The Manager of Human Resources for a large manufacturing company in the Chicago area

Essay Questions

Respond to all three of the following questions. Individual answers should be a minimum of 250 words but not be more than 500 words each.

ESSAY QUESTIONS

Question #1 (25 points)

You have just signed on as the Manager of Human Resources for a large manufacturing company in the Chicago area. Your company manufactures parts to the automotive industry such as air duct assemblies for various models of new vehicles as well as to the secondary market for these same parts. Upon conducting an audit of HR initiatives and trying to understand the challenges you want to tackle, you find that the overall turnover rate for this company is 37%. You have not worked in this specific industry but you feel at first glance that this number is high. Based on this limited information that you have, lay out a strategy for addressing turnover. You should include the following in your answer:

  1. Is the 37% turnover a cause for concern? How would you go about finding out this information?
  2. What additional data will you gather to learn more about the turnover in this organization? Remember that your readings discuss different types of turnover and this should be addressed in your answer along with any benefits of turnover.
  3. Assume that you find that the turnover is problematic. Particularly, you discover that the turnover for non-exempt staff is 42% - well over the total turnover for the organization. Prepare a strategy to suggest to the CEO for addressing this turnover, specifically addressing possible causes of the turnover and solutions related to those causes. You will need to think about many of the concepts we have discussed throughout this course in order to answer this question fully.

Question #2 (25 points)

Discuss the criteria for good cutoff scores as viewed by the courts. You should be able to state clearly what the Uniform Guidelines on Employee Selection Procedures say about cutoff scores.

Question #3 (50 points)

For this question, assume you are employed as an HR consultant for a mid-sized bank. The bank employs 200 tellers across its branches. Review the details of the teller position as provided on O*Net (http://www.onetonline.org/link/summary/43-3071.00).
Based on this information, the bank decides that the ideal candidate for this position will possess the following factors:

  1. Have at least a high school EDUCATION (bachelor’s or associate’s degree desirable).
  2. Have EXPERIENCE as a teller or in a related field (cashier, billing clerk)
  3. Be able to perform basic MATH SKILLS related to banking (for example, count currency quickly and accurately and balance a cash drawer correctly).
  4. Be KNOWLEDGEABLE OF VERIFICATION requirements for bank transactions (for example, errors in check and proper identification to authorize transactions).
  5. Have good INTERPERSONAL SKILLS (for example, speak clearly, make good eye contact and develop rapport easily).
  6. Be MOTIVATED to work.

PART 1: Identify which selection methods (e.g. resume, interview, test, role play exercise, reference check or personality inventory) you would recommend for each of the six factors listed above. You can use the same selection method more than once if you believe it is appropriate for more than one factor. Below is an example of how you might justify using an application form as an appropriate selection method for education.

  1. Education – selection method: Application Form
    Justification: A question on the application form can ask applicants to describe their education. This selection method makes it easy and inexpensive to obtain this information.
  2. Work Experience – selection method: _____________________________ Justification:
  3. Math Skills – selection method: ______________________ Justification:
  4. Verification Knowledge – selection method: ______________________ Justification:
  5. Interpersonal Skills – selection method: __________________________ Justification:
  6. Work Motivation – selection method: __________________________ Justification:

Part 2:

The bank collected the following data over the past five years:

Males applied = 200 Females applied = 300
Males hired = 40 Females hired = 45

Based on this information, the selection ratio for men is 20% (40/200), whereas the selection ratio for women is 15% (45/300). Dividing the minority group (women) by the majority group (men) results in an answer of 75% (15%/20%). Since the result is less than 80%, adverse impact exists. The organization needs to explore the selection process to identify what might be the cause of this disparity.

In this part of the question – you will conduct this analysis.

The bank compiled selection data on three racial groups during the past year: Caucasians, African Americans and Latinos. The data is as follows:

Number applied  Number hired

Caucasians 90 27
African Americans 50 10
Latinos 40 10

Answer the following:

a. What are the selection ratios for each of the three groups?

b. Does adverse impact exist when you compare the African American applicant pool with the Caucasian applicant pool? Show your work.

c. Does adverse impact exist when you compare the Latino applicant pool with the Caucasian applicant pool? Show your work.

Full Answer Section

       
    • associations to find the average turnover rate for manufacturing companies, particularly those in the automotive parts sector and within the Chicago area.
    • Analyze Historical Trends: I would examine the company's turnover rates over the past 3-5 years to identify if this is a new spike, a consistent issue, or a declining trend. Understanding the historical context can provide insights into potential triggers or ongoing problems.
    • Compare to Competitors: If possible, I would try to gather data on the turnover rates of direct competitors in the Chicago area. This would provide a more specific benchmark and highlight if our company is significantly underperforming in employee retention within the local talent market.
    • Calculate Cost of Turnover: I would work with the finance department to estimate the actual cost associated with this 37% turnover. This involves calculating expenses related to recruitment, onboarding, training, lost productivity during the vacancy period and the new employee's learning curve, and potential impacts on quality and customer service. Quantifying the financial impact will underscore the urgency of addressing the issue.
  • What additional data will you gather to learn more about the turnover in this organization? Remember that your readings discuss different types of turnover and this should be addressed in your answer along with any benefits of turnover.

