Chapter 1: Strategic Human Resource Management

Multiple Choice Questions

1. Choose the most correct from the following:

(a) the focus of human resource management (HRM) is on managing people withinthe employer-employee relationship

(b) HRM involves the productive utilisation of people in achieving the organisation’s objectives and the satisfaction of individual employee needs

(c) both (a) and (b)(d) HRM is simply a set of activities relating to the coordination of an organisation’s

human resources

2. HR managers have not been accepted as full strategic business partners because:

(a) they are concerned only with issues of employee welfare(b) they often fail to understand the organisation’s business and align human resource

strategies, policies and practices with business strategies(c) they are primarily concerned with developing people skills and pay little, if any,

attention to the ‘bottom line’(d) they perform activities that are not considered to be essential to the success of the

business

3. Many organisations have disbanded and distributed HRM functions throughout theorganisation due to all of the following except:

(a) funding cuts and financial losses(b) restructuring and takeovers(c) computerisation of personal records(d) lack of value-added

4. For HRM activities to ‘add value’ to an organisation they must:

(a) improve employee loyalty, responsibility and commitment(b) be low cost but high return(c) focus on increasing profits through increasing productivity

(d) respond to the demands of the shareholders

5. When pursuing a career in HRM there are three broad areas of focus and speciality.Which of the following is not one of them.

(a) pragmatic generalists(b) employee welfare officers(c) functional specialists(d) strategic partners

6. To successfully fulfil the role of a strategic partner an HR professional must:

(a) demonstrate an ability to ask the right questions(b) have the ability to translate business strategy into action(c) put the needs and demands of management above those of the employees(d) both (a) and (b)

7. In a situation where the HR manager is supporting the need for employees to begiven additional resources to allow them to perform their job more successfully theHR manager is fulfilling the role of:

(a) change agent(b) employee advocate(c) resource allocator(d) employee champion

8. Which of the following is not linked to the results of a performance appraisal:Fac

(a) rewards(b) training and development(c) employee placement(d) employee responsibilities

9. Employee motivation and behaviour can be positively influenced by:

(a) social interaction on the job(b) cash rewards

(c) skill and knowledge transferability(d) management commitment to employee welfare

10. An organisation that has a culturally diverse membership can reduce mistakescaused by misunderstanding if they:

(a) learn to manage diversity(b) introduce better induction and orientation programs(c) have clear equal opportunity policies(d) improve their communication

11. The purpose of an organisation’s strategy is to:

(a) communicate the CEO’s ambitions to the organisation members(b) provide the shareholders with an understanding of how their investment is being used

and protected(c) maintain a competitive advantage by capitalising on the strengths and minimising the

weaknesses of an organisation(d) identify and counter the strengths of the competition

12. Johnson and Johnson, and Sony frequently change their business strategies and practices in response to changes in the business environment, but maintain stable:

(a) codes of ethics(b) mission statements(c) goals and objectives(d) core values

13. The process whereby managers establish an organisation’s long-term direction, set specific performance objectives, develop strategies to achieve these objectives in thelight of all the relevant internal and external circumstances and undertake to execute the chosen action plans is known as:

(a) performance management(b) strategic management(c) operations management(d) service management

14. Hewlett-Packard exists ‘to make technical contributions for the advancement and welfare of humanity’. Jones and Kahaner argued that such statements ‘are the operational, ethical and financial guiding lights of companies’. By what name are such statements more commonly known?

(a) codes of ethics(b) value statements(c) mission statements(d) business strategies

15. Which of the following would not be analysed during an examination of an organisation’s external environment:

(a) import tariffs(b) exchange rates(c) technological development(d) competition

16. The aim of conducting a SWOT analysis is to:

Und(a) identify the organisation’s strengths, weaknesses, opportunities and threats(b) select the strategy that gives the best alignment or fit between the external and internal

environments(c) select a strategy that allows the organisation to maintain its market position given

increases in competition(d) aid the managing director’s in determining a course of action that most closely fits the

articulated mission statement

17. The ability of management to help the organisation respond to changing circumstances through the development of its objectives and polices requires themto be:

(a) proactive(b) reactive(c) selective

(d) responsive

18. Which of the following is not considered under an analysis of an organisation’s internal environment:

(a) product quality(b) employee skills(c) shortages of skilled labour(d) customer service

19. The extent to which an organisation is achieving its strategic objectives can be determined by examining:

(a) the yearly profit margin(b) the value of shares(c) the frequency with which objectives have to be changed(d) the implementation of plans and the results achieved

20. The business strategy adopted by the National Australia Bank and Westpac, whichinvolved acquisitions and mergers, is known as a(n):

(a) expansion strategy(b) competitive takeover(c) growth strategy(d) aggressive strategy

21. The strategy that seeks to improve performance by cost cutting, downsizing or re-engineering is known as a(n):

(a) retrenchment strategy(b) stability strategy(c) consolidation strategy(d) financial strategy

22. Organisations are more likely to have a HR strategic plan if they are:

(a) stable(b) retrenching(c) expanding(d) consolidating

23. Which of the following is not a pressure demanding a broader, more comprehensive and more strategic perspective with regard to an organisation’s human resources?

(a) increasing international competition which is creating a need for improved human productivity

(b) greater government involvement in HRM through policies such as EEO/AA and superannuation

(c) increasing education of the workforce that is resulting in changes to employee capabilities

(d) stable values and attitudes of the workforce

24. Competitors can easily copy all of the following except:

(a) technology(b) people(c) markets(d) products

25. HRM strategy aims to enable the organisation to achieve its objectives by all of the following except:

(a) seeing that all concerned in strategic planning appreciate the human resource implications of their proposals and understand the potential human resource constraints if action is not taken

(b) achieving a close match between corporate business objectives and the objectives of the human resource function

(c) maintaining the lowest cost workforce relative to the organisation’s competitors(d) assessing the performance requirements needed to reach the company’s goals and

deciding the lines along which the requirements should be satisfied

26. HRM strategic planning

(a) clarifies for the people in an organisation how HRM intends to contribute, what methods it will use, and what performance standards it is aiming for

(b) is concerned only with ensuring that the people requirements of the organisation can be met

(c) establishes clear guidelines for the implementation of workplace relations legislation(d) is the process used by an organisation to monitor and duplicate the human resources of

competitor organisations

27. An organisation with a business strategy that includes profit improvement might pursue which of the following set of activities:

(a) reduced labour costs through improved employee performance(b) increased expenditure on product development(c) investment in more advanced technology to increase output(d) reduced expenditure on employee development programs

28. Organisational objectives to which HRM can be linked are:

(a) customer service(b) organisational effectiveness(c) strategy development(d) both (a) and (b)

29. HRM objectives and activities must be:

(a) easily understood and achievable(b) designed to favour management, not employee, opinions(c) measurable and have a predetermined timeframe(d) a reflection of the development of the competition

30. Which of the following is not one of the major purposes of a HRM policy?

(a) to reassure employees that they will be treated fairly and objectively(b) to ensure that the organisation complies with all relevant government legislation and

requirements(c) to help managers make quick and consistent decisions

(d) to give managers the confidence to resolve problems and to defend their decisions

31. According to Stone’s diagnostic approach to human resource management, HRM outcomes are:

(a) acquisition and departure of human resources(b) employee commitment and productivity(c) organisation structure and organisation culture(d) job analysis and employee recruitment

32. To achieve the best alignment between the organisation’s strategy and the organisation environment all of the following should be undertaken, except:

(a) setting clear objectives(b) evaluating performance(c) examine internal and external influences(d) review of global economic issues

33. Organisations that adopt HRM strategies and practices consistent with the demands of their internal and external environments should:

(a) attract a group of employees who are satisfied with their jobs and committed to the organisation

(b) be aware of the intended moves of the competition before they take place(c) outperform organisations that have less well-matched strategies and practices(d) experience less internal conflict and indecision when solving major HR problems

34. Which of the following is not a major influence that exists outside of an organisation, but has a significant impact upon an organisation?

