01 Chapter - Human Resource Management: Gaining a Competitive Advantage
Chapter 01
Human Resource Management: Gaining a Competitive Advantage
True / False Questions
1. Companies have historically looked at HRM as a means to contribute to profitability,
quality, and other business goals through enhancing and supporting business operations.
True False
2. The human resource department is most likely to collaborate with other company functions
on outplacement, labor law compliance, testing, and unemployment compensation.
True False
3. The three product lines of HR include a) administrative services and transactions, B)
financial services, and c) strategic partners.
True False
4. 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 False
5. Advances in technology have allowed HR services to be offered more on a self-service
basis than in the past.
True False
6. HR functions related to areas such as employee development, performance management,
and organizational development are outsourced most frequently.
True False
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
7. Evidence-based HR provides managers with data to make decisions, instead of just relying
on intuition.
True False
8. 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.
True False
9. Companies are now more and more interested in using intangible assets and human capital
as a way to gain an advantage over competitors.
True False
10. A learning organization places the highest emphasis on completion of formal employment
training.
True False
11. The psychological contract describes what an employee expects to contribute and what the
company will provide to the employee in return for these contributions.
True False
12. The use of alternative work arrangements, which include independent contractors, on-call
workers, temporary workers, and contract company workers, is shrinking.
True False
13. To be effective, balanced scorecards must be customized by companies to fit different
market situations, products, and competitive environments.
True False
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
14. The balanced scorecard should not be used to link the company's human resource
management activities to the company's business strategy.
True False
15. Corporate cultures within companies that successfully implement TQM typically
emphasize individualism, hierarchy, accountability, and profits.
True False
16. ISO 9000 certification is an integral component of W. Edwards Deming's quality control
process.
True False
17. 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.
True False
18. 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.
True False
19. Cultural diversity can provide a company competitive advantage regarding problemsolving.
True False
20. The Sarbanes-Oxley Act of 2002 sets strict rules for corporate behavior and sets heavy
fines and prison terms for noncompliance.
True False
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
21. Every business must be prepared to deal with the global economy.
True False
22. One of the disadvantages of technology is that it does not allow older workers to postpone
retirement.
True False
23. 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.
True False
24. An HR dashboard is a series of indicators that managers and employees have access to on
the company intranet or human resource information system.
True False
25. Compensating human resources involves measuring employees' performance.
True False
Multiple Choice Questions
26. _____ refers to a company's ability to maintain and gain market share in its industry.
A. Outsourcing
B. Competitiveness
C. Self-service
D. Empowerment
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
27. _____ 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. 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. Which of the following is NOT a responsibility of HR departments?
A. Recruiting
B. Benefits
C. Community relations
D. Production and operations
30. 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. 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.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
32. 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. Giving employees online access to information about HR issues such as training, benefits,
and compensation is known as:
A. outsourcing.
B. continuous learning.
C. self-service.
D. strategic planning.
34. 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:
A. e-commerce.
B. empowering.
C. outsourcing.
D. benchmarking.
35. Traditionally, the HRM department was primarily a(n):
A. proactive agency.
B. finance expert.
C. employer advocate.
D. administrative expert.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
36. 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. 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. 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. _____ refers to the ability of a company to survive and succeed in a dynamic competitive
environment.
A. Outsourcing
B. Empowerment
C. Sustainability
D. Resource management
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
40. 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. 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. Tacit knowledge is an example of _____ capital.
A. social
B. customer
C. human
D. intellectual
43. 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. 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.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
45. A(n) _____ contract describes what an employee expects to contribute and what the
company will provide to the employee for these contributions.
A. employer
B. employee
C. psychological
D. job
46. 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. 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. 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. 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?
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
50. 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.
B. diversity.
C. total quality management.
D. social responsibility.
51. 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. "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
D. Leadership
53. 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.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
54. 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. 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.
A. projected
B. secondary
C. external
D. internal
56. 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. 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.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
58. 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. 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.
60. To successfully manage a diverse workforce, managers need to develop all of the
following skills EXCEPT:
A. providing performance feedback that is based on values rather than objective outcomes.
B. communicating effectively with employees from a wide variety of cultural backgrounds.
C. coaching employees of different ages, educational backgrounds, ethnicity, physical ability,
and race.
D. recognizing and responding to generational issues.
61. Managing cultural diversity involves:
A. enforcing EEO rules.
B. creating separate career tracks for employees with families.
C. establishing a strong affirmative action policy.
D. creating a workplace that makes it comfortable for employees of all backgrounds to be
creative and innovative.
62. How diversity issues are managed in companies has implications for all the following
EXCEPT:
A. knowing how to learn.
B. creativity.
C. retaining good employees.
D. problem solving.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
63. Managing cultural diversity can provide a competitive advantage by:
A. decreasing the number of available women and minorities in the company's labor pool.
B. helping women and minorities understand they must conform to organizational norms and
expectations.
C. helping companies produce better decisions by including all employees' perspectives and
analysis.
D. identifying product markets on which the company should focus.
64. In managing cultural diversity, which of the following would improve the level of
creativity thereby providing competitive advantage to an organization?
A. Diversity of perspectives and less emphasis on conformity to norms of the past.
B. Those with the best reputations for managing diversity will win the competition for the
best personnel.
C. An implication of the multicultural model for managing diversity is that the system will
become less determinate, less standardized, and therefore more fluid.
D. Heterogeneity in decisions and problem-solving groups potentially produces better
decisions.
65. Which of the following cultural diversity arguments states that companies with the best
reputations for managing diversity will win the competition for the best personnel?
A. System flexibility argument
B. Marketing argument
C. Employee attraction and retention argument
D. Problem-solving argument
66. Diversity is important for tapping all of the following skills of employees EXCEPT:
A. cultural skills.
B. communication skills.
C. creativity.
D. homogeneous thinking.
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67. What areas of the legal environment have influenced HRM practices over the past 25
years?
A. Equal employment opportunity, safety and health, pay and benefits, privacy, and job
security.