    To gain a deeper understanding of the turnover within the organization, I would gather the following additional data:

    • Detailed Turnover Metrics: I would break down the overall turnover rate by various demographics and organizational factors:
      • Voluntary vs. Involuntary Turnover: Understanding the reasons behind employees leaving is critical. Voluntary turnover (employees choosing to leave) often signals dissatisfaction, while involuntary turnover (terminations by the company) points to performance or disciplinary issues.
      • Functional Area/Department: Turnover rates may vary significantly across different departments (e.g., production, administration, sales). Identifying high-turnover areas can pinpoint specific problem areas.
      • Tenure: Analyzing turnover by employee tenure can reveal if new hires are leaving quickly (indicating issues with onboarding or initial job expectations) or if longer-tenured employees are departing (suggesting issues with career progression, compensation, or management). This relates to dysfunctional turnover (loss of valuable employees) versus functional turnover (departure of low-performing employees).
      • Performance Level: Understanding the performance levels of those who leave (high, average, low performers) is crucial. Losing high performers is particularly detrimental.
      • Demographic Data: Analyzing turnover rates by demographics such as age, gender, and race can help identify potential issues related to diversity, equity, and inclusion.  
    • Exit Interviews: Conducting thorough and standardized exit interviews with departing employees is invaluable. This provides qualitative data on the reasons for their departure, their perceptions of the company culture, management, compensation, benefits, and opportunities. Analyzing trends in exit interview feedback can highlight recurring issues.
    • Stay Interviews: Proactively engaging with current employees through "stay interviews" can help identify factors that keep them with the company and potential issues that might lead them to consider leaving. This allows for preventative measures.  
    • Employee Engagement Surveys: Implementing or reviewing existing employee engagement surveys can provide insights into overall employee satisfaction, morale, and commitment levels. Low engagement is often a precursor to higher turnover.  
    • Compensation and Benefits Analysis: A thorough review of the company's compensation and benefits packages compared to industry standards and local market rates is essential to determine if they are competitive.
    • Management Practices Feedback: Gathering feedback from employees about their direct supervisors and management practices can reveal potential issues with leadership style, communication, and employee development opportunities.

    While high turnover is generally problematic, some benefits of turnover can include:

    • Removal of Poor Performers: Involuntary turnover can help remove individuals who are not meeting performance expectations.
    • Opportunity for New Perspectives and Skills: Replacing departing employees can bring in fresh ideas, new skills, and diverse perspectives.
    • Cost Savings (in some cases): Replacing higher-salaried employees with entry-level staff can lead to short-term cost savings, although this often comes at the expense of experience and potential productivity.
    • Organizational Flexibility: Turnover can create opportunities to restructure teams or roles to better align with changing business needs.
  • Assume that you find that the turnover is problematic, particularly for non-exempt staff at 42%. Prepare a strategy to suggest to the CEO for addressing this turnover, specifically addressing possible causes of the turnover and solutions related to those causes.

    A 42% turnover rate for non-exempt staff is indeed highly problematic and demands immediate attention. This level of attrition likely disrupts production schedules, increases operational costs significantly, and negatively impacts the morale of remaining staff. Based on the concepts discussed in this course, potential causes and corresponding solutions include:

    Possible Causes:

    • Inadequate Compensation and Benefits: Non-exempt roles often have lower pay and less comprehensive benefits. If the company's offerings are not competitive with other manufacturing or entry-level jobs in the Chicago area, employees will likely seek better opportunities.  
    • Poor Management and Supervision: Front-line supervisors have a significant impact on employee satisfaction and retention. Lack of clear communication, unfair treatment, lack of support, and limited opportunities for feedback or development can drive employees away.  
    • Lack of Growth and Development Opportunities: Non-exempt staff may feel stuck in their roles with limited chances for skill development, advancement, or increased responsibility.
    • Difficult or Demanding Work Environment: The physical demands of manufacturing, coupled with potentially repetitive tasks, long hours, and safety concerns, can lead to burnout and turnover if not properly managed.  
    • Poor Onboarding and Training: If new hires do not feel adequately prepared for their roles or integrated into the company culture, they are more likely to leave early (functional turnover being high for new hires).
    • Lack of Recognition and Appreciation: Feeling undervalued can significantly impact morale and retention. If non-exempt staff do not receive adequate recognition for their contributions, they may seek employers who provide it.
    • Limited Work-Life Balance: Unpredictable schedules, mandatory overtime, and a lack of flexibility can negatively impact employees' personal lives and lead to them seeking more accommodating employers.  

    Proposed Strategy for the CEO:

    I recommend a multi-faceted strategy that addresses the potential root causes identified above:

    • Conduct a Comprehensive Compensation and Benefits Review: Immediately benchmark the pay rates and benefits packages for non-exempt roles against industry standards and local competitors. Identify any significant gaps and develop a plan to incrementally improve compensation and benefits to become more competitive. This could include increasing hourly wages, enhancing health insurance options, offering paid time off, and exploring opportunities for bonuses or profit-sharing. (Concept: Competitive Compensation & Benefits)
 

Sample Answer

       

Essay Questions

Question #1 (25 points)

Upon assuming the role of Human Resources Manager at the large manufacturing company with a 37% overall turnover rate, my initial priority would be to thoroughly investigate this figure.

  1. Is the 37% turnover a cause for concern? How would you go about finding out this information?

    Yes, a 37% overall turnover rate is a significant cause for concern. While some level of turnover is natural and even beneficial, a rate this high suggests potential systemic issues within the organization that are leading to a substantial loss of human capital. This can result in increased recruitment and training costs, decreased productivity, lower morale among remaining employees, and a potential loss of valuable skills and organizational knowledge.  

    To ascertain the true impact and context of this 37% figure, I would undertake the following steps to gather more information:

    • Benchmark Against Industry Averages: The most crucial step is to compare this rate against industry-specific turnover data. Turnover rates vary significantly across industries. Manufacturing, while potentially having some inherent turnover due to the nature of the work, might have a different average than, say, the tech or finance sectors. I would consult industry reports from organizations like the Bureau of Labor Statistics (BLS), SHRM (Society for Human Resource Management), and industry-specific