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SHRM-CP Certification Exam Questions 2023 - Day 20
1. Business Analysis What is the best description of an information system portal?
A) User-customized search engine
B) Organization's access to the Internet
C) Screen area in which data can be entered into the system
D) User's point of access to system data and applicationsÂ
2. What type of analytical task would be best served by online analytical processing (OLAP)?
A) Trying to establish a declining trend in the use of a wellness program
B) Identifying how many employees have quit in each functional area
C) Exploring the types of variables that may be affecting attendance rates
D) Proving the cost-effectiveness of purchasing an HR application
3. What is the key benefit of an enterprise resource planning (ERP) system over function-based stand-alone systems?
A) Shared, current database for all departmentsÂ
B) Forecasting capabilities to run planning scenarios
C) User-customized data interfaces for greater security
D) Greater analytical power and capabilities
4. What are the key components of a business intelligence system?
A) Input, processing, output
B) Data gathering, data warehousing, query and reporting
C) User interface, access to the Internet, integrated database
D) Accuracy, currency, and completeness
5. Refer to the following scenario for the next 4 questions. The annual loss ratio for a company's health plan is a staggering 158%. The head of HR has been asked by the CEO to propose changes to the plan that will lower costs while retaining as many of the current benefits as possible. An actuarial review reveals that the riders for dental and prescription drug coverage account for 84% of the plan's claims and that three employees in a workforce of 91 account for 73% of the claims. After reviewing a series of benefit options, the head of HR decides that the best option is a plan that doubles the deductibles on the dental and prescription benefits while also lowering the maximum reimbursement coverage by 25%. She makes a presentation outlining this suggestion to the company's executive committee. After a brief discussion of the rationale and the merits, the chief operating officer mentions that the company should announce the plan's changes to employees immediately. The head of HR responds that doing so would risk defeating the purpose of the changes. Without further discussion, the executive committee proceeds to vote and accepts the changes to become effective upon plan renewal the following month. Two months after the introduction of the new plan, it is discovered that two employees made bulk prescription purchases (a six-month supply) one week prior to the changes in the benefit plan going into effect. This seems a peculiar coincidence, and the head of HR suspects a leak of confidential information. Why would announcing any plan changes to employees in this way be problematic?
A) A. Incentivizing use just prior to a change could increase the loss ratio even further, requiring even more funding adjustments to make the plan sustainable.
B) B. The plan's normal renewal date must be allowed to transpire in order to verify, without bias, that yearly use rates are in fact occurring naturally.
C) C. The terms and conditions of a benefit provider require a blackout period to avoid insider information about the change being leaked.
D) D. It would be inappropriate to announce any pending policy changes until they become official and are implemented.
6. How should the company react to the employees who are using the benefits excessively?
A) A. Confidentially meet with the employees responsible and advise them that their use was the main reason why the plan had to change for everyone.
B) B. In order to avoid conflict, nothing should be done; the plan should be changed and no reason should be given to the employees.
C) C. Wait until the plan changes are in effect and then hold a company-wide meeting using aggregated data to explain why the changes are necessary.
D) D. Issue disciplinary action to those employees who have used the benefits in excess of normal use.
7. Why should the company remain with the benefit provider?
A) A. If benefit entitlements remain similar, finding and using a new benefit provider would not address the root cause as measured by the loss ratio.
B) B. A request for proposal to find a new benefit provider can take several months to finalize and may not provide a comparable plan at a cheaper rate.
C) C. It is unlikely that another benefit provider would accept the company's business without a thorough analysis of the previous year's use rates.
D) D. To ensure a minimum break-even, any new insurance provider will quote and charge at a rate that is equal to or more than that of the previous provider.
8. What is the first step the head of HR should take to handle the suspected leak of confidential information?
A) A. Suspend the chief operating officer for leaking confidential information about a pending policy change.
B) B. Because there is no proof that a leak occurred, no action can be taken accusing employees at any level of leaking confidential information.
C) C. HR should confidentially interview the employees who used the benefits just prior to the changes to assess their rationale.
