54. Which of the following statements about performance appraisal is true?
a.
Most employees and managers intensely dislike the performance appraisal process.
b.
Performance appraisals can be used as a basis for compensation but not as a basis for
determining who needs further training.
c.
Since performance appraisal is only a marginally important human resource process, any
problems associated with it do not affect organizations overall.
d.
Legally, a disgruntled employee cannot sue an employer on the basis of a dissatisfactory
performance appraisal.
e.
All of these statements about performance appraisal are true.
55. Which of the following is an example of a subjective performance measure?
a.
behavioral observation scales
b.
sales quotas
c.
production rate
d.
revenues
e.
number of customer complaints
56. ____ ask raters to rate the frequency with which workers perform specific behaviors representative of
the job dimensions that are critical to successful job performance.
a.
Behavioral observation scales
b.
Observational research studies
c.
Performance rating scales
d.
Objective performance measures
e.
Trait rating scales
57. Which of the following is an example of an objective performance measure?
a.
performance analyses
b.
behavioral observation scales
c.
cognitive ability scales
d.
input/output measures
e.
all of these
58. A ____ is a performance appraisal process in which feedback is obtained from the boss, subordinates,
peers, and co-workers as well as the employees themselves.
a.
360-degree feedback
b.
performance appraisal iteration
c.
reciprocal appraisal
d.
grapevine appraisal
e.
circular feedback program
59. To improve traditional performance appraisal feedback sessions, it is recommended that managers
____.
a.
combine developmental feedback and administrative feedback
b.
strengthen the grading aspect of performance appraisal
c.
base performance appraisal feedback sessions on self-appraisals
d.
use outsourcing
e.
use either a halo or a recency measure
60. Which of the following statements about using 360-degree feedback is true?
a.
360-degree feedback is most effective when used to train performance raters.
b.
A 360-degree feedback provides feedback from peer workers only.
c.
With the 360-degree feedback approach, feedback comes from four sources.
d.
Employees do not provide feedback about their own efforts in the 360-degree feedback
approach.
e.
360-degree feedback should not be used for developmental purposes.
61. The term ____ refers to both the financial and nonfinancial rewards organizations give employees in
exchange for their work.
a.
wages
b.
value-added
c.
compensation
d.
salaries
e.
fees
62. Which of the following is NOT an example of a pay-variability decision used to motivate employee
performance?
a.
piecework pay
b.
hierarchical pay
c.
sales commission
d.
stock options
e.
profit sharing
63. An ESOP is an ____.
a.
equitable stock ownership plan
b.
employee stock ownership plan
c.
employee salary option program
d.
equity in salary organizational plan
e.
employer/subordinate organizational profit
64. One of the reasons items manufactured in Southeast Asia are imported into the United States less
expensively is that workers are paid a small amount of money for each item produced. The
manufacturers operating in Southeast Asia use what type of pay plan?
a.
real-time pay
b.
compressed pay
c.
piecework
d.
batch processing
e.
commission
65. Which of the following statements about employee separation is true?
a.
Employee separations may be voluntary or involuntary.
b.
Examples of employee separation would include terminations, downsizing, retirements,
and turnover.
c.
Wrongful discharge is a legal doctrine that requires employers to have a job-related reason
for terminating an employee.
d.
Outplacement services provide employment-counseling services for employees faced with
downsizing.
e.
All of these statements about employee separation are true.
66. To minimize the problems inherent in firing employees, managers should do which of the following?
a.
Before firing employees, managers should give them a chance to improve.
b.
Employees should be fired if they develop a health problem that will put an unforeseen
burden on the company’s insurance carrier.
c.
Employees should never be fired in private.
d.
While written records are not necessary, managers should be sure to verbally report the
reason for the firing to the human resource department.
e.
None of these statements describes what a manager should do to minimize the problems
inherent in firing employees.
67. Sharron Grant-Burton was a marketing director for Covenant Care, owner of skilled-nursing and
assisted-living facilities. During a discussion of the fairness of the company’s bonus structure with
other marketing directors, Grant-Burton said she did not receive a bonus because her executive
director “did not believe in them.” Several days later, Grant-Burton was fired and told she had been
terminated for a number of unspecified reasons, including her comments about bonuses. This is an
example of a ____.
a.
de-employment
b.
wrongful discharge
c.
reactive termination
d.
regressive turnover
e.
proactive termination
68. Which of the following statements regarding downsizing is true?
a.
Downsizing refers to the revaluation or splitting of the organization’s common stock.
b.
