SHRM-CP Exam 2025-2026

Dispositional obstacles

internal barriers stemming from an individual's attitudes, beliefs, or perceptions that negatively impact their motivation or willingness to engage in a learning program. these obstacles are often rooted in skepticism, lack of confidence, or resistance to change

Situational obstacles

external factors that hinder an individual's ability to participate in a learning program, such as family responsibilities, work commitments, or time constraints. these barriers are often temporary and can vary based on personal circumstances

Institutional obstacles

barriers created by organizational policies, structures, or practices that limit access to learning opportunities. these can include restrictive scheduling, lack of resources, or bureaucratic procedures that impede participation in development programs

Environmental factors

in the context of business decision-making refers to elements related to the natural environment that can impact an organization's operations and strategic choices. include climate change, resource availability (such as water and energy sources), and environmental regulations. decisions on investments in sustainable technologies like solar or wind power, or systems for recycling water in production, are influenced by these factors

Seniority pay increase

type of wage adjustment that is based solely on a employee's length of service with a company or within a specific role. this increase is predetermined and not influenced by individual performance metrics. commonly found in unionized environments where pay scales are structured to reward loyalty and tenure

The Omnibus Budget Reconciliation Act (OBRA) of 1993

reduced the compensation limits in qualified retirement plans, making it more challenging for high-earning employees to maximize their retirement savings within traditional tax-deferred plans.

Pension Protection Act (PPA)

focused primarily on pension reform, increasing funding requirements for defined benefit plans and improving transparency in retirement plan reporting

Portal-to-Portal Act

clarified compensable work time under the Fair Labor Standards Act (FLSA), specifically addressing pre and post-shift activities

Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA)

welfare reform law that changed eligibility for public assistance programs

Administrative control

strategies implemented through policies, procedures, training, and supervision to manage workplace risks by influencing employee behavior and awareness. these controls aim to reduce the likelihood of incidents by ensuring that employees follow safe practices and protocols

Impact-mitigation strategies

proactive measures designed to reduce the negative effects of risks that cannot be prevented, especially those outside the organization's control. in context of global HR, these strategies help organizations lessen the damage from external disruptions like political or regulatory changes

External risks

outside the organizations control and require proactive impact-mitigation strategies

Psychological safety

workplace environment where employees feel safe to express ideas, take risks, and make mistakes without fear or negative consequences, enabling open communication and fostering innovation

Span on control

number of direct reports a supervisor or manager has. a wider span of control means more employees report to a single manager, while a narrower span involves fewer direct reports, often resulting in more management layers

Chain of command

formal line of authority and communication within an organization, dictating who reports to whom

Organizational hierarchy

describes the structured arrangement of roles and levels within a company, illustrating the flow of authority and responsibilities from top management to lower-level employees

Centralized organizational structure

where decision-making authority is concentrated at the top levels of management, with lower levels having limited autonomy. can leader to consistent decision-making by may slow down responsiveness

Divisional organizational structure

organizes a company into semi-autonomous units of divisions based on product lines, markets, or geographical regions, allowing each division to operate independently with its own resources and leadership

Matrix organizational structure

combines elements of both functional and divisional structures, where employees report to 2 managers; one for their functional area and another for the specific product or product they are working on, facilitating collaboration across different departments

Functional organizational structure

organizes employees based on specific job functions or roles, such as marketing, finance, or HR, creating specialized departments that focus on their respective areas of expertise

Industrial actions

measures taken by employees or employers during a labor dispute, often due to unsuccessful negotiations. these actions can include strikes, sick-outs, slowdowns, and lockouts, aimed at exerting pressure to achieve desired outcomes

Unfair labor practices

actions by employers or unions that violate labor laws, such as interfering with employees' rights to organize, refusing to negotiate in good faith, or retaliating against employees for participating in union activities

Collective bargaining impasse

occurs when negotiations between the employer and the union reach a deadlock, with both parties unable to agree on terms, often leading to industrial actions or mediation efforts

Family and Medical Leave Act (FMLA)

U.S. law providing eligible employees with up to 12 weeks of unpaid, job-protected leave for specific family and medical reasons, like childbirth, adoption, or a serious health condition, while maintaining their health benefits. It applies to public agencies, schools, and private companies with 50+ employees and requires the employee to have worked for the employer for at least a year and meet hour requirements. FMLA ensures job security and allows employees to manage work-life balance during significant life events; specifically prohibits an employee's supervisor from making contact with an employee's medical provider. Eligibility requires at least 12 months of employment and 1,250 hours worked in the past year.

