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OBM practice questions

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Question 1Strategic Management and Business Policy

Which level of strategy is primarily concerned with deciding which businesses a diversified company should be in and how resources should be allocated among them?

  1. Corporate strategy Correct answer.
  2. Operational strategy
  3. Functional strategy
  4. Business strategy

Explanation

Corporate strategy sits at the top of the hierarchy and addresses the overall scope of the firm, including the portfolio of businesses it competes in and how capital and other resources flow between them. Business and functional strategies operate at lower levels within an already-chosen portfolio.

Question 2Strategic Management and Business Policy

A firm states that it will be the lowest-cost producer of commodity steel in its region. This statement is best described as a:

  1. Mission statement
  2. Code of ethics
  3. Vision statement
  4. Competitive strategy Correct answer.

Explanation

A competitive strategy specifies how the firm will win against rivals in a defined market, in this case through cost leadership. Mission and vision describe purpose and future aspiration rather than the route to competitive advantage.

Question 3Strategic Management and Business Policy

In a SWOT analysis, a firm's strong brand recognition among existing customers is classified as a:

  1. Strength Correct answer.
  2. Weakness
  3. Threat
  4. Opportunity

Explanation

SWOT separates internal attributes from external conditions: strengths and weaknesses are internal, while opportunities and threats arise in the environment. Brand recognition is an internal capability the firm already possesses, so it belongs in the strength category.

Question 4Strategic Management and Business Policy

According to Porter's five forces framework, which force is most directly increased when suppliers are few and their input is critical to the buyer's product?

  1. Bargaining power of buyers
  2. Threat of substitutes
  3. Bargaining power of suppliers Correct answer.
  4. Threat of new entrants

Explanation

Supplier power rises when inputs are concentrated in few hands and are important to the buyer, giving suppliers leverage over price and terms. The other forces describe entry, customer leverage, and alternative products rather than upstream dependence.

Question 5Strategic Management and Business Policy

A company grows by acquiring a chain of retail pharmacies even though it currently operates only hospitals. This move is best described as:

  1. Horizontal integration
  2. Vertical integration
  3. Conglomerate diversification
  4. Related diversification Correct answer.

Explanation

Diversification is related when the new business shares meaningful links such as customers, channels, or capabilities with existing operations. Health-care delivery and pharmacy retail share a health-care value chain and customer base, so the move extends rather than abandons existing linkages.

Question 6Strategic Management and Business Policy

In the BCG growth-share matrix, a business unit with high market share in a slow-growing industry is labeled a:

  1. Star
  2. Dog
  3. Cash cow Correct answer.
  4. Question mark

Explanation

The matrix classifies units by market growth and relative share. High share combined with low growth defines a cash cow, a unit that generates more cash than it consumes and can fund other units.

Question 7Strategic Management and Business Policy

The primary purpose of a strategic control system is to:

  1. Replace the annual budgeting process with continuous forecasting
  2. Determine the compensation of the chief executive officer
  3. Measure whether strategy is being implemented as intended and whether assumptions still hold Correct answer.
  4. Ensure that every employee follows standardized operating procedures

Explanation

Strategic control monitors both the execution of the chosen strategy and the continued validity of the premises behind it. It is distinct from operational controls that enforce procedural compliance or from financial planning processes.

Question 8Strategic Management and Business Policy

A firm's stated purpose, which answers why the organization exists and whom it serves, is known as its:

  1. Mission Correct answer.
  2. Budget
  3. Tactics
  4. Vision

Explanation

A mission defines the organization's fundamental purpose and the stakeholders it serves, guiding scope decisions. Vision instead describes an aspired future state, and tactics are short-term actions.

Question 9Strategic Management and Business Policy

A manufacturer of luxury watches emphasizes craftsmanship, exclusivity, and premium pricing rather than volume. Which generic strategy is it pursuing?

