CHAPTER 2—STRATEGY AND HUMAN RESOURCES PLANNING
TRUE/FALSE
1. Organizations set procedures for making decisions to achieve those objectives through strategic
planning.
2. Human Resource Planning (HRP) is the conducting of recruitment and selection methods according to
a strategic plan.
3. Strategic HRM is a combination of strategic planning and HR planning.
4. The first step in strategic planning is establishing a mission, vision, and values for the organization.
5. The vision is the basic purpose of the organization.
6. Organizational core values form the foundation of a firm’s decisions.
7. Changes in labor supply can place limits on the strategies available to firms.
8. Internal analysis provides strategic decision makers with an inventory of organizational skills and
resources.
9. Internal analysis focuses on culture and conflicts with an organization.
10. A cultural audit may examine the attitudes and expectations of the employees.
11. Strategic planning is the process of anticipating and providing for the movement of people into, within,
and out of an organization.
12. Trend analysis relies on a single factor to predict employment needs.
13. A strategic vision provides the strong and enduring beliefs and principles that the company uses as a
foundation for its decisions.
14. Strategic knowledge workers usually earn long-term commitments and investments in their training
and development from their employers.
15. Forecasting is frequently more an art than a science, providing inexact approximations rather than
absolute results.
16. Forecasting may be as informal as having one person familiar with the organization anticipate HR
needs.
17. Qualitative HR forecasting techniques generally employ sophisticated analytical models.
18. Trend analysis is a qualitative approach to labor demand forecasting.
19. Trend analysis relies on a single business factor.
20. The vision statement clarifies the long-term direction of the company and its strategic intent.
21. Staffing tables provide data on external labor supply sources.
22. Markov analysis is used to track an organization’s internal supply of labor.
23. Core values are the essence of a corporate culture and an expression of its personality.
24. Succession planning is the process of identifying, developing, and tracking key individuals so that they
may eventually assume top-level positions.
25. SWOT analysis helps executives summarize the major facts and forecasts derived from the external
analysis.
26. Corporate strategy focuses on domain selection.
27. In international joint ventures, the issue of culture is paramount.
28. Dell has been very successful utilizing a low cost strategy.
29. Southwest Airlines has been very successful utilizing a differentiation strategy.
30. In the long run, firms must approach outsourcing decisions based on cost alone.
31. Differentiation strategy is based on efficiency and productivity.
32. While unemployment rates vary by sector, the shortage of talent in low-skill jobs continues to create a
real challenge for firms.
33. Organizational structure is the framework in which activities of the organization members are
coordinated.
34. Shared values act as a guiding parameter for strategic planning.
35. In unionized firms, layoffs are typically based on performance.
36. The order of employee layoffs is usually based on seniority and/or ability.
37. A disadvantage of overemphasizing seniority is that less competent employees receive the same
rewards and security as more competent employees.
38. Markov analysis shows the percentage of employees who remain in each of the firm’s jobs from one
year to the next.
39. Benchmarking identifies the best practices in a given area and establishes them as performance
standards.
40. The target company for benchmarking does not need to be a competitor.
41. Calculating separation costs and training investment factors are component measures of human capital.
42. The Balanced Scorecard is a tool for mapping a firm’s strategy in order to ensure strategic alignment.
43. The quality of fill metric attempts to measure how well new hires that fill positions are performing on
the job.
44. A SWOT analysis helps executives summarize the major facts and forecasts derived from external and
internal analysis.
MULTIPLE CHOICE
1. The process of setting procedures for making decisions about the organization’s long-term goals and
strategies is called:
a.
strategic planning.
b.
HR planning.
c.
job analysis.
d.
environmental scanning.
2. Human resource planning is:
a.
a technique that identifies the critical aspects of a job.
b.
the process of anticipating and making provision for movement of people into, within, and
out of an organization.
c.
the process of setting major organizational objectives and developing comprehensive plans
to achieve these objectives.
d.
the process of determining the primary direction of the firm.
3. Customers, suppliers, and substitutes are part of the _____ environment.
a.
political
b.
technological
c.
demographic
d.
competitive
4. The ____ provide(s) the basic purpose of the organization as well as its scope of operations.
a.
mission
b.
vision statement
c.
core values
d.
core competencies
5. Based upon U.S. Census Bureau projections, which of the following is NOT anticipated to happen
between 2012 and 2018?
a.
Employment growth will continue to be concentrated in the service-providing sector of the
economy.
b.
The number of workers in the 55 and older group is projected to grow by nearly 30
percent.
c.
Approximately 62 percent of all new jobs created in the U.S. economy will be in the
health care and social assistance industry.
d.