Sarbanes-Oxley Act (SOX)

enacted to enforce strict oversight on publicly held companies, ensuring greater corporate transparency and accountability in financial reporting. primarily applies to public companies, certain provisions extend to privately held businesses, particularly those involved in securities fraud or preparing for public acquisition

Challenging assumptions

final step in critical evaluation, where businesses critically assess existing beliefs, market trends, and internal biases to make informed decisions. when businesses fail to challenge their assumptions, they make overcommit to outdated business models, failing to recognize or adapt to external market shifts

Fair and Accurate Credit Transactions Act (FACTA) 2003

provides an exemption for employers from notifying employees when they are under investigation for workplace misconduct, specifically related to suspected fraud, misconduct, or a violation of company policies. ensures investigation can be conducted without alerting suspects prematurely, preserving integrity of the process

Immigration Reform and Control Act (IRCA)

requires employers to verify the identity and employment authorization of individuals hired to work in US (complete I-9 form)

Ethical practice

SHRM behavioral competency that encompasses personal and professional integrity as well as acting as an ethical agent within an org. maintaining transparency, fostering culture of trust, and applying ethical frameworks to decision-making

Business accumen

understanding business operations and applying HR strategies to align with the org's goals.

Discretionary assessment methods

used to differentiate among finalists when all candidates have met the minimum qualifications for the role. meaningful insights into candidate's job-related skills, experience, or competencies

Drug-Free Workplace Act (1988)

organizations that receive federal contracts or grants valued at $100k+ must maintain a drug-free workplace policy - employee awareness programs and disciplinay actions for violators

Self-directed teams

groups that manage their own tasks and workflow without supervision, promoting autonomy, accountability, and more agile problem-solving

Middle-of-the-road leadership style

moderate level of concern for both people and production. seeks compromise but often results in average performance, as it neither fully prioritizes employee needs nor production goals = stagnation

Blake-Mouton Managerial Grid

framework for understanding leadership styles based on 2 dimensions: concern for people and production. impoverished -> team leader (5 styles)

The Lanham Act (Trademark Act of 1946)

governs trademarks, service marks, and unfair competition. establishes guidelines for registering, maintaining, and enforcing trademarks to prevent unauthorized use and consumer confusion

Dialectical inquiry

structured decision-making method that ensures diverse perspectives are critically examined by forming opposing groups to debate the strengths/weaknesses of a proposed solution. prevents groupthink

Protected concerted activity

actions by employees to improve workplace conditions or address safety concerns collectively. under National Labor Relations Act (NLRA), these activities are safeguarded, meaning employees cannot be penalized for engaging in them

Cameron and Quinn's Competing Values Framework (CVF)

model for understanding organizational culture, defining four types—Clan, Adhocracy, Market, Hierarchy—based on two core dimensions: *internal/external focus (integration vs. positioning) and stability/flexibility* (control vs. flexibility). It highlights the paradoxes in management by showing how organizations balance competing values like collaboration (Clan) versus competition (Market) and control (Hierarchy) versus innovation (Adhocracy) to achieve effectiveness.

Clan culture

(CVF) fosters family-like work environment, emphasizing collaboration, employee development, and internal cohesion

Adhocracy culture

(CVF) characterized by flexibility, creativity, and an entrepreneurial spirit, where innovation drives success

Hierarchy culture

(CVF) structured, with a clear chain of command, formalized processes, and a focus on efficiency and stability

Counseling

progressive discipline model prioritizing problem-solving and employee development by encouraging open dialogue about underlying causes of performance or behavioral issues. aims to support employees in making meaningful improvements vs administering discipline.

Corporate Governance

refers to the structures and processes that guide corporate direction and control but does not focus on individual ethical behavior

Regulatory compliance

ensures adherence to laws and regulations but does not address that behavioral aspect of ethics in decision-making

Country Club leadership style

Blake-Mouton Managerial Grid

leaders with this style prioritize employee comfort, well-being, and job satisfaction, often at the expense of task completion and productivity

high concern for people, low concern for production

Impoverished management style

low concern for people and production

Team leader style

high concern for people and production - considered the most effective as it emphasizes both employee satisfaction and task accomplishment

Produce/Perish style

low concern for people and high concern for production

Strategic planning stages

-formulation

-development

-implementation

-evaluations

Formulation stage

involves gathering data, assessing industry trends, and defining the overall strategy but does not include executing specific objectives

Development stage

refining competitive strategies and preparing for implementation - does not establish measurable objective

Implementation stage

where strategic goals are translated into actionable initiatives, involving setting objectives, allocating resources, and executing plans to drive org change and achieve desired outcomes

Evaluations stage

occurs after implementation, focusing on measuring outcomes, assessing performance, and making necessary adjustments

Lilly Ledbetter Fair Pay Act

signed into law by President Obama in 2009 - amended federal law by stating that each discriminating paycheck resets to 180-day period for filing a claim, effectively expanding employees' ability to challenge unfair pay practices

Triple bottom line

encourages businesses to consider 3 key factors: environmental sustainability (planet), social responsibility (people), and economic viability (profit) = promotes balanced focus