B. Executive compensation, pay and benefits, workers' compensation, safety and health, and
job security.
C. Product liability, workers' compensation, equal employment opportunity, safety and health,
and labor relations.
D. Equal employment opportunity, patent infringement, workers' compensation, safety and
health, and job security.
68. There will likely be continued discussion, debate, and possible legislation in all but one of
the following areas in companies. Name the exception.
A. Genetic testing
B. Glass ceiling
C. Employment-at-will
D. Design of physical work environment
69. Litigation involving job security will have a major influence on human resource
management practices because:
A. work rules, recruitment practices, and performance evaluation systems might falsely
communicate lifetime employment agreements that the company does not intend to honor
during layoffs.
B. adjustments of test scores to meet affirmative action requirements are now illegal.
C. employees now bear the burden of proof in discrimination cases.
D. compensation awards for discrimination claims have increased.
70. Which of the following is one of the four ethical principles of a successful company?
A. Managers assume all responsibility for the actions of the company.
B. It has a strong profit orientation.
C. Customer, client, and vendor relationships emphasize mutual benefits.
D. It does not produce products that can be used for violent purposes.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
71. Which legislation act sets new strict rules for business especially as regards accounting
practices?
A. Human Rights Act of 1994
B. Reverse Discrimination Act of 1990
C. Sarbanes-Oxley Act of 2002
D. Corruption and Practices Act of 2000
72. Which of the following is NOT a standard that human resource managers must satisfy for
practices to be ethical?
A. Managers must treat employees as family.
B. Human resource practices must result in the greatest good for the largest number of people.
C. Employment practices must respect basic human rights of privacy, due process, and free
speech.
D. Managers must treat employees and customers equitably and fairly.
73. Exporting jobs from developed to less developed countries is known as:
A. insourcing.
B. offshoring.
C. importing.
D. onshoring.
74. Exporting jobs to rural parts of the United States is referred to as:
A. insourcing.
B. offshoring.
C. importing.
D. onshoring
75. Which of the following statements about technology is FALSE?
A. The Internet allows employees to locate and gather resources, including software, reports,
photos, and videos.
B. Technology does not allow older workers to postpone retirement.
C. The Internet gives employees instant access to experts whom they can communicate with.
D. Technology has made equipment easier to operate, helping companies cope with skill
shortages.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
76. Which of the following is NOT typically true of work teams?
A. They are used to increase employee responsibility and control.
B. They use cross-training to give employees knowledge on a wide range of skills.
C. They frequently select new team members and plan work schedules.
D. They assume all of the activities reserved for managers such as controlling, planning, and
coordinating activities.
77. Which of the following is NOT recommended for supporting work teams?
A. Reducing flexibility and interaction between employees to maintain high productivity.
B. Giving employees formal performance feedback.
C. Linking compensation and rewards with performance.
D. Allowing employees to participate in planning changes in equipment, layout, and work
methods.
78. All of the following statements about cross training are true EXCEPT:
A. it provides teams' maximum flexibility.
B. it helps in measuring employees' performance.
C. it trains employees in a wide range of skills.
D. employees can fill any of the roles needed to be performed on the team.
79. Company X has offices around the globe. Its teams are separated by time, geographic
distance, culture and/or organizational boundaries, and almost rely exclusively on technology
for interaction between team members. Its teams are:
A. virtual teams.
B. geographically-concentrated teams.
C. lean teams.
D. teleworker teams.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
80. Adaptive organizational structures emphasize:
A. efficiency, decision making by managers, and the flow of information from top to bottom
of the organization.
B. a core set of values, and elimination of boundaries between managers, employees, and
organizational functions.
C. clear boundaries between managers, employees, customers, vendors, and the functional
areas, and a constant state of learning.
D. internal linking, external linking, diversification, and a core set of values.
81. Which of the following is FALSE about high-involvement, adaptive organizational
structures?
A. Employees are in a constant state of learning and performance improvement.
B. Employees are free to move wherever they are needed in a company.
C. Line employees are trained to specialize in one job in order to maximize efficiency.
D. Previously established boundaries between managers, employees, customers, and vendors
are abandoned.
82. Employees in geographically dispersed locations can work together in virtual teams using
video, e-mail, and the Internet. This e-HRM implication refers to which aspect of HR?
A. Recruiting
B. Analysis and design of work
C. Selection
D. Compensation and benefits
83. From the manager's perspective, an HRIS can be used to perform primarily all but one of
the following. Name the exception.
A. Support strategic decision making
B. Avoid litigation
C. Evaluate programs and policies
D. Motivate employees
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
84. A(n) _____ is a series of indicators or metrics that managers and employees have access
to on the company intranet or human resource information system.
A. HR dashboard
B. balanced scorecard
C. web portal
D. Intranet
85. All of the following HR practices support high-performance work systems EXCEPT:
A. employees participate in selection process.
B. jobs are designed to use a variety of skills.
C. employee rewards are related to company performance.
D. individuals tend to work separately.
86. Which one of the following is NOT associated with managing the human resource
environment?
A. Linking HRM practices to the company's business objectives.
B. Identifying human resource requirements through human resource planning, recruitment,
and selection.
C. Ensuring that HRM practices comply with federal, state, and local laws.
D. Designing work that motivates and satisfies the employee as well as maximizes customer
service, quality, and productivity.
87. Economic value is traditionally associated with all of the following EXCEPT:
A. equipment.
B. technology.
C. facilities.
D. HRM practices.
88. A company's human resource acquisition requirements are influenced by all of the
following EXCEPT:
A. terminations.
B. customer demands for products and services.
C. motivation and satisfaction of employees.
D. promotions.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
89. Managing the assessment and development of human resources involves all of the
following EXCEPT:
A. measuring employees' performance.
B. creating an employment relationship and work environment that benefits both the company
and the employee.
C. recruiting employees and placing them in jobs that best use their skills.
D. identifying employees' work interests, goals, and values, and other career issues.
90. Besides interesting work, _____ are the most important incentives that companies can
offer to its employees.
