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Chapter 14 HR Assessment and Analytics
Chapter 14 HR Assessment and Analytics
Clas Dat
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2. Why do some managers resist the need to measure the effectiveness of their performance?
a. because it is impossible to calibrate meaningful measures
b. because they know that they are underperforming in their jobs
c. because they do not control the information that is produced
d. because the time to gather information exceeds the benefits
ANSWER: a
3. In the book titled Retooling HR, author Boudreau stated that HR evolution is challenged by the presence of
too much information. What solution did the author suggest?
a. reducing the volume of information
b. developing measures to summarize information
c. focusing on relevant HR information
d. creating frameworks to interpret the information
ANSWER: d
4. What are two types of evidence that Enbridge Gas Distribution measures to determine overall customer
satisfaction?
a. employee turnover and “presenteeism”
b. employee commitment and engagement
c. employee innovation and advocacy
d. employee satisfaction and work–life balance
ANSWER: a
10. If an organization measures a decline in employee morale, approximately how long will it take to realize a
drop in customer satisfaction?
a. 2 months b. 4 months
c. 6 months d. 8 months
ANSWER: c
11. What is the underlying assumption of the culture management model that is used to determine the
effectiveness of HRM?
a. HR professionals are employed 20 to 30 percent of the time to ensure compliance with laws and
legislation.
b. Organizational effectiveness is directly correlated to the size of the human resources budget.
c. HR practices can have a positive influence on employee attitudes, which in turn influence employee
performance.
d. Highly committed employees will make personal sacrifices for the job and will not leave the
organization for personal gain.
ANSWER: c
12. What are three of the main employee attitudes that are measured in HRM effectiveness surveys?
a. motivation, commitment, and work–life balance
b. satisfaction empowerment, and engagement
c. empowerment, commitment, and advocacy
d. engagement, satisfaction, and motivation
ANSWER: d
13. What is one way that an HR department can reduce expenses associated with employees without reducing
the headcount?
a. increase employees’ efficiencies
b. eliminate the costs associated with absenteeism
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15. According to a recent study, what percentage increase in customer satisfaction did Sears stores realize with
every five percent increase in improved employee attitudes?
a. 0.8 percent b. 1.3 percent
c. 1.8 percent d. 2.3 percent
ANSWER: b
17. If an organization wishes to monitor the costs of turnover, which two costs should it measure?
a. lost revenue and productivity b. absenteeism and termination
c. replacement and training d. learning time and recruitment
ANSWER: a
18. If HRM is effective, it can cause numerous effects on employee behaviour. What is one such effect?
a. improving customer satisfaction b. enhancing employee attrition
c. reducing employee shirking d. eliminating high-potentials
ANSWER: c
20. Why are measures of managerial perceptions necessary when evaluating HRM effectiveness?
a. because other measures are time-consuming and meaningless
b. because management has a unique, comprehensive perspective
c. because management can give rich, qualitative information
d. because financial measures can be neither available nor appropriate
ANSWER: d
24. What are some of the necessary costs for human resources accounting?
a. training, development, executive salaries, and benefits
b. recruiting, selecting, training, and retaining
c. technology, outsourcing, selecting, and orientation
d. downsizing, training, recruiting, and development
ANSWER: b
26. Which of the following is one of the four basic questions used in the balanced HR scorecard?
a. How do employees see us? b. Can we continue to remain profitable?
c. How do we look to shareholders? d. Which areas need improvement?
ANSWER: c
27. Which of the following is NOT a type of mimicry that organizations use to adopt HR practices?
a. outcome-based mimicry b. frequency-based mimicry
c. trait-based mimicry d. knowledge-based mimicry
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32. What are three ways to reduce labour expenses by reducing the size of the labour force?
a. technology, job design, and outsourcing b. technology, outsourcing, and downsizing
c. layoffs, downsizing, and restructuring d. outsourcing, layoffs, and downsizing
ANSWER: b
33. The number of people interviewed to fill a job is an example of what kind of efficiency measurement?
a. time b. labour
c. volume d. cost
ANSWER: c
38. What are two of the main employee attitudes that are measured in HRM effectiveness surveys?
a. initiative and satisfaction b. satisfaction and collaboration
c. empowerment and commitment d. engagement and motivation
ANSWER: d
40. There are a number of approaches to measuring the impact of HRM policies and practices. Measuring the
cost per hire is an example of what type of measure?
a. activity-based measures b. hiring measures
c. costing measures d. staffing measures
ANSWER: c
41. What are two types of evidence that Enbridge Gas Distribution measures to determine overall customer
satisfaction?
a. employee commitment and productivity
b. employee satisfaction and engagement
c. employee innovation and advocacy
d. employee satisfaction and work–life balance
ANSWER: b
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43. What term best defines the collection and analysis of facts and statistics for reference or analysis?
a. performance metric b. analytics
c. data d. hr analytics
ANSWER: c
44. What are two types of evidence that Enbridge Gas Distribution measures to determine overall customer
satisfaction?