  1. Focused differentiation Correct answer.
  2. Cost leadership
  3. Broad cost leadership with parity
  4. Stuck in the middle

Explanation

Differentiation builds advantage through unique attributes that customers value enough to pay a premium, and a focus strategy narrows the target to a specific segment. Luxury watches target a narrow high-end segment with distinctive craftsmanship, so focused differentiation fits.

Question 10Strategic Management and Business Policy

Which condition most strongly supports the use of a differentiation strategy?

  1. The industry has severe overcapacity and price wars
  2. Technological change is so rapid that product features quickly become obsolete
  3. Many buyers value unique features and are willing to pay a premium Correct answer.
  4. Buyers are highly price sensitive and standard products meet their needs

Explanation

Differentiation pays off when a meaningful segment of buyers values distinctive attributes enough to accept a higher price, so the firm can recover the added cost of uniqueness. Price-sensitive buyers or commoditized products push firms toward cost competition instead.

Question 11Strategic Management and Business Policy

A firm enters a foreign market by licensing its technology to a local partner. Which trade-off best characterizes this entry mode?

  1. High control with high capital commitment
  2. Moderate control with no risk of creating a competitor
  3. Low control with low capital commitment Correct answer.
  4. High control with low risk

Explanation

Licensing requires little capital and limits exposure to unfamiliar markets, but the licensor surrenders operational control and may create a future rival. Entry modes trade off control, commitment, and risk along this continuum.

Question 12Strategic Management and Business Policy

In an industry where fixed costs are very high and marginal costs are low, which force tends to intensify rivalry?

  1. Rapid market growth that absorbs new capacity
  2. Strong product differentiation among competitors
  3. Low exit barriers combined with slow demand growth Correct answer.
  4. High storage costs for finished goods

Explanation

When demand grows slowly and exiting the industry is costly, firms stay and fight for share, often cutting prices toward marginal cost. High fixed costs amplify this pressure because each firm needs volume to cover its cost base.

Question 13Strategic Management and Business Policy

A resource is valuable, rare, and difficult to imitate, but the firm lacks the organizational routines to exploit it. According to the resource-based view, the resource will:

  1. Automatically become a core rigidity
  2. Fail to produce advantage because the firm cannot deploy it Correct answer.
  3. Generate only temporary advantage because competitors will copy it
  4. Still generate sustained competitive advantage because rarity dominates

Explanation

The resource-based framework requires that a resource be valuable, rare, inimitable, and organizationally supported to yield advantage. Without the routines and structures to exploit it, the potential value is not realized.

Question 14Strategic Management and Business Policy

A company's value chain analysis is most useful for:

  1. Setting the firm's dividend policy
  2. Choosing which board committees to establish
  3. Identifying where in the sequence of activities cost or differentiation advantage can be built Correct answer.
  4. Forecasting macroeconomic cycles

Explanation

Value chain analysis disaggregates the firm into primary and support activities so managers can locate where value is created or cost is incurred. This helps target improvement efforts at the activities that most affect competitive advantage.

Question 15Strategic Management and Business Policy

When a firm uses a joint venture to enter a market with restrictive foreign ownership rules, the main benefit is:

  1. Complete control over local operations
  2. Elimination of coordination costs between partners
  3. Shared risk and local knowledge while satisfying ownership requirements Correct answer.
  4. Guaranteed protection of proprietary technology

Explanation

Joint ventures allow firms to share capital and risk and to access a local partner's knowledge and relationships, which is valuable where regulation limits foreign ownership. The trade-off is shared control and potential conflict over objectives.

Question 16Strategic Management and Business Policy

A firm's strategy is to serve a narrow niche of customers with highly customized products. Which of Porter's five forces is most likely to be weakened by this positioning?

  1. Bargaining power of buyers
  2. Threat of new entrants
  3. Bargaining power of suppliers
  4. Rivalry from broad-line mass-market competitors Correct answer.