A. training for future work roles
B. beneficial work environments
C. support for nonwork activities
D. pay and benefits
Essay Questions
91. Name and discuss the competencies that HR professionals need.
92. How has the role of HRM changed in recent years? Discuss three trends that are changing
the HRM function. Why have these roles changed?
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
93. What is meant by empowering and what type of training must be conducted to make it
effective?
94. Discuss the balanced scorecard approach of measuring stakeholder performance.
95. Discuss the Malcolm Baldrige National Quality Award including its purpose, the
application process, the criteria used for evaluation, and the advantages associated with the
award.
96. What sorts of activities does managing cultural diversity involve? Discuss four of the six
ways (arguments) that managing cultural diversity can provide a competitive advantage.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
97. What five main areas of the legal environment have influenced human resource
management over the past 25 years?
98. Define electronic human resource management (e-HRM) and indicate its implications for
five HRM practices.
99. Discuss how HR practices support the use of new technology and work designs.
100. Outline the four dimensions of human resource management practices, including specific
examples of human resource practices within each area.
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-1
Topic: What Responsibilities and Roles do HR Departments Perform?
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.
FALSE
AACSB: Business Knowledge and Analytic Skills, Group/Individual Dynamics in Organizations
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-1
Topic: What Responsibilities and Roles do HR Departments Perform?
3. (p. 6) The three product lines of HR include a) administrative services and transactions, B)
financial services, and c) strategic partners.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-1
Topic: What Responsibilities and Roles do HR Departments Perform?
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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
AACSB: Business Knowledge and Analytic Skills, Group/Individual Dynamics in Organizations
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-1
Topic: How is the HRM Function Changing?
5. (p. 9) Advances in technology have allowed HR services to be offered more on a self-service
basis than in the past.
TRUE
AACSB: Business Knowledge and Analytic Skills, Information Technologies
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-1
Topic: How is the HRM Function Changing?
6. (p. 9) HR functions related to areas such as employee development, performance
management, and organizational development are outsourced most frequently.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-1
Topic: How is the HRM Function Changing?
7. (p. 11) Evidence-based HR provides managers with data to make decisions, instead of just
relying on intuition.
TRUE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-1
Topic: How is the HRM Function Changing?
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
TRUE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-2
Topic: Introduction
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.
TRUE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-2
Topic: The Sustainability Challenge
10. (p. 22) A learning organization places the highest emphasis on completion of formal
employment training.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-2
Topic: The Sustainability Challenge
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.
TRUE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-2
Topic: The Sustainability Challenge
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
12. (p. 25) The use of alternative work arrangements, which include independent contractors,
on-call workers, temporary workers, and contract company workers, is shrinking.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-2
Topic: The Sustainability Challenge
13. (p. 27) To be effective, balanced scorecards must be customized by companies to fit
different market situations, products, and competitive environments.
TRUE
AACSB: Business Knowledge and Analytic Skills, Domestic and Global Economic Environments of Organizations
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Meeting the Needs of Stakeholders, Shareholders, Customers, Employees, and Community
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.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Meeting the Needs of Stakeholders, Shareholders, Customers, Employees, and Community
15. (p. 30) Corporate cultures within companies that successfully implement TQM typically
emphasize individualism, hierarchy, accountability, and profits.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Customer Service and Quality Emphasis
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
16. (p. 31) ISO 9000 certification is an integral component of W. Edwards Deming's quality
control process.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Customer Service and Quality Emphasis
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.
TRUE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
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.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
19. (p. 39) Cultural diversity can provide a company competitive advantage regarding problemsolving.
TRUE
AACSB: Multicultural and Diversity Understanding, Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
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Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
20. (p. 42) The Sarbanes-Oxley Act of 2002 sets strict rules for corporate behavior and sets
heavy fines and prison terms for noncompliance.
TRUE
AACSB: Business Knowledge and Analytic Skills, Ethical/Legal Responsibilities
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-3
Topic: Legal and Ethical Issues
21. (p. 43) Every business must be prepared to deal with the global economy.
TRUE
AACSB: Business Knowledge and Analytic Skills, Domestic and Global Economic Environments of Organizations
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-4
Topic: The Global Challenge
22. (p. 48) One of the disadvantages of technology is that it does not allow older workers to
postpone retirement.
FALSE
AACSB: Business Knowledge and Analytic Skills, Information Technologies
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-5
Topic: The Technology Challenge
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.
FALSE
AACSB: Reflective Thinking Skills, Information Technologies
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-6
Topic: High-Performance Work Systems
1-27
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
TRUE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-6
Topic: High-Performance Work Systems
25. (p. 58) Compensating human resources involves measuring employees' performance.
FALSE
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-7
Topic: Meeting Competitive Challenges Through HRM Practices
Multiple Choice Questions
26. (p. 4) _____ refers to a company's ability to maintain and gain market share in its industry.
A. Outsourcing
B. Competitiveness
C. Self-service
D. Empowerment
Competitiveness is related to company effectiveness, which is determined by whether the
company satisfies the needs of stakeholders (groups affected by business practices).
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-1
Topic: Introduction
1-28
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
27. (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
Many companies refer to HRM as involving "people practices."
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-1
Topic: Introduction
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
Strategic HR management includes Analysis and design of work, HR planning, Recruiting,
Selection, Training and development, Compensation, Performance management, and
Employee relations.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-1
Topic: Introduction
1-29
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
29. (p. 6) Which of the following is NOT a responsibility of HR departments?
A. Recruiting
B. Benefits
C. Community relations
D. Production and operations
The Responsibilities of HR departments include Employment and Recruiting, Training and
Development, Compensation, Benefits, Employee services, Employee and community
relations, Personnel records, Health and safety and Strategic planning.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-1
Topic: What Responsibilities and Roles do HR Departments Perform?
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
The product lines of human resources include Administrative services and transactions,
Strategic partner and Business partner services.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-1
Topic: What Responsibilities and Roles do HR Departments Perform?
1-30
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
Cultural steward facilitates change, develops and values the culture and helps employees
navigate the culture.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-1
Topic: What Competencies Do HR Professionals Need?