(a) demographics(b) technology(c) strategy(d) legal regulations

35. Job design, employee orientation and training, health and safety, industrial relations,

and corporate image can be directly or indirectly affected by:

(a) government and community concerns regarding environmental issues(b) number of workers employed by an organisation at any given time(c) the nature of human resources available to an organisation(d) the stability of the national economy

36. An HR manager considering the nature of the internal environment would analyse:

(a) technology, job design, competition(b) structure, culture and strategy(c) organisation mission, technology, competition(d) culture, demographics, political values

37. An organisation’s culture:

(a) is used to convey information to the public that the organisation wants to distribute

(b) is determined by management and maintained by a rigidly enforced list of rules and regulations

(c) defines what an organisation stands for, and distinguishes an organisation from other organisations

(d) manipulates employee behaviour to ensure conformity

38. An organisation can foster the development of a particular culture by all of the following except:

(a) responding to changes in society’s expectations(b) strategic selection(c) employee orientation and training(d) rewards systems

39. Stone argues that HRM activities contribute to the development of an organisation’s culture and provide it with a competitive edge:

(a) by selecting only applicants with specialist skills to fill vacant positions

(b) by restricting the organisation’s strategic objectives to those that can be readily achieved with the existing human resources

(c) by designing highly specialised jobs which allow employees to perform a narrow range of tasks more efficiently

(d) by stimulating and reinforcing behaviours needed to achieve the organisation’s strategic objectives

40. For an organisation’s strategy to be implemented effectively it needs to have the right:

(a) employee mix(b) organisational structure(c) task environment(d) mission statement

41. Organisations with narrow spans of control are characterised by all of the following except:

(a) hierarchical structure(b) highly specialised roles(c) flexible reporting relationships(d) rigid, formal procedures

42. Organisations which are characterised by flexibility, adaptability, informality, entrepreneurial behaviour, and less specialised roles are described as having:

(a) narrow spans of control(b) laissez-faire management(c) bureaucratic/autocratic managers(d) wide spans of control

43. When evaluating HRM strategies and policies which of the following is not considered:

(a) commitment(b) cost effectiveness

(c) creativity(d) socialisation

44. The extent to which HRM policies promote the achievement of employee goals and, at the same time, satisfy the organisation’s strategic business objectives is known as:

(a) agreement(b) congruence(c) fit(d) strategic management

45. If HRM specialists are to be involved in strategic planning and decision making theyneed to:

(a) demonstrate increased profitability through improved employee productivity(b) develop their knowledge and understanding of the organisation’s production processes(c) acquire specialist skills and qualifications in the human resources discipline(d) support major decisions of management

Chapter 2 : Human Resource Planning

Multiple Choice Questions

1. Identify the least correct statement:

(a) Human resource planning is concerned with the demand and supply of labour.(b) To be successful, an organisation needs employees. Therefore, it needs human

resource planning to successfully meet its future labour requirements.(c) The purpose of human resource planning is to assure that a certain desired number of

persons with the correct skills are available at the specified time in the future.(d) Human resource planning can be undertaken in isolation, and divorced from the

company’s overall business objectives.

2. Human resource planning is the responsibility of:

(a) line managers(b) top managers(c) HR managers(d) all managers

3. An HR plan should be focused on:

(a) future employee needs(b) the organisation’s strategic plan(c) labour costs(d) both (a) and (b)

4. To be of value, HR planning must be:

(a) an integrated part of the organisation’s strategic planning process(b) undertaken immediately after strategic planning takes place(c) developed independently of, but at the same time as, strategic planning(d) undertaken as and when a need arises in relation to human resource issues

5. If an HR manager concentrates on meeting short-term replacement needs it can result in:

(a) cost savings(b) quantity and quality problems(c) up-to-date employee skills(d) improved job satisfaction

6. Linking HR planning with corporate strategy allows the HR manager:

(a) an opportunity to understand the role he/she plays within the organisation(b) to influence the future direction of the organisation(c) to anticipate and influence the future HR requirements of the organisation(d) to more clearly understand the impact of increased global competition

7. Effective HR planning ensures all of the following except:

(a) reduced absenteeism and turnover(b) more satisfied and better developed employees(c) reduced financial and legal costs(d) more effective and efficient use of human resources

8. When developing HR plans the HR manager must consider which of the following issues

(a) competitive strategy, economic policy, social values(b) conservation, social values, legal regulations(c) environmental trends, social values, demographics, conditions of employment(d) labour costs, unemployment levels, economic conditions, competition

9. Improved childcare facilities, the increased availability of part-time work, and maternity leave are a reflection of:

(a) changing social values(b) increasing numbers of women in the workforce(c) attempts to reduce levels of employee absenteeism(d) the requirements of EEO legislation

10. In 1997 what percentage of Australia’s workforce were classed as part-time?c

(a) 25%

(b) 10%(c) 50%(d) 15%

11. If you were conducting HR planning for a small manufacturing firm which of the following would you not be considering when you examine environmental factors that might impact on your organisation?

(a) skill shortages(b) demographics(c) work schedules(d) political stability

12. HR managers need to be able to forecast the organisation’s future HR requirements and determine how to acquire the people needed. To do this they need three sets of forecast. Which of the following is not a forecast required for human resource planning?

(a) forecast of the demand for human resources(b) forecast of the demand for human resources of competitor organisations(c) forecast of supply of human resources available within the organisation(d) forecast of the supply of external human resources

13. The quantitative approach to human resource planning:

(a) uses expert opinion to predict the future(b) calls for a panel of experts to independently make predictions about human resource

needs(c) uses statistical and mathematical techniques(d) is exemplified by the Delphi technique

14. HR surpluses, shortages and career blockages are the focus of which approach to HRplanning?

(a) qualitative approach(b) reactive approach(c) humanistic approach

(d) quantitative approach

15. An organisation’s human resource inventory contains information on all of the following except:

(a) employee skills(b) employee experience(c) career goals(d) employee attitudes

16. According to the human resource planning process presented by Stone the first step is to:

(a) determine number and type of jobs to be filled(b) examine human resource inventory(c) identify labour shortages(d) stops recruiting new employees

17. The technique which involves building complex computer models to simulate future events based on probability and multiple assumptions is:

(a) trend projection(b) econometric modelling(c) time-line analysis(d) projected growth analysis

18. The qualitative approach to human resource planning:

(a) uses expert opinion to predict the future(b) uses statistical and mathematical techniques(c) relies upon trend projection, and econometric modelling(d) uses succession planning charts, and workforce audits

19. The Delphi technique aims to:

(a) collect information that supports the decisions of management(b) review the ideas of an expert in relation to projected trends(c) integrate the independent opinions of experts by eliminating personal influence and

discussion(d) bring together a group of experts so that a range of issues and alternatives can be

addressed

20. Identify the most complete list of analyses for forecasting the internal supply of human resources

(a) turnover analysis, skills inventory, replacement charts, Markov analysis, Delphi technique

(b) turnover analysis, skills inventory, replacement charts, Markov analysis, succession planning

(c) turnover analysis, skills inventory, replacement charts, trend projection, succession planning

(d) turnover analysis, skills inventory, expert opinion, Markov analysis, succession planning

21. The number of people who leave an organisation due to resignation, retirement, death or disability, retrenchment or termination is known as:

(a) employee loss(b) downsizing(c) employee departure(d) labour turnover

22. The best source of information about people leaving the organisation can be obtained from:

(a) employee exit interviews(b) employee attitude surveys(c) labour turnover rates from past years(d) retrenchment figures for the past five years

23. The skills inventory allows the HR manager to do all of the following except:

(a) identify where qualified external labour sources can be found(b) identify qualified employees for different jobs(c) determine which skills are present or lacking in the organisation(d) assess longer-term recruitment, selection and training and development requirements

24. Which of the following information would not be found in a skills inventory:

(a) qualifications(b) political affiliations(c) personal data(d) salary and job history

25. A skills inventory can benefit employees by:

(a) allowing the HR manager to check personal details without interrupting an employee on the job

(b) keeping an accurate record of bonus and leave entitlements(c) making regular performance appraisal reviews unnecessary(d) allowing the HR manager to fill positions by internal promotion

26. To be successful a skills inventory system requires all of the following except:

(a) top management support(b) assured confidentiality(c) computer storage of data(d) current information

27. Replacement charts are used to identify:

(a) where qualified applicants can be located to fill senior positions when they become vacant(c) present incumbents and potential replacements for given positions(c) which positions are no longer necessary and can remain vacant when the current

incumbent leaves the organisation(d) which positions can be amalgamated or replaced by machines due to advances in

production technology

28. A replacement chart is not used with which type of employees:

(a) technical(b) professional(c) clerical(d) managerial

29. Markov analysis

(a) uses a mathematical technique to forecast the availability of internal job candidates(b) focuses on the development of high potential employees to guarantee their readiness

for promotion(c) uses the opinions of experts to identify internal candidates for promotion(d) identifies existing employees who should be released due to poor performance

30. The use of Markov analysis requires:

(a) a knowledge of regression analysis(b) the full support of both management and employees(c) a maximum of 20 employees in any one job classification(d) a minimum of 50 employees in any one job classification

31. Which of the following techniques for forecasting the internal supply of human resources is concerned with the filling of management vacancies?