Explanation

Focusing on a niche with customized offerings reduces direct overlap with mass-market rivals, lowering the intensity of rivalry the firm faces. Niche positioning does not by itself reduce supplier power, buyer power, or entry threats.

Question 17Strategic Management and Business Policy

In the Ansoff product-market matrix, selling existing products to new customers in new geographic markets is:

  1. Diversification
  2. Market penetration
  3. Product development
  4. Market development Correct answer.

Explanation

The matrix crosses products with markets. Keeping the existing product but reaching new markets defines market development, which carries moderate risk because the offering is already proven.

Question 18Strategic Management and Business Policy

A firm's top managers set ambitious growth targets and reward only short-term sales results, leading business units to pursue risky acquisitions. This situation best illustrates:

  1. Economics of scale in distribution
  2. Technological substitution
  3. Agency problems arising from misaligned incentives Correct answer.
  4. A strong culture that supports strategy

Explanation

Agency problems occur when managers pursue their own interests, such as hitting incentive targets, rather than the owners' long-term interests. Incentive structures that reward short-term sales can encourage excessive risk-taking, showing a governance and control failure.

Question 19Strategic Management and Business Policy

Which statement best distinguishes a deliberate strategy from an emergent strategy?

  1. Emergent strategy is formulated only by the board of directors
  2. Deliberate strategy is realized through intended plans, while emergent strategy arises from patterns of decisions over time Correct answer.
  3. Deliberate strategy applies only to small firms
  4. Deliberate strategy is always more profitable than emergent strategy

Explanation

Deliberate strategy is the realized portion of what leaders intended, whereas emergent strategy develops from a stream of decisions and actions that were not part of the original plan. Most realized strategies combine elements of both.

Question 20Strategic Management and Business Policy

A firm competes in a mature industry with slow growth, many similar products, and price-sensitive customers. Which action is most consistent with a cost leadership strategy?

  1. Launching limited-edition premium product lines
  2. Reducing capacity to raise prices through scarcity
  3. Investing in continuous process improvement to lower unit costs Correct answer.
  4. Increasing advertising to build an exclusive brand image

Explanation

Cost leadership requires the firm to be the low-cost producer, which in a mature industry is achieved through efficiency gains in processes, scale, and experience. Premium branding and scarcity pricing are differentiation moves that conflict with a volume-oriented cost position.

Question 21Strategic Management and Business Policy

An analysis shows a firm's core capability is valuable and rare but easily imitated by competitors. What outcome should be expected?

  1. Permanent monopoly position
  2. Sustained competitive advantage
  3. Temporary competitive advantage Correct answer.
  4. No competitive advantage at all

Explanation

Value and rarity can produce an advantage, but easy imitation means rivals will quickly erode it, so the advantage is temporary. Sustained advantage requires barriers to imitation and organizational support.

Question 22Strategic Management and Business Policy

A diversified firm's corporate parent adds little value to its business units but imposes heavy reporting requirements and central overhead. This pattern is best described as:

  1. Value-destroying corporate parenting Correct answer.
  2. Financial economies of scope
  3. Synergy creation through shared services
  4. Parenting advantage

Explanation

Corporate parenting adds value only when the parent's influence improves unit performance more than alternative ownership would. When the parent adds bureaucracy and cost without improving unit competitiveness, it destroys rather than creates value.

Question 23Strategic Management and Business Policy

Two competitors both pursue differentiation, but one enjoys a first-mover advantage in a market with strong network effects. What is the most likely consequence?

  1. First-mover status guarantees permanent advantage regardless of execution
  2. The leader's advantage may become self-reinforcing as more users increase the value of its offering Correct answer.
  3. The follower can easily match the leader's position because differentiation is imitable
  4. Network effects reduce the value of differentiation and push both firms toward cost leadership

Explanation

Network effects make a product more valuable as more users adopt it, so an early lead can create a self-reinforcing cycle that is hard for followers to break. The advantage still depends on continued execution and on the strength of the network effect.