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.
A strategic architect is one who recognizes business trends and their impact on the business
and develops people strategies that contribute to the business strategy.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-1
Topic: What Competencies Do HR Professionals Need?
1-31
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
33. (p. 9) Giving employees online access to information about HR issues such as training,
benefits, and compensation is known as:
A. outsourcing.
B. continuous learning.
C. self-service.
D. strategic planning.
Self-service refers to giving employees online access to information about HR issues such as
training, benefits, compensation, and contracts; enrolling online in programs and services; and
completing online attitude surveys.
AACSB: Business Knowledge and Analytic Skills, Information Technologies
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-1
Topic: How is the HRM Function Changing?
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:
A. e-commerce.
B. empowering.
C. outsourcing.
D. benchmarking.
The primary reasons for outsourcing are to save money and spend more time on strategic
business issues.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-1
Topic: How is the HRM Function Changing?
1-32
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
35. (p. 10) Traditionally, the HRM department was primarily a(n):
A. proactive agency.
B. finance expert.
C. employer advocate.
D. administrative expert.
The HRM department took care of employee problems, made sure employees were paid
correctly, administered labor contracts, and avoided legal problems.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-1
Topic: How is the HRM Function Changing?
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.
A study concludes that human resources is being transformed from a specialized, stand-alone
function to a broad corporate competency in which human resources and line managers build
partnerships to gain competitive advantage.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-1
Topic: How is the HRM Function Changing?
1-33
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
A college degree is required of all HR professionals.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Hard
Learning Objective: 1-1
Topic: What Competencies Do HR Professionals Need?
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.
Three competitive challenges that companies now face will increase the importance of human
resource management practices: the challenge of sustainability, the global challenge, the
technology challenge.
AACSB: Business Knowledge and Analytic Skills, Domestic and Global Economic Environments of Organizations
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-2
Topic: Competitive Challenges Influencing Human Resource Management
1-34
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
39. (p. 14) _____ refers to the ability of a company to survive and succeed in a dynamic
competitive environment.
A. Outsourcing
B. Empowerment
C. Sustainability
D. Resource management
Sustainability refers to a company's ability to make a profit without sacrificing the resources
of its employees, the community, or the environment.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-2
Topic: The Sustainability Challenge
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.
Expanding into foreign markets falls under the global challenge.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-2
Topic: The Sustainability Challenge
1-35
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
Intangible assets are equally or even more valuable than physical assets.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-2
Topic: Economic Changes
42. (p. 20) Tacit knowledge is an example of _____ capital.
A. social
B. customer
C. human
D. intellectual
Tacit knowledge, Education, Work-related know how and Work-related competence are the
examples of human capital.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-2
Topic: Economic Changes
1-36
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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, as
information such 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.
Knowledge workers are employees who contribute to the company not through manual labor,
but through what they know about customers or a specialized body of knowledge.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-2
Topic: Economic Changes
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.
Employees also share the rewards and losses of the results.
AACSB: Business Knowledge and Analytic Skills, Group/Individual Dynamics in Organizations
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-2
Topic: Economic Changes
1-37
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
A. employer
B. employee
C. psychological
D. job
Unlike a sales contract, a psychological contract is not written.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-2
Topic: Economic Changes
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.
Alternative work arrangements include independent contractors, on-call workers, temporary
workers, and contract company workers.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-2
Topic: Economic Changes
1-38
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
The balanced scorecard depicts the company from the perspective of internal and external
customers, employees, and shareholders.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-3
Topic: Meeting the Needs of Stakeholders, Shareholders, Customers, Employees, and Community
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.
The balanced scorecard is important because it brings together most of the features that a
company needs to focus on to be competitive.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-3
Topic: Meeting the Needs of Stakeholders, Shareholders, Customers, Employees, and Community
1-39
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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?
According to the financial perspective of the balanced scorecard, the question should be
answered is "How do we look to shareholders?" The managers should be able to identify
critical indicators or metrics related to human resources.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Meeting the Needs of Stakeholders, Shareholders, Customers, Employees, and Community
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.
B. diversity.
C. total quality management.
D. social responsibility.
Social responsibility can help boost a company's image with customers, gain access to new
markets, and help attract and retain talented employees.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Meeting the Needs of Stakeholders, Shareholders, Customers, Employees, and Community
1-40
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
TQM refers to a cooperative form of doing business that relies on the talents and capabilities
of both labor and management to continually improve quality and productivity.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Customer Service and Quality Emphasis
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
D. Leadership
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.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Customer Service and Quality Emphasis
1-41
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
Seven categories evaluated within the Malcolm Baldrige Quality Award are leadership,
measurement, analysis, and knowledge management, strategic planning, workforce focus,
process management, business results and customer and market focus.
AACSB: Reflective Thinking Skills, Value Creation
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-3
Topic: Customer Service and Quality Emphasis
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.
Part of lean thinking includes training workers in new skills or how to apply old skills in new
ways so they can quickly take over new responsibilities or use new skills to help fill customer
orders.
AACSB: Business Knowledge and Analytic Skills, Value Creation
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Customer Service and Quality Emphasis
1-42
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
A. projected
B. secondary
C. external
D. internal
The labor force of current employees is often referred to as the internal labor force.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
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.
The 55 years and older workforce is expected to grow by approximately 47 percent between
2006 and 2016, more than five times the 8.5 percent growth projected for the entire
workforce.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
1-43
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
Older employees are willing and able to learn new technology.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
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.
"Baby boomers," born between 1946 and 1964, live to work.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
1-44
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
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.
Employees view work as a means to self-fulfillmentthat is, a means to more fully use their
skills and abilities, meet their interests, and allow them to live a desirable life-style.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
60. (p. 38-39) To successfully manage a diverse workforce, managers need to develop all of the
following skills EXCEPT:
A. providing performance feedback that is based on values rather than objective outcomes.
B. communicating effectively with employees from a wide variety of cultural backgrounds.
C. coaching employees of different ages, educational backgrounds, ethnicity, physical ability,
and race.