D) D. Ask the executive committee to hold an emergency meeting to investigate who leaked the information about the benefit plan changes.
9. Refer to the following scenario for the next 4 questions. A clothing retail company with three locations in a popular beach resort area has been in business for over three years. There are two similar retailers in the same beach town competing for the same customers and labor pool. Recently the company has had extensive growth due to a new clothing design. Despite the growth in sales, their turnover is high. Employees do not stay longer than 90 days, as the competition is enticing sales staff away. Turnover is now affecting their customer satisfaction and increasing the workload on the remaining staff. Most of the management staff started as sales floor employees and received little to no management training. One of the key criteria used in promoting staff is their success on the sales floor, leading to complaints of internal selection unfairness. Recent exit interviews suggest low morale, poor leadership, and lack of work/life balance as the top three reasons for leaving the company. Knowing that there are plans to launch two new product lines in the near future, the CEO has asked the HR director to search and find a new supplier to provide new employee orientation for all new sales staff. Twenty companies have submitted requests for proposals, and the CEO wants a short list to be presented in the next two days. What steps should the HR director take to develop a short list of possible training vendors?
A) A. Conduct an online search of the best training companies and send the resulting list to the CEO.
B) B. Rank the companies in regard to their prices and present the five lowest bids, as cost is an issue.
C) C. Determine, with the CEO, key criteria that should be considered, using this information to narrow the search.
D) D. Ask for input on the short list from another employee who has done this type of training before.
10. What action should the HR director take first to create a robust workforce plan that addresses the expected organizational growth?
A) A. Ensure that all recruiters are well trained in sourcing and selecting qualified applicants for a retail sales organization.
B) B. Review environmental conditions in regard to expected tourists and expected sales growth, and calculate the number of employees needed.
C) C. Review internal turnover, promotions, and transfer data to calculate the number of employees needed to meet future staffing needs.
D) D. Analyze current labor trends along with internal staffing metrics to ensure appropriate staffing levels to meet expected organizational growth.
A) User-customized search engine
B) Organization's access to the Internet
C) Screen area in which data can be entered into the system
D) User's point of access to system data and applicationsÂ
2. What type of analytical task would be best served by online analytical processing (OLAP)?
A) Trying to establish a declining trend in the use of a wellness program
B) Identifying how many employees have quit in each functional area
C) Exploring the types of variables that may be affecting attendance rates
D) Proving the cost-effectiveness of purchasing an HR application
3. What is the key benefit of an enterprise resource planning (ERP) system over function-based stand-alone systems?
A) Shared, current database for all departmentsÂ
B) Forecasting capabilities to run planning scenarios
C) User-customized data interfaces for greater security
D) Greater analytical power and capabilities
4. What are the key components of a business intelligence system?
A) Input, processing, output
B) Data gathering, data warehousing, query and reporting
C) User interface, access to the Internet, integrated database
D) Accuracy, currency, and completeness
5. Refer to the following scenario for the next 4 questions. The annual loss ratio for a company's health plan is a staggering 158%. The head of HR has been asked by the CEO to propose changes to the plan that will lower costs while retaining as many of the current benefits as possible. An actuarial review reveals that the riders for dental and prescription drug coverage account for 84% of the plan's claims and that three employees in a workforce of 91 account for 73% of the claims. After reviewing a series of benefit options, the head of HR decides that the best option is a plan that doubles the deductibles on the dental and prescription benefits while also lowering the maximum reimbursement coverage by 25%. She makes a presentation outlining this suggestion to the company's executive committee. After a brief discussion of the rationale and the merits, the chief operating officer mentions that the company should announce the plan's changes to employees immediately. The head of HR responds that doing so would risk defeating the purpose of the changes. Without further discussion, the executive committee proceeds to vote and accepts the changes to become effective upon plan renewal the following month. Two months after the introduction of the new plan, it is discovered that two employees made bulk prescription purchases (a six-month supply) one week prior to the changes in the benefit plan going into effect. This seems a peculiar coincidence, and the head of HR suspects a leak of confidential information. Why would announcing any plan changes to employees in this way be problematic?