Question 24Strategic Management and Business Policy

A firm operates in an industry where buyers have strong bargaining power and suppliers are fragmented. Which strategic response is most defensible?

  1. Build switching costs and differentiated features that reduce buyer leverage Correct answer.
  2. Reduce product variety to lower costs and accept commodity status
  3. Raise prices to offset buyer pressure without changing the offering
  4. Increase dependence on a single large customer to secure volume

Explanation

When buyers hold power, firms can counter it by creating switching costs, differentiating the offering, or broadening the customer base so no single buyer dominates. These moves reduce the credible threat of customers extracting concessions.

Question 25Strategic Management and Business Policy

A conglomerate's businesses share few operational links, yet headquarters claims synergy from centralized capital allocation. Which condition is most necessary for this claim to hold?

  1. Business units must be prevented from accessing external capital markets
  2. Each business unit must operate in the same industry as the others
  3. The conglomerate must centralize all operating decisions in headquarters
  4. Headquarters must possess superior information and discipline in allocating capital compared with external markets Correct answer.

Explanation

Financial synergy from internal capital allocation requires that headquarters allocate funds better than external capital markets would, typically through superior information and discipline. Without that advantage, diversification adds complexity and cost without adding value.

Question 26Strategic Management and Business Policy

A firm's mission statement primarily serves which purpose?

  1. To specify the detailed operating procedures for each department
  2. To communicate the organization's fundamental purpose and scope of activities Correct answer.
  3. To list the technical qualifications required for each job
  4. To project next quarter's financial results

Explanation

A mission statement articulates an organization's raison d'être, defining what it does, whom it serves, and the values that guide its strategic decisions. It provides a shared sense of direction that helps align stakeholders and set boundaries for strategy formulation.

Question 27Strategic Management and Business Policy

Which of the following best describes the role of a SWOT analysis in strategic management?

  1. It guarantees that a firm will achieve a sustainable competitive advantage.
  2. It provides a snapshot of internal strengths and weaknesses and external opportunities and threats to inform strategy formulation. Correct answer.
  3. It replaces the need for setting long-term objectives.
  4. It focuses exclusively on financial ratio analysis.

Explanation

SWOT analysis synthesizes internal capabilities (strengths and weaknesses) with external environmental conditions (opportunities and threats) to create a foundation for matching the firm's resources to its environment. It is a diagnostic tool that feeds strategy formulation, not a guarantee of success or a substitute for objectives.

Question 28Strategic Management and Business Policy

A firm competes in an industry where the threat of new entrants is high. According to Porter's five forces framework, which action would most directly reduce this threat?

  1. Lobbying for stricter government licensing requirements Correct answer.
  2. Investing in exclusive long-term contracts with key suppliers
  3. Lowering prices to gain market share
  4. Increasing advertising expenditure to build brand recognition

Explanation

The threat of new entrants is influenced by barriers to entry, and government licensing requirements are a regulatory barrier that can restrict the number of competitors. By lobbying for stricter licensing, the firm raises entry barriers, directly reducing the threat of new entrants.

Question 29Strategic Management and Business Policy

A company is deciding whether to diversify into a new industry. Which criterion is most consistent with the resource-based view for evaluating this decision?

  1. The new industry should be unrelated to current operations to spread risk.
  2. The new industry should have low rivalry intensity.
  3. The diversification should leverage existing valuable, rare, and inimitable resources. Correct answer.
  4. The diversification should be financed primarily through debt.

Explanation

The resource-based view holds that competitive advantage stems from resources that are valuable, rare, and difficult to imitate. Diversification is most likely to create value when it allows the firm to apply such resources to new markets, exploiting economies of scope and leveraging core competencies.

Question 30Strategic Management and Business Policy

A firm operates in a stable industry but faces increasing competition from low-cost global rivals. Its current strategy emphasizes premium quality and high margins. Which strategic response is most consistent with a differentiation strategy under these conditions?