Downsizing typically leads to increased employee morale.
c.
When downsizing, outplacement programs can help the company maintain a positive
image in the community.
d.
The best strategy for downsizing is to establish a tall organizational structure as quickly as
possible.
e.
Downsizing is seldom a planned strategy; it typically evolves as a result of environmental
changes.
69. Which of the following provides employment counseling services for employees faced with
downsizing?
a.
outplacement services
b.
reassessment centers
c.
employee outsourcing
d.
employee restructuring
e.
outsourced centers
70. Which of the following statements about employee turnover is true?
a.
For top management, dysfunctional turnover is preferable to functional turnover.
b.
One of the best ways to discourage turnover is to link pay directly to performance.
c.
Employee turnover is the loss of employees who involuntarily choose to leave a company.
d.
Functional turnover requires outplacement centers.
e.
Sales commissions and bonuses should not be used to decrease employee turnover.
71. ____ is the loss of high-performing employees who voluntarily choose to leave a company.
a.
De-employment
b.
Dysfunctional turnover
c.
Reactive turnover
d.
Regressive turnover
e.
A “brain leak”
72. The U.S. chemical industry faces a looming shortage of process operators and is hiring new ones as
fast as it can. The average age of an effective process operator is 50. A wave of retirements among
these highly qualified and experienced operators in coming years will create openings for as many as
10,000 operators in the chemical industry. The retirement of the current operators is an example of
____.
a.
de-employment
b.
dysfunctional turnover
c.
reactive turnover
d.
regressive turnover
e.
a “brain leak”
Trends in Hiring Practices
Zachary Schneider saw a sign in the window of an Amy’s Ice Creams franchise operation. The sign
said the company was looking for new employees. When he went in to ask for a job application, he
was given a paper bag and told to do “something creative with it.” The test was to see whether the job
applicant was suited to carrying out the chain’s mission: “To make people’s day.” This type of
pre-employment assessment is not unusual. Gourmet grocery chain Central Market uses a four-page
application form which includes essay questions such as “Tell us about your favorite food experience.”
If it seems an applicant is a good match for the company, he or she is asked to make a statement about
himself or herself using items found in the grocery store and to participate with other applicants in a
roundtable discussion.
73. Refer to Trends in Hiring Practices. The need for creative skills in order to work at Amy’s would be
listed as a ____ that the company’s HR department would have developed for franchisees.
a.
task specialization
b.
job description
c.
work empowerment norm
d.
job specification
e.
multitasking capability
74. Refer to Trends in Hiring Practices. Which recruiting technique did Amy’s use?
a.
internal recruiting
b.
establishing career paths
c.
franchising
d.
job posting
e.
external recruiting
75. Refer to Trends in Hiring Practices. Amy’s is convinced that how applicants respond to its request to
do something creative with a brown paper bag accurately predicts how well job applicants will
perform if hired. In other words, it believes its pre-employment assessment method is ____.
a.
standardized
b.
valid
c.
efficient
d.
economical
e.
reliable
76. Refer to Trends in Hiring Practices. Central Market uses its application form to ____.
a.
shield it from EEOC prosecution
b.
avoid reference checks
c.
administer selection tests
d.
determine how well future employees are performing
e.
train new employees
Domino’s Pizza
At Domino’s Pizza, company-wide turnover is 158 percent. That means Domino’s must recruit,
hire, and train 180,000 people a year just to fill its company’s 114,000 jobs. And, with that much
turnover, you can’t consistently produce a quality product. Making and delivering pizza may seem
simple, but up the ante to making and delivering one million pizzas each night, as Domino’s does, and
all of a sudden it’s not quite so easy, especially if you’re always working with inexperienced
employees. For instance, even a simple job like taking orders has a learning curve when you’re taking
45 to 50 orders an hour. In fact, a new order taker usually requires 80 hours to become as reliable as an
experienced one. Until they learn their jobs, new workers make lots of mistakes such as getting orders
wrong, giving out the wrong change, and showing up at customers’ homes with the wrong pizza.
Those mistakes are costly in two ways.
First, if the order is wrong, late, or missing, customers get angry and may not do business with
you again. Indeed, according to the University of Michigan’s American consumer satisfaction index,
Domino’s ranks in the bottom half of fast–food companies. Second, to right those wrongs, Domino’s
often says the pizza is free—“Our fault, no charge.”—and that hurts profits. So much turnover is costly
in other ways as well. For one thing, it costs time and money to find and hire new workers. Domino’s
estimates that it costs $2,500 to replace each hourly worker who leaves and $20,000 to replace a store
manager. Then all those new workers must be trained, and that takes time and money. At Domino’s,
each new worker spends the first 30 days in training, learning to take orders, handle the cash register,
make pizza dough, and, ultimately, how to make a pizza in less than a minute. When everything is
considered, turnover is costing the company several hundred million dollars a year, or an astonishing
15 percent to 20 percent of revenues. The question, of course, is what to do about it.
