Challenge of Human Resources Exam.docx

The Challenge of Human Resources Management TRUE/FALSE 1. An organization's human resources are a means by which the firm fosters a sustained competitive advantage. ANS: T 2. To achieve sustainable competitive advantage through people, an organization's employees' skills, knowledge, and abilities must be widely available in the labor market. ANS: F 3. In order to facilitate sustained competitive advantage, firms need only to ensure that human resources are combined and organized properly. ANS: F 4. We have to understand corporate social responsibility to work with people effectively. ANS: F 5. Human capital plays an important role in providing employees a work environment that meets their needs. ANS: F 6. Approximately 40 percent of the U.S. economy is affected by international competition. ANS: F 7. The Free Trade Area of the Americas (FTAA) was replaced by the North American Free Trade Agreement (NAFTA). ANS: F 8. For a company with overseas operations, some critical concerns for success are the identification, selection, and compensation of expatriates. ANS: T 9. The introduction of advanced technology tends to increase the number of jobs that require basic skills. ANS: F 10. In general, many companies are realizing diminished demand for "touch labor" and an increasing demand for "knowledge workers." ANS: T 11. Knowledge workers are employees whose responsibilities focus on problem solving. ANS: F 12. A Human Resource Information System (HRIS) provides current and accurate data for control and decision-making by managers. ANS: T 13. Because of its importance, HR managers should assume sole responsibility for the implementation of information technology. ANS: F 14. To proactively manage change, organizations should wait to see how external forces impact an organization's performance, then develop a plan to address those changes. ANS: F 15. Only about two-thirds of the companies surveyed by the American Management Association (AMA) reported having a formal change management program in their companies. ANS: T 16. Reallocating resources and assets are most often the reason for failed change management. ANS: F 17. One of the main reasons change efforts fail is that organizations do not create a sense of urgency. ANS: T 18. A firm's ability to compete through people depends upon its ability to manage human capital. ANS: T 19. Human capital is owned by the organization and is part of the company's core competencies. ANS: F 20. To build human capital in organizations, managers should focus on training programs in areas that cannot be transferred to competitors. ANS: T 21. To build human capital in organizations, firms should seek employees who possess knowledge, skills and abilities that are of strategic value to the firm and also invest in the development of employee KSAs. ANS: T 22. Development programs, especially those involving teams, facilitate learning and knowledge exchange. ANS: T 23. Employees often have skills that go unused. ANS: T 24. Teamwork is often a valuable way of facilitating knowledge exchange and mutual learning. ANS: T 25. Development of human capital is the responsibility of the HR group. ANS: F 26. Total-quality management is a set of principles and practices whose core ideas include doing things right the first time and striving for continuous improvement. ANS: T 27. To be successful, organizations should constantly seek to align their processes with customer needs. ANS: T 28. 'Six Sigma' refers to the six criteria for Malcolm Baldrige National Quality Award. ANS: F 29. Organizations known for product and service quality recognize the importance of employees in fostering quality improvements ANS: T 30. Six Sigma is a set of principles and practices whose core ideas include doing things right the first time and striving for continuous improvement. ANS: F 31. Employee motivation, teamwork, corporate culture, employee education, performance management, and rewards are the six aspects in the quality improvement program known as 'Six Sigma.' ANS: F 32. Reengineering is a statistical method of translating customer needs into separate tasks and defining the best way to perform each task. ANS: F 33. To launch a successful reengineering effort, it is important that managers build on existing processes. ANS: F 34. Labor costs are one of the largest expenditures of any organization. ANS: T 35. Technology reduces labor costs in service and knowledge intensive companies. ANS: F 36. Methods of reducing labor costs include downsizing, outsourcing, and employee leasing. ANS: T 37. Downsizing is often used by organizations for the planned elimination of jobs. ANS: T 38. The large majority of major corporations have undergone some cycle of downsizing. ANS: T 39. Historically, layoffs affected line workers in manufacturing firms, but since the 1990’s white collar and managerial jobs are the hardest hit. ANS: T 40. "No Layoff" policies help preserve institutional