  1. Focusing on a narrow customer segment with highly customized products
  2. Reducing product features to lower costs and appeal to price-sensitive customers
  3. Outsourcing production to low-cost countries to match competitor prices
  4. Enhancing unique product attributes and building a strong brand image to justify a premium price Correct answer.

Explanation

A differentiation strategy seeks to create a perceived unique product or service that commands a premium price. When facing low-cost rivals, the firm should reinforce differentiation by investing in attributes that customers value and are willing to pay for, rather than competing on price.

Question 31Organizational Behavior and Human Resource Management

Which discipline contributed the idea that behavior is shaped by observable consequences rather than inner mental states?

  1. Psychoanalysis
  2. Behaviorism Correct answer.
  3. Humanistic psychology
  4. Gestalt psychology

Explanation

Behaviorism, associated with Skinner and others, holds that psychology should study observable stimuli and responses, and that consequences such as reinforcement and punishment shape behavior. This contributed the reinforcement and feedback concepts used in organizational behavior modification. The other traditions focus on unconscious drives, self-actualization, or perceptual wholes rather than environmental contingencies.

Question 32Organizational Behavior and Human Resource Management

In a typical five-stage model of team development, during which stage do members first clarify roles and settle disagreements about leadership?

  1. Performing
  2. Forming
  3. Storming Correct answer.
  4. Norming

Explanation

In the storming stage, intragroup conflict emerges as members push back against imposed structures and compete over influence and roles. Forming is polite orientation, norming is when cohesion and shared norms solidify, and performing is when the group focuses on task accomplishment. Recognizing that conflict is expected at storming helps leaders avoid treating it as failure.

Question 33Organizational Behavior and Human Resource Management

According to Herzberg's two-factor theory, which factor is a motivator rather than a hygiene factor?

  1. Company policy
  2. Working conditions
  3. Recognition for achievement Correct answer.
  4. Salary level

Explanation

Herzberg separated job context factors, which prevent dissatisfaction, from job content factors, which produce satisfaction and motivation. Recognition, achievement, responsibility, and growth are motivators tied to the work itself. Policy, pay, and working conditions are hygiene factors whose improvement mainly reduces dissatisfaction.

Question 34Organizational Behavior and Human Resource Management

Which term describes the tendency of interviewers to let one strongly favorable or unfavorable characteristic of a candidate color their overall judgment?

  1. Similarity bias
  2. Halo effect Correct answer.
  3. Contrast effect
  4. Recency effect

Explanation

The halo effect occurs when a single salient trait, such as appearance or one strong answer, spreads to influence ratings of unrelated qualities. Contrast effects arise from comparison with other candidates, similarity bias from shared traits with the rater, and recency from ordering of information. Structured, behaviorally anchored rating scales help reduce halo error.

Question 35Organizational Behavior and Human Resource Management

A manager rewards only the top salesperson each quarter while asking the whole team to share leads. Which element of the organization's reward system is misaligned with the requested behavior?

  1. The training budget
  2. The performance criteria used to allocate rewards Correct answer.
  3. The base pay structure
  4. The employee benefits package

Explanation

Reward systems signal which behaviors matter, so rewarding only individual sales volume contradicts a request for cooperative lead sharing. Alignment requires that performance criteria include the cooperative behavior being asked for. Base pay, benefits, and training budgets do not directly specify which behaviors are recognized and rewarded.

Question 36Organizational Behavior and Human Resource Management

Which source of power is based on a manager's formal position in the hierarchy rather than on personal qualities?

  1. Referent power
  2. Legitimate power Correct answer.
  3. Expert power
  4. Coercive power

Explanation

Legitimate power derives from the formal authority attached to a position, so subordinates comply because the role is recognized as rightful. Expert power rests on knowledge, referent power on identification and liking, and coercive power on the ability to punish. Position-based authority persists regardless of who occupies the role.