D. recognizing and responding to generational issues.
Managers need to develop a skill of providing performance feedback that is based on
objective outcomes rather than values and stereotypes that work against women, minorities,
and handicapped persons by prejudging these persons' abilities and talents.
AACSB: Multicultural and Diversity Understanding, Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
1-45
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
61. (p. 39) Managing cultural diversity involves:
A. enforcing EEO rules.
B. creating separate career tracks for employees with families.
C. establishing a strong affirmative action policy.
D. creating a workplace that makes it comfortable for employees of all backgrounds to be
creative and innovative.
How diversity issues are managed has implications for creativity, problem solving, retaining
good employees, and developing markets for the firm's products and services.
AACSB: Multicultural and Diversity Understanding, Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
62. (p. 39) How diversity issues are managed in companies has implications for all the following
EXCEPT:
A. knowing how to learn.
B. creativity.
C. retaining good employees.
D. problem solving.
How diversity issues are managed has implications for creativity, problem solving, retaining
good employees, and developing markets for the firm's products and services.
AACSB: Multicultural and Diversity Understanding, Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
1-46
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
63. (p. 39) Managing cultural diversity can provide a competitive advantage by:
A. decreasing the number of available women and minorities in the company's labor pool.
B. helping women and minorities understand they must conform to organizational norms and
expectations.
C. helping companies produce better decisions by including all employees' perspectives and
analysis.
D. identifying product markets on which the company should focus.
Managing cultural diversity can provide a competitive advantage by cost argument, employee
attraction and retention argument, marketing argument, creativity argument, problem-solving
argument and system flexibility argument.
AACSB: Multicultural and Diversity Understanding, Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
64. (p. 39) In managing cultural diversity, which of the following would improve the level of
creativity thereby providing competitive advantage to an organization?
A. Diversity of perspectives and less emphasis on conformity to norms of the past.
B. Those with the best reputations for managing diversity will win the competition for the
best personnel.
C. An implication of the multicultural model for managing diversity is that the system will
become less determinate, less standardized, and therefore more fluid.
D. Heterogeneity in decisions and problem-solving groups potentially produces better
decisions.
Diversity of perspectives and less emphasis on conformity to norms of the past (which
characterize the modern approach to management of diversity) should improve the level of
creativity in managing cultural diversity. This is called creative argument.
AACSB: Multicultural and Diversity Understanding, Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
1-47
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
65. (p. 39) Which of the following cultural diversity arguments states that companies with the
best reputations for managing diversity will win the competition for the best personnel?
A. System flexibility argument
B. Marketing argument
C. Employee attraction and retention argument
D. Problem-solving argument
Employee attraction and retention argument states that companies develop reputations on
favorability as prospective employers for women and ethnic minorities. Those with the best
reputations for managing diversity will win the competition for the best personnel.
AACSB: Multicultural and Diversity Understanding, Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
66. (p. 39) Diversity is important for tapping all of the following skills of employees EXCEPT:
A. cultural skills.
B. communication skills.
C. creativity.
D. homogeneous thinking.
Diversity is important for tapping all employees' creative, cultural, and communication skills
and using those skills to provide competitive advantage.
AACSB: Multicultural and Diversity Understanding, Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
1-48
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
67. (p. 40) What areas of the legal environment have influenced HRM practices over the past 25
years?
A. Equal employment opportunity, safety and health, pay and benefits, privacy, and job
security.
B. Executive compensation, pay and benefits, workers' compensation, safety and health, and
job security.
C. Product liability, workers' compensation, equal employment opportunity, safety and health,
and labor relations.
D. Equal employment opportunity, patent infringement, workers' compensation, safety and
health, and job security.
Attention is likely to continue to be paid to age, race, and religious discrimination, and
discrimination against physically challenged employees.
AACSB: Business Knowledge and Analytic Skills, Ethical/Legal Responsibilities
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Legal and Ethical Issues
68. (p. 40-41) There will likely be continued discussion, debate, and possible legislation in all but
one of the following areas in companies. Name the exception.
A. Genetic testing
B. Glass ceiling
C. Employment-at-will
D. Design of physical work environment
There is also likely to be continued discussion about legislation to prohibit discrimination by
employers and health insurers against employees based on their genetic makeup.
AACSB: Reflective Thinking Skills, Ethical/Legal Responsibilities
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-3
Topic: Legal and Ethical Issues
1-49
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
69. (p. 41) Litigation involving job security will have a major influence on human resource
management practices because:
A. work rules, recruitment practices, and performance evaluation systems might falsely
communicate lifetime employment agreements that the company does not intend to honor
during layoffs.
B. adjustments of test scores to meet affirmative action requirements are now illegal.
C. employees now bear the burden of proof in discrimination cases.
D. compensation awards for discrimination claims have increased.
As companies are forced to close plants and lay off employees because of restructuring,
technology changes, or financial crisis, cases dealing with the illegal discharge of employees
have increased.
AACSB: Reflective Thinking Skills, Ethical/Legal Responsibilities
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-3
Topic: Legal and Ethical Issues
70. (p. 41) Which of the following is one of the four ethical principles of a successful company?
A. Managers assume all responsibility for the actions of the company.
B. It has a strong profit orientation.
C. Customer, client, and vendor relationships emphasize mutual benefits.
D. It does not produce products that can be used for violent purposes.
Ethical, successful companies can be characterized by four principles. First, in their
relationships with customers, vendors, and clients, these companies emphasize mutual
benefits. Second, employees assume responsibility for the actions of the company. Third, such
companies have a sense of purpose or vision the employees value and use in their day-to-day
work. Finally, they emphasize fairness; that is, another person's interests count as much as
their own.
AACSB: Ethical and Legal Understanding and Reasoning Abilities, Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Legal and Ethical Issues
1-50
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
71. (p. 42) Which legislation act sets new strict rules for business especially as regards
accounting practices?
A. Human Rights Act of 1994
B. Reverse Discrimination Act of 1990
C. Sarbanes-Oxley Act of 2002
D. Corruption and Practices Act of 2000
The Sarbanes-Oxley Act of 2002 sets strict rules for corporate behavior and sets heavy fines
and prison terms for noncompliance.
