Chapter 2: Strategic HR Planning

Question 1

(T/F) The environmental scanning stage of HR planning can directly inform the design of compensation and benefits packages to attract and retain the right employees.

Answer 1

True

Question 2

__________ are set by an organization to address its position in relation to its competitors.

Answer 2

Strategic plans

Question 3

Expectations and unwritten rules about the relationship and exchange between employers and employees make up the:

Answer 3

psychological contract

Question 4

One difference between corporate and business unit strategies is that:

a. corporate strategies may concentrate on a particular geographic location or profit center, while business unit strategies focus on goals such as product development.

b. corporate strategies focus on a shorter time span than business unit strategies.

c. corporate strategies outline the big picture of the whole organization, while business unit strategies focus on a particular segment.

d. corporate strategies are broad, while business unit strategies focus on short-term, day-to-day operations.

Answer 4

c. corporate strategies outline the big picture of the whole organization, while business unit strategies focus on a particular segment.

Question 5

__________ occurs when two organizations become a single entity, combining resources and unifying their objectives and goals.

Answer 5

Merger

Question 6

Which of the following is NOT a way in which strategic human resource planning can be challenging?

a. Many HR managers rely on their intuition and their years of experience and are resistant to a more systematic approach.

b. Strategic HR planning uses an extremely detail-oriented approach and requires 100% accuracy.

c. There is rarely a systematic method for HR managers to assess the accuracy or relevance of information.

d. Things change so quickly that information may no longer be useful once it is incorporated into the strategic plan.

Answer 6

b. Strategic HR planning uses an extremely detail-oriented approach and requires 100% accuracy.

Question 7

(T/F) The economic value added method measures strategic performance factors such as internal business processes, customer service, as well as learning and growth in order to align organizational activities, including HR, with its strategic objectives.

Answer 7

False

Question 8

Expectations and unwritten rules about the relationship and exchange between employers and employees make up the _________.

Answer 8

psychological contract

Question 9

(T/F) The environmental scanning stage of HR planning can directly inform the design of compensation and benefits packages to attract and retain the right employees.

Answer 9

True

Question 10

__________ are set by an organization to address its position in relation to its competitors.

Answer 10

Strategic plans

Question 11

Which of the following is NOT true about the quantitative method used to forecast labor demand?

a. It takes a centralized approach.

b. It uses market patterns.

c. It is known as trend analysis.

d. It extrapolates past trends.

Answer 11

a. It takes a centralized approach.

Question 12

Which of the following is NOT true about the quantitative method used to forecast labor demand?

a. It takes a centralized approach.

b. It uses market patterns.

c. It is known as trend analysis.

d. It extrapolates past trends.

Answer 12

a. It takes a centralized approach.

Question 13

a measure of organizational performance used to assess HR investments in their own right or in comparison to alternative investments to maximize shareholder value

Answer 13

Economic value added (EVA)

EVA = (operating profit) - (cost of capital)

**in order for an organization to create wealth for shareholders, must add value beyond the cost of capital.

Question 14

quantitative measures of HR performance and effectiveness

Answer 14

HR metrics

Question 15

What are some examples of HR metrics?

Answer 15

return on investment

economic value added (EVA)

balanced scorecard

benchmarking

HR audits

Question 16

What are HR metrics used for?

Answer 16

to assess the efficiency and effectiveness of HR functions

Question 17

financial measure that evaluates the efficiency of an investment.

Answer 17

return on investment (ROI)

ROI = (actual and prospective cost of benefits)/(total value of costs)

**can be used to measure the costs of HR activities and the length of time needed for these activities to pay off

Question 18

measures the organization’s financial performance and other strategic performance factors.

the purpose is to align organizational activities with strategic objectives (3rd party

Answer 18

balanced scorecard

Question 19

the practice of comparing organizational performance metrics against those of other organizations

Answer 19

benchmarking

limitations: Benchmarking can require extensive investments of time, labor, and capital, and costs for a large program can run into the hundreds of thousands of dollars, and the firm is always “playing catchup”

Question 20

a tool for organizations to diagnose the current status of HRM through assessingHR policies and the degree to which they fit organizational strategies.HR policies are assessed by evaluating the organizational impact ofHR activities in each of theHR areas, which include staffing, compensation, performance management, and training and development.

Answer 20

HR audit