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This one is for you.
I used to think that the creative process was quite romantic in many ways. After all, as inhabitants of a quirky world made up of inspired leaps and profound discoveries, writers, I thought, must guard their process closely. I could not have been more wrong! Taking a concept from idea to delivery requires the (sometimes) herculean efforts of many talented individuals, the least of which is the author. To the editors Kenyon Brown, Kelly Talbot, Kim Wimpsett, Karin Hill, Pete Gaughan, and the countless other hands that touched this text, I give my utmost respect and gratitude. Their thoughtful guidance and professionalism carried this book through many iterations, contributing to what I believe is the best version of this material to date!
To my clients, I am equally indebted, for it is in their people-and-process-centric laboratories that I am able to explore so many of the critical HR systems and behavioral science practices that inform the basis of the PHR and SPHR exams.
I would also like to acknowledge the consummate professionals at the Human Resource Certification Institute. Their dedication of purpose to the field of HR is clearly embedded in their quest for excellence, and I feel privileged to help bring the HRBoK to life through applied practice.
Finally, Ralph Waldo Emerson noted, “In my walks, every man I meet is my superior in some way, and in that I learn from him.” This could not be more true of my family, friends, mentors, clients, colleagues, employees, coaches, and students, who daily show me yet another perspective of the important work of our lives. I am fortunate to know each of you.
Sandra M. Reed, SPHR, has more than 20 years of experience in the field of human resources. With a bachelor's degree in I-O psychology and her graduate work in organizational leadership in progress, she has led the work of many professionals in the development of the Human Resource Body of Knowledge. This culminated in the bringing together of HR thought leaders of today to share their insights and technical proficiencies in HRCI's A Guide to the Human Resource Body of Knowledge (HRBoK), Second Edition, published in 2017.
Sandra is a certified practitioner of the MBTI Personality Assessment and an endorsed trainer of the Leadership Training for Managers (LTM) program with Dale Carnegie. Additionally, she leads a team of human resource professionals for a manufacturing company in the Central Valley of California, where she is also an active member of the local HR community.
Find her on the Web at http://epochresources.com.
Karin M. Hill, MBA, SPHR, SHRM-SCP, acquired extensive experience managing human resources and organizational development departments. Her HR experience—from entry level to executive—was gained while working for international companies, an outplacement/career development/team-building consulting business, and major Midwest health systems in St. Louis and Kansas.
She earned her BA in journalism and government from Southern Illinois University at Edwardsville and her MBA from St. Louis University. Hill is currently on the continuing education adjunct faculty at Midlands Technical College, providing facilitation in the leadership and employee development areas. She also serves as a human resources and organizational development consultant for small businesses in the Columbia, South Carolina, area. She holds several national training certifications as well as the SPHR and SHRM-SCP certifications.
Currently, Hill consults with and provides leadership, employee, and customer service training for multiple organizations, including manufacturing and service industries, healthcare and related health services, insurance companies, educational institutions, and government entities and agencies at the city, county, and state levels.
Congratulations on your decision to pursue the Professional in Human Resources (PHR)® or Senior Professional in Human Resources (SPHR)® credential. With more than 500,000 certified professionals in more than 120 countries, you join a community of dedicated human resource leaders across the globe. Furthermore, achieving this designation distinguishes you as an expert in the field, one with both the knowledge and competencies to drive organizational results. This in turn develops the practice of human resources overall, as organizations become more aware of the practical value HR provides when efforts are aligned with business goals. In short, your successful certification and application of the knowledge acquired will help grow the industry.
The PHR and SPHR credential is offered by the Human Resource Certification Institute (HRCI®), a not-for-profit organization based in Alexandria, Virginia. HRCI® has been certifying HR professionals for more than 40 years and currently offers eight human resource exams. The PHR and SPHR exams are both accredited by the National Commission for Certifying Agencies (NCCA), an agency that sets rigorous standards to maintain quality and integrity within the certification process.
Preparing for an exam of this magnitude requires a systematic approach that involves the ability to demonstrate knowledge within an applied context. However, knowledge and competencies are not enough to pass these tests. The PHR and SPHR exams are noted not only for the difficult content but also for the unique format of questions, so it is imperative that you prepare for the question structures. Whether you are in the final stages of preparation or just beginning your preparation journey, there is value in taking the time to work with practice exams.
This book is primarily structured around two major resources: HRCI’s Exam Content Outlines (ECO) and HRCI’s A Guide to the Human Resource Body of Knowledge (HRBoK®), Second Edition. This book tests your knowledge of the responsibilities covered by the exam domains with the goal of exposing you to questions formatted similarly to those you would find on the actual exam. The more questions that you expose yourself to, the better prepared you will be on exam day.