A) A. Incentivizing use just prior to a change could increase the loss ratio even further, requiring even more funding adjustments to make the plan sustainable.
B) B. The plan's normal renewal date must be allowed to transpire in order to verify, without bias, that yearly use rates are in fact occurring naturally.
C) C. The terms and conditions of a benefit provider require a blackout period to avoid insider information about the change being leaked.
D) D. It would be inappropriate to announce any pending policy changes until they become official and are implemented.
6. How should the company react to the employees who are using the benefits excessively?
A) A. Confidentially meet with the employees responsible and advise them that their use was the main reason why the plan had to change for everyone.
B) B. In order to avoid conflict, nothing should be done; the plan should be changed and no reason should be given to the employees.
C) C. Wait until the plan changes are in effect and then hold a company-wide meeting using aggregated data to explain why the changes are necessary.
D) D. Issue disciplinary action to those employees who have used the benefits in excess of normal use.
7. Why should the company remain with the benefit provider?
A) A. If benefit entitlements remain similar, finding and using a new benefit provider would not address the root cause as measured by the loss ratio.
B) B. A request for proposal to find a new benefit provider can take several months to finalize and may not provide a comparable plan at a cheaper rate.
C) C. It is unlikely that another benefit provider would accept the company's business without a thorough analysis of the previous year's use rates.
D) D. To ensure a minimum break-even, any new insurance provider will quote and charge at a rate that is equal to or more than that of the previous provider.
8. What is the first step the head of HR should take to handle the suspected leak of confidential information?
A) A. Suspend the chief operating officer for leaking confidential information about a pending policy change.
B) B. Because there is no proof that a leak occurred, no action can be taken accusing employees at any level of leaking confidential information.
C) C. HR should confidentially interview the employees who used the benefits just prior to the changes to assess their rationale.
D) D. Ask the executive committee to hold an emergency meeting to investigate who leaked the information about the benefit plan changes.
9. Refer to the following scenario for the next 4 questions. A clothing retail company with three locations in a popular beach resort area has been in business for over three years. There are two similar retailers in the same beach town competing for the same customers and labor pool. Recently the company has had extensive growth due to a new clothing design. Despite the growth in sales, their turnover is high. Employees do not stay longer than 90 days, as the competition is enticing sales staff away. Turnover is now affecting their customer satisfaction and increasing the workload on the remaining staff. Most of the management staff started as sales floor employees and received little to no management training. One of the key criteria used in promoting staff is their success on the sales floor, leading to complaints of internal selection unfairness. Recent exit interviews suggest low morale, poor leadership, and lack of work/life balance as the top three reasons for leaving the company. Knowing that there are plans to launch two new product lines in the near future, the CEO has asked the HR director to search and find a new supplier to provide new employee orientation for all new sales staff. Twenty companies have submitted requests for proposals, and the CEO wants a short list to be presented in the next two days. What steps should the HR director take to develop a short list of possible training vendors?
A) A. Conduct an online search of the best training companies and send the resulting list to the CEO.
B) B. Rank the companies in regard to their prices and present the five lowest bids, as cost is an issue.
C) C. Determine, with the CEO, key criteria that should be considered, using this information to narrow the search.
D) D. Ask for input on the short list from another employee who has done this type of training before.
10. What action should the HR director take first to create a robust workforce plan that addresses the expected organizational growth?
A) A. Ensure that all recruiters are well trained in sourcing and selecting qualified applicants for a retail sales organization.
B) B. Review environmental conditions in regard to expected tourists and expected sales growth, and calculate the number of employees needed.
C) C. Review internal turnover, promotions, and transfer data to calculate the number of employees needed to meet future staffing needs.
D) D. Analyze current labor trends along with internal staffing metrics to ensure appropriate staffing levels to meet expected organizational growth.
1. Right Answer: D
Explanation: An information system portal is the point of entry for a user into an information system. The system does not need to be web-hosted. It may provide access to the system's search engine, but it is not a search engine. It may be customized to users.