(a) replacement charts(b) succession planning(c) Markov analysis(d) skills inventory

32. Many organisations have depleted their management ranks as a result of:

(a) neglect

(b) rapid internal promotion(c) downsizing(d) lack of employee development

33. Management development and succession are considered superfluous by many organisations because of:

(a) the labour surplus for specialist, skilled positions(b) the more highly educated nature of the current workforce(c) the costs involved in developing a fluid and mobile workforce(d) rapid changes in business and a mobile job market

34. Succession planning for chief executives and senior executives is used by what percentage of Australian companies?

(a) approximately 50%(b) less than 10%(c) at least 75%(d) 23%

35. Succession planning often begins with an examination of:

(a) turnover rates(b) staff development activities(c) replacement charts(d) trend projections

36. The practice of managers developing their own replacement has been found to be:

(a) successful and cost efficient(b) ad hoc and subjective(c) objective and well-structured(d) difficult to implement and monitor

37. Effective development of managers requires:

(a) employing a specialist trainer to identify training needs(b) a knowledge of competitor strategy to allow the development of skills that match those

of the competition(c) the use of a computer based form of individual needs assessment(d) identifying appropriate learning experiences via job assignments

38. For succession planning to meet the future needs of the organisation it relies on all of the following to be effective except:

(a) performance appraisal system(b) training and development programs(c) compensation and benefits(d) a culture of individual growth and promotion from within

39. To accurately forecast the availability of external human resources the HR manager must monitor and respond to:

(a) changes in business strategy(b) demographic changes(c) changes to skill requirements(d) changes to Government regulations

40. The workforces of Australia, Hong Kong, Japan, Singapore, South Korea, Taiwanand the USA are:

(a) aging(b) shrinking(c) growing(d) younger

41. The Australian labour market is affected by all of the following except:

(a) increased female participation rates(b) increases in school retention rates(c) increased use of succession planning(d) changes in the rate of immigration

42. Competitive pressures, changes in technology and outsourcing have all contributed to the trend towards:

(a) multiskilling of the workforce(b) casualisation of the workforce(c) downsizing of the workforce(d) mobility of the workforce

43. The process of subcontracting work to an outside company that specialises in and is more efficient at that kind of work is known as:

(a) specialising(b) consulting(c) de-skilling(d) outsourcing

44. Organisations choose to outsource for all of the following reasons except:

(a) cost and quality(b) lack of employee skills(c) increased focus on core business(d) access to improved technology

45. Organisations might choose to outsource:(a) performance review activities(b) training needs analysis(c) recruitment activities(d) exit interviews

46. Many criticisms have been made of the practice of outsourcing. Which of the following is not one of these criticisms?

(a) loss of essential personnel(b) reduced service

(c) production delays(d) leaking of confidential information

47. The internationalisation of business has been facilitated by:

(a) advances in technology and labour mobility(b) population growth and spending power(c) increased immigration and changing consumer tastes(d) widespread marketing and sales potential

48. An organisation’s success depends on:

(a) financial standing(b) how well its human resources are managed(c) how quickly new products can be developed and produced(d) having efficient, low-cost sources of labour

49. Which of the following is not a requirement for effective human resource planning:

(a) top management that is supportive of the planning process(b) good communication between HR personnel and line management(c) the plan utilises qualitative, and the qualitative approaches to planning(d) the integration of the HR and corporate plan

50. The HR plan:

(a) is independent of all other plans undertaken by the organisation(b) affects all HR activities, and is a strategic link between organisational and HRM

objectives(c) serves as a broad guideline for the employment and placement of human resources(d) is a superfluous activity that adds nothing of value to the management of an organisation

and its ability to achieve its strategic objectives

Chapter 5: Job Analysis, Job Design and Quality of Work Life

Multiple Choice Questions

1. Ensuring a proper match between work and employee capabilities is now considered:

(a) better for employee morale(b) an economic necessity(c) well intentioned, but unrealistic(d) impossible because of rapid and continuous change

2. The process by which jobs are divided to determine what tasks, duties andresponsibilities they include, their relationship to other jobs, the conditions under which work is performed, and the personal capabilities required for satisfactory performance is known as:

(a) task differentiation(b) human resource analysis(c) job analysis(d) position classification

3. Job analysis provides information about:(a) job content and job requirements only(b) job description(c) job enrichment(d) job content, job requirements, and job context

4. The job oriented approach to job analysis is most likely to be concerned with:(a) job enrichment(b) performance appraisal(c) sequencing, time and motion involvement(d) career planning and development

5. Which of the following is not an occasion when job analysis is generally undertaken:(a) when an employee is not performing their role adequately(b) when a new job is created(c) when a job is changed significantly as a result of new methods, new procedures, or new

technology(d) when the organisation commences and the job analysis program is started

6. Identifying what work must be performed, how it will be performed, where it is to be performed and who will perform it is.(a) human resource planning(b) division of labour(c) organisation structure and design(d) job design

7. “A written statement explaining why a job exists, what the job holder actually does, how he or she actually does it, and under what conditions the job is performed” is a definition of:

(a) job specification(b) job analysis(c) job description(d) job enrichment

8. An explanation of which of the following is included in most job descriptions:

(a) staff social activities(b) problem solving(c) staff morale(d) superannuation options

9. A job specification identifies:

(a) the most essential tasks of each position(b) the most appropriate personality type for a person holding that position(c) the experience, qualifications, skills, abilities and knowledge required to successfully

perform the job(d) (b) and (c)

10. Traditional job descriptions have been criticised for being:

(a) inaccurate and inflexible(b) out of date wish lists(c) straitjackets suitable only for repetitive work(d) vague performance guidelines

11. Traditional job descriptions are not seen as appropriate for jobs that are:

(a) project-based(b) routine and repetitive(c) varied and autonomous(d) changing rapidly

12. The purpose of the job analysis, the types of information to be collected, the sources of information, and the way in which the data are to be analysed and reported determines:

(a) who gathers the information(b) the most appropriate data collection method(c) the importance of accuracy in the data collected(d) how the process is received and supported by employees

13. Job analysis for standardised, repetitive short job cycle, or manual jobs will primarily use which of the following data gathering methods:

(a) interviews(b) observations(c) questionnaires(d) employee diary

14. When using a questionnaire to gather data for a job analysis which of the following should be avoided:

(a) using a short questionnaire(b) explaining how the questionnaire results are to be used(c) using simple, easy to understand language(d) using a long questionnaire to gather as much detail as possible

15. Functional Job Analysis is an approach to job analysis that:

(a) uses standardised statements and terminology to describe the nature of jobs and to prepare job descriptions and job specifications

(b) uses unique descriptions of each position to emphasise the importance or significance of all positions within the organisation

(c) relies upon the position holder to correctly identify all tasks related to their position

and the relevance of these tasks to the achievement of the organisation’s objectives(d) requires a job analysis to be undertaken at an agreed upon time every year so that the

job description and job specification documents are always up-to-date

16. The job analysis instrument and scoring/reporting service that is marketed commercially is:

(a) the Job Review Service(b) the Position Analysis Questionnaire(c) the Job Orientation Review(d) the Position Description Report

17. Which of the following is not a generally accepted method of data collection for the purposes of job analysis:

(a) Position Classification Inventory(b) Position Analysis Questionnaire(c) Hay Guide Chart Profile(d) Job Profile Analysis

18. The usefulness of task-oriented approaches to job analysis has been reduced by all of the following except:

(a) widespread corporate downsizing(b) flexible job design(c) employee turnover(d) project assignments

19. The approach to job analysis that is based upon identifying the skills and behavioursneeded to perform a job is described as a(n):

(a) behavioural approach(b) people-oriented approach(c) task-oriented approach(d) employee centered approach

20. Which of the following job-related competencies are described as visible competencies:

(a) self-concept(b) traits(c) knowledge(d) motives

21. The essential characteristics that everyone in a job needs to be minimally effective are:

(a) differentiating competencies(b) required competencies(c) specific competencies(d) threshold competencies

22. The advantages of the Behaviour-Event Interview method includes all of the following except:

(a) identification of how superior performers handle specific tasks or problems(b) identification of personality characteristics essential for a position involving a large

amount of customer contact(c) freedom from racial, gender and cultural bias(d) empirical identification of competencies

23. Competency profiling has been criticised for:

(a) only dealing with employee attitudes(b) promoting a mismatch between organisation needs and employee skills(c) emphasising technical competencies(d) not addressing the real issues facing employee performance

24. Job analysis helps to establish organisational adherence to EEO requirements by:

(a) providing hard evidence of job relatedness(b) allowing an organisation to give preference to a particular group of employees(c) identifying clear lines of promotion and career development that are communicated to

all employees(d) ensuring that job descriptions and job specifications are accurate

25. A problem with job analysis might be that:

(a) multiple methods of job analysis are used(b) there is management support for the job analysis(c) employees are not made aware of the importance of job analysis(d) multiple sources are used for collecting job information

26. Specification of the content of a job, the material and equipment required to do the job, and the relation of the job to other jobs is:

