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PHR / SPHR Professional Exam: Business Management and Strategy

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While the HR role traditionally was one of a transactional administrative nature, it has now grown and shifted into an area of responsibility and focus as a strategic element to an organization’s competitive advantage. The role of HR now encompasses: strategic business planning, change facilitation, and employee advocacy. The greatest way of showing that the HR function is strategic is through the partnering with organizational management as an internal business consultant. A true business consultant presents all the factual data and necessary information, along with recommendations from... Show more

The greatest way of showing that the HR function is strategic is through the partnering with organizational management as an internal business consultant. A true business consultant presents all the factual data and necessary information, along with recommendations from their broader perspective in an effort to help their client reach a decision. For the HR professional, that includes presenting credible data, understanding all functions of the organization, aligning HR initiatives with the organization’s strategy, and knowing how to monitor and measure the results.

The Business Management and Strategy area of the HRCI exam is heavily emphasized on the SPHR exam with 29 percent of the test questions focused in this functional competency area.

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PHR / SPHR Professional Exam: Business Management and Strategy

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1. Which of the following actions taken by HR Manager Chris is the most ethical?

Working exclusively with a technical contracting agency for the IT group to qualify for a random prize drawing for customersDeleting low-paying companies from salary survey results of HR positionsReferring a qualified friend for a vacant position at the companyNot standing up and voicing displeasure about a discriminatory decision made by a superior

2. The process of analyzing and identifying the need for availability of human resources so that the organization can meet its objectives is known as:

Organization planningPEST analysisHuman resource planningStrategic planning

3. Financial contributions from the HR department are important because

There is little impact from reducing the HR department’s budget.Executives expect the HR department to be the most flexible in budget terms.Every strategic decision must contribute to the financial performance of the organization.Training and staffing are the easiest areas to cut and gain back budget.

4. In an organizational structure, what is centralized?

The degree to which decision-making authority is given to lower levels in an organization’s hierarchy.The hierarchical division of labor that distributes formal authority and establishes how critical decisions will be made.The degree to which decisions are made by committees.The degree to which decision-making authority is restricted to senior management.

5. Colin is the HR manager at a tax preparation firm. During the tax season, Colin contracts with a temporary agency for seasonal help. The seasonal workers receive payroll checks from the temporary agency and not Colin’s organization. What type of contract will Colin sign with the temporary agency for the seasonal workers?

Third-party contractTemporary contractSeasonal contractDirect contract

6. A strategy that focuses on launching a new line of business would most likely occur at which stage in the organization’s life cycle?

MaturityGrowthRebirthStartup

7. A statement that describes what the organization does and its customer base is a:

Statement of positionMission statementVision statementLofty statement

8. Mergers and acquisitions (M&A) provide HR managers with special problems of cultural differences. In order to make sure that the cultures don’t clash after the merger, the HR manager should

Send memos to department heads that specify the new cultural characteristics and express the expectation that the department heads will “make it happen.”Provide written complaint forms to all employees and express a willingness to listen to any comments the employees have to make about the merger.Conduct meetings with key players from each organization to outline the cultural values of each organization and determine how best to protect them in the blended employer unit.Assign a subordinate to monitor the complaint levels and report on problems that are being addressed.

9. Taylor is the Quality Assurance director at her organization and reports to both the Division VP at her facility and the VP of Quality Assurance located at the headquarters office. This is an example of what type of organizational structure?

Span of controlFormalizedMatrixChain of command

10. Which is the most important foundational issue of organizational effectiveness?

PoliciesEthicsGovernanceRewards

11. The AB Trucking Co. is expanding its routes and hiring more people. Those changes will mean that employees will have to take on different work assignments. How should the HR manager handle those changes with the workforce?

Explain the coming changes and tell the truckers that assignments will be made based on seniority. The new people will be assigned last.Explain the coming changes and let the senior executives handle the questions about how new job assignments will be made.Explain the coming changes and let the employees discuss among themselves how they want to assign routes to the workforce.Explain the coming changes to all employees and solicit their help in deciding how to assign the new routes. Prepare a project plan and make sure everyone has a chance to see it before the implementation date.