memory and worker productivity. ANS: T 41. Outsourcing refers to employing workers in their homes rather than within the traditional office environment. ANS: F 42. Offshoring greatly improves key competencies of a firm. ANS: F 43. Employee leasing refers to employing workers in their homes rather than within the traditional office environment. ANS: F 44. Employee leasing shifts administrative costs from the company to a professional employer organization. ANS: T 45. An increased reliance on outsourcing is likely to increase the morale and productivity of the employees that remain on the job. ANS: F 46. Performance can be thought of as a function of individual ability and motivation. ANS: F 47. Compared to today, nonwhite employees are expected to account for a larger share of labor force growth in 2012. ANS: T 48. Demographic changes have to do with the retirement of baby boomers reducing the average age of the labor force. ANS: F 49. Workers' motor skills and cognitive abilities can decline with age, but the expertise and experience of managers compensates for this. ANS: F 50. Retirements may drain the company of its employee expertise. ANS: T 51. Older workers have significantly higher training costs than younger workers. ANS: F 52. By the year 2012, women will still make up only about 20 percent of the U.S. labor force. ANS: F 53. The fastest growing sector of employment has been in areas suited for the unskilled and uneducated. ANS: F 54. Educational level is positively related to annual earnings. ANS: T 55. As many as half of all high school graduates are unable to handle basic math involving fractions, decimals, and simple algebra. ANS: T 56. Basic proficiencies such as reading and writing are of concern due to the prevalence of deteriorating skill levels among Americans. ANS: T 57. Hispanics and blacks are heavily concentrated in several of the fast-growth occupations. ANS: F 58. Managing diversity means engaging in actions to increase the representativeness of minority groups within organizations. ANS: F 59. Managing diversity means taking efforts to encourage minority recruitment, selection, and training. ANS: F 60. Employees today are less likely to define success in terms of financial gain. ANS: T 61. Family-friendly practices include offering 32 hour work weeks, telecommuting, and job sharing. ANS: T 62. One of the responsibilities of HR managers is to provide advice and counsel to line managers. ANS: T 63. An HR manager is typically expected to function as an in-house consultant to supervisors, managers, and executives. ANS: T 64. Because HR managers function in an advisory role, they are responsible for issuing policy revisions and implementing them. ANS: F 65. One of the roles of HR managers is to act as employee advocates despite their positions as managers. ANS: T 66. HR professionals must know the business of their organization thoroughly. ANS: T 67. HR managers establish credibility by supporting the policies and values of the firm. ANS: F MULTIPLE CHOICE 1. The term human resource implies that ____ have the capabilities that drive human performance. a. money b. materials c. people d. information ANS: C 2. Which of the following is not a typical HRM issues? a. staffing b. marketing. c. training. d. compensation. ANS: B 3. To work with people effectively, we have to understand a. legal issues. b. economic constraints. c. technological developments. d. human behavior. ANS: D 4. Which of the following is not among the most distinctive and renewable resources of a company? a. employee skill. b. employee motivation. c. employee knowledge. d. employee abilities. ANS: B 5. HRM plays an important role in organizations by balancing the sometimes competing demands of: a. competitive challenges and international challenges. b. international challenges and employee concerns. c. employee concerns and HRM challenges. d. competitive challenges and employee concerns. ANS: D 6. Much of the U.S. trade deficit is with: a. Canada. b. India. c. Japan. d. China. ANS: D 7. What proportion of the U.S. economy is affected by international competition? a. less than 20%. b. 10% to 40% c. 40% to 60% d. more than 60%. ANS: D 8. The World Trade Organization (WTO) utilizes ____ to establish rules and guidelines for global commerce. a. NAFTA (North American Free Trade Agreement) b. GATT (General Agreement on Tariffs and Trade) c. FTAA (Free Trade Area of the Americas) d. APEC (Asia Pacific Economic Cooperation) ANS: B 9. HR issues underlying globalization include all of the following except: a. identifying expatriate managers. b. designing training programs to enhance understanding of foreign cultures and work practices. c. adjusting compensation plans to ensure equitable treatment across global regions. d. identifying potential centers of global operations. ANS: D 10. Knowledge workers require skills in all of the following areas except: a. computer programming. b. planning. c. decision-making. d. problem