Question 37Organizational Behavior and Human Resource Management

Which conflict-handling style involves giving up one's own concerns to satisfy the other party's concerns?

  1. Avoiding
  2. Accommodating Correct answer.
  3. Compromising
  4. Competing

Explanation

Accommodating is high on concern for the other party and low on concern for self, so one side yields. Competing is the opposite pattern, compromising splits differences, and avoiding sidesteps the issue entirely. Accommodating suits issues that matter more to the other party or when preserving harmony is paramount.

Question 38Organizational Behavior and Human Resource Management

Which type of organizational justice concerns the perceived fairness of the amount and distribution of outcomes such as pay?

  1. Distributive justice Correct answer.
  2. Informational justice
  3. Procedural justice
  4. Interactional justice

Explanation

Distributive justice focuses on whether outcomes are allocated fairly relative to contributions and comparisons. Procedural justice concerns the fairness of the decision process, while interactional and informational justice concern the quality and honesty of interpersonal treatment. Employees often react to unfair outcomes differently than to unfair processes.

Question 39Organizational Behavior and Human Resource Management

A firm wants a selection test that predicts future job performance well. Which property is it most concerned with?

  1. Test-retest reliability
  2. Criterion-related validity Correct answer.
  3. Internal consistency
  4. Inter-rater agreement

Explanation

Criterion-related validity reflects how strongly test scores relate to a criterion such as later performance or training success. Reliability concerns consistency of measurement and is necessary but not sufficient for validity. Internal consistency and inter-rater agreement are reliability estimates, not evidence of predictive accuracy.

Question 40Organizational Behavior and Human Resource Management

A job analysis produces a list of tasks, duties, and responsibilities. Which document is built directly from that information to describe the role to applicants?

  1. Succession plan
  2. Job specification
  3. Performance appraisal form
  4. Job description Correct answer.

Explanation

The job description summarizes duties, working conditions, and reporting relationships derived from job analysis. The job specification instead lists the knowledge, skills, and abilities a person needs, which also comes from analysis but describes the person rather than the work. Appraisal forms and succession plans serve later performance and staffing purposes.

Question 41Organizational Behavior and Human Resource Management

According to goal-setting theory, which goal characteristic most consistently improves performance when ability and commitment are present?

  1. Assignment by peers rather than supervisors
  2. Ease of attainment
  3. Specificity and moderate difficulty Correct answer.
  4. Ambiguity and flexibility

Explanation

Specific, moderately difficult goals direct attention, mobilize effort, encourage persistence, and prompt strategy development. Vague or easy goals provide little motivational pull, and peer assignment is not the defining property. Goal commitment and feedback remain necessary conditions for the effect.

Question 42Organizational Behavior and Human Resource Management

An employee compares her pay with that of a coworker doing similar work and reduces her effort after finding the coworker earns more. Which theory best explains this reaction?

  1. Equity theory Correct answer.
  2. Expectancy theory
  3. ERG theory
  4. Reinforcement theory

Explanation

Equity theory holds that people compare their outcome-to-input ratio with a referent and act to restore equity when they perceive imbalance. Reducing effort is one way to lower one's inputs and restore perceived balance. Expectancy theory addresses effort-to-performance beliefs, reinforcement theory addresses consequences, and ERG theory addresses need categories.

Question 43Organizational Behavior and Human Resource Management

A supervisor gives an employee a bonus after every fifth sale completed. Which reinforcement schedule is being used?

  1. Fixed-ratio Correct answer.
  2. Variable-interval
  3. Fixed-interval
  4. Variable-ratio

Explanation

A fixed-ratio schedule delivers reinforcement after a set number of responses, here every fifth sale. Interval schedules are time-based rather than response-based, and variable schedules make the criterion unpredictable. Ratio schedules generally produce higher response rates than interval schedules.

Question 44Organizational Behavior and Human Resource Management

Which leadership approach assumes that effective leaders adapt their style to the readiness and ability of followers on a given task?