Perimutter's Headquarters Orientations

-regiocentric

-ethnocentric

-polycentric

-geocentric

Regiocentric

creating strategies that leverage similarities within a specific geographical region, allowing for regional coordination while respecting local differences. balances standardization, ideal

Ethnocentric

belief that the home country's business practices and management styles are superior and should be implemented globally. often leaders to resistance from local employees due to lack of consideration of local culture and practices

Polycentric

tailors business strategies to each host country's unique cultural and business practices, prioritizing local responsiveness over region or global consistency. allows for greater local adaptation but may result in lack of cohesion across regions

Geocentric

integrates best practices from various countries to create a unified, borderless approach to management and strategy. seeks to balance local and global needs, fostering a cohesive org. culture across all locations

Labor-Management Reporting and Disclosure Act

requires unions to provide annual financial reports to the Department of Labor to promote transparency and accountability in union financial activities

Value chain model

developed by Michael Porter, framework that identifies a series of activities within an org that contribute to delivering a product/service, helping to pinpoint areas where value can be added to gain a competitive advantage

Davis-Bacon Act (1931)

requires contractors and subcontractors working on federally funded or assisted construction contracts over $2,000 to pay laborers ad mechanics wages and fringe benefits at rates that are at least equal to those prevailing in the area as determined by the Department of Labor

Push factors

conditions that drive organizations to expand internationally due to challenges in their current market. usually include market saturation, shortages in natural resources, limited growth opportunities, and competitive talent landscapes that make operating in the home country more difficult

Andragogy

theory of adult learning, emphasizing the unique way adults learn compared to children, focusing on self-direction, real world application, and leveraging personal experiences

The Norris-LaGuardia Act (1932)

strengthened workers' rights by restricting the ability of federal courts to intervene in labor disputes through injunctions against peaceful strikes, picketing, and boycotts. also made "yellow-dog" contracts - agreements where employee promise not to join a union - unenforceable

Uniformed Services Employment and Reemployment Rights Act (USERRA)

federal law that protects the employment and reemployment rights of military service members. ensures that individuals who leave their civilian jobs to serve in the military can return to their jobs with the same status, pay, and benefits as if they had never left

Reverse innovations

products, services, or business models that are initially developed in emerging markets to address unique local challenges but later find success in developed markets. capitalizes on affordability, efficiency, and adaptability of innovations created for cost-conscious and resource-limited environments

Hesey-Blanchard Situational Leadership Model

leadership theory that suggests leaders should adapt their lifestyle based on the maturity and competence level of their followers, using different approaches like telling, selling, participating, and delegating to match the needs of the team

Coaching style (selling)

high directive, high supportive behavior - leader provides guidance and support to followers who are motivated but lack the necessary skills, focusing on skill development and collaborative problem-solving (low ability but high commitment) (high directive, high supportive behavior)

Delegating style

highly skilled, self-reliant - minimal direction and support - leader entrusts tasks to followers. both competent and motivated, allowing them to take responsibility and make decisions independently (high ability, high commitment) (low directive, low supportive behavior)

Supporting style (participating)

competent employees but may lack confidence or motivation, emphasizes encouragement over direct guidance. leader offers encouragement and support to followers, fostering sense of empowerment and self-assurance (high ability, low commitment) (low directive, high supportive behavior)

Directing style (telling)

employees are inexperienced and need step-by-step instructions. does not focus on developing their abilities vs coaching. eager to learn, closely supervised (low ability and low commitment) (high directive, low supportive behavior)

Upside risk

potential for positive gains/better than-expected returns

Downside risk

possibility for negative outcomes, losses, and underperformance

Payrolling

staffing solution where a 3rd-party vendor manages the administrative aspects of employments, such as payroll/benefits, for workers hired by a company, reducing the risk of mis-class and ensuring compliance with labor laws

Organizational design

the process of restructuring an organization in a way that supports its strategic goals, mission, and objectives. involves defining roles, responsibilities, processes, and reporting relationships to ensure efficiency and alignment with business strategy

The Pension Protection Act (PPA) (2006)

improve funding of defined benefit pension plans and enhance transparency. requires employers with underfunded pension plans to pay increased premiums to the Pension Benefit Guaranty Corporation (PBGC), which insures private-sector retirement benefits by holding plan sponsors accountable for adequately funding their plans

The Health Information Technology for Economic and Clinical Health Act (HITECH) (2009)

requires entities handling personal health records to notify individuals if their info is disclosed due to a data breach. was enacted to strengthen privacy and security protections under the Health Insurance Portability and Accountability Act (HIPAA) and ensures transparency in cases where patient data is compromised

Trait leadership theory

based on the idea that certain individuals possess inherent characteristics that make them more suited for leadership. traits such as intelligence, self-confidence, dominance, and high energy as distinguishing leaders from non-leaders. assumes leadership is largely innate rather than developed

Moral hazard

occurs when an individual changes their behavior because they are insulated from the consequences, often due to insurance or other protective measures, leading to