Robert Chabot, who owns RAM Pizza, a series of Domino’s franchise stores, says, “This business
is all about who you hire. It’s about people: those who want to do it (good work) and those who don’t.”
Consequently, Chabot relies heavily on employee referrals to first identify good job applicants. Chabot
assumes that if current employees are satisfied with their jobs, they’ll tell their family and friends
about their positive work experiences, and those people will in turn want to work for him and RAM
pizza (i.e., Domino’s). He also pays employees $25 for each person they recommend who gets hired
and then stays for 90 days.
Domino’s is also doing a much better job of screening and selecting potential managers. Anyone
who wants to manage a Domino’s store has to pass a 30-minute online test of their financial and
management skills. If you’re not familiar with financial concepts such as “break–even” and “cash
flow,” and you’re not sure how to handle poorly performing employees (hint: yelling and screaming
isn’t the preferred answer), then you’re unlikely to pass the test.
77. Refer to Domino’s. Robert Chabot relies heavily on employee referrals to first identify good job
applicants. In other words, Chabot uses ____.
a.
a reliable selection process
b.
internal recruiting
c.
functional recruiting
d.
functional selection
e.
external recruiting
78. Refer to Domino’s. Which of the following selection methods could Robert Chabot use to determine
that prospective employees do not have a criminal record?
a.
assessment center
b.
cognitive ability tests
c.
structured interviews
d.
background checks
e.
personality tests
79. Refer to Domino’s. Anyone who wants to manage a Domino’s store has to pass a 30-minute online test
of their financial and management skills. Domino’s uses ____.
a.
work performance testing
b.
aptitude testing
c.
personality testing
d.
affective skills testing
e.
cognitive ability testing
80. Refer to Domino’s. One new pay method Domino’s implemented to combat its problems is a
store-profitability bonus. On average, the store-profitability bonuses add 30 percent, or about $10,000,
to the $32,000 base pay for the managers of Domino’s stores that perform well. These bonuses are a
form of ____.
a.
piecework pay
b.
hierarchical pay
c.
sales commission
d.
payroll deductions
e.
profit sharing
WWYD Nick’s Pizza & Pubs
Nick’s Pizza & Pubs, a two-restaurant business in northern Illinois, wanted to open five more
restaurants. But expansion wasn’t to be. Expenses were high because of an inability to control food
and beverage costs. An economic downturn saw guest counts drop. In the end, with costs up, revenues
down, and lending standards tightening, Nick’s fixed up and grew the two existing restaurants.
Following the success of a young employee who asked staff for ways to keep costs in line, Nick pulled
together the staffs in both restaurants to share how and where the restaurants were earning revenue and
incurring expenses. He then asked for their help on three key issues: pay, hiring, and training. Nick and
his people addressed three human resource challenges at Nick’s Pizza & Pubs.
Pay was the first. Nick’s takes a sophisticated multipronged approach to compensating its
employees. To start, Nick’s alters basic pay by one dollar more than minimum wage, and for
employees who work at least 30 hours a week, the company pays half the cost of their
company-provided health insurance. And for nearly a decade, Nick’s has had a profit sharing plan for
all 230 employees. Each month, if the restaurant meets its goals in four out of five following areas,
food costs, beverage costs, guest comments, employee turnover, and labor costs, Nick’s employees
split 80% of the profit sharing pot.
Nick’s also takes a unique approach to recruiting. From the start of Nick’s interview process,
managers are looking for signs of personal accountability. The initial screening interview is strict and
eliminates 80 percent of applicants. The 20 percent of applicants who make it out of the first round of
interviews then complete two more interviews. This time, however, to increase the reliability and
validity of the interview process, two managers sit in on each interview, with one manager sitting in on
both interviews for each applicant. Like the first round of interviews, the criteria are strict. One “no”
vote, and you’re not hired. If you aren’t, you still receive a thank-you note and a coupon for a free
pizza. During the interview process, hiring managers at Nick’s ask each applicant the same job-related
questions.