The PHR exam content makes up the first part of this book. Questions are focused on the operational nature of a generalist’s day-to-day activities, such as implementing and managing typical HR programs and systems. The question content is focused on the five functional areas of the exam, as shown in Table 1. It is useful to note that on the PHR exam, more than half the content is related to the functional areas of Business Management and Employee & Labor Relations. If you are on an accelerated preparation path, it is recommended that you start with these sections and seek perfection in your scores. The first section ends with a full-length PHR practice exam.
TABLE 1 PHR Exam Weighting by Functional Area
Functional Area | Title | % of Exam Content |
1 | Business Management | 20% |
2 | Talent Planning & Acquisition | 16% |
3 | Learning & Development | 10% |
4 | Total Rewards | 15% |
5 | Employee & Labor Relations | 39% |
HRCI notes on its website that “the PHR is for the HR professional who has experience with program implementation, has a tactical/logistical orientation, is accountable to another HR professional within the organization, and has responsibilities that focus on the HR department rather than the whole organization.”
The second section of the book is dedicated to the SPHR content outline. A senior-level HR professional is expected to be well versed in the strategic development of HR programs and systems that are aligned with business drivers and outcomes. As shown in Table 2, the exam is weighted with 60 percent of content in Leadership & Strategy and Employee Relations & Engagement. Knowing this will allow for more focused preparation activities. This section also includes a full-length SPHR-specific practice exam.
TABLE 2 SPHR Exam Weighting by Functional Area
Functional Area | Title | % of Exam Content |
1 | Leadership & Strategy | 40% |
2 | Talent Planning & Acquisition | 16% |
3 | Learning & Development | 12% |
4 | Total Rewards | 12% |
5 | Employee Relations & Engagement | 20% |
Explanations are provided in the appendixes to help you learn the concepts.
The SPHR exam is focused on the business, rather than at a department level. HRCI notes that “the SPHR demonstrates your mastery of the strategic and policy-making aspects of HR management as practiced in the U.S. The credential is designed for big-picture thinkers responsible for planning rather than implementing HR policy. Organizations seek out SPHR professionals for their proven accountability for HR department goals, for breadth and depth of knowledge in all HR disciplines, and for understanding business issues beyond the HR function.”
Both the PHR and SPHR exams are three hours in length and include 175 questions—150 questions that are scored and 25 questions that are being validated for future use. You will not know which questions are being scored and which are part of the 25 being pretested. Each domain includes a summary statement, a list of short exam responsibility statements, and a broader list of knowledge requirements. These are listed at the beginning of each chapter.
Finally, of the thousands of questions available on exam day related to the breadth of content covered in the ECOs, no two exams are exactly alike. These computerized tests will deliver to you a 175-question experience that is unique. Some candidates may see an abundance of questions related to union organizing, for example, while others may see only one or two questions on this content. This means that you may feel both over-prepared and under-prepared on exam day. Try not to worry about this! Looking at the intense preparation process through a long-view lens will reinforce the reason you are seeking certification in the first place—for future application of best practices on the job. We wish you the best of luck as you strive for excellence in our industry and for your organization.
THE PHR EXAM CONTENT FROM THE BUSINESS MANAGEMENT FUNCTIONAL AREA COVERED IN THIS CHAPTER FOCUSES ON “USING INFORMATION ABOUT THE ORGANIZATION AND BUSINESS ENVIRONMENT TO REINFORCE EXPECTATIONS, INFLUENCE DECISION-MAKING, AND AVOID RISK.” IT CONSISTS OF THE FOLLOWING RESPONSIBILITIES:
IN ADDITION TO THE RESPONSIBILITIES LISTED ABOVE, AN INDIVIDUAL TAKING THE PHR EXAM SHOULD HAVE WORKING KNOWLEDGE OF THE FOLLOWING, USUALLY DERIVED THROUGH PRACTICAL EXPERIENCE:
Which of the following is not one of the four elements of the acronym VUCA?
Which option is the correct term describing the near-term activities involved in transferring the product or service from the business to the customer?
Managing payroll and recruiting for open positions are examples of which human resource role?
A conduct statement is most likely to be found in which corporate document?
Which of the following tools would HR most likely recommend to an employer who wants to tailor an employee wellness program to the needs of the workforce?
Reengineering, corporate restructuring, and workforce expansion are all examples of what type of management strategy?