(a) job description(b) job design(c) job ranking(d) job specification

27. Job specialisation, job enlargement, and job rotation are all methods of:

(a) job enrichment(b) job description(c) job analysis(d) job design

28. Problems with job specialisation might be:

(a) no sense of identifiable end product, and training costs are increased(b) vertical loading, and no employee involvement(c) higher absenteeism, increased turnover, and increased skill variety(d) repetition, mechanical pacing, and little social interaction

29. Job enlargement involves:

(a) the vertical expansion of a job by adding planning and decision making responsibilities(b) the horizontal expansion of a job by adding similar level responsibilities(c) increasing task variety by moving employees from one task to another(d) the use of standardised work procedures and having employees perform repetitive,

precisely defined and simplified tasks

30. A possible drawback of job rotation is:

(a) demotivation of intelligent and ambitious trainees(b) lack of suitable jobs that can be included in the rotation(c) difficulty of maintaining an accurate record of employee performance(d) inability to ensure consistent quality of output

31. Job enrichment builds motivating factors into the job content by:

(a) opening feedback channels, combining tasks, and loading jobs horizontally(b) establishing client relationships, creating natural work units, and performing precisely

defined and repetitive tasks(c) combining tasks, creating natural work units, and expanding jobs vertically(d) both (a) and (b)

32. Job enrichment can lead to:

(a) the development of specialised skills(b) improvements in job performance and job satisfaction(c) increased training and development costs(d) limited opportunities for social interaction among employees

33. Socio-technical enrichment aims to:

(a) change the technology of existing operations(b) improve the environment to allow increased social interaction among employees(c) design production processes that are viewed as more acceptable by society(d) integrate people with technology

34. Autonomous work teams are a form of:

(a) quality circle(b) job enrichment(c) workforce flexibility(d) task diversification

35. Hackman and Oldham identified five core job characteristics that are especially

important for job design. Which of the following is not included in their list of core characteristics?

(a) task significance(b) skill variety(c) task specialisation(d) feedback

36. The critical psychological states; experienced meaningfulness of work, experienced responsibility for work outcomes, and knowledge of results determine:

(a) the level of employee motivation, job satisfaction and performance(b) the extent to which an employee has a good understanding of the requirements of their

position(c) whether or not tasks are completed on time(d) the likelihood of an employee remaining with the organisation

37. Before the HR manager or line manager attempts to change the job characteristics ofa position it is important to:

(a) make employees aware of the impending changes(b) trial the changes to see if they are appropriate(c) change job titles to reflect job changes(d) assess the personality and situation of employees to ensure that desired outcomes will

be achieved

38. Quality of work life involves the quality of supervision, working conditions, pay andbenefits, and the nature of the job. It aims to:

(a) integrate employee needs and wellbeing with the organisation’s desire for higher productivity

(b) increase productivity at the lowest possible cost to the organisation(c) provide an environment where employees like coming to work(d) develop a culture which attracts and retains high quality staff

39. Factors that can be addressed to improve quality of work life include all of the

following except:

(a) social integration(b) remuneration(c) product quality(d) development of capabilities

40. Where were quality circles developed and refined:

(a) United States of America(b) Germany(c) United Kingdom(d) Japan

41. Identify problems as a group, process suggestions and examine alternatives forimproving productivity, raising product and service quality and increasing worker satisfaction is the objective of:

(a) participative management(b) quality circles(c) job autonomy and feedback(d) job enrichment

42. Quality circles often fail because:

(a) leaders provide poor guidance(b) they are introduced in the wrong type of organisation(c) managers often feel threatened(d) employees resist change to current work practices

43. Which of the following is not necessary for successful quality circles:

(a) restricted number of meetings(b) union support(c) provision of adequate training(d) use of quality circle suggestions

44. Employee participation which involves a redistribution of decision-making powerfrom management to employees is:

(a) decentralised decision-making(b) industrial democracy(c) quality circles(d) participative decision-making

45. Industrial democracy is often confronted with:

(a) lack of employee interest(b) union resistance(c) management resistance(d) poor understanding of its purpose

Chapter 6: Recruiting Human Resources

Multiple Choice Questions

1. To ensure that people who are recruited have the unique skills and know-how

required by the organisation’s strategic objectives, management must:

(a) hire only people with formal academic qualifications(b) aim for a 5% annual turnover to allow the continual upgrade of skills(c) make sure that the organisation’s strategic objectives are in line with the skills of

existing employees(d) anticipate changes in the organisation’s environment

2. Recruitment policy and activities should reflect:

(a) society’s demand for improved employee skills(b) the organisation’s business objectives and culture(c) the practices of competitors(d) government policy on unemployment

3. By ignoring its strategic mission, objectives and culture when recruiting personnel an organisation can:

(a) ensure a more objective selection of personnel(b) draw upon a wider range of potential employees(c) destroy its unique competitive advantage(d) develop a more flexible workforce

5. Recruitment is a two-way process that involves:

(a) determining the employment needs of the organisation and the financial needs of job applicants

(b) satisfying the organisation’s strategic HR requirements and helping potential candidates decide whether they meet the job requirements, are interested in the position and want to join the organisation

(c) identifying the skills needed to maintain market position and targeting specialist skill reas

(d) examining career aspirations of candidates and matching them to suitable positions within the organisation

6. An organisation’s recruitment policy:

(a) consists of rules and regulations to be followed(b) provides a concise list of how many employees are needed and with what skills(c) provides a framework for recruiting action and reflects the organisation’s recruitment

objectives(d) is a document most organisations have, but it is only used as window dressing

7. The organisation’s recruitment policy details principles that should be followed. It can include all of the following except:

(a) employees taking important religious holidays as days off(b) promotion from within(c) employees taking early or normal retirement(d) EEO and AA policies

8. For effective recruitment an HR manager should:

(a) conduct psychological and personality tests(b) be aware of changing conditions in the labour market(c) have a good understanding of employee aspirations(d) understand the impact of the competition on the organisation

9. Stone describes recruitment as:

(a) a form of human juggling(b) a necessary evil(c) a process of elimination(d) a form of economic competition

10. Effective recruitment should:

(a) make it easy to attract good quality applicants(b) provide a harmonious work environment(c) satisfy the needs of both the candidate and the organisation(d) be able to reduce the costs associated with filling vacant positions

11. An advantage of internal recruitment is:

(a) the organisation has more knowledge of the candidate’s strengths and weaknesses(b) the pool of talent is bigger(c) employees may be promoted beyond their level of competence(d) excellent training and development programs are necessary

13. Advertising of job openings to current employees via bulletin boards, newsletters or personal letters is:

(a) employee promotion(b) career development(c) job posting(d) job description

14. An advantage of external recruitment is:

(a) enhanced employee morale and motivation(b) new employee adjustment and orientation takes longer(c) the organisation’s return on investment in training and development is increased(d) new insight, skills and know-how can be introduced into the organisation

15. A disadvantage of external recruitment is:

(a) employee infighting for promotion can affect morale(b) organisation hires only entry-level candidates(c) an employee may be selected whose personality does not match with the organisation’s

culture(d) the pool of talent is bigger

16. External recruitment involves all of the following methods except:

(a) job posting(b) advertising(c) personal consultancies(d) executive search firms

18. An advantage of newspapers as a method of recruitment advertising is:

(a) long advertisement life(b) circulation is not specialised(c) considerable competitive clutter(d) circulation is concentrated in specific geographic areas

19. An advantage of magazines as a method of recruitment is:

(a) wide geographic circulation(b) pinpointed occupational categories can be reached(c) long lead time for ad placement(d) cost for reaching each prospect is high

20. Radio and television advertising would be an effective method of recruiting:

(a) when there are multiple job openings and there are enough prospects in a specific geographic area

(b) when the job is specialised(c) when there is a need to attract hi-tech computer literate personnel(d) when involved in ongoing recruitment programs

21. A disadvantage of using radio and television as a method of recruitment is:

(a) wide geographic circulation(b) poor printing quality(c) lack of permanence(d) cost of reaching prospective candidates is high

22. Advertising vacant positions on the Internet can be beneficial when:

(a) you want a mix of males/females and minority groups applying(b) you want to limit recruitment to a specific area(c) you want to avoid time delays and high advertising costs(d) there is a need to attract hi-tech computer literate personnel

23. Government employment agencies are mostly used to recruit for what type of positions:

(a) specialist professions(b) clerical and sales(c) management executives(d) security personnel

24. Research has shown that personnel consultancies are most likely to fall down in the area of:

(a) candidate selection; screening(b) negotiating salary packages(c) quality of resumés(d) confidentiality; honesty

26. Which of the following is not an advantage of using a professional recruiting consultant:

(a) time(b) confidentiality(c) expertise(c) cost

27. Executive search firms are favoured for external recruitment when:

(a) personnel with the required skills and experience are not known to be seeking a job change