solving. ANS: A 11. Which of the following is the largest employment agency in the United States? a. Snelling Personnel Services b. Kelly Services c. Manpower Inc. d. Labor Ready ANS: C 12. An HRIS extends information technology beyond storing and retrieving information to: a. overseeing production planning. b. providing current and accurate data for purposes of control and decision making. c. providing managers easy access to personnel records. d. serving as an intranet communication system. ANS: B 13. Which of the following is not a primary impact that technology has had on HRM? a. It has altered the methods of collecting employment information. b. It has speeded up the processing of employment data. c. It has diminished the role of supervisors in managing employees. d. It has improved the processes of internal and external communications. ANS: C 14. The operational impact of information technology on HRM includes all of the following except: a. administering benefits programs. b. improving productivity internal to the HR function. c. providing a direct connection to recruitment sources such as Monster.com. d. automating routine tasks. ANS: C 15. Information technology has a transformational impact on HR by: a. expanding the scope and function of the HR Dept. b. allowing firms to store and retrieve large amounts of information quickly and inexpensively. c. institutionalizing organizational knowledge. d. allowing easy communication between company units. ANS: A 16. The first step in choosing an HRIS is for the HR personnel to: a. evaluate the most time-consuming tasks. b. examine the user-friendliness of the software. c. calculate the cost savings in using an HRIS. d. calculate the time required to train the HR staff. ANS: A 17. A needs assessment for IT investments should include all of the following except: a. Initial costs and annual maintenance. b. Who will have access to private records. c. Ability to upgrade. d. User friendly capability. ANS: B 18. In highly competitive environments, managing organizational change has become: a. a proactive method of downsizing. b. the preferred method of reacting to a decrease in organizational performance. c. a core competency of the organization. d. a product of globalization. ANS: C 19. Organizational changes are said to be ____ when external forces have already affected an organization's performance. a. proactive b. intentional c. reactive d. negative ANS: C 20. What change is initiated by management to take advantage of targeted opportunities? a. proactive b. intentional c. reactive d. negative ANS: A 21. Which of the following is not a primary reason why change efforts fail? a. The company does not establish a sense of urgency. b. The company relies upon a powerful coalition to guide the change effort. c. The company lacks a vision. d. The company does not remove obstacles to the new vision. ANS: B 22. To ensure that organizational change initiatives are successful, managers should: a. create a vision for the change effort. b. rely upon bottom-up emergence of change ideas. c. systematically plan for and create short term "wins." d. try to create a new culture to guide the change effort. ANS: C 23. According to Dr. Marilyn Buckner, the most frequent problem in failed change projects is: a. non-technical unattended human factors. b. failure to get the 'buy-in' of senior management. c. union opposition. d. declaring victory too soon. ANS: A 24. Which of the following is not a key element of successful change management planning? a. change is linked to business strategy. b. they lead clearly and consistently. c. they sell communication about the change. d. they engage key employees early. ANS: C 25. The value, skills, and capabilities that have a tremendous impact on an organization's performance but does not show up on its balance sheet are known as: a. intellectual capital. b. human capital. c. core competencies. d. employee capital. ANS: B 26. To manage employees in a manner that allows human capital to develop as a source of competitive advantage, managers need to be sure to do all of the following except: a. provide training programs that provide skill enhancement. b. identify, recruit, and hire the best talent available. c. attach pay to productivity. d. provide opportunities for development on the job. ANS: C 27. To build human capital in organizations, managers should rely upon staffing programs that focus on: a. identifying cheap sources of qualified labor. b. identifying and hiring the best and brightest talent available. c. identifying college graduates with the requisite skills. d. identifying individuals with highly specialized skills. ANS: B 28. To build human capital in organizations, training programs should focus on those skills that: a. cannot be transferred to another company if an employee should leave. b. require minimal levels of training effort. c. are widely applicable to many different firms within the organization's industry. d. can