New hires spend two days learning about the company’s purpose, values, and culture in a
training class called Nick’s 101 during which they spend 4 hours in the kitchen learning how to make
pizza. The next step is Nick’s 201, in which employees are separated by job, kitchen, wait staff, or bar
staff, and are trained in their specific job responsibilities. And to prove that they’ve mastered their
jobs, each employee is encouraged to certify their skill level in the tasks contained in their job. For
example, it usually takes pizza makers two to four weeks to become certified, whereby they can make
a pizza on their own to Nick’s standards. Pizza makers, however, can get certified in other kitchen
jobs, such as salads and sandwiches. When they’ve been certified in 3 jobs, their pay goes up 75
cents an hour. Becoming certified in another three jobs, six in total, increases their ay by $1.25 an
hour. And when a kitchen worker is certified in 9 jobs, their pay will increase by $2.75 an hour.
81. Refer to WWYD Nick’s Pizza & Pub. Minimum wage is the starting point for______ decisions ant
Nick’s Pizza & Pub. ?
a.
job evaluation
b.
pay level
c.
recruiting
d.
selection
e.
profit sharing
82. Refer to WWYD Nick’s Pizza & Pub. Nick’s profit sharing plan is an example of:
a. an employee benefit
a.
an employee benefit
b.
an ESOP
c.
pay variability
d.
recruiting bonus
e.
commission
83. Refer to WWYD Nick’s Pizza & Pub. Nick prefers to use __________ because of the _________ that
job applicants otherwise provide in their responses.
a.
structured interviews/lies
b.
single-manager interviews/inconsistencies
c.
structured interviews/variation
d.
internal recruiting/unknowns
e.
unstructured interviews/lack of creativity
84. Refer to WWYD Nick’s Pizza & Pub. All of Nick’s new hires learn about the company’s purpose,
values, and culture. The most appropriate method to deliver that training would be:
a.
lectures
b.
vestibule training
c.
on-the-job training
d.
role-playing
e.
task related simulations
85. Refer to WWYD Nick’s Pizza & Pub. Nick’s certification program and the related pay changes for
performing different tasks in the kitchen reflect which kind of compensation decisions?
a.
objective
b.
employment benefits
c.
pay level
d.
pay variability
e.
performance
86. Refer to WWYD Nick’s Pizza & Pub. Most likely, the kitchen workers at Nick’s are trained to do the
different kitchen jobs using:
a.
videos
b.
lectures
c.
planned readings
d.
vestibule training
e.
OJT
SHORT ANSWER
1. Identify the employee characteristics that are protected by federal employment anti-discrimination
laws (i.e., the characteristics upon which employers are not legally allowed to discriminate). Specify
which human resource management decisions these laws affect.
2. Briefly identify the EEOC’s definition of sexual harassment. Also identify and describe the two kinds
of sexual harassment that can be specified from a legal perspective.
3. Explain how job analysis is related to recruiting. Be sure to specify how it helps an organization to
meet a basic legal requirement for human resource management.
4. Differentiate between internal and external recruiting. Provide two examples of each.
5. Explain how a human resources department defines selection. List the four common categories of
selection procedures used by companies. Specify which of these four generally does the best job of
predicting applicants’ future job performance.
6. Identify and describe the three kinds of job interviews. Which type works best as a selection tool?
7. Identify two common problems that occur during the performance appraisal process. Recommend one
approach for avoiding each of these problems.
8. List and briefly define the three basic kinds of compensation decisions.
9. Identify three things that managers can do to minimize the problems inherent in terminating
employees.
ESSAY
1. Explain the nature and intent of federal employment law. Identify the circumstances under which
protected characteristics such as gender, age, or religion can be used as the basis for employment
decisions as well as the circumstances under which a company may be found guilty of illegal
discrimination.
2. What is sexual harassment? Identify the two kinds of sexual harassment from a legal perspective.
Describe some frequent misunderstandings about sexual harassment. Specify steps that companies can
take to make sure that sexual harassment laws are followed and not violated. Give one example of
possible sexual harassment that you have heard or read about and explain which of the steps just
described could have averted or resolved that situation more effectively.
3. What makes an effective selection process? What are the steps in the common selection procedures
used by companies? Which of these procedures would you recommend that a company use to hire
managers? Explain the reasons for your recommendations.
4. What is a performance appraisal? How does it influence organizational success? Explain why it
poses a particular challenge to managers.
5. List and explain the three basic kinds of compensation decisions. Give two examples of what is
involved in making each kind of compensation decision. What is a job evaluation? Which kind(s) of
compensation decisions are job evaluations directly related?