Worldatwork c8 practice test

What best describes a necessary skill and/or behavior in relation to business acumen?

• A. An understanding of the culture and subcultures of your organization
• B. The capacity to manage multiple projects and priorities and meet deadlines
• C. A willingness to take on additional duties and responsibilities when resources are limited
• D. A thorough understanding of the products and/or services your organization provides

What is the most likely explanation for why compensation and rewards require a strong grasp of
business acumen for compensation professionals?

• A. Because the internal and external environments are constantly changing
• B. Because the best interests of the organization take priority, which can lead to difficult decisions and implementation issues
• C. Because they are emotional issues and stakeholders have many vested interests
• D. Because strong business acumen is required for all compensation decisions

What best describes an effective approach for balancing multiple priorities and perspectives
regarding compensation?

• A. Being firm and uncompromising in your decision-making
• B. Representing your view with data and relating it to business results
• C. Finding a compromise that may not appease all stakeholders but does not give any one group or person everything they are seeking
• D. Giving priority to perspectives based on the job or influence level of the stakeholders

What is the primary reason why a compensation professional working for a multinational company
should understand regulatory requirements and application of rewards globally?

• A. Because legal compliance with compensation-related regulations is the responsibility of the compensation department
• B. Because the compensation professional has a fiduciary responsibility to ensure that the financial resources of their organization are spent in a prudent manner
• C. Because it is possible to pay significantly less for talent in different countries and compensation should advise management on when and where to locate various jobs within the company
• D. They shouldn’t. Due to the complexities of global regulations and practices, compensation administration outside of the home country should be outsourced.

You have been asked to develop a short-term incentive plan that motivates employees in business
units to increase productivity. Your team has designed a plan that rewards managers and employees
quarterly based on achievement against target on measures that should generate productivity
increases that will self-fund the plan. When presenting the plan to senior management, what would
be the best strategy to receive approval?

• A. Demonstrate how it is aligned to the rewards philosophy, principles and organizational business strategy
• B. Provide details on the plan design and measures and how they will be administered to employees at different levels
• C. Make the case that a self-funded plan poses no risk to the organization while creating the potential for significant gains
• D. Identify in advance the priorities of the various stakeholders and design your presentation to address any objections or perceptions they may have

What is the most accurate statement regarding the effect of compensation plans on the
organization?

• A. They typically have the greatest effect on net income and operating results of any organizational expense or program
• B. Their success or failure is closely tied to the success or failure of organizationwide goals and objectives
• C. They have very little effect as long as they are managed effectively and efficiently
• D. They affect the organization’s overall financial status and impact multiple stakeholders across most, if not all, business units

What best describes a benefit of business acumen with regard to career development?

• A. The ability to display confidence and decisiveness that will inspire others and make you a better leader
• B. A greater likelihood of promotion, especially when you are competing with individuals with more experience
• C. Increased marketability, which will lead to qualification for opportunities outside of human resources
• D. It is critical to your career development and a deficiency is very likely to hinder career advancement and success.

Which of the following best describes the guiding principles and/or beliefs shared by stakeholders in
an organization?

• A. Mission
• B. Vision
• C. Values
• D. Strategy

What is a “profit model?”

• A. The intention or purpose of the business
• B. A descriptor for how the company works
• C. The financial objectives of the organization
• D. The plan for how the organization generates revenue and makes money

How is the purpose of a non-profit organization typically communicated?

• A. Explained throughout the mission, vision, values and strategy
• B. Implied in the mission, vision and strategy and specifically explained on the organization’s website
• C. Reflected in the mission, vision, values and strategy although often not stated directly
• D. Documented internally but not released to the public to protect trade secrets and maintain competitive advantage