AACSB: Business Knowledge and Analytic Skills, Ethical/Legal Responsibilities
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Legal and Ethical Issues
72. (p. 43) Which of the following is NOT a standard that human resource managers must
satisfy for practices to be ethical?
A. Managers must treat employees as family.
B. Human resource practices must result in the greatest good for the largest number of people.
C. Employment practices must respect basic human rights of privacy, due process, and free
speech.
D. Managers must treat employees and customers equitably and fairly.
HRM practices must result in the greatest good for the largest number of people, must respect
basic human rights of privacy, due process, and free speech and they must treat employees
and customers equitably and fairly.
AACSB: Ethical and Legal Understanding and Reasoning Abilities, Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Legal and Ethical Issues
1-51
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
73. (p. 45) Exporting jobs from developed to less developed countries is known as:
A. insourcing.
B. offshoring.
C. importing.
D. onshoring.
The main reason for offshoring is labor costs.
AACSB: Business Knowledge and Analytic Skills, Domestic and Global Economic Environments of Organizations
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-4
Topic: Offshoring
74. (p. 47) Exporting jobs to rural parts of the United States is referred to as:
A. insourcing.
B. offshoring.
C. importing.
D. onshoring
Onshoring may be most attractive to companies that have brands tied to the United States
because they fear the political fallout related to offshoring.
AACSB: Business Knowledge and Analytic Skills, Domestic and Global Economic Environments of Organizations
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-4
Topic: Offshoring
1-52
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
75. (p. 48) Which of the following statements about technology is FALSE?
A. The Internet allows employees to locate and gather resources, including software, reports,
photos, and videos.
B. Technology does not allow older workers to postpone retirement.
C. The Internet gives employees instant access to experts whom they can communicate with.
D. Technology has made equipment easier to operate, helping companies cope with skill
shortages.
Technology has also made equipment easier to operate, helping companies cope with skill
shortages and allowing older workers to postpone retirement.
AACSB: Reflective Thinking Skills, Information Technologies
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-5
Topic: How and Where People Work
76. (p. 49) Which of the following is NOT typically true of work teams?
A. They are used to increase employee responsibility and control.
B. They use cross-training to give employees knowledge on a wide range of skills.
C. They frequently select new team members and plan work schedules.
D. They assume all of the activities reserved for managers such as controlling, planning, and
coordinating activities.
Work teams may assume many of the activities usually reserved for managers, including
selecting new team members, scheduling work, and coordinating activities with customers
and other units in the company.
AACSB: Reflective Thinking Skills, Group/Individual Dynamics in Organizations
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-6
Topic: High-Performance Work Systems
1-53
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
77. (p. 49) Which of the following is NOT recommended for supporting work teams?
A. Reducing flexibility and interaction between employees to maintain high productivity.
B. Giving employees formal performance feedback.
C. Linking compensation and rewards with performance.
D. Allowing employees to participate in planning changes in equipment, layout, and work
methods.
Supporting work teams involves encouraging flexibility and interaction between employees to
maintain high productivity.
AACSB: Reflective Thinking Skills, Group/Individual Dynamics in Organizations
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-6
Topic: High-Performance Work Systems
78. (p. 49) All of the following statements about cross training are true EXCEPT:
A. it provides teams' maximum flexibility.
B. it helps in measuring employees' performance.
C. it trains employees in a wide range of skills.
D. employees can fill any of the roles needed to be performed on the team.
The performance appraisal process measures employee performance according to
departmental objectives that support the scorecard.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-6
Topic: High-Performance Work Systems
1-54
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
79. (p. 50) Company X has offices around the globe. Its teams are separated by time, geographic
distance, culture and/or organizational boundaries, and almost rely exclusively on technology
for interaction between team members. Its teams are:
A. virtual teams.
B. geographically-concentrated teams.
C. lean teams.
D. teleworker teams.
Virtual teams refer to teams that are separated by time, geographic distance, culture, and/or
organizational boundaries and that rely almost exclusively on technology (e-mail, Internet,
videoconferencing) to interact and complete their projects.
AACSB: Reflective Thinking Skills
BT: Application
Difficulty: Medium
Learning Objective: 1-6
Topic: High-Performance Work Systems
80. (p. 50-51) Adaptive organizational structures emphasize:
A. efficiency, decision making by managers, and the flow of information from top to bottom
of the organization.
B. a core set of values, and elimination of boundaries between managers, employees, and
organizational functions.
C. clear boundaries between managers, employees, customers, vendors, and the functional
areas, and a constant state of learning.
D. internal linking, external linking, diversification, and a core set of values.
In the adaptive organizational structure, employees are in a constant state of learning and
performance improvement. Employees are free to move wherever they are needed in the
company.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Hard
Learning Objective: 1-6
Topic: High-Performance Work Systems
1-55
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
81. (p. 51) Which of the following is FALSE about high-involvement, adaptive organizational
structures?
A. Employees are in a constant state of learning and performance improvement.
B. Employees are free to move wherever they are needed in a company.
C. Line employees are trained to specialize in one job in order to maximize efficiency.
D. Previously established boundaries between managers, employees, customers, and vendors
are abandoned.
Line employees are trained in multiple jobs, communicate directly with suppliers and
customers, and interact frequently with engineers, quality experts, and employees from other
functions.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Hard
Learning Objective: 1-6
Topic: High-Performance Work Systems
82. (p. 51) Employees in geographically dispersed locations can work together in virtual teams
using video, e-mail, and the Internet. This e-HRM implication refers to which aspect of HR?
A. Recruiting
B. Analysis and design of work
C. Selection
D. Compensation and benefits
Human Resource Management Practices include Analysis and design of work, HR planning,
Recruiting, Selection, Training and development, Compensation, Performance management
and Employee relations.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-6
Topic: High-Performance Work Systems
1-56
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
83. (p. 52) From the manager's perspective, an HRIS can be used to perform primarily all but
one of the following. Name the exception.