(b) the number of people with the necessary skills and experience is limited(c) maximum confidentiality is desired(d) all of the above

28. The value of using executive search firms has been questioned because of:

(a) the small number of candidates considered for each position

(b) the ethical problems associated with ‘pinching’ another organisation’s executives(c) the high costs, questionable performance and conflict of interest over the raiding of

existing clients(d) the quality of candidate screening and selection

29. A situation where a consultant cannot look for potential applicants inside companies which are existing clients is known as:

(a) the ‘off-limits’ problem(b) a conflict of interest(c) an ethical dilemma(d) restricted business practice

30. When choosing an executive search firm the HR manager should:

(a) find the cheapest one possible(b) ensure that the search firm is compatible with the organisation’s requirements and that

their conduct will be professional(c) ensure that the search firm understands the importance of the position to be filled(d) seek recommendations from organisations that have used an executive search firm in

the past

31. External recruiting can involve all of the following methods except:

(a) university recruiting(b) professional associations(c) personnel consultancies(d) computerised record systems

32. Which of the following recruitment approaches does not charge a fee for the placement of candidates:

(a) management recruitment consultants(b) personnel consultancies(c) outplacement firms(d) executive leasing

33. The major problems associated with university recruiting are:

(a) time, expense and high labour turnover(b) lack of student interest, poor quality of applicants(c) the wrong institutions are frequently targeted(d) too many applicants, insufficient time allocated to interviews with each student

34. The performance of ‘walk-in’ and ‘write-in’ applicants has been found to be:

(a) below acceptable standard(b) superior to candidates recruited through placement services or newspaper

advertisements(c) of an average or mediocre standard(d) disruptive to the existing workplace harmony

35. Trade Unions have traditionally provided a valuable recruiting service for which industry:

(a) hospitality(b) public servants(c) coal mining(d) technical professions

37. EEO and AA legislation is about:

(a) selecting the best person for the job in terms of his or her job-related skills(b) ensuring that selected groups of individuals get special consideration when job

applications are considered(c) protecting the rights of the organisation to employ only those people they want to(d) providing enhanced career advancement for employees from minority groups

38. The largest group among the disadvantaged members of the workforce are:

(a) the physically disabled(b) Aboriginal workers

(c) women(d) Asians

39. The major barrier encountered by women in the workplace is:

(a) physical limitations(b) stereotyped thinking(c) lack of ambition(d) inability to give orders

40. When women attempt to move from middle management into general management they often encounter:

(a) the wooden floor(b) the old boys club(c) the closed door(d) the glass ceiling

41. Organisations can assist in removing the ‘glass ceiling’ by:

Und(a) educating current management(b) appointing women directly into positions in top management(c) redecorating the offices(d) ensuring that employees of all nationalities are considered for internal promotion

42. A major concern of older workers in the workplace is:

(a) retirement benefits(b) superannuation benefits(c) health problems(d) age discrimination

43. Studies examining the employment of people with disabilities conducted in Australia and Hong Kong have shown that people with disabilities:

(a) require more complex and costly work stations(b) bring benefits to the workplace

(c) respond better to team based work than people without disabilities(d) are good for company image

44. If an Aboriginal employee has had to relocate to find employment they may have difficulty:

(a) finding accommodation(b) finding their way around town(c) adjusting to the new work environment(d) moving their families

45. What type of discrimination is growing in Australia:

(a) racial(b) religious(c) gender(d) sexual orientation

46. Les and Salamon argue that organisations tend to evaluate the success of their recruitment initiatives based on:

(a) quality of applicants(b) acceptance of job offers(c) filling of vacancies with minimally qualified people at acceptable cost(d) how many applications were received

47. Phillips recommends that recruitment activity be assessed according to all of the following except:

(a) quality of recruitment method(b) costs associated with filling the vacancy(c) number of applicants generated(d) cultural mix of employees

48. Phillips describes the number of applicants generated by a particular recruitment method or source as:

(a) frequency of reply(b) productivity(c) responsiveness(d) attractiveness

49. Evaluating an organisation’s recruitment activity is important for all of the followingexcept:

(a) maintaining competitive advantage(b) controlling costs(c) meeting strategic business objectives(d) improving recruiting performance

50. Organisations considered good employers have:

(a) higher salary packages(b) problems attracting high quality candidates(c) no problems attracting high quality candidates(d) flexible, family-friendly employment policies

Chapter 7 : Employee Selection

Multiple Choice Questions

1. Selecting and retaining key human resources has increased in importance due to all of the following except:

(a) increased international competition(b) high unemployment levels(c) industry restructuring(d) corporate mergers

2. Selection criteria should:

(a) not be complicated(b) correspond closely to how a job is performed now(c) be consistent with the organisation’s strategic direction and culture(d) reflect the standard of applicants from which a choice is to be made

3. The process of choosing from a group of applicants those individuals best suited for a particular position is:

(a) decision-making(b) recruiting(c) manpower planning(d) selection

4. When an organisation develops its selection policy, which of the following factors isnot considered:

(a) the financial costs of filling a vacancy(b) quality of people required(c) selection techniques to be used(d) role of management in final hiring decision

5. Criteria that is used to distinguish successful from unsuccessful job performance is required to be:

(a) clearly communicated to all employees(b) vague and subjective

(c) reliable and valid(d) flexible and situational

6. Validity in relation to selection refers to:

(a) the value of the position to the organisation(b) the extent to which something measures what it claims to measure(c) the extent to which a measure is consistent and dependable(d) how badly an applicant wants to acquire a particular position

7. The identification of criteria necessary for the successful performance of a job is derived from:

(a) a skills inventory(b) a job specification document(c) the human resource plan(d) a job description document

8. The two approaches that HR managers use to determine the validity of criteria are:

(a) past performance and future strategies(b) concurrent validity and predictive validity(c) subjective observation and behavioural patterns(d) performance validity and result validity

9. If a performance predictor lacks reliability an organisation could find that the applicant chosen for a position:

(a) is totally unable to perform the tasks required(b) is unaware of the necessary tasks to be performed on the job(c) may perform well one time and poorly the next(d) does not have a personality that fits in well with the culture of the organisation

10. Test/retest, split halves, and parallel forms are all methods for measuring:

(a) employee ability(b) employee/organisation compatibility

(c) employee personality(d) predictor reliability

11. The most correct order of the steps in the selection process is:

(a) job analysis; recruitment; interview; placement on the job(b) placement on the job; background investigation; medical examination(c) preliminary interview; background investigation; interview(d) preliminary screening by HRM department; application form; placement on the job

12. When using telephone screening to determine if candidates satisfy minimum requirements the questions asked should be:

(a) related to formal qualifications only(b) related to issues critical to job requirements and prepared beforehand(c) varied according to the age and sex of the applicant(d) open-ended and enquire about previous positions held

13. Which of the following is not one of the steps followed in the selection process:

(a) application form(b) tests(c) investigation of social activities(d) placement on the job

14. Attempts to identify the relationship between an application form item and job performance measures make use of a:

(a) numbered application form(b) personality test(c) performance review form(d) weighted application form

15. Which of the following statements about application forms is correct in terms of EEO requirements:

(a) inquiries indicating national or ethnic origin may be made

(b) inquiries into family circumstances, relationships, spouse’s situation, family planning or any related circumstances are not acceptable

(c) applicants may be asked to list all the clubs and organisations to which they belong(d) information about relatives including names, addresses and relationships may be

required of the applicant

16. What information should not be requested on an application form:

(a) criminal records and/or traffic convictions(b) understanding of the organisation and its strategy(c) present working relationship with colleagues(d) residency status

17. If an organisation was considering using some form of test as part of the selection process the choice would depend on:

(a) cost, ability of HR manager to administer test, candidate personality(b) management commitment, time available, type of position(c) company policy, type of job applied for, cost of test(d) qualifications of candidate, business strategy, HR manager’s perception of the test’s

usefulness

18. Selection tests include all of the following except:

(a) aptitude tests(b) intelligence tests(c) personality tests(d) performance tests

19. Tests which are designed to measure the special abilities required in a specific job are:

(a) interest tests(b) intelligence tests(c) aptitude tests(d) employment tests

20. The first step in using any form of selection test is:

(a) ensuring the tests are administered by qualified personnel and that the results are treated as strictly confidential

(b) analyse the job thoroughly to determine the precise requirements needed to successfully perform the job

(c) review the types of tests available that measure the ‘critical factors’ for successful job performance

(d) ensure that all applicants are advised of the results and properly counselled

21. Personality tests are the most difficult tests to evaluate and use in employee selection because:

(a) the concept of personality itself is hazy and the relationship between performance on the job and personality is often vague or non-existent

