CAIB 4 - Book Practice Questions & Answers
What are the similarities between a strategic plan and an action plan? - ANS-They are
n n n n n n n n n n n n n n
both critical steps in the success of a brokerage
n n n n n n n n n
They both flow from the mission statement
n n n n n n n
They both use the same process (top down/bottom up)
n n n n n n n n n
What are the differences between a strategic plan and an action plan? - ANS-strategic
n n n n n n n n n n n n n
plans are for three to five years;
n n n n n n n n
action plans are for one year
n n n n n
strategic plans apply to the brokerage as a whole; action plans apply to a particular
n n n n n n n n n n n n n n
business unit
n n
action plans are much more detailed than strategic plans
n n n n n n n n
Explain the advantages and disadvantages of top-down and bottom-up approaches to
n n n n n n n n n n
planning. - ANS-Top-Down Approach
n n n n
o Management is firmly in control
n n n n n
o May fail because employees don't buy into it
n n n n n n n n
Bottom-Up Approach n
o Employees set the plan - buy-in
n n n n n n
o Management feel that they are not in control
n n n n n n n n
The combination of both approaches, with open communication throughout the process,
n n n n n n n n n n
is the key to effective and successful planning.
n n n n n n n n
When evaluating an operating affiliation why would the following be an important
n n n n n n n n n n n
consideration?
n n
a) Exclusivity
n n
b) Fees - ANS-Exclusivity;
n n n
Many of the organizations with which a brokerage can affiliate are in one way or another
n n n n n n n n n n n n n n n
exclusive. Often it is this exclusivity that makes the organization attractive to the
n n n n n n n n n n n n n
brokerage.
n
It is important that the following questions be asked;
n n n n n n n n
How many other brokerages in the immediate marketing area will be permitted to join?
n n n n n n n n n n n n n
What is the legal nature of the exclusivity?
n n n n n n n
, How tight is the contract in describing the rights of an affiliated brokerage to a particular
n n n n n n n n n n n n n n n
territory?
n
What is the reputation of those brokerages already participating in the program?
n n n n n n n n n n n
If the brokerage is seeking prestige and image from the affiliation, this can be derived
n n n n n n n n n n n n n n
nonly if others participating are up to the standards described by the sponsoring
n n n n n n n n n n n n
norganization.
When evaluating an operating affiliation why would the following be an important
n n n n n n n n n n n
consideration?
n n
a) Exclusivity
n n
b) Fees - ANS-Fees;
n n n
A major factor in determining whether to affiliate is the cost of the affiliation and whether
n n n n n n n n n n n n n n n
the services offered are worth the price being charged.
n n n n n n n n n
All costs should be known in advance so that there will be no surprises once the
n n n n n n n n n n n n n n n
affiliation has been formed.
n n n n
Some brokerages effectively structure their brokerages as a functional organization.
n n n n n n n n n
Discuss why it is a difficult form to implement effectively - ANS-Employees will find that
n n n n n n n n n n n n n n n
they have more than one boss, so that in areas of overlapping authority they may be
n n n n n n n n n n n n n n n n
given conflicting or inconsistent instructions.
n n n n n
When a decision is required that does not firmly belong to any manager, decision-
n n n n n n n n n n n n n
making can be slow. Employees may be referred by one manager to another without
n n n n n n n n n n n n n
any decision being made.
n n n n
When there are too many managers giving instructions, employees are frequently
n n n n n n n n n n
distracted from their primary roles of serving their clients.
n n n n n n n n n
The first activity in human resources management is planning. Discuss three areas
n n n n n n n n n n n
involved - ANS-Evaluate its existing ability to generate sales and premium growth, and
n n n n n n n n n n n n n
determine whether the existing human resources are capable of producing the levels
n n n n n n n n n n n n
anticipated in the strategic plan. If they are not, a plan must be established to obtain the
n n n n n n n n n n n n n n n n n
necessary human resources and to revise the organization structure to accommodate
n n n n n n n n n n n
the anticipated growth.
n n n
Estimate human resource needs as early in the planning process as possible, to permit
n n n n n n n n n n n n n
time for a professional approach to selecting new employees and to avoid the pitfalls of
n n n n n n n n n n n n n n n
a crash hiring process. The human resource plan should include an evaluation of the
n n n n n n n n n n n n n n
skills the new employees need to have, the hiring timetable, and a contingency plan in
n n n n n n n n n n n n n n n
the event candidates with the required skills cannot be found in a timely manner.
n n n n n n n n n n n n n n
Prepare a position description containing position qualifications and specifications for
n n n n n n n n n
each position to be filled. This will enable the brokerage to determine the kind of
n n n n n n n n n n n n n n n
experience, knowledge, attitude and behaviors which will be required of the candidates.