be taught in classroom settings. ANS: A 29. An employee's Human Capital belongs to ____. a. His/her employer b. The Employee c. The Federal Government d. None of these; Human Capital is not proprietary ANS: B 30. Managers have to find ways to empower employees and encourage their participation and involvement to more fully utilize human capital because: a. They are figured as part of training costs. b. Firms are moving away from team-based structures. c. Employee skills often go unused. d. Knowledge exchange is the best method of human capital development. ANS: C 31. A survey conducted by the Human Resource Planning Society revealed that ____ percent of the responding companies believe that their HR group plays an important role in developing human capital. a. less than 30 b. nearly 50 c. between 30 and 40 d. nearly 65 ANS: D 32. Methods that firms use to align their processes with their essential need to meet customer expectations include all of the following except: a. Total quality management. b. Six Sigma. c. Cost containment through outsourcing. d. Process reengineering. ANS: C 33. TQM: a. Focuses on understanding customer needs, doing things right the first time, and striving for continuous improvement. b. Uses statistical methods to translate customer needs into separate tasks and defining the best way to perform them. c. Fundamentally redesigns business processes to achieve improvements in cost, quality, service, and speed. d. Changes the purpose and function of the HR group. ANS: A 34. The ____ has provided the impetus for both large and small companies to rethink their approach to HRM. a. Malcolm Baldrige National Quality Award b. Peter F. Drucker Quality Initiative Award c. Deming Award for Quality d. Presidential Quality Initiative Award ANS: A 35. Six Sigma is a systematic approach to quality that: a. Focuses on understanding customer needs, doing things right the first time, and striving for continuous improvement. b. Uses statistical methods to translate customer needs into separate tasks and defining the best way to perform them. c. Fundamentally redesigns business processes to achieve improvements in cost, quality, service, and speed. d. Focuses on improving the HR function through six principles. ANS: B 36. The importance of Six Sigma to HR extends to all of the following except: a. employee benefits b. performance management c. communication d. training ANS: A 37. Reengineering: a. Focuses on understanding customer needs, doing things right the first time, and striving for continuous improvement. b. Uses statistical methods to translate customer needs into separate tasks and defining the best way to perform them. c. Fundamentally redesigns business processes to achieve improvements in cost, quality, service, and speed. d. Changes the purpose and function of the HR group. ANS: C 38. Reengineering often requires that managers start from scratch in rethinking all of the following except: a. how work should be done. b. how technology and people should interact. c. how the entire organization should be structured. d. how organizations should compete. ANS: D 39. Which of the following is one of the largest expenditures of service companies? a. production costs. b. marketing costs. c. labor costs. d. distribution costs. ANS: C 40. Which of the following is not an approach used by organizations to try to lower labor costs? a. productivity enhancements b. outsourcing c. employee leasing d. employee development ANS: D 41. What is the planned elimination of jobs? a. downsizing. b. outsourcing c. TQM d. reengineering ANS: A 42. Historically, which of the following workers have been hit the hardest by layoffs? a. line workers b. secretarial and clerical workers c. white-collar and managerial workers d. service workers ANS: A 43. Which of the following workers have been hit the hardest by layoffs since 1990’s? a. line workers b. secretarial and clerical workers c. white-collar and managerial workers d. service workers ANS: C 44. Layoffs can incur all of the following hidden costs except: a. pension and benefit payoffs b. increased training expenses c. loss of institutional memory and human capital d. a paranoid, political workforce ANS: B 45. Which one of the following is not an HR cost that is typically incurred as a result of downsizing? a. severance pay b. vacation and sick-day payouts c. outplacement expenditures d. developmental expenses ANS: D 46. A fiercely loyal workforce, a recruiting edge, and workers who aren't afraid to innovate are all benefits of: a. downsizing b. outsourcing c. companies that establish "no layoff" policies d. productivity enhancements ANS: C 47. Hiring someone outside the company to perform tasks that could be done internally is known as: a. outplacement. b. contracting. c. outsourcing. d. employee leasing. ANS: C 48. The practice of moving jobs overseas is known as: a. outplacement. b. offshoring. c. outsourcing. d. employee leasing. ANS: B 49. Outsourcing