Financial management strategies Chapter 14 Test Bank

Chapter 15

Test Bank

Type: true-false

Title: Chapter 15 Question 01

1) A geocentric staffing strategy assumes that management candidates must be searched for domestically.

a. True

b. False

Feedback: The answer is incorrect. A staffing strategy that emphasizes home country managers is an ethnocentric strategy

A-head reference: 15.3 Staffing policy

Type: multiple response question

Title: Chapter 15 Question 02

2) Citizens of a country other than host country or home country are termed _______

Feedback: Those who are not from the home or host country are termed "third-country" nationals.

A-head reference: 15.2 The challenges of international human resources management

a. migrants.

b. overseas contractors.

c. third-country nationals.

d. temporary employees.

Type: multiple choice question

Title: Chapter 15 Question 03

3) The process of moving back to the parent company and country from a foreign assignment and returning to familiar surroundings is known as _______

Feedback: The return from an overseas assignment is termed repatriation.

A-head reference: 15.4 Expatriate management

a. acclimatization.

b. assimilation.

c. acculturation.

d. repatriation.

Type: true-false

Title: Chapter 15 Question 04

4) The high level of interdependency between activities in a global value chain means that HRM within a global factory should always prioritize consistency.

a. True

b. False

Feedback: Correct. In some cases, such as the use of expatriates, some consistency is desirable. But when value adding activities are separable, or are undertaken by independent parties, the emphasis may be on adaptation to local conditions at the cost of some consistency.

A-head reference: 15.7 Compensation

Type: true-false

Title: Chapter 15 Question 05

5) Key to successful management of HR processes within a global factory is the ability to travel abroad.

a. True

b. False

Feedback: Correct. More plausible is the ability to identify key skills and competencies required for working overseas

A-head reference: 15.3 Staffing policy

Type: multiple choice question

Title: Chapter 15 Question 06

6) A _______ is a cross-functional group that focuses on a problem or issue but members also retain their formal positions.

Feedback: The correct response is b, as a project team draws upon particular sources of expertise, but the project is usually for a fixed period, after which staff return to their normal duties.

A-head reference: Topics for debate

a. self-managed team

b. project team

c. crisis response team

d. permanent team

Type: true-false

Title: Chapter 15 Question 07

7) For an international business that adds subsidiaries managed by locals, a polycentric staffing approach is appropriate.

a. True

Feedback: The statement is true because it describes what a polycentric strategy is and when it is appropriate

A-head reference: 15.3 Staffing policy

b. False

Type: true-false

Title: Chapter 15 Question 08

8) A polycentric staffing strategy is usually more expensive that sending expatriates abroad.

a. True

b. False

Feedback: This is false as a polycentric strategy is based on local recruitment, that is, people from the particular location are employed in the affiliate in that location. This is likely to result in lower costs that sending expatriates with their associated costs.

A-head reference: 15.3 Staffing policy

Type: multiple choice question

Title: Chapter 16 Question 09

9) Often the reason why expatriate assignments fail is because of _______

Feedback: The most likely reason for failure is an inability to adjust to cultural differences between the home and host locations.

A-head reference: 15.4 Expatriate management

a. homesickness.

b. jet lag.

c. cultural dissimilarities.

d. inadequate housing.

Type: true-false

Title: Chapter 15 Question 10

10) The inpatriation model is based on the idea of developing successful overseas managers by exposing them to headquarters practices.

a. True

Feedback: True. Inpatriation is increasingly part of a geocentric staffing strategy that ensures that overseas based managers have opportunities to interact with the company's HQ and most senior staff

A-head reference: 15.8 Repatriation

b. False

Type: true-false

Title: Chapter 15 Question 11

11) Trade unions have experienced difficulties gathering critical information on the operations of MNEs when mounting bargaining campaigns.

a. True

Feedback: This has been the experience of trade unions, and they have complained about the level of aggregation of information provided, the selective nature of information released, its timing, and the reliability of such information.

A-head reference: 15.11 International labour relations

b. False

Type: true-false

Title: Chapter 15 Question 12

12) A home based or balance sheet approach to expatriate compensation seeks to neutralize cost differences between home and host locations.

a. True

Feedback: The statement is true as this approach implements incentives to ensure the expatriate is no worse off.

A-head reference: 15.7 Compensation

b. False

Type: multiple choice question

Title: Chapter 15 Question 13

13) The idea of strategic IHRM is based on the idea that the competitive advantage of the organization can utilise _______

Feedback: The correct response is a), since competitive advantage results primarily from social, cultural, or human capital. Capturing the benefits of diversity is key to such advantages, which are likely to be more sustainable than those based on financial capital.

A-head reference: 15.7 Compensation

a. social, cultural and human capital.

b. financial and venture capital.

c. equity capital.

d. natural capital.

Type: true-false

Title: Chapter 15 Question 14

14) Within an international business, cultural differences will have no impact on a successful payment system.

a. True

b. False

Feedback: This statement is false since cultures differ in terms of their values and beliefs, views on justice and tolerance for inequality and so payment systems may need to be adapted to reflect such differences

A-head reference: 15.7 Compensation

Type: true-false

Title: Chapter 15 Question 15

15) Human resource management within a global factory is complicated by the need to adapt HR policies and procedures to account for differences among the locations in which activities are located.

a. True

Feedback: The statement is true because operating in diverse locations means that different HRM policies and practices are required, a single approach is extremely unlikely to be effective.

A-head reference: 15.10 Diversity and Equity

b. False

Type: true-false

Title: Chapter 15 Question 16

16) An organization's competitive advantage achieved through human resource management practices is likely to be more sustainable than one achieved by other means.

a. True

Feedback: Advantages that result from unique human capital, or the capabilities they create, are extremely difficult to emulate because they are characterized by invisibility, benefits of conjoint use (effective when combined with other assets), and ambiguity

A-head reference: 15.2 The challenges of international human resources management

b. False

Type: true-false

Title: Chapter 15 Question 17

17) An effective performance appraisal system can create competitive advantage by directing employee behaviour toward organizational goals.

a. True

Feedback: Organizational performance is likely to benefit from a high level of consistency between organizational and individual goals, so anything, such as performance appraisal that contributes to this, is likely to bring advantages

A-head reference: 15.6 Performance appraisal

b. False

Type: true-false

Title: Chapter 15 Question 18

18) Historically, relational and cross-cultural communication abilities of expatriates have been undervalued by MNEs.

a. True

Feedback: This statement is true, since many MNEs traditionally emphasized technical and functional skills over the so-called “softer skills”.

A-head reference: 15.5 International training and management development

b. False

Type: true-false

Title: Chapter 15 Question 19

19) Companies that operate internationally find that transplanting an existing performance appraisal system from head office is very effective.

a. True

b. False

Feedback: This is rarely true since any HR policy, including performance appraisal, needs to be adapted to the characteristics of the local operating environment.

A-head reference: 15.11 International labour relations

Type: true-false

Title: Chapter 15 Question 20

20) Hourly compensation costs are more advantageous for companies selecting Switzerland as investment location instead of Sweden

a. True

b. False

Feedback: This is false because as shown by table 15.3 Switzerland labour costs are higher than Sweden’s.

A-head reference: 15.11 International labour relations