a. employee commitment and high levels of productivity
b. employee creativity and high levels of innovation
c. employee leadership succession and high levels of alignment to company goals
d. employee satisfaction and high levels of employee efficiency
ANSWER: c
45. What term best defines the process of measuring an organization’s behaviour, activities, and performance?
a. performance metrics b. analytics
c. workforce analytics d. HR analytics
ANSWER: a
46. What is an evidence-based approach for making better decisions about employees and HR policies, using a
variety of tools to report HR metrics and to predict outcomes of HR programs?
a. performance analytics b. HR analytics
c. data analytics d. workforce analytics
ANSWER: b
47. There is growing interest in measuring HR. What is this interest fuelled by?
a. the need for competitive measurements
b. business improvement efforts across organizations
c. the need to measure human resource productivity
d. the need for subjective and objective indicators of HR activities
ANSWER: b
48. What term best defines how HR metrics, such as turnover and employee engagement, are used to describe
the workforce?
a. workforce analytics b. HR analytics
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49. There is growing interest in measuring HR. What is this interest fuelled by?
a. attempts to measure competitive advantage
b. attempts to position HR as a strategic partner
c. attempts to measure change initiatives
d. attempts to evaluate HR activities
ANSWER: d
50. What are three ways to reduce labour expenses by reducing the size of the labour force?
a. restructuring, outsourcing, and downsizing
b. technology, rightsizing, and downsizing
c. technology, layoffs, and downsizing
d. technology, outsourcing, and downsizing
ANSWER: d
52. What term best defines the discovery, interpretation, and communication of meaningful patterns in data?
a. performance metric b. analytics
c. workforce analytics d. HR analytics
ANSWER: b
54. What are two main employee attitudes that are measured in HRM effectiveness surveys?
a. engagement, advocacy, and motivation
b. satisfaction, empowerment, and engagement
c. empowerment, commitment, and advocacy
d. motivation, commitment, and work–life balance
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55. Which of the following is a passive measure of employee contentment with little relationship to
performance?
a. satisfaction b. motivation
c. fulfillment d. engagement
ANSWER: a
56. Which of the following is a measure that probes whether employees feel stimulated in their role and are
driven to meet work and organizational goals?
a. empowerment b. commitment
c. engagement d. motivation
ANSWER: d
58. Which of the following is an employee attitude measure of their alignment with the strategy, objectives, and
values of the organization?
a. commitment b. engagement
c. empowerment d. satisfaction
ANSWER: a
59. Which of the following is a measure of high employee motivation, commitment, and advocacy?
a. empowerment b. engagement
c. motivation d. satisfaction
ANSWER: b
60. Counting the number of employees completing training is an example of what type of measure?
a. activity-based measure b. costing measure
c. client satisfaction measure d. employee satisfaction measure
ANSWER: a
61. Many HR departments were originally set up because of the need to comply with employment legislation
and standards.
a. True
b. False
ANSWER: True
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63. Indirect costs are the hard costs that can be measured by expenditures.
a. True
b. False
ANSWER: False
64. Kim has to move to another city. Kim has decided to compare and contrast different moving companies in
terms of their charges and the times that they are available. Kim is conducting an informal utility analysis.
a. True
b. False
ANSWER: True
65. By focusing on the alignment of HR practices with organizational strategy, a company will achieve greater
performance and fit than by focusing on best practices and benchmarking.
a. True
b. False
ANSWER: True
67. Corporate scorekeeping allows organizations to make a plan that fits organizational strategy.
a. True
b. False
ANSWER: False
71. There are three ways to reduce labour expenses by reducing the size of the labour force: technology,
outsourcing, and mergers.
a. True
b. False
ANSWER: False
72. HR can affect the probability of survival of a new venture by as much as 32 percent.
a. True
b. False
ANSWER: False
73. Return on investment is a key financial ratio computed by an organization to determine its relative success in
achieving its goals.
a. True
b. False
ANSWER: True
74. There are three typical measures for efficiency: time, quality, and cost.
a. True
b. False
ANSWER: False
75. Organizational survival is the first measure of effectiveness and is considered a “life-or-death” index.
a. True
b. False
ANSWER: True
77. There are four sources of benchmarking partners: internal, competitive, sector, and external.
a. True
b. False
ANSWER: False
81. The HR profession is like the accounting profession because they both rely on generic measures and
principles.
a. True
b. False
ANSWER: False
82. The costs of turnover include termination, replacement, reduced customer satisfaction, and time for a new
employee to become productive.
a. True
b. False
ANSWER: False
83. The 5C model of HRM impact includes five areas for evaluating HRM: compliance, client satisfaction,
culture management, cost control, and commitment.
a. True
b. False
ANSWER: False
84. A balanced scorecard is a measure that can enhance organizational performance by establishing standards
against which processes, products, and performance can be compared and improved
a. True
b. False
ANSWER: False
85. HR analytics is an evidence-based approach for making better decisions about employees and HR policies,
using a variety of tools to report HR metrics and to predict outcomes of HR programs.
a. True
b. False
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Name Clas Dat
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86. The goal of surveying clients is to identify gaps between their expectations and their satisfaction.
a. True
b. False
ANSWER: True
88. Workforce analytics is an evidence-based approach for making better decisions about employees and HR
policies, using a variety of tools to report HR metrics and to predict outcomes of HR programs.
a. True
b. False
ANSWER: False
89. If employee morale drops, management can expect to see customer satisfaction levels drop in about six
months.
a. True
b. False
ANSWER: True
91. There are two ways of measuring contribution: financial measures and measures of managerial perceptions
of effectiveness.
a. True
b. False
ANSWER: True
95. The Society for Human Resource Management identifies nine major reasons why it is important to measure
HRM programs and practices. Briefly state five of these reasons.