of key activities: a. contains costs for the firm b. can erode the key competencies of the firm c. results in improved service to employees and managers d. will not cause productivity or morale to drop rapidly ANS: B 50. A method of containing costs that allows firms to maintain working relationships while shifting administrative costs to another firm is known as ____. a. Outsourcing b. Employee Leasing c. Gainsourcing d. Professional employer organization ANS: B 51. Employee productivity be summarized as a function of all of the following except: a. Ability b. Motivation c. Environment d. Compensation ANS: D 52. It is anticipated that in the future, the American workforce will exhibit: a. about the same demographic mix as it does today. b. an increase in ethnic diversity. c. a decrease in ethnic diversity. d. a decrease in the number of older workers. ANS: B 53. Changes in demographics are important because they affect the employer and include all of the following except: a. Age b. Comparable Worth c. Employee Background d. Educational Level ANS: B 54. Between 2002 and 2012, the annual growth rate of 55-and-older group is expected to be ____ times the annual growth rate of the overall labor force. a. two b. three c. four d. five ANS: C 55. Managers are concerned that the expertise of employees will be rapidly drained from their companies because: a. recruitment of minorities is increasing b. large portions of some workforces are nearing retirement c. older workers' skills and performance decline d. older workers have higher absentee and accident rates ANS: B 56. Labor force demographics are expected to change in which of the following ways? a. Minorities will make up a smaller share of the U.S. labor force than they did in the past. b. Women will make up a smaller share of the U.S. labor force than they did in the past. c. Shrinking pool of entry-level workers. d. Increased use of temporary workers. ANS: C 57. The anticipated imbalance in the age distribution of the future labor force means that: a. there will be greater competition for advancement opportunities. b. there will be more workers available to support retirement benefits. c. there will be more career opportunities for the middle-aged employee. d. retraining workers will not be as important as it is today. ANS: A 58. Older workers: a. have lower performance than younger workers b. have higher performance than younger workers c. have lower training costs than younger workers d. learn new behaviors more quickly because of their experience ANS: C 59. By the year 2012, women will account for: a. nearly 48% of the labor force. b. the largest segment of the labor force. c. nearly 70% of the immigration of working age adults. d. the fastest growing group among Asians. ANS: A 60. Over the last few decades, the educational attainment of the U.S. labor force has: a. risen dramatically. b. fallen dramatically. c. remained at about the same level. d. had little influence on HRM. ANS: A 61. According to the Department of Labor, the average payoff in annual earnings from education has: a. declined. b. remained the same c. increased d. resulted in a higher literacy rate ANS: C 62. All of the following are business-related reasons for managing diversity except: a. better utilization of talent. b. enhanced creativity. c. increased quality of team problem solving. d. lower turnover and absenteeism. ANS: D 63. Managing diversity means: a. Recruiting and hiring more minorities. b. Being aware of characteristics common to employees and managing them as individuals. c. Tolerating differences. d. Accommodating differences. ANS: B 64. Which of the following does not represent a cultural change emerging in organizations? a. an increased concern for privacy b. changing attitudes toward work c. balancing work and family demands d. accommodating unemployed workers ANS: D 65. Employee rights include all of the following except: a. company funded pension plan. b. equal employment opportunity. c. union representation. d. equal pay for equal work. ANS: A 66. One of the first companies to show concern for handling of personal information about employees was: a. IBM b. Dell c. Home Depot d. American Express ANS: A 67. In an attitude survey of 3000 workers, 86 percent of workers said that ____ were their top priorities. a. work-life balance and being successful at work b. work fulfillment and work-life balance c. work fulfillment and being successful at work d. being successful at work and high pay ANS: B 68. Family friendly work options include all of the following except: a. day care. b. spousal benefits c. parental leave. d. job sharing. ANS: B 69. Which of the following is False? a. A majority of employees have no children under 18 b. Family friendly policies have no positive outcomes for firms. c. Flextime options are on the rise for employees. d. Family friendly policies may include day care, part-time work, and job sharing. ANS: B 70. In order to play a more