A. Support strategic decision making
B. Avoid litigation
C. Evaluate programs and policies
D. Motivate employees
A systematic planned strategic effort by a company to attract, retain, develop, and motivate
highly skilled employees and managers is called talent management.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Easy
Learning Objective: 1-6
Topic: High-Performance Work Systems
84. (p. 54) A(n) _____ is a series of indicators or metrics that managers and employees have
access to on the company intranet or human resource information system.
A. HR dashboard
B. balanced scorecard
C. web portal
D. Intranet
HR dashboard allows company to identify divisions that are developing new talent.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Easy
Learning Objective: 1-6
Topic: High-Performance Work Systems
1-57
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
85. (p. 54) All of the following HR practices support high-performance work systems EXCEPT:
A. employees participate in selection process.
B. jobs are designed to use a variety of skills.
C. employee rewards are related to company performance.
D. individuals tend to work separately.
One of the most popular methods for increasing employee responsibility and control is work
teams.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-6
Topic: High-Performance Work Systems
86. (p. 56) Which one of the following is NOT associated with managing the human resource
environment?
A. Linking HRM practices to the company's business objectives.
B. Identifying human resource requirements through human resource planning, recruitment,
and selection.
C. Ensuring that HRM practices comply with federal, state, and local laws.
D. Designing work that motivates and satisfies the employee as well as maximizes customer
service, quality, and productivity.
Acquiring and Preparing Human Resources deals with identifying human resource
requirements through human resource planning, recruitment, and selection.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-7
Topic: Managing the Human Resource Environment
1-58
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
87. (p. 56) Economic value is traditionally associated with all of the following EXCEPT:
A. equipment.
B. technology.
C. facilities.
D. HRM practices.
HRM practices have not traditionally been seen as providing economic value to the company.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-7
Topic: Meeting Competitive Challenges Through HRM Practices
88. (p. 57) A company's human resource acquisition requirements are influenced by all of the
following EXCEPT:
A. terminations.
B. customer demands for products and services.
C. motivation and satisfaction of employees.
D. promotions.
Creating a positive environment for human resources involves designing work that motivates
and satisfies the employee as well as maximizes customer service, quality, and productivity.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-7
Topic: Acquiring and Preparing Human Resources
1-59
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
89. (p. 58) Managing the assessment and development of human resources involves all of the
following EXCEPT:
A. measuring employees' performance.
B. creating an employment relationship and work environment that benefits both the company
and the employee.
C. recruiting employees and placing them in jobs that best use their skills.
D. identifying employees' work interests, goals, and values, and other career issues.
Acquiring and Preparing Human Resources involves recruiting employees and placing them
in jobs that best use their skills.
AACSB: Reflective Thinking Skills
BT: Comprehension
Difficulty: Medium
Learning Objective: 1-7
Topic: Assessment and Development of Human Resources
90. (p. 58) Besides interesting work, _____ are the most important incentives that companies
can offer to its employees.
A. training for future work roles
B. beneficial work environments
C. support for nonwork activities
D. pay and benefits
Also, pay and benefits are used to reward employees' membership in the company and attract
new employees.
AACSB: Business Knowledge and Analytic Skills
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-7
Topic: Compensating Human Resources
Essay Questions
1-60
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
91. (p. 8) Name and discuss the competencies that HR professionals need.
1. Credible activist: delivers results with integrity, shares information, builds trusting
relationships, and influences others, providing candid observation, taking appropriate risks.
2. Cultural steward: facilitates change, develops and values the culture, and helps employees
navigate the culture.
3. Talent manager/organizational designer: develops talent, designs reward systems, and
shapes the organization.
4. Strategic architect: recognizes business trends and their impact on the business, evidencebased HR, and develops people strategies that contribute to the business strategy.
5. Business ally: understands how the business makes money and the language of the
business.
6. Operational executor: implements workplace policies, advances HR technology, and
administers day-to-day work of managing people.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 1-1
Topic: What Competencies Do HR Professionals Need?
92. (p. 9-10) How has the role of HRM changed in recent years? Discuss three trends that are
changing the HRM function. Why have these roles changed?
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.
One trend seen today is that the role of HRM in administration is decreasing as technology is
used for many administrative purposes, such as managing employee records and allowing
employees to get information about and enroll in training, benefits, and other programs.
Another trend is that outsourcing of the administrative role is occurring quite frequently.
Additionally, HRM is becoming more proactive and less reactive. Roles such as practice
development and strategic business partnering have increased.
HRM roles have changed because managers see HRM as the most important lever for
companies to gain competitive advantage over both domestic and foreign competitors.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 1-1
Topic: How is the HRM Function Changing?
1-61
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
93. (p. 21) What is meant by empowering and what type of training must be conducted to make
it effective?
Empowering means giving employees responsibility and authority to make decisions
regarding all aspects of product development or customer service. Employees are then held
accountable for products and services; in return, they share the resulting rewards and losses of
the results.
For empowerment to succeed, managers must be trained to link employees to resources within
and outside the company, help employees interact with their fellow employees and managers
throughout the company, and ensure that employees are updated on important issues and
cooperate with each other. Employees must also be trained to use the Web, e-mail, and other
tools for communicating, collecting, and sharing information.
AACSB: Reflective Thinking Skills, Group/Individual Dynamics in Organizations
BT: Analysis
Difficulty: Medium
Learning Objective: 1-2
Topic: Economic Changes
94. (p. 27) Discuss the balanced scorecard approach of measuring stakeholder performance.
The balanced scorecard:
1. Is based on the degree to which stakeholder needs are satisfied.
2. Brings together most measures needed to be competitive.
3. Gives employees a framework to link their goals to organizational goals.
4. Is used to link HR activities to business strategy.
5. Evaluates how much HR is helping to meet strategic objectives.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 1-3
Topic: Meeting the Needs of Stakeholders, Shareholders, Customers, Employees, and Community
1-62
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
95. (p. 31) Discuss the Malcolm Baldrige National Quality Award including its purpose, the
application process, the criteria used for evaluation, and the advantages associated with the
award.
