1. Part A: Major objectives include cost, fairness (including legal compliance), incentives for effort, ability to attract workers, ability to retain workers, and consistency with other HR policies. In a new plant, one also would want to set the right norms for expected behavior. Grading: 2 points for each objective, full credit for answers with four objectives.
  2. Part B: Grading was based on the following: (1) 5 points for making a recommendation (-1 if unclear or a bit ambiguous), (2) 3 points for linking recommendation to overall strategy of cost and quality (-1 if linkage not clear but answer shows awareness of strategy), (3) 3 points each for dealing with the following issues – ability to attract/retain, incentives for effort (-1 if not explained well), unique issues for Indonesia (potential for bad PR, no piecerates, government corruption, legal minimum; -1 if mentions but no clear link to impact on pay policy).


  3. Everyone got 10 points as long as they addressed the question seriously. Five points apiece were allocated to dealing thoroughly with these issues: short-term hiring strategy, sensitivity training and diversity task force, and long-term hiring. If you did not back up your recommendation very well in the first two areas, you got three points instead of five. On short-term hiring, if you argued for hiring goals that managers would be expected to meet, you should have brought up prevention of lawsuit and the addition of qualified workers in your case. If you argued that such goals would be counterproductive, you should have brought up the need for stars in R&D jobs, the low odds of success given the facts in the labor market, and the downsizing. On training and task forces, the case for: R&D results being hurt by insensitivity, risk of losing scientists, and the mission of DPMPC. The case against: effectiveness unlikely, additional costs. If you did not get into specifics on long-term hiring (e.g., re-evaluate performance appraisals, raid other firms, recruit at more universities, scholarship programs), you got three points instead of five.

  5. This came straight from the text, ch. 14. Five points for the right answer: they are not valid or reliable. Four points for why (anchoring on initial impressions, social similarity, notions of ideal candidate, quality of others being interviewed); half credit for saying they are subjective and not going into further detail. Up to eight points for specific recommendations (two points each): follow set script, realistic job preview, train interviewers, panel interview, multiple scales (vs. single summary measure), simulations on decision making.

  7. This came straight from text, ch. 10. There were as many as five arguments in favor of this approach: more than one person’s observations and experiences, more knowledge shared about workers available for new assignments, greater consistency with what firm wants to measure and less role for individual biases, more backbone (the group gave you the low eval, I could not talk them out of it), whole process gets taken more seriously when you have to defend your evals in front of peers. Full credit for any four of these, -2 for three, -4 for two, -8 for one.

  9. This came from lecture. There were four arguments I was looking for: attract better workers, reduce turnover, ability to demand a higher level of performance, and reduced threat of unionization. No one mentioned the last one, so I ended up not penalizing anyone for failing to mention it (maybe the notion of R&D scientists or product line managers on a picket line seemed too far-fetched?). Full credit for three arguments, -4 for two, -8 for one.

  11. All but one person did internal labor markets. Defining the system was worth seven points; -2 for sketchy explanations. Describing two complementarities was worth four points, two points for each pair. Examples: promotion based on seniority encourages training by eliminating incentives to withhold knowledge, due process procedures encourage low turnover and firm-specific training, use of seniority encourages low turnover and more training, training enhances pay and reduces turnover. Three points each for the examples. Good fit for stable, growing firms; large firms; jobs with firm-specific training (Armed Forces, UPS package team, IBM in 1960s). Bad fit for fast changing firms, firms that need stars, shrinking firms (Microsoft, UPS computer group, IBM in 1980s).