ANSWER: ∙ Labour costs are most often a firm’s largest controllable cost.
∙ Managers recognize that employees make the difference between success and failure and so good
performance can be rewarded objectively.
∙ Organizations have legal responsibilities to ensure compliance with laws governing the employer–
employee relationship.
∙ Evaluations are needed to determine which HR practices are effective (and not fads).
∙ Measuring and benchmarking HR activities will result in continuous improvements. Performance
gaps can be identified and eliminated.
∙ Audits will bring HR closer to the line functions of the organization.
∙ Data will be available to support resource allocations.
∙ Investors want this information.
∙ HR managers are more likely to be welcomed at the boardroom table and to influence strategy if
they use measures to demonstrate the contribution of their function.
98. When evaluating the effectiveness of HRM practices, organizations have the choice of using two
approaches: fit or best practice. Briefly describe the difference between the two approaches.
ANSWER: See Figure 14.3 – Two Approaches: Fit or Best Practice on page 389.
Fit Approach: is an evaluation approach that focuses on the alignment of HR practices with
organizational strategy. If they are in good alignment, then there should be corresponding effects
seen in the HR outcomes such as employee satisfaction, motivation, productivity, and also the
financial criteria such as profitability, added-value for shareholders, growth, etc. It is important also
to note that environment scanning is an important first step in the fit approach.
Best Practice: is an evaluation approach that mimics or copies the best practices and benchmarks of
other organizations that may or may not be similar to the evaluating organization. From there, these
best practices and benchmarks will be factored into the business and HR strategies. Although this is
a more generic approach that would be useful if the evaluating organization did not have the
expertise to grow its own approach, the relevance to the evaluating organization may not be as
useful as the customized fit approach. Using the best practices of one’s competitors might not
necessarily support the goals and objectives of the organization.
99. Discuss the three ways HR practices can reduce labour expenses by reducing the size of the labour force.
ANSWER: ∙ Technology: One of the most frequently used ways to cut labour costs is to increase the use of
technology. Technology to process benefits claims and pursue e-learning has replaced HR staff,
resulting in cost savings of about 30 percent.
∙ Outsourcing: Firms are also outsourcing major activities in order to manage the costs of labour.
However, there are detrimental effects of cutting costs in this way. Core talent may be lost and the
capacity for innovation diminished. See Chapter 13 for a more detailed discussion of outsourcing.
∙ Downsizing: Chapter 10 provides an analysis of the processes for restructuring.
100. Identify an organization you are familiar with (such as from your work experience or from your textbook).
Discuss one measure that the organization uses to measure the efficiency of their HR practices. Provide a
concrete example. Ensure you define efficiency.
ANSWER: Efficiency is expressed in terms of the results achieved (outputs) in comparison to the resource
inputs. Measures of efficiency include the following:
∙ Time (e.g., average time to fill an opening, process a benefits claim)
∙ Volume (e.g., number of people interviewed to fill a job, number of requests processed per
employee)
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101. What does added value mean when measuring the impact of HRM practices?
ANSWER: The following examples help explain the concept of value added:
∙ An activity measure for an HR professional would be the number of people trained.
∙ A performance measure for an HR professional would be the number of trainees who passed the
training test or rated the training courses as above average.
∙ An added-value measure for an HR professional would be the increase in profits, sales, or
customer satisfaction, or decrease in complaints, errors, or defects, as a result of the skills learned in
the training course.
102. Organizations may use different terms when measuring employee attitudes. Discuss attitude and 2 terms
(behaviours) which can be measured through HR culture surveys
ANSWER:
Attitudes, in an organizational context, can be defined as perceptions or opinions about
organizational characteristics.
Organizations use different terms in measuring employee attitudes:
• Satisfaction: This is a passive measure of employee contentment with little relationship to
performance.
• Motivation: This measure probes whether employees feel stimulated in their role and are driven to
meet work and organizational goals. Motivation is strongly related to productivity measures.
• Commitment: A measure of the alignment between the strategy, objectives, and values of the
organization, commitment is strongly linked to employee loyalty and customer service excellence.
• Advocacy: This is a measure of whether employees will speak highly of the organization as an
employer, and as an organization with products and service. Advocacy is strongly linked to sales
growth and employee attraction.
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103. Hewitt Associates describes the attitudes of an engaged employee in three simple ways. Describe these
three ways.
ANSWER:
• Say: Consistently speaks about the organization to co-workers, potential employees, and
customers
• Stay: Has an intense desire to be a member of the organization
• Strive: Exerts extra effort and engages in behaviours that contribute to organizational success.