12. In an organizational structure, what is centralized?

The degree to which decision-making authority is given to lower levels in an organization’s hierarchy.The degree to which decision-making authority is restricted to senior management.The hierarchical division of labor that distributes formal authority and establishes how critical decisions will be made.The degree to which decisions are made by committees.

13. A balance sheet shows:

Amount of equity owned by investorsTaxes paid last yearThe income and expenses over a defined period of timeHistorical budgeting

14. Antonio has been assigned as the HR project manager for the implementation of the new HRIS. The IT staff, Training and Development group, Risk Management department, and the Compensation and Benefits group will be involved in the implementation. What project management tool will be best for Antonio to use for scheduling and managing the tasks with all groups?

Balanced scorecardPERT chartGantt chartImplementation schedule

15. Mikayel is the shipping and receiving manager at your Russian parts plant. He has experienced problems with getting shipments through Customs for timely delivery to the United States. His contact at Customs informs him that he can expedite the shipments if Mikayel would pay him a gratuity for his service in cash. Your organization’s ethics clearly state that bribes are considered unethical behavior; however, this “gratuity” seems to be in the best interest of the organization. What is your best course of action?

Authorize Mikayel to make the payments out of petty cash.Adhere to the organization’s no-bribe ethics policy and seek other solutions for the shipment delay issue.Report the bribe incident to the local Russian Customs head officer.Ask executive management for “special outside-of-policy” authorization.

16. When the AB Trucking Co. makes its organizational changes, it plans to alter its reporting relationships. If it elects to have each supervisor report to an operations manager and also to a financial manager, what type of organizational structure will AB Trucking Co. be using?

Matrix. A perfect example when multiple reporting relationships exist for certain jobs.Work specialization. Because there are multiple reporting relationships, the specialization of each will increase.Span of control. The span of control will be exceedingly easier to manage with multiple reporting relationships.Formalized. A firm structure that can be charted, regardless of how many reporting lines exist from one job to another.

17. Complex project management is made easier through the use of

Gaunt PERK planning chartsPERT/CPM planning chartsPARK/ITEM planning chartsPACK/CWA planning charts

18. A statement that describes what the organization does and its customer base is a:

Mission statementStatement of positionVision statementLofty statement

19. The role of human resource management has changed over the last few decades because more focus is now placed on

Strategic management of the organization and less focus on labor relationsRecruiting and less focus on paperworkSupporting the executive suite and the programs that the officers want implementedFinding people with qualifications in high technology that can meet today’s challenges

20. Colin is the HR manager at a tax preparation firm. During the tax season, Colin contracts with a temporary agency for seasonal help. The seasonal workers receive payroll checks from the temporary agency and not Colin’s organization. What type of contract will Colin sign with the temporary agency for the seasonal workers?

Temporary contractDirect contractSeasonal contractThird-party contract

21. Antonio has been assigned as the HR project manager for the implementation of the new HRIS. The IT staff, Training and Development group, Risk Management department, and the Compensation and Benefits group will be involved in the implementation. What project management tool will be best for Antonio to use for scheduling and managing the tasks with all groups?

Gantt chartImplementation schedulePERT chartBalanced scorecard

22. Management skills have been identified over a long period of time through the work of

Studies such as the Management Progress Study conducted by American Telephone and Telegraph beginning in 1956 and continuing over the next 30 yearsVarious universities around the country and their studies of manufacturing plantsVarious consulting firms across the country and their studies of university environmentsIBM’s study of management individuals that lasted for 35 years

23. Taylor is the Quality Assurance director at her organization and reports to both the Division VP at her facility and the VP of Quality Assurance located at the headquarters office. This is an example of what type of organizational structure?

Chain of commandFormalizedSpan of controlMatrix

24. The role of human resource management has changed over the last few decades because more focus is now placed on

Recruiting and less focus on paperworkSupporting the executive suite and the programs that the officers want implementedFinding people with qualifications in high technology that can meet today’s challengesStrategic management of the organization and less focus on labor relations

25. Which of the following is a legal consequence of the Sarbanes-Oxley Act?

Organizations are allowed to conduct their own stock appraisal.Shareholders are prevented from suing the company.Audit firms must alternate every two years.CEOs may be punished, including jail time, for fraudulent financial reports.

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