active role in influencing change within organizations, HR departments must do all of the following except: a. serve as an employee advocate. b. become business partners with the entire organization. c. view themselves as primarily performing a service function. d. develop leadership capabilities. ANS: C 71. A firm’s top ____ manager is in a good position to be the “chief ethics officer” of an organization. a. HR b. Finance c. Production d. Marketing ANS: A 72. Consultation provided by the HR staff should not: a. be based on managerial expertise. b. be based on technical expertise. c. help managers or supervisors make firm decisions. d. conflict with the goals of the managers or supervisors seeking assistance. ANS: D 73. In general, HR managers do not: a. conduct performance evaluations of production employees. b. investigate accident reports. c. develop training programs. d. negotiate collective bargaining agreements. ANS: A 74. As an employee advocate, HR managers: a. formulate and issue policy revisions b. listen to employees and represent their needs to management. c. provide individual orientation and training to every employee. d. assist employees with labor negotiations. ANS: B 75. ____ is a competency of the HR manager that entails knowing the business of their organization thoroughly. One must understand its economic and financial capabilities as well as develop external relations skills focused on their customers. a. Change Mastery b. HR Mastery c. Business Mastery d. Personal Credibility ANS: C 76. ____ is a competency of the HR manager that involves innovativeness, creativity, interpersonal skills and problem-solving skills. These skills enable the HR professionals to manage the change process within the organization. a. Change Mastery b. HR Mastery c. Business Mastery d. Personal Credibility ANS: A 77. ____ is a competency of the HR manager earned by developing personal relationships with internal customers, by demonstrating the values of the firm, by standing up for one's own beliefs, and by being fair-minded in dealing with others. a. Change Mastery b. HR Mastery c. Business Mastery d. Personal Credibility ANS: D ESSAY 1. What are the six competitive challenges facing human resources management departments? ANS: The six competitive challenges facing human resources departments are (1) globalization, (2) embracing technology, (3) managing change, (4) managing human capital, (5) responding to the market, and (6) containing costs. 1. First, in order to grow and prosper, many companies are seeking business opportunities in global markets. HR issues underlie concerns related to managing diverse cultures, geographies, laws, and business practices. 2. Second, the introduction of advanced technology has created a shift from touch labor to knowledge workers, impacting the way in which workers are managed. In addition, technology has altered the methods of collecting employment information, speeding up the processing of that data, and improving the process of internal and external communication. 3. Third, to become faster and more adaptable, many organizations are seeking ways to manage change. Programs such as TQM, downsizing, reengineering, outsourcing, and the like are examples of changes that organizations are making to modify the way they operate to be more successful. Each of these change efforts depends heavily on the adjustment of HR practices to facilitate and manage evolving issues related to an organization's workforce. 4. Fourth, organizational success is increasingly recognized as resting upon a firm's ability to manage human capital. HR practices are the fundamental tools by which organizations build, enhance, and maintain their stock of human capital. 5. Fifth, meeting the demands of the market is an important criterion for organizational success. Management innovations such as TQM and reengineering represent two prominent approaches to responding to customer demands. 6. Finally, containing costs, especially labor costs, is an important component of organizational success. As a result, many firms have engaged in initiatives such as downsizing, outsourcing, and employee leasing as a means to realize greater cost controls. Each of these practices has significant implications for HR practices. For example, during a downsizing initiative, HR has an obligation to help maintain a healthy relationship between a company and its employees through services such as outplacement. 