2. Right Answer: C
Explanation: OLAP allows the analyst to sort data quickly in different ways, according to different and multiple variables. A conventional relational database would be sufficient to identify a trend in one factor or numbers in different departments. A cost-effectiveness analysis could be done on a spreadsheet.
3. Right Answer: A
Explanation: An ERP integrates current data from across an organization's functional areas, while a stand-alone system would require a customized bridge to access the ERP database. Integrated data enables more thorough analysis. Stand-alone systems can provide significant analytical power. Customization and forecasting can be performed in integrated and stand-alone systems.
4. Right Answer: B
Explanation: A business intelligence system has three components: a means to gather information from various data collection points, a secure means of storing or warehousing data so that it is available to users, and the means to analyze the data via queries and reports.
5. Right Answer: A
Explanation: A is the best answer. It demonstrates a superior understanding of the cause-and-effect relationship between a plan's use and its funding. It also incorporates the moral hazard associated with asymmetric information (one side having more information than the other). B is incorrect. The trend in use is already unsustainable. Many plans include auto-renewal clauses that, if allowed to pass, could unnecessarily extend the current loss ratio structure. C is incorrect. While blackout periods may apply to certain changes in some employee benefits, such is not the case for private health plans. D is incorrect. Although this may be the correct course of action in this specific case, it is not true for all policy changes.
6. Right Answer: C
Explanation: C is the best answer. It educates all employees while addressing the root cause and avoids allocating blame after the fact. A is incorrect. It assumes the use was willfully abusive or avoidable when it may simply have been extraordinary and unique. Doing so risks the organization being perceived as threatening or harassing to the employees. B is incorrect. Although the employees who may have been abusing the benefits should not be confronted or mentioned, an explanation needs to be given to the employees as to why the changes are needed. D is incorrect. In the absence of proof or evidence of fraud or similar willful abuse, it is inappropriate to consider formal discipline.
7. Right Answer: A
Explanation: A is the best answer. It demonstrates an understanding of both the short- and long-term issues. B is incorrect. It is often possible to negotiate an extension to a current benefit plan as is for a few months while considering alternative plans. C is incorrect. This isn't a legitimate excuse because a thorough analysis would be conducted no matter what the company's situation was. D is incorrect. Often new providers offer to charge at a loss in the first year to attempt to lock in an organization's business and then make up their losses in following years.
8. Right Answer: C
Explanation: C is the best answer. The first step should be to make no assumptions and use a due process, least disruptive approach, starting by gathering evidence from the first verifiable source of the leak. A is incorrect. The chief operating officer is not provided any due process; it is assumed that the COO leaked the information simply because he or she stated an opinion to inform employees about the change. B is incorrect. There is good evidence to suggest that a leak of confidential or privileged information did occur, and this is a serious matter that cannot be ignored. D is incorrect. This is not the best first step in an investigative process. It also risks creating conflict among the executive team prior to gathering initial evidence.
9. Right Answer: C
Explanation: C is the best answer. The CEO may, based on hands-on experience in the company, have specific concerns that need to be addressed. Additionally the HR director may have some ideas about how the course should be designed and delivered in the future. Combining both viewpoints can create an informed and well-structured process of short listing. A is incorrect. This does not represent a short list or filter for specific criteria. B is incorrect. While price is important, the quality of the training may be jeopardized by not considering other factors. D is incorrect. While one person may have sound advice, a decision needs to be made based on the organization's needs. This option may not provide the key criteria to consider for selecting the right vendor.
10. Right Answer: D
Explanation: D is the best answer. The best strategy should consider both internal and external influences for better alignment with organizational growth. A is incorrect. While this is a critical skill in sourcing and selecting the right candidates, it does not assist in forecasting future staffing needs. B is incorrect. This response addresses only outside influences and does not consider the important internal metrics that influence staffing needs (turnover, promotions, transfers, etc.). C is incorrect. This strategy considers only inside metrics and does not consider outside influences of the labor force and market conditions.
Explanation: An information system portal is the point of entry for a user into an information system. The system does not need to be web-hosted. It may provide access to the system's search engine, but it is not a search engine. It may be customized to users.