(b) they are designed to measure basic aspects of an applicant’s personality, such as degree of introversion/extroversion, emotional stability and motivation

(c) answers are impossible to fabricate(d) both (b) and (c)

22. Some personality tests have limited value in employee selection and:

(a) are culturally biased(b) are easy to develop and administer(c) make it difficult for the applicant to fabricate answers easily(d) are difficult to justify to EEO authorities

23. If done properly selection tests can:

(a) increase management control(b) help managers make decisions about optimal job/person fit(c) promote workforce diversity(d) make the selection of job applicants more risky

24. Before using any form of selection test the organisation should consider all of the

following except:

(a) staff attitudes(b) legal liability(c) job-relatedness(d) equal opportunity

25. The most widely used selection technique is the:

(a) aptitude test(b) employment interview(c) assessment centre(d) personality test

26. Using a structured interview:

(a) ensures that the interviewee feels that their application is taken seriously(b) ensures that all relevant information on the candidate is systematically covered(c) allows the interviewer to focus on specific issues that are crucial to the applicant’s

ability to perform the job(d) ensures that all members of the interview panel have some input into the selection

decision

27. The most correct statement regarding selection interviews is:

(a) The employment interview is infrequently used as a selection technique.(b) Research indicates that the use of an unstructured interview yields more accurate

results than a structured approach.(c) Research suggests that behavioural interviews have much greater validity than

unstructured interviews.(d) Set general objectives for interview and go over the questions on the application form.

28. T select the right person for a job it is essential that the HR manager and line manager:

(a) like the job applicant

(b) have read the application form(c) ask the right questions in the interview(d) know the requirements of the position to be filled

29. The purpose of the employment interview is:

(a) to give and get information that will help the interviewer make a decision about the applicant’s suitability

(b) to clarify and check the accuracy of information provided in the application form(c) to determine whether the candidate has the character and personality to work well with

existing employees(d) to ensure that the organisation is adhering to regulations relating to EEO legislation

30. It is important to review an applicant’s written application to determine:

(a) the honesty of the applicant(b) if additional information is needed(c) whether the applicant’s writing skills are adequate(d) the age and nationality of the applicant

31. Research shows that interviewers make a judgement about an applicant:

(a) when reading the written application(b) after the interview has concluded(c) in the first 3 to 5 minutes of the interview(d) based on their ability to communicate

32. The most correct statement about research and the employment interview is:

(a) interviewers develop their own stereotypes of a good applicant and select those who match the stereotype

(b) favourable information outweighs unfavourable information(c) interviewers are more likely to change their initial opinion of an applicant from

negative to positive than from positive to negative(d) applicants who demonstrate greater eye contact, head moving, smiling and other

similar non-verbal behaviour receive lower evaluations

33. Conducting a successful interview involves all of the following except:

(a) knowing the job(b) explaining the job(c) encouraging the applicant to talk(d) assessing the appearance of candidates

34. To encourage an applicant to do most of the talking the interviewer should:

(a) avoid asking direct questions(b) avoid asking questions that simply require a yes/no answer(c) monopolise the conversation(d) not ask many questions

35. A new employee may be dissatisfied with their job if:

(a) the tasks are too complex and varied(b) they are unable to fit in easily(c) they were not given accurate information about the job and the employment conditions(d) their colleagues are helpful during their settling-in period

36. An applicant who is clearly not suitable for a position:

(a) should be told tactfully at the close of the interview(b) should be notified at the conclusion of the interview process(c) should be forgotten about(d) should receive a letter detailing the reasons why they were unsuccessful two weeks

after their interview

37. An accurate record of interview should be kept because:

(a) they help to remind the interviewer why certain decisions were made(b) they can help to prove that the selection decision was not discriminatory(c) human resources/personnel need to have copies on file for audit purposes

(d) they can be used to monitor the effectiveness of recruitment and selection processes38. An applicant’s references should be checked:

(a) as soon as the application has been received(b) immediately prior to the interview(c) after a job offer has been accepted(d) after the interview is over, and before making a final decision

39. The validity of reference checks is most accurate when:

(a) the reference is obtained from an immediate superior(b) references are provided by close friends and family(c) the referee is well acquainted with the applicant’s work(d) both (a) and (c)

40. When asked to provide a reference which of the following is not recommended?

(a) responding to telephone requests(b) sticking to the facts - providing only information that can be substantiated(c) direct all reference inquiries to the HR department(d) ask the enquiring organisation to have the applicant verify that a reference is to be given

41. When interviewing an applicant who is blind, it is good etiquette to:

(a) make friends with the guide dog, if they have one(b) let them find their own way about(c) identify yourself and others present immediately(d) avoid using words or phrases that might be awkward or embarrassing to the applicant

42. By examining labour turnover figures and performance appraisal assessments the HR manager can:

(a) determine future staffing needs(b) evaluate the success of the interviewing technique(c) estimate the performance standard of employees(d) identify promotional potential of employees

43. The pre-employment medical gathers information that is useful in all of the following except:

(a) ensuring that people are not assigned to jobs for which they are physically unsuited(b) determining the applicant’s eligibility for group life, health and disability insurance(c) safeguarding the health of present employees through the detection of contagious

diseases(d) protecting workers from workplace accidents and injuries

44. Biographical information blanks are used to:

(a) collect relevant personal data for the personnel files(b) compare the responses given by applicants with those given by high-performing

employees(c) ensure an increase of workforce diversity(d) check the accuracy of data collected during the interview

45. A disadvantage of panel interviews is:

(a) a more thorough questioning of the applicant is likely(b) more thorough preparation of the interview is undertaken by panel members(c) the experience can be quite stressful for the interviewee(d) it can overcome any idiosyncratic biases that individual interviewers might have

46. Which of the following is not a recognised form of employment interview:

(a) peer interview(b) panel interview(c) group interview(d) computer interview

47. An advantage of video interviewing is:

(a) an applicant may be reluctant to take part in a video interview(b) it often limits the amount of feedback candidates receive(c) candidates complain about the lack of the human element(d) it can save time and money if interviewing candidates from interstate or overseas

48. The technique that uses interviews, tests, simulations, games, and observations to evaluate an individual’s potential is known as:

(a) performance reviews(b) assessment centres(c) computer exercises(d) task assignments

49. Which of the following is not used during the selection process:

(a) peer appraisal(b) graphology(c) the polygraph(d) assessment centres

50. The approach to selection that uses a series of steps, and eliminates candidates who fail a step is the:

(a) step by step approach(b) the collective step approach(c) the successive hurdles approach(d) the contemporary behavioural approach

Chapter 12 : Employee Compensation

Multiple Choice Questions

1. By rewarding desired results an organisation’s compensation policies and practices can:

(a) attract highly skilled applicants to the organisation(b) reinforce employee behaviour that realises its strategic business objectives(c) encourage employees to work harder and faster(d) stimulate the interest of employees in their tasks

3. Some critics argue that collective employee relations and unions can be undermined by

(a) enterprise bargaining(b) negotiated award rates(c) pay for performance(d) bonus incentive schemes

5. A compensation objective for the organisation would(a) give the employee equitable treatment(b) measure and reward appropriately the employee’s performance(c) provide regular salary and performance reviews(d) attract and keep the desired quality mix of employees

6. An objective for the employee of a compensation program would be to

(a) control compensation costs(b) provide regular salary and performance reviews(c) motivate employees to improve their performance(d) comply with legal requirements

7. Before determining the compensation given to a job incumbent it is necessary to(a) access the financial needs of the employee(b) review compensation packages at other organisations(c) conduct a job analysis and job evaluation(d) decide how valuable the employee is to the organisation

8. Components of a systematic salary administration program include(a) job evaluation; salary survey; performance evaluation; pay for performance(b) job evaluation; organisational objectives; performance evaluation; pay for performance(c) job evaluation; job description; performance evaluation; pay for performance(d) organisational objectives; job description; salary survey; merit pay

9. Gross overpayment or underpayment of employees gives rise to employee dissatisfaction due to(a) lack of motivation to work harder(b) above average compensation(c) the difficulty of achieving intrinsic rewards for performance

(d) the lack of fairness employees perceive

10. A systematic model of determining the worth to the organisation of the job in relation to other jobs is

(a) salary survey(b) job evaluation(c) job grading(d) salary formula

11. The most common systems of job evaluation are

(a) job review, job ranking, task classification, job audit(b) job classification, job grading, performance review, task analysis(c) job ranking, job grading, points and factor comparison(d) job grading, job review, job audit, factor comparison

12. The approach to job evaluation that sizes jobs by placing them in rank order is known as

(a) job grading(b) job structuring(c) job factor analysis(d) job ranking

14. For job grading to be accurate

(a) broad experience and knowledge of the job is required by the grader(b) satisfactory job descriptions have to be written for each of the grades(c) it is necessary to observe and interview the current job holder(d) it is important to recognise the differences between jobs