  1. Transactional leadership
  2. Situational leadership Correct answer.
  3. Charismatic leadership
  4. Trait theory

Explanation

Situational leadership proposes that leaders adjust task and relationship behavior to follower readiness for a specific task. Trait theory seeks stable personal attributes, transactional leadership exchanges rewards for performance, and charismatic leadership relies on inspiration and personal appeal. The contingency on follower readiness is the defining feature.

Question 45Organizational Behavior and Human Resource Management

A team member privately believes the group's chosen approach is flawed but says nothing during the meeting. This behavior illustrates which concept?

  1. Role ambiguity
  2. Social loafing
  3. Group polarization
  4. Groupthink symptoms of self-censorship Correct answer.

Explanation

Groupthink includes self-censorship, in which members withhold doubts to preserve apparent consensus. Social loafing is reduced individual effort in groups, polarization is a shift toward more extreme positions after discussion, and role ambiguity concerns unclear expectations. Practices such as devil's advocacy and leader impartiality reduce self-censorship.

Question 46Organizational Behavior and Human Resource Management

Which dimension of the Big Five personality model is most strongly associated with organization, dependability, and achievement striving?

  1. Conscientiousness Correct answer.
  2. Neuroticism
  3. Openness to experience
  4. Agreeableness

Explanation

Conscientiousness captures self-discipline, orderliness, and dependability, and it shows consistent links with job performance across occupations. Agreeableness concerns cooperation and trust, openness concerns curiosity and imagination, and neuroticism concerns emotional instability. Conscientiousness is the strongest general personality predictor of performance.

Question 47Organizational Behavior and Human Resource Management

In the Myers-Briggs type framework, a person who prefers to focus on concrete facts and present realities rather than possibilities is classified as which type?

  1. Perceiving
  2. Intuitive
  3. Sensing Correct answer.
  4. Judging

Explanation

The sensing-intuition dimension contrasts preference for concrete, factual information with preference for patterns and possibilities. Judging and perceiving describe orientation toward planning and closure versus flexibility and spontaneity. Sensing types attend to present, tangible data rather than inferred meanings.

Question 48Organizational Behavior and Human Resource Management

Which action best illustrates employee involvement in decision making rather than mere information sharing?

  1. Having employees vote on which process improvement to implement Correct answer.
  2. Posting quarterly results on the intranet
  3. Sending a memo describing a new policy
  4. Holding a town hall where leaders announce plans

Explanation

Involvement means employees influence decisions, such as through voting or consultative input that shapes the outcome. Information sharing and announcements only transmit decisions already made. Voting gives real influence and therefore qualifies as participation.

Question 49Organizational Behavior and Human Resource Management

A firm links a portion of each employee's pay to team-level quality metrics. Which outcome is most consistent with expectancy theory predictions?

  1. Employees will ignore the metrics because pay is not a motivator
  2. Employees will be satisfied regardless of whether they value the reward
  3. Employees will reduce effort because team metrics create social loafing
  4. Employees will work harder if they believe their effort improves quality and that quality is rewarded Correct answer.

Explanation

Expectancy theory predicts effort when employees believe effort leads to performance, performance leads to outcomes, and the outcomes are valued. All three conditions must hold for motivation to be high. Team metrics can weaken the effort-performance link if individual contributions are hard to see, but that is a contingency rather than the general prediction.

Question 50Organizational Behavior and Human Resource Management

An organization designs jobs so that employees complete a whole product, receive feedback, and use several skills. Which job design model does this most directly reflect?

  1. Telework arrangement
  2. Job rotation
  3. Job enrichment based on the job characteristics model Correct answer.
  4. Scientific management

Explanation

The job characteristics model identifies skill variety, task identity, task significance, autonomy, and feedback as core dimensions that raise meaningfulness, responsibility, and knowledge of results. Job enrichment redesigns work to increase these dimensions. Scientific management simplifies tasks, rotation moves people among tasks, and telework concerns location.