n n n n n n n n n n n n
What are the similarities between a strategic plan and an action plan? - ANS-They are
n n n n n n n n n n n n n n
both critical steps in the success of a brokerage
n n n n n n n n n
They both flow from the mission statement
n n n n n n n
They both use the same process (top down/bottom up)
n n n n n n n n n
What are the differences between a strategic plan and an action plan? - ANS-strategic
n n n n n n n n n n n n n
plans are for three to five years;
n n n n n n n n
action plans are for one year
n n n n n
strategic plans apply to the brokerage as a whole; action plans apply to a particular
n n n n n n n n n n n n n n
business unit
n n
action plans are much more detailed than strategic plans
n n n n n n n n
Explain the advantages and disadvantages of top-down and bottom-up approaches to
n n n n n n n n n n
planning. - ANS-Top-Down Approach
n n n n
o Management is firmly in control
n n n n n
o May fail because employees don't buy into it
n n n n n n n n
Bottom-Up Approach n
o Employees set the plan - buy-in
n n n n n n
o Management feel that they are not in control
n n n n n n n n
The combination of both approaches, with open communication throughout the process,
n n n n n n n n n n
is the key to effective and successful planning.
n n n n n n n n
When evaluating an operating affiliation why would the following be an important
n n n n n n n n n n n
consideration?
n n
a) Exclusivity
n n
b) Fees - ANS-Exclusivity;
n n n
Many of the organizations with which a brokerage can affiliate are in one way or another
n n n n n n n n n n n n n n n
exclusive. Often it is this exclusivity that makes the organization attractive to the
n n n n n n n n n n n n n
brokerage.
n
It is important that the following questions be asked;
n n n n n n n n
How many other brokerages in the immediate marketing area will be permitted to join?
n n n n n n n n n n n n n
What is the legal nature of the exclusivity?
n n n n n n n
, How tight is the contract in describing the rights of an affiliated brokerage to a particular
n n n n n n n n n n n n n n n
territory?
n
What is the reputation of those brokerages already participating in the program?
n n n n n n n n n n n
If the brokerage is seeking prestige and image from the affiliation, this can be derived
n n n n n n n n n n n n n n
nonly if others participating are up to the standards described by the sponsoring
n n n n n n n n n n n n
norganization.
When evaluating an operating affiliation why would the following be an important
n n n n n n n n n n n
consideration?
n n
a) Exclusivity
n n
b) Fees - ANS-Fees;
n n n
A major factor in determining whether to affiliate is the cost of the affiliation and whether
n n n n n n n n n n n n n n n
the services offered are worth the price being charged.
n n n n n n n n n
All costs should be known in advance so that there will be no surprises once the
n n n n n n n n n n n n n n n
affiliation has been formed.
n n n n
Some brokerages effectively structure their brokerages as a functional organization.
n n n n n n n n n
Discuss why it is a difficult form to implement effectively - ANS-Employees will find that
n n n n n n n n n n n n n n n
they have more than one boss, so that in areas of overlapping authority they may be
n n n n n n n n n n n n n n n n
given conflicting or inconsistent instructions.
n n n n n
When a decision is required that does not firmly belong to any manager, decision-
n n n n n n n n n n n n n
making can be slow. Employees may be referred by one manager to another without
n n n n n n n n n n n n n
any decision being made.
n n n n
When there are too many managers giving instructions, employees are frequently
n n n n n n n n n n
distracted from their primary roles of serving their clients.
n n n n n n n n n
The first activity in human resources management is planning. Discuss three areas
n n n n n n n n n n n
involved - ANS-Evaluate its existing ability to generate sales and premium growth, and
n n n n n n n n n n n n n
determine whether the existing human resources are capable of producing the levels
n n n n n n n n n n n n
anticipated in the strategic plan. If they are not, a plan must be established to obtain the
n n n n n n n n n n n n n n n n n
necessary human resources and to revise the organization structure to accommodate
n n n n n n n n n n n
the anticipated growth.
n n n
Estimate human resource needs as early in the planning process as possible, to permit
n n n n n n n n n n n n n
time for a professional approach to selecting new employees and to avoid the pitfalls of
n n n n n n n n n n n n n n n
a crash hiring process. The human resource plan should include an evaluation of the
n n n n n n n n n n n n n n
skills the new employees need to have, the hiring timetable, and a contingency plan in
n n n n n n n n n n n n n n n
the event candidates with the required skills cannot be found in a timely manner.
n n n n n n n n n n n n n n
Prepare a position description containing position qualifications and specifications for
n n n n n n n n n
each position to be filled. This will enable the brokerage to determine the kind of
n n n n n n n n n n n n n n n
experience, knowledge, attitude and behaviors which will be required of the candidates.
n n n n n n n n n n n n