2. Why do change efforts fail in organizations? ANS: Research suggests that most of the major reasons for failure of change efforts are HR related. Some of the top reasons are: a. Not establishing a sense of urgency. b. Not creating a powerful coalition to guide the effort. c. Lacking leaders who have a vision. d. Lacking leaders who communicate the vision. e. Not removing obstacles to the new vision. f. Not systematically planning for and creating short-term “wins.” g. Declaring victory too soon h. Not anchoring changes in the corporate culture. Organizations that have been successful in engineering change typically build in the following key elements into their change process: a. They link the change to the business strategy. b. They create quantifiable benefits. c. They engage key employees, customers, and their suppliers early. d. They integrate required behavior changes. e. They lead clearly, unequivocally, and consistently. f. They invest to implement and sustain change. g. They communicate continuously and personally. h. They sell commitment to change, not communication about change. 3. Describe the HR impact of cost containment techniques on the firm. ANS: Because labor costs are often the largest expense of a firm, cost containment options often focus on labor cost reduction. Firms can try downsizing, outsourcing, employee leasing, and productivity enhancements. 1. Downsizing eliminates jobs entirely. Occasionally, downsized firms add new workers afterward. This can result from poor planning in cyclical hiring, or effective management by hiring new workers with skills the company now needs to compete. 2. Outsourcing occurs when the company hires someone outside the firm to perform tasks that could be done, or had been done internally. Outsourcing allows the firm to focus on what it does best and improving its core competencies, while lowering costs, increasing flexibility, and gaining access to expertise of others. 3. Employee leasing involves hiring workers through a professional employer organization (PEO) to perform specific tasks within its organization. It is similar to outsourcing, except workers stay in the same place, the firm purchasing the services, doing the same jobs, rather than at another location. In this way, firms can shift administrative costs to the PEO, while maintaining its own effective working relationships. 4. Productivity enhancements reduce costs by increasing the amount of the outputs produced by the current workforce. Raising labor costs by increasing pay may result in increased productivity and correspondingly lower unit costs. 4. What implications do the anticipated changes in age of the workforce have for the management of human resources? ANS: Demographically, the labor force is expected to age (with the aging of the baby boomers), creating a larger number of older workers and a shrinking pool of young workers. HRM implications for aging workers include increases in (1) the competition for entry level workers; (2) the costs of compensation, health care, and retirement benefits; (3) career plateauing and related motivational concerns; and (4) training techniques that help senior workers "unlearn" old behaviors while acquiring new ones. Diversity in the workplace will continue, with a higher proportion of women and minorities in the workforce. HRM efforts that will be required to accommodate the needs of these workers include (1) flexible schedules, parental leave, and day-care options for dual-career families; and (2) training for supervisors in the management of a diverse workforce. Educational levels are expected to rise, but functional and technological illiteracy will continue to be a problem for employers. HR managers will need to plan training programs to assist employees in attaining basic and developmental skills and overcoming these deficiencies. Managing diversity involves managing employees as individuals while maintaining awareness of characteristics common to all employees. 5. What are some of the key competencies needed by Human Resource Managers to become full business partners? ANS: As top executives expect HR managers to assume a broader role in overall organizational strategy, many of these managers will have to acquire a complementary set of competencies. These competencies are business mastery, HR mastery, change mastery, and personal credibility. 1. Business mastery. HR professionals need to know the business of their organization thoroughly. This required HR professionals to develop skills at customer focused external relations and an understanding of their organization’s economic and financial capabilities. These skills will enable them to join a team of “business managers” to develop the firm’s strategic direction. 2. HR mastery. HR professionals are a firm’s behavioral science experts. It is important that they are current with developments and changes in their professional field. 3. Change mastery. This is a competency of the HR manager that involves innovativeness, creativity, interpersonal skills and problem-solving skills. These skills enable the HR professionals to manage the change process effectively within the organization and ensure that HR activities support the business needs of the organization. 4. Personal credibility. This competency is earned by developing personal relationships with internal customers, by demonstrating the values of the firm, by standing up for one's own beliefs, and by being fair-minded in dealing with others.