Established to promote quality awareness:
1. Company fills out detailed application with basic information about the company location,
markets and products, as well as in-depth presentation of how the company addresses specific
criteria related to quality improvement.
2. Board of examiners evaluates the application. All applicants receive written feedback
summarizing company strengths and needs for improvements. Three awards may be given
annually in each of five categories: manufacturing, service, small businesses, education, and
health care.
Criteria used:
1. Leadership120 pts
2. Customer and market focus85 pts
3. Workforce focus85 pts
4. Measurement, analysis, and knowledge management90 pts
5. Strategic planning85 pts
6. Process management85 pts
7. Business results450 pts
Overall research suggests the award has had a positive impact on overall company
performance, including:
1. Better employee relations.
2. Increased productivity.
3. Customer satisfaction.
4. Market share.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 1-3
Topic: Customer Service and Quality Emphasis
1-63
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
96. (p. 38-39) What sorts of activities does managing cultural diversity involve? Discuss four of
the six ways (arguments) that managing cultural diversity can provide a competitive
advantage.
Activities include:
1. Creating an organizational culture that values diversity
2. Ensuring that HRM systems are bias-free
3. Facilitating higher career involvement of women
4. Promoting knowledge and acceptance of cultural differences
5. Ensuring involvement in education both within and outside the company
6. Dealing with employees' resistance to diversity
Competitive advantages associated with diversity
1. Cost argumentAs organizations become more diverse, the cost of a poor job in
integrating workers will increase. Those who handle this well will thus create cost advantages
over those who do not.
2. Employee attraction and retention argumentCompanies will develop reputations as good
companies for women and minorities to work for and therefore they will attract the best from
these groups of individuals. This will be especially important as the labor pool shrinks and
changes composition.
3. Marketing argumentThe insight and cultural sensitivity of employees with roots in other
countries or different ethnic groups will help both in multinational organizations as well as
when marketing to subpopulations domestically.
4. Creativity argumentCreativity should be improved by diversity of perspectives and less
emphasis on conformity to norms of the past.
5. Problem-solving argumentWider range of perspectives and more thorough critical
analysis of issues will lead to more heterogeneity in decisions and problem-solving groups.
6. System flexibility argumentSystem will become less determinate, less standardized, and
more fluid, which should create greater flexibility to react to environmental changes.
AACSB: Multicultural and Diversity Understanding, Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 1-3
Topic: Changing Demographics and Diversity of the Workforce
1-64
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
97. (p. 40) What five main areas of the legal environment have influenced human resource
management over the past 25 years?
The five main areas of the legal environment that have influenced HRM over the past 25
years are equal employment opportunity legislation, employee safety and health, employee
pay and benefits, employee privacy, and job security.
AACSB: Reflective Thinking Skills, Ethical/Legal Responsibilities
BT: Knowledge
Difficulty: Medium
Learning Objective: 1-3
Topic: Legal and Ethical Issues
98. (p. 51) Define electronic human resource management (e-HRM) and indicate its implications
for five HRM practices.
Electronic human resource management (e-HRM) refers to the processing and transmission of
digitized information used in HRM, including text, sound, and visual images, from one
computer or electronic device to another.
Implications include:
1. Analysis and design of workEmployees in geographically dispersed locations can work
together in virtual teams using video, e-mail, and the Internet.
2. RecruitingPost job openings online. Candidates can apply for jobs online.
3. TrainingOnline training can bring training to employees anywhere, anytime.
4. SelectionOnline simulations, including tests, videos, and e-mails that measure job
candidate's abilities to deal with real-life business challenges.
5. Compensation and benefitsEmployee can review salary and bonus information and seek
information about and enroll in benefit plans.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 1-6
Topic: High-Performance Work Systems
1-65
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
99. (p. 49-50) Discuss how HR practices support the use of new technology and work designs.
Teams are used to perform work. Employees participate in the selection process. Employees
receive formal performance feedback and are actively involved in the performanceimprovement process. Ongoing training is emphasized and rewarded. Employees' rewards and
compensation relates to the company's financial performance. Equipment and work processes
are structured to encourage maximum flexibility and interaction among employees.
Employees participate in planning changes in equipment, layout, and work methods. Work
design allows employees to use a variety of skills. Employees understand how their jobs
contribute to the finished product or service.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Hard
Learning Objective: 1-6
Topic: High-Performance Work Systems
1-66
Chapter 01 - Human Resource Management: Gaining a Competitive Advantage
100. (p. 56-58) Outline the four dimensions of human resource management practices, including
specific examples of human resource practices within each area.
1. Managing the human resource environment. Managing internal and external environmental
factors allow employees to make the greatest possible contribution to company productivity
and competitiveness. Examples include:
a) Ensuring that HRM practices are in legal compliance.
b) Designing work that motivates employees and that maximizes customer service, quality,
and productivity.
c) Linking HRM practices to the company's business objectives.
2. Acquiring and preparing human resources. Number and type of employees influenced by
customer needs, terminations, promotions, and retirements. Need to predict the number and
types of employees needed and identify current or potential employees to fill those needs.
Examples include:
a) Human resource planning.
b) Recruiting employees.
c) Selecting employees.
d) Training employees.
3. Assessment and development of human resources. Managers must ensure employees have
the necessary skills to perform current and future jobs. Work may be redesigned to be done by
teams. Companies need to create a supportive work environment. Examples include:
a) Measuring employee performance.
b) Preparing employees for future work roles.
c) Identifying employees' work interests, goals, and values.
4. Compensating human resources. Pay and benefits are important incentives to offer
employees in exchange for contributing to productivity, quality, and customer service. Also
used to reward employees' membership and attract new employees. Examples include:
a) Creating pay systems.
b) Rewarding employee contributions.
c) Providing employees with benefits.
AACSB: Reflective Thinking Skills
BT: Analysis
Difficulty: Medium
Learning Objective: 1-7
Topic: Meeting Competitive Challenges Through HRM Practices
1-67