2. Right Answer: C
Explanation: OLAP allows the analyst to sort data quickly in different ways, according to different and multiple variables. A conventional relational database would be sufficient to identify a trend in one factor or numbers in different departments. A cost-effectiveness analysis could be done on a spreadsheet.
3. Right Answer: A
Explanation: An ERP integrates current data from across an organization's functional areas, while a stand-alone system would require a customized bridge to access the ERP database. Integrated data enables more thorough analysis. Stand-alone systems can provide significant analytical power. Customization and forecasting can be performed in integrated and stand-alone systems.
4. Right Answer: B
Explanation: A business intelligence system has three components: a means to gather information from various data collection points, a secure means of storing or warehousing data so that it is available to users, and the means to analyze the data via queries and reports.
5. Right Answer: A
Explanation: A is the best answer. It demonstrates a superior understanding of the cause-and-effect relationship between a plan's use and its funding. It also incorporates the moral hazard associated with asymmetric information (one side having more information than the other). B is incorrect. The trend in use is already unsustainable. Many plans include auto-renewal clauses that, if allowed to pass, could unnecessarily extend the current loss ratio structure. C is incorrect. While blackout periods may apply to certain changes in some employee benefits, such is not the case for private health plans. D is incorrect. Although this may be the correct course of action in this specific case, it is not true for all policy changes.
6. Right Answer: C
Explanation: C is the best answer. It educates all employees while addressing the root cause and avoids allocating blame after the fact. A is incorrect. It assumes the use was willfully abusive or avoidable when it may simply have been extraordinary and unique. Doing so risks the organization being perceived as threatening or harassing to the employees. B is incorrect. Although the employees who may have been abusing the benefits should not be confronted or mentioned, an explanation needs to be given to the employees as to why the changes are needed. D is incorrect. In the absence of proof or evidence of fraud or similar willful abuse, it is inappropriate to consider formal discipline.
7. Right Answer: A
Explanation: A is the best answer. It demonstrates an understanding of both the short- and long-term issues. B is incorrect. It is often possible to negotiate an extension to a current benefit plan as is for a few months while considering alternative plans. C is incorrect. This isn't a legitimate excuse because a thorough analysis would be conducted no matter what the company's situation was. D is incorrect. Often new providers offer to charge at a loss in the first year to attempt to lock in an organization's business and then make up their losses in following years.
8. Right Answer: C
Explanation: C is the best answer. The first step should be to make no assumptions and use a due process, least disruptive approach, starting by gathering evidence from the first verifiable source of the leak. A is incorrect. The chief operating officer is not provided any due process; it is assumed that the COO leaked the information simply because he or she stated an opinion to inform employees about the change. B is incorrect. There is good evidence to suggest that a leak of confidential or privileged information did occur, and this is a serious matter that cannot be ignored. D is incorrect. This is not the best first step in an investigative process. It also risks creating conflict among the executive team prior to gathering initial evidence.
9. Right Answer: C
Explanation: C is the best answer. The CEO may, based on hands-on experience in the company, have specific concerns that need to be addressed. Additionally the HR director may have some ideas about how the course should be designed and delivered in the future. Combining both viewpoints can create an informed and well-structured process of short listing. A is incorrect. This does not represent a short list or filter for specific criteria. B is incorrect. While price is important, the quality of the training may be jeopardized by not considering other factors. D is incorrect. While one person may have sound advice, a decision needs to be made based on the organization's needs. This option may not provide the key criteria to consider for selecting the right vendor.
10. Right Answer: D
Explanation: D is the best answer. The best strategy should consider both internal and external influences for better alignment with organizational growth. A is incorrect. While this is a critical skill in sourcing and selecting the right candidates, it does not assist in forecasting future staffing needs. B is incorrect. This response addresses only outside influences and does not consider the important internal metrics that influence staffing needs (turnover, promotions, transfers, etc.). C is incorrect. This strategy considers only inside metrics and does not consider outside influences of the labor force and market conditions.
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