People - HR Strategy (Development) Flashcards
Which corporate activity requires an HR strategy of organizational growth?
Answer: Mergers & Acquisitions
A three-year-old company has achieved excellent results through perceptive market timing and aggressive marketing.
Which type of strategy is the company following?
Answer: Successful differentiation strategy
Explained: Differentiation strategies focus on setting a product or service apart from its competition by giving it unique characteristics that consumers value. Differentiation comes from a variety of factors, including product/service features, marketing approach, and delivery system.
What guidance from HR is useful to an organization that has decided to pursue a greenfield operation?
Answer: Demographic characteristics of the new location
Explained: The demographics in the location is useful information when an organization has decided to build from the ground up. A new staff will be required, and tapping into the local market will be necessary.
Not correct answers: Data about current skill sets is not applicable in a greenfield operation, as this strategy requires building from the ground up. There is no existing workforce. While recommendations about talent management concerns are helpful with any growth strategy an organization may decide to use, the selection of companies to pursue for an alliance is not within the purview of HR. In addition, a greenfield operation does not involve alliances or partnerships with other organizations. Best practices regarding how to implement a greenfield operation are not the responsibility of the HR department.
An international discount supermarket chain’s competitive strategy is to provide the lowest-price products by minimizing operational overhead. Which generic competitive strategy is it using?
Answer: Cost Leadership
Explained: To achieve cost leadership, an organization must be the low-cost producer in its industry. Sources of cost advantage vary depending on the industry
It may originate from
- economies of scale,
- proprietary technology
- preferential access to raw materials
- reduced costs in advertising and research
- among other factors.
Successful low-cost producers use all sources of cost advantage.
Which three generic strategies for success are identified in Michael Porter’s model?
Answer: Cost leadership, differentiation, focus
Explained: According to Michael Porter, there are three potentially successful generic strategies: cost leadership, differentiation, and focus.
Which is the most low-risk strategy for global market expansion?
Answer: Licensing
Explained: Licensing does not take a large initial investment or major organizational commitment. It is, therefore, a relatively low-risk way to expand globally.
What term refers to a company building a new global location from the ground up?
Answer: Greenfield Operation
HR has gathered information about the factors that may drive employee engagement in a newly acquired division. Which phase in strategic planning will HR be using as they translate the data gathered into an employee engagement strategy?
Answer: Development
Explained: The development phase of strategic planning involves translating data to develop a specific strategic plan. Once a plan has been developed, it can be implemented and evaluated.
While developing the HR function’s business plan, an HR manager is informed that organizational budget constraints have led to an organization-wide hiring freeze. The manager has also been told to plan for at least one major round of workforce reductions. Which would be a reasonable objective for the coming year’s business plan for HR?
Answer: Training all HR personnel in the termination process
Explained: Ensuring that all personnel are prepared to assist in layoffs will use function resources prudently and flexibly.
Which is the most likely advantage of starting a greenfield operation?
Answer: The company can start fresh with new technology, workforces, and practices.
Greenfield operations require more time and probably more resources but provide more control and strategy.
Which term best describes organizational compatibility with external and internal environments related to the goals and values the organization chooses and the resources and capabilities that can be deployed?
Answer: Strategic fit
Explained: Robert Grant defines strategic fit as the consonance or compatibility of an organization’s strategy with its external and internal environments, especially with regard to the goals and values the organization chooses and the resources and capabilities that can be deployed toward strategic goals.
Which business strategy is being used when a global furniture company varies its sofa fabrics and dimensions to fit local market tastes while using standardized manufacturing methods?
Answer: Product differentiation
Explained: Creating competitive advantage through internal changes involves the organization’s ability to create product change to create a new way to appeal to customers.
