disadvantages

Answer 39

A ‘First Mover’ is a business that gains a competitive advantage by being the first to bring a specific product or service to market.

Advantages:
* Strong brand recognition and customer loyalty.
* Time to improve the product or service before entering the public market.
* Longer learning curve, allowing for refinement and growth.
* High switching costs for customers, making it challenging for them to switch to competitors.
* Opportunity to establish relationships with suppliers and negotiate favorable terms.
* First choice in factors such as location, website names, and key personnel.

Disadvantages
* Free-rider effects, where competitors can benefit from the company’s research and development efforts without bearing the same costs.
* Dealing with technological or market uncertainty, which can impact the company’s ability to meet customer demands and stay competitive.
* Potential shifts in technology or customer needs that could be better addressed by a competitor, posing a risk to the company’s market position and profitability.