chapter 2 - hr strategy and planning (10 mc)

Question 1

strategic hr planning

Answer 1

Strategic Human Resource Management - The pattern of human resources activities that enable an organization to achieve its strategic goals

Strategy formulation - providing input as to what is possible given the types and numbers of people available

Strategy implementation - making resource allocation decisions about structure, processes, and human resources to implement/meet strategic goals

Question 2

strategic hr planning steps

Answer 2

Step 1: Mission, Vision and Values

Step 2: Environmental Scanning
Environmental Scanning
The systematic monitoring of the major external forces influencing the organization.

Step 3: Internal Analysis

Question 3

(ON EXAM) - core knowledge employees

Answer 3

Core employees
Strategic knowledge workers
- Employees who have firm-specific skills that are directly linked to the company’s strategy
- High in strategic value; high in unique skills
Example job: Senior software programmer

Question 4

(ON EXAM) - non-core employees: job-based employees

Answer 4

1. Job-based employees
   - Employees with skills to perform a predefined job that are quite valuable to a company, but not unique
   - Transferable skills, low investment in training
   - High in strategic value; low in unique skills
   Example job: Accountant

Question 5

(ON EXAM) - non-core employees: contract supporting workers

Answer 5

2. Contract/supporting workers
   - Employees whose skills are of less strategic value and generally available to all firms
   - Low in strategic value; low in unique skills
   Example job: General electrician

Question 6

(ON EXAM) - non-core employees: complimentary partners

Answer 6

3. Partners with complementary skills
   - Individuals and groups with unique skills, but those skills are not directly related to a company’s core strategy
   - Low in strategic value; high in unique skills
   Example job: Contract lawyer

Question 7

forecasting labor demand - labor demand defined

Answer 7

Labor demand – derived demand - determined by demand for product/service

Question 8

(ON EXAM) - Forecasting Labor DEMAND QuaNtitatively - trend (ratio) analysis (REMEMBER FORMULA AND PRACTICE THIS)

Answer 8

of employees = X

Forecasting labor demand based on an organizational index such as sales: Commonly used approach for forecasting HR demand, need 3 pieces of info:
1. organizational indicator: e.g., sales
2. # of employees last period
3. Forecasted sales

REMEMBER:
Last yrs sales = Forecasted sales

$3,880,000 = $4,095,000
310 X = (solved is 327 employees)

STEPS:
1. $3,880,000 / 310 = 12,516
2. $4,095,000 / 12,516 = 327

310 people make us $3,880,000 so X people make us $4,095,000
X = 327
Hire 17 more people to make more money

Question 9

(ON EXAM) - Forecasting Labor DEMAND QuaLitatively - Management Forecasts

Answer 9

Management Forecasts
The opinions (judgments) of supervisors, department managers, experts, or others knowledgeable about the organization’s future employment needs

Question 10

(ON EXAM) - Forecasting Labor DEMAND QuaLitatively - Delphi Technique

Answer 10

Delphi Technique
Experts answer questionnaires in two or more rounds. After each round, a facilitator provides an anonymous summary of the experts’ forecasts
- Experts are encouraged to revise their earlier answers in light of the replies of other members

Both approaches consider knowledge of future issues
- New technology, new competitors, etc. - this information may not be reflected in historical data

Question 11

Forecasting Labor Supply – two components:

Answer 11

Forecasting Labor Supply
Labor supply – two components:
1) Internal labor supply = current employees
2) External labor supply = all people outside the organization who make themselves available for employment

Question 12

(ON EXAM) - Forecasting INTERNAL Labor Supply QuaNtitative Forecast - Markov Analysis (STUDY THIS AND LOOK AT CHART GIVEN)

Answer 12

Markov Analysis - quantitative
- Method for tracking the pattern of employee movements through various jobs
- Looks at the internal labor market
- Examines flows into, between, and out of the organization
- Easy diagnostic tool for identifying staffing problems or “gaps”
- Snapshot of movement across 2 time periods

Question 13

(ON EXAM) - Forecasting INTERNAL Labor Supply QuaLitative Forecast - Replacement charts (STUDY THIS AND LOOK AT CHART GIVEN)

Answer 13

Chart of positions and persons who are potential replacements if an opening occurs - qualitative
- Considers individual’s specific KSAs
- Looks at the internal labor market
- More focus on individual employees and their career development needs
- “What if” analysis

Question 14

(ON EXAM) - core vs. non-core employees

Answer 14

Core employee – employees central to our strategic goals and objectives

Non-core employee – employees in staff positions, low skill jobs or skills found readily in the labor market

Core/Non-core Model uses may use more of a commitment approach for the core ees, more of a transactional approach for the non-core positions
- Is it possible to pay all of our employees above market wages?

Question 15

(ON EXAM) - vertical fit (LOOK AT IMAGE ON NOTES)

Answer 15

Vertical Fit = HR practices fit with overall organizational strategy

Focuses on the connection between the business objectives and the various functional area initiatives

organizational strategy
I I I I
production, hr, accounting, marketing

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Question 16

(ON EXAM) - horizontal fit (LOOK AT IMAGE ON NOTES)

Answer 16

Horizontal Fit = HR practices complement each other

Aligning HR practices with one another to establish a configuration that is mutually reinforcing

human resources:

recruiting - training
compensation - training
performance management

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Question 17

(ON EXAM) - business strategy (2)

Answer 17

How are we going to compete in our given business?

1) Low-cost strategy: competing on productivity and efficiency
- Keeping costs low to offer an attractive price to customers (relative to competitors)
- Ex: Dollar Tree, Shein, Walmart

2) Differentiation strategy: compete on added value
- Involves providing something unique and distinctive to customers that they value

Question 18

(ON EXAM) - HR Strategy - Labor Transaction

Answer 18

Labor Transactional Model
Employees are a cost to be minimized rather than an asset that adds value

• HR’s primary purpose is to minimize labor costs
• No long term commitment to employees
• No training investment–job specific training only
• No career development
• Performance appraisal primary purpose – weed out

Question 19

(ON EXAM) - HR Strategy - Commitment (workforce commitment model)

Answer 19

Workforce Commitment Model
Employees are assets which warrant investment

• Encourage productivity and loyalty through commitment
• Training for expanding skills to use for current and future jobs
• Job security
• Career development
• Performance appraisal focus on developing employees

Question 20

(ON EXAM) - Calculating turnover rate (STUDY THIS REAL HARD)

Answer 20

turnover =
number of separations during a month
————————————————————- x 100
total number of employees at mid month

EX: IF THERE WERE 25 SEPARATIONS IN A MONTH AND THE TOTAL NUMBER OF EMPLOYEES AT MIDMONTH WERE 500, THE TURNOVER RATE WOULD BE:

25
—- x 100 = 5%
500

Question 21

(ON EXAM) - Calculating AVOIDABLE turnover rate (STUDY THIS REAL HARD)

Answer 21

what is a unavoidable separation: pregnancy, return to school, death or marriage

avoidable turnover =
avoidable separations - unavoidable separations
———————————————————————–x 100
total number of employees at mid month

S - US
_____ x 100
M