Minorities and immigrants will constitute a larger share of the population and labor force.
6. This group of employees has skills that are quite valuable to a company, but not particularly unique or
difficult to replace.
a.
core employees
b.
strategic knowledge workers
c.
supporting workers
d.
partners
7. Which of the following is NOT a component of corporate culture?
a.
Values
b.
Assumptions
c.
Experiences
d.
Beliefs
8. The mission of a company:
a.
is the systematic monitoring of external opportunities
b.
is the basic purpose of the organization
c.
are the strong enduring beliefs used by the company to make decisions
d.
provides a perspective on where the company is headed
9. The strategic vision of a company:
a.
is the systematic monitoring of external opportunities
b.
is the basic purpose of the organization
c.
are the strong enduring beliefs used by the company to make decisions
d.
provides a perspective on where the company is headed
10. The core value of a company:
a.
is the systematic monitoring of external opportunities
b.
is the basic purpose of the organization
c.
is the strong enduring beliefs and principles used by the company to make decisions
d.
provides a perspective on where the company is headed
11. The systematic, regular monitoring of major external forces influencing the organization is called:
a.
demand forecasting.
b.
environmental scanning.
c.
exception reporting.
d.
influence analysis.
12. Environmental factors that are frequently attended to by organizations include all of the following
except:
a.
economic factors.
b.
demographic trends.
c.
technological changes.
d.
employee turnover and absenteeism rates.
13. Social concerns include:
a.
new processes
b.
innovations
c.
demographic trends
d.
elder care
14. The competitive environment includes all the following except:
a.
new entrants
b.
suppliers
c.
rivals
d.
subordinates
15. At the fundamental level, strategy focuses on creating ____ value.
a.
buyers
b.
suppliers
c.
customers
d.
subordinates
16. The examination of the attitudes and activities of a company’s workforce refers to:
a.
environmental scanning.
b.
a trend analysis.
c.
a cultural audit.
d.
behavioral modeling.
17. ____ is the process of identifying, developing, and tracking key individuals for executive positions.
a.
Succession planning
b.
Creating skill inventories
c.
Developing replacement charts
d.
Quality of fill
18. Questions that might typically be found on a cultural audit include all of the following except:
a.
Age, race, and gender
b.
Pay and benefits
c.
Diversity efforts
d.
Hiring practices
19. Integrated knowledge sets within an organization that distinguish it from its competitors and deliver
value to customers are known as:
a.
individual competencies.
b.
core capabilities.
c.
human capital.
d.
organizational competencies.
20. When a firm’s resources improve the efficiency or effectiveness of the company, these are known as:
a.
difficult to imitate.
b.
valuable.
c.
organized.
d.
rare.
21. Core capabilities are limited, but provide a long-term basis for:
a.
delivering customer satisfaction.
b.
HR expenditures.
c.
human capital development.
d.
technology innovation, product development, and service delivery.
22. When the knowledge, skills, and abilities of a firm’s human resources are not equally available to
competitors, these resources are known as:
a.
difficult to imitate.
b.
valuable.
c.
organized.
d.
rare.
23. Strategic knowledge workers:
a.
have unique skills not directly related to company strategy
b.
have firm-specific skills directly related to company strategy
c.
have skills that are valuable but not unique
d.
have skills available to all firms
24. With respect to forecasting, which of the following is NOT a critical element of planning?
a.
capabilities
b.
composition
c.
culture
d.
coordination
25. Which of the following is NOT a component of SWOT analysis?
a.
Weakness
b.
Threat
c.
Strategy
d.
Opportunity
26. Elements in an effective HR planning process must include all of the following except:
a.
making forecasts of labor demand.
b.
benchmarking best practices.
c.
performing supply analyses.
d.
balancing supply and demand considerations.
27. Which of the following is NOT an element of organizational growth?
a.
Increased employee productivity.
b.
A greater number of employees.
c.
Employees developing or acquiring new skills.
d.
An increase in profitability.
28. A qualitative approach to demand forecasting can include any of the following except:
a.
trend analysis.
b.
the Delphi technique.
c.
soliciting expert opinions.
d.
management forecasts.
29. Trend analysis includes all of the following steps except:
a.
selecting a business factor.
b.
soliciting expert opinions.
c.
computing a productivity ratio.
d.
plotting historical trends.
30. Multiple predictive techniques used to predict employment needs could include all of the following
factors except:
a.
interest rates
b.
gross national product
c.
disposable income
d.
hiring costs
31. The Delphi technique
a.
attempts to decrease subjectivity of forecasts
b.
is a quantitative method
c.
uses sophisticated statistical tools for forecasting
d.
is a method of reducing hiring costs
32. A graphical representation of all organizational jobs along with the numbers of employees currently
occupying those jobs and future employment requirements is called:
a.
a staffing table.
b.
an organization chart.
c.
a skills inventory.
d.
career planning.
33. An analysis of the number and percentage of employees in each job from year to year, with
proportions of those who are promoted, demoted, transferred, or exit the organization is called:
a.
a staffing table.
b.
a Markov analysis.
c.
a skills inventory.
d.
modeling.
34. Talent inventories can be used to develop ____, which list current jobholders and identify possible
replacements.
a.
staffing tables
b.
replacement charts
c.
trend models
d.
Markov analysis
35. The process of identifying, developing, and tracking key individuals so that they may eventually
assume top-level positions is:
a.
target forecasting.
b.
predicted change.
c.
succession planning.
d.
replacement selection.
36. ____ helps executives summarize the major facts and forecasts derived from external and internal
analyses.
a.
Target forecasting
b.
Predicted change
c.
SWOT analysis
d.
Replacement selection
37. A firm with a ____ focuses on only a limited portion of the industry.
a.
target forecasting
b.
predicted focus
c.
concentration strategy
d.
replacement selection
38. Cooperative strategies pursued by firms include
a.
joint ventures
b.
growth
c.
diversification
d.
acquisitions
39. Structure:
a.
lays out the route that the organization will take in the future.
b.
is the framework in which activities of employees are coordinated.
c.
are formal and informal procedures that govern every day activity.
d.
act as guiding parameters for strategic planning.
40. Systems:
a.
lay out the route that the organization will take in the future.
b.
is the framework in which activities of employees are coordinated.
c.
are formal and informal procedures that govern every day activity.
d.
act as guiding parameters for strategic planning.
41. Shared values:
a.
lay out the route that the organization will take in the future.
b.
is the framework in which activities of employees are coordinated.
c.
are formal and informal procedures that govern every day activity.
d.
act as guiding parameters for strategic planning.
42. Layoff decisions:
a.
can cause management’s discretion to be reduced where layoffs are based on seniority
b.
are always determined by labor agreement
c.
are made at management’s sole discretion
d.
and employment rights of each individual are determined by state law
43. Layoff decisions are frequently based on:
a.
union membership.
b.
department ranking.
c.
seniority.
d.
favoritism.
44. According to 7-S framework analysis, which of following is NOT in the “Hard S” category?
a.
strategy
b.
shared values
c.
structure
d.
system
45. Benchmarking refers to:
a.
identifying employees with promotion potential
b.
identifying performance differences with competing firms
c.
the process of identifying the best practice of a firm in a given area and comparing your
practices to theirs
d.
the process of establishing performance standards through HRP
46. Measures of turnover costs DO NOT include:
a.
separation costs
b.
return on assets
c.
replacement costs
d.
training program costs
47. A tool adopted for mapping a firm’s strategy in order to ensure strategic alignment is:
a.
target forecasting.
b.
predicted focus.
c.
balanced scorecard
d.
replacement selection.
48. The capacity of an organization to continuously act and change in pursuit of competitive advantage is:
a.
coordination flexibility.
b.
predicted focus.
c.
organizational capability.
d.
replacement selection.
49. ____ occurs through rapid reallocation of resources to new or changing needs.
a.
Coordination flexibility
b.
Predicted focus
c.
Organizational capability
d.
Replacement selection
50. Cross-training, job rotations, and the like results in ____ within the organization.
a.
coordination flexibility
b.
predicted focus
c.
organizational capability
d.
resource flexibility
51. Which of the following is NOT a cell of the Balanced Scorecard Model?
a.
financial
b.
planning
c.
customer
d.
process
52. The first step in strategic planning is:
a.
analyze the competition.
b.
interview potential employees.
c.
review failed plans from the past.
d.
establish a mission, vision, and values for the organization.
53. Analysis of external opportunities and threats is ___________ component of the strategic management
process.
a.
the second
b.
the last
c.
an optional
d.
the most difficult
54. In the telephone industry, mobile phones and VOIP (Voice-over-the Internet Protocol) are examples of
____________ for traditional firms.
a.
companions
b.
rivals
c.
substitutes
d.
supplements
55. As companies diversify into new businesses, managers are inevitably faced with a “make or ____”
decision.
a.
buy
b.
lease
c.
forego
d.
substitute
ESSAY
1. Describe the basics of SWOT analysis.
ANS:
2. Describe the criteria necessary for firms to achieve sustained competitive advantage through people.
ANS:
3. Describe the three key elements of the HR forecasting model.
4. What is the Balanced Scorecard?
5. How would you define “organizational capability”?