15. An approach to job evaluation in which numerical values are assigned to specific jobfactors and the sum of those values provides a quantitative assessment of a job’s relative worth is

(a) job rating

(b) job grading(c) point system(d) factor comparison

16. When choosing the weights of each job factor, the gradations within each factor, the factors themselves, and the number of factors the point system of job evaluation becomes flawed due to

(a) objectivity(b) subjectivity(c) negativity(d) reflectivity

17. Factor comparison is a refinement of which job evaluation systems

(a) job grading and job classification(b) job analysis and point system(c) job structuring and job ranking(d) job ranking and point system

19. Which of the following is not a commonly used ‘pre-packaged’ job evaluation system

(a) Hay guide chart profile(b) Watson Wyatt MULTICOMP(c) McTavish JEVRE(d) Weighted job questionnaire

20. The Hay guide chart profile bases its job evaluation on an examination of three factors. (a) qualifications, experience, working conditions(b) know-how, problem-solving, accountability(c) creativity, risk-taking, experience(d) job tasks, initiative, performance results

22. Role-based evaluation developed by the Hay Group views work in terms of

(a) evolving roles that reflect the growing ability of the incumbents to add value to an organisation

(b) a collection of continually changing activities(c) a series of related tasks that have been grouped into a single job simply for the sake of

convenience(d) a few related activities that are grouped together to provide structure and control within

the organisation

23. Role-based evaluation combines elements of job evaluation and

(a) strategic flexibility(b) skill development(c) job re-design(d) people-centred approaches

24. The Mercer Cullen Egan Dell method of job evaluation measures

(a) quantity and quality of effort(b) cognition, education and decision accountability(c) education, experience, and problem-solving skills(d) initiative, creativity, and risk-taking

25. MULTICOMP uses which statistical method to evaluate questionnaire responses

(a) factor analysis(b) two-factor theory(c) multiple regression analysis(d) cluster analysis

26. The Weighted job questionnaire asks questions about five core job factors. This includes all of the following except

(a) work attitudes(b) working conditions(c) problem solving(d) skill and knowledge

27. When selecting a job evaluation approach the HR manager should consider(a) ease of use(b) provider support(c) flexibility(d) size of organisation

28. Which of the following is not a frequent criticism of job descriptions

(a) incompatibility with the organisation’s strategic business objectives and culture(b) difficulty of comprehension(c) negative attitudes of employees in supplying accurate information(d) time spent on writing the description

29. If inaccurate or incomplete job descriptions were used as a guide in HR decision making it can

(a) cloud employee roles and organisational objectives(b) help to make objectives and strategies more flexible(c) ensure the appointment of employees with the right skills and abilities(d) result in job descriptions being totally ignored

30. The main purpose of a salary survey is

(a) as the vehicle used by most job evaluation systems to translate words into numbers(b) to relate the organisation’s salaries to those for similar jobs in other organisations(c) to attract and keep the desired quality mix of employees(d) to comply with legal requirements

31. The salary survey provides information on

(a) compensation packages offered by the competition(b) minimum award rates as determined by the Government(c) base salaries and benefits(d) bonus and incentive schemes used to enhance employee motivation

32. The information provided in the salary survey can be used by the HR manager to

(a) determine overall labour costs(b) highlight how HR activities have reduced labour costs(c) assess the contribution of each job holder to the achievement of organisational

objectives(d) calculate the organisation’s competitive position and plan any corrective action

required

33. The salary survey helps to ensure

(a) appropriate compensation is offered to new entrants(b) external equity is achieved and maintained(c) that a perception of fairness is achieved(d) employees are not over or underpaid

34. An essential tool in salary administration that presents all salary ranges over the whole spectrum of job sizes is

(a) salary structure(b) graphic rating scales(c) effort-reward differentiation(d) salary review chart

35. The salary range

(a) graphically depicts the salaries currently being paid for jobs, related to job size(b) presents all salary ranges over the whole spectrum of job sizes(c) sets the minimum and maximum scheduled amounts paid for a job at a particular job size(d) identifies the standard salary, and how much above or below that figure is being paid

for each job

36. The clustering of formerly numerous individual pay grades into a few broad pay grades is known as

(a) salary range(b) narrow banding(c) job evaluation(d) broadbanding

37. Organisations wanting to restructure and flatten, redefine career paths and encouragepersonal growth through lateral job movement may make use of which pay system

(a) standard salary range(b) broadbanding(c) salary structures(d) job evaluation

38. Which of the following is not one of the basic market postures that an organisation uses to position itself in the pay market

(a) pay above market average(b) pay market average(c) pay below market average(d) pay determined by yearly profits

39. A graphical representation of the organisation’s predicted salary midpoints for the 12-month period ahead is known as

(a) a salary policy line(b) a salary structure(c) a salary range(d) a salary curve

40. Inequities in compensation can:

Und(a) lead to internal competition(b) have a negative impact on morale and motivation(c) reduce the organisation’s ability to attract high quality employees(d) promote increased employee performance

41. Pay secrecy can

(a) generate mistrust of the compensation program(b) reduce employee motivation and inhibit the organisation’s effectiveness(c) increase commitment and loyalty to the organisation(d) both (a) and (b)

42. When the difference in pay rates between jobs is too small employees may feel

(a) unmotivated to improve performance(b) pay secrecy exists(c) pay compression exists(d) pay inequities exist

43. Executive remuneration has increased rapidly because of all of the following except

(a) talent shortages(b) performance(c) executive salary disclosures(d) globalisation

44. An organisation that uses length of time on the job to determine pay levels and increases is using

(a) seniority-based pay(b) pay-for-performance(c) merit-based pay(d) skill-based pay

45. Merit pay aims to

(a) develop a productive, efficient, effective organisation that enhances employee motivation and performance

(b) reward employees for their commitment and loyalty to the organisation(c) encourage employees to gain additional skills, competencies and knowledge that will

increase their personal satisfaction and value to the organisation(d) ensure that salary packages offered by the organisation are competitive

46. An effective pay-for-performance system should

(a) be competitive(b) eliminate the need for performance appraisals(c) create a link between reward and performance(d) encourage initiative and creativity

47. An advantage of skill-based pay is claimed to be that

(a) if too many skills are permitted the plan may become too complex and thus difficult to administer and for employees to understand

(b) employees trained in several different jobs may not be able to perform all of them better than a group of workers trained only in one job

(c) some employees may not have the ability or the desire to acquire new skills or knowledge and therefore may resist skill based pay

(d) multiskilling reinforces a high involvement management style, in which employees are given responsibility

48. To determine the appropriate salary increases for an employee’s performance the organisation matches

(a) the salary index and performance index(b) effort and performance ratings(c) merit based index and performance evaluation(d) performance increases and work attitude

49. Which of the following is not one of the main types of salary review

(a) flexible-date reviews

(b) fixed-date reviews(c) job specialisation reviews(d) anniversary reviews

50. Which of the following does not have to be considered when determining promotional increases

(a) the probability of future promotions(b) the employee’s age and length of service(c) the salaries of other employees at the new job level(d) the average salary for equivalent positions in other organisations within the same

industry

Chapter 13 : Incentive Compensation

Multiple Choice Questions

1. Compensation that is linked to performance by rewarding employees for actual results achieved instead of seniority or hours worked is known as

(a) pay-for-performance(b) incentive compensation(c) performance bonus(d) fringe benefits

2. Many CEOs often receive bonus payments

(a) regardless of whether performance agreements are in place(b) that are tied to effort not results(c) whether organisations have performed well or not(d) (a) and (c)

3. What percentage of an executive’s remuneration is fixed at Harvey Norman?

(a) 35%(b) 69%(c) 20%(d) 12%

5. A pay plan that is designed to directly link rewards to the contributions made by an individual employee is known as

(a) pay-for-performance(b) contribution-based pay(c) skill-based pay(d) results-based pay

7. Incentive pay plans are used by organisations because

(a) it is a simple, easy to understand method of evaluation(b) it is a useful way of identifying those employees who are not performing at an

acceptable standard(c) employees who are rewarded in this method are more loyal and committed to the

organisation(d) they can focus employee attention on those objectives that the organisation wishes to

reinforce

8. If you were designing a performance-based pay system you need to

(a) make sure that it reduces the organisation’s overall labour costs(b) ensure that it is straightforward in design and simple to communicate(c) involve all employees in the design and decision-making process(d) conduct a detailed review of employee performance standards

9. Which of the following is not a reason organisations introduce incentive compensation

(a) to encourage employees to undertake further training and development(b) to encourage individual, team or business unit performance

(c) to control fixed compensation costs(d) to increase remuneration competitiveness