The employer you work for is looking to open a large paint facility in a neighboring state. It will be the second location, with corporate headquarters continuing to be home base. Which change management structural intervention will HR most likely need to address?
Which metric should you use to communicate to an executive team the expenses associated with recruiting and selection?
A supervisor complained to HR that one of his employees is often tardy. When asked about it, the employee said that he thought being on time wasn’t really that important, as his supervisor seemed to come and go as he pleased. The supervisor himself is a nonexempt employee with a regular schedule. What should HR recommend as a first step?
How do employee handbooks contribute to an organization’s risk management plan?
Why is it important for HR professionals to keep up to date on employment litigation statistics?
Which of the following usually present the most risk of a discrimination charge being filed with the Equal Employment Opportunity Commission?
What is the purpose of a legislative committee?
An activity in which anybody can participate to influence laws and regulations is known as which of the following?
A code of conduct is to _____________ as an ethical statement is to organizational standards of behavior.
An assembly-line configuration and standard operating procedures for taking a sales call are examples of which of the following organizational functions?
Considering inputs such as available material and labor is an activity of which organizational function?
The evolution from pagers to cellular phones is an example of which of the following forces in the external business environment?
In which of the following ways does the finance department contribute to the achievement of HR outcomes?
Forecasting is most likely to be used when a company is doing which of the following activities?
The company for which you work has partners who have agreed to share responsibility for managing the business on a day-to-day basis. This is an example of which of the following business structures?
Under what conditions would employees be most receptive to organizational change?
Fill in the blank: Technological challenges are to project management as __________ challenges are to change management.
During the strategic planning session, the organizational leaders of a custom cabinet shop identified that there were serious quality defects in the wood being sourced from an outside vendor. Additionally, these flaws were contributing to the reason existing product packaging was no longer adequate to properly prepare the product for freight transport. This company has identified problems in which business function?
A company objective is to help managers perform through a series of 90-day goals. The goals will be set by the executive team, and managers will be expected to report weekly progress via email. Which of the following internal relationships should HR cultivate to help the company achieve this strategic objective?
Which of the following is an example of a human capital measurement?
A values statement does not need to include which of the following?
A painting company has decided to organize its services by industrial and residential. It plans to hire division directors to form key account teams in both sales and marketing but keep operations as its own division. This is an example of which strategy?
Inventory, employees, and accounts receivable are all examples of what?
Which number is the mode in the following sequence: 1334555?
One of the corporate values of your company is the concept of “Ohana” that is centered around behaviors such as transparency and trust. Which of the following conditions would you expect to find at this organization?
The large company that you work for has decided that addressing the leadership needs of their organization is necessary to advance their growth objectives. Which of the following should be your first priority?
Which of the following is the most likely reason that some organizational leaders struggle with ethical decision-making?
A startup company is focused on innovation, driven by its research and development efforts. The skillsets necessary for its workforce do not currently exist in the available labor market. Which of the following strategies should you recommend?
The executive team at a major retailer has decided that it must close 68 stores nationwide, with an anticipated loss of more than 10,000 jobs. Which of the following external partnerships would have the biggest impact on the laid-off workers?
Who is hiring, what price points are selling, and what are the current trends and cultural factors are questions answered by a scan of which of the following?
HR provided the strategic planning committee with a report showing the unemployment rate at the state and county levels and the availability of labor by skillset. The committee is most likely preparing for which of the following planning activities?
Which of the following is a major characteristic of evidence-based management?
Which evidence would you use to make a decision about how many employees a company may need during peak season?
In developing the exam content outline, a major exam administrator identifies subject-matter experts to review the existing exam content and anonymously make suggestions for changes. A facilitator gathers the feedback and then sends out proposed changes to each member for revisions and comments. The facilitator repeats this process round after round until a consensus is reached. This company is employing which of the following decision-making methods?
Which of the following is most likely to increase employee commitment to change?
Purchasing employment practice liability insurance (EPLI) is what type of risk management technique?
HR is most likely to serve in what type of role related to an employer’s use of workforce analytics?
For what purpose is a churn model most likely to be used?
Suppliers, employees, and local community groups are all examples of which of the following?
A code of ethics, accounting rules, and sustainability guidelines are all examples of what type of company behavior?
Which of the following technological tools would best help HR manage résumés, training documents, and service awards?
The collective knowledge, skills, and abilities of an organization’s employees based upon which an employer may compete is best known as which of the following?
Your favorite news outlet just announced that interest rates will be going up in the next calendar quarter. This is an example of which of the following?
You have tasked a department with coming up with a proposed schedule for the holiday season. You are asking them in effect to form which of the following?