10. A plan whereby employees share in the company profits is

(a) at-risk compensation(b) profit sharing(c) commission bonus(d) performance bonus

12. If you were using an incentive compensation system you would measure senior manager performance against

(a) the cost reductions achieved during the last evaluation period(b) the level of employee job satisfaction and turnover rates(c) the overall financial performance of the business unit under their control(d) responses from customers indicating their level of satisfaction with the goods and

services provided

13. Variable performance pay system can be all of the following except

(a) recognition programs(b) individual(c) small group(d) specialty based

15. Research suggests that employees perceive a weak link between

(a) performance and pay(b) position and pay(c) effort and performance(d) pay and length of service

16. The relationship between employee control and influence over the end result is referred to

as

(a) goal focused behaviour(b) line of sight(c) directed control(d) results focus

18. An important principle in the design of ‘at-risk’ incentive systems is that(a) no more than 23% of an employee’s total compensation can be ‘at risk’(b) the employee must have the opportunity to earn more than the target amount(c) the performance target and the ‘at-risk’ component of an employee’s compensation be

determined by the employee(d) to ensure equity and fairness all employees within the organisation must come under

the same system

19. Two conditions need to be present for individual incentive plans to be successful. They are

(a) 1. There is a requirement that the organisation emphasises individual and group contribution, as distinct from organisational contribution.

2. The job must be designed to allow each employee to work independently and with a high degree of autonomy and discretion.

(b) 1. There is a requirement that the organisation emphasises individual contribution, as distinct from team or work group effort.

2. The job must be designed to allow each employee to work independently or as an integral part of a team.

(c) 1. There is a requirement that the organisation emphasises individual contribution, as distinct from team or work group effort.

2. The job must be designed to allow each employee to work independently and with a high degree of autonomy and discretion.

(d) 1. There is a requirement that the organisation emphasises individual and group contribution, as distinct from organisational contribution.

2. The job must be designed to allow each employee to work independently or as an integral part of a team.

20. A door-to-door sales representative, whose pay consists only of a commission on sales revenue or volume is working under

(a) a performance bonus system(b) a piece-rate system(c) a profit sharing incentive(d) an individual incentive pay system

21. That part of pay that is not guaranteed and is at risk is known as

(a) the variable pay component(b) a performance bonus(c) results-based incentives(d) a fringe benefit

22. The criteria used to set performance objectives in relation to individual incentive plans include all of the following except

(a) internal benchmark(b) customer satisfaction(c) strategic business objectives(d) external benchmark

23. The most common form of variable pay used in Australia is

(a) the performance bonus(b) contribution-based pay(c) individual incentive plans(d) gainsharing

24. An advantage of an individual incentive plan is that

(a) it may encourage individualism and non-productive competition(b) where improvements by one employee are offset by poor performance by another, the

organisation is no better off

(c) it can sometimes end up paying for performance that would have been achieved without an incentive plan

(d) it discriminates in favour of high performers

25. Which of the following is not an advantage of an individual incentive plan

(a) provides a clear link between individual pay and work contribution(b) may encourage individualism and non-productive competition(c) links total compensation costs to organisational objectives(d) can have significant impact on key performance indicators such as productivity, quality

and sales

26. When designing and implementing an individual incentive plan you need to considerall of the following except

(a) ability to attract job applicants(b) frequency of rewards(c) clear goals and design simplicity(d) the need for periodic review

27. Performance tracking and management systems are important aspects of the individual incentive plan as they

(a) help management to budget for labour costs(b) provide an indication of employee attitudes regarding incentive pay plans(c) assist employees to maximise their performance and earning opportunities(d) identify any flaws in the current plan and help to correct problems

28. A periodic review of the individual incentive plan(a) ensures that the plan continues to meet the organisation’s objectives and employee

needs(b) ensures that the incentive plan can be funded from increases in productivity(c) provides employees with the opportunity to see how they are performing compared to

the previous year(d) identifies areas where the organisation could provide training and development

opportunities that will help employees improve their performance

29. An organisation uses complex technology requiring specific purpose project teams.

Secondly, this organisation has a flat structure with a culture characterised by employee involvement and a supportive management style. This organisation would most probably utilise

(a) small group incentives(b) individual incentive plans(c) recognition plans(d) organisation wide incentive plans

30. Because small group incentives focus on team accomplishments rather than individual ones they are able to

(a) increase job satisfaction(b) increase performance(c) decrease competition and conflict between different work groups(d) increase flexibility in job assignments

31. A small group incentive system that shares the productivity improvements with the employees who make them is a definition of

(a) recognition program(b) profit share(c) gainsharing(d) bonus payment

32. The Scanlon Plan is a type of

(a) profit sharing(b) gainsharing(c) bonus management(d) individual incentive

33. A gainsharing plan that is designed to link employee rewards to the firm’s performance is

(a) the Hay Guide to job evaluation

(b) the Watson Wyatt performance review portfolio(c) the Scanlon Plan(d) Rucker Plans

34. The Scanlon Plan emphasises

(a) employee goal setting and development(b) participative management and employee involvement(c) flexibility in job assignments and employee autonomy(d) employee morale and motivation

35. A gainsharing plan that calculates employee gains using a value-added formula is

(a) the Scanlon Plan(b) the Line of Sight Plan(c) the piece-rate plan(d) the Rucker Plan

36. Total Quality management involves

(a) an organisation-wide commitment to continuous improvement and satisfying customer needs

(b) focusing on acquiring the highest quality raw materials for the production process(c) providing quality training and development activities for employees to improve their

chances of adding value to the organisation(d) both (b) and (c)

37. Any salary increase awarded to an employee based on their individual performance is known as

(a) performance-based pay(b) bonus pay(c) merit pay(d) profit sharing

38. The TQM approach that links pay and quality has the advantage of

(a) providing a simple and logical basis for an incentive pay system(b) keeping incentive payments to an acceptable level(c) allowing regular reviews of team progress(d) giving a perception of complexity and sophistication that reinsures employees of its

fairness

39. The shift towards an increased emphasis in the use of teams and work groups is an illustration of

(a) decentralised decision-making(b) a devaluation of responsibilities(c) workplace redesign(d) restructuring

40. The key performance measures for project work are

(a) product quality and employee satisfaction(b) reduction in production costs and product quality(c) increased productivity and lower labour costs(d) task completion on time and within budget

41. An advantage of small-group incentive plans is that it

(a) reduces emphasis on employee performance(b) provides a clear link between group performance and reward(c) allows poor performers to be carried by the group(d) can sometimes mean organisations end up paying for performance that would have

been achieved without an incentive plan

42. Which of the following is not a disadvantage of small-group incentive plans

(a) reduces emphasis on employee performance(b) organisations can sometimes end up paying for performance that would have been

achieved without an incentive plan

(c) allows greater use and flexibility of team members(d) allows poor performers to be carried by the group

43. Of the following statements, which is not a consistent criticism of the use of bonus plans

(a) they do little to influence individual performance(b) they are often seen as a ‘right’ and as a form of deferred pay(c) high performing employees often feel their contributions are not sufficiently recognised(d) they promote a positive organisational image

44. If you were using organisation-wide incentive plans as a motivation tool you would use which two performance indicators to determine incentive payments

(a) profit and achievement within budget(b) productivity and quality improvements(c) reduction in downtime and lower employee turnover(d) lower costs of production and increased output

45. A disadvantage of large-group incentive plans is that they(a) promote a positive organisational image(b) have a long ‘line of sight’ because only a few employees can directly influence the end

result(c) encourage employee identification with organisation-wide objectives(d) control part of remuneration costs if reward is contingent on meeting objectives

46. Incentive programs that make use of rewards such as cash, merchandise, travel, ccertificates and the like are known as Fac

L(a) bonus incentive schemes(b) profit sharing schemes(c) recognition programs(d) pay for performance programs

47. An advantage of recognition programs is that they d

Und(a) can involve high administrative costs and time M(b) may lead employees to lose motivation if they feel they cannot ever win(c) may be seen as favouritism if system allows for repeat winners

(d) have the added psychological value associated with peer recognition48. The first step in designing an effective incentive pay system is b

Und(a) to determine the budget allowance for incentives M(b) to define the required performance criteria(c) to discuss incentive choices with all employees(d) to provide explanatory sessions so that all employees are aware of how the incentive

system works

49. How base pay and the incentive system fit together to form the total reward framework needs to be determined

(a) after the system has been trialed for a minimum of six months(b) through a process of negotiation with employees(c) by an examination of packages offered by competitor organisations(d) at the design stage

50. Incentive plans are generally funded through

(a) increased profits and reduced expenses(b) increased customer satisfaction and increasing share values(c) the sale of surplus assets and product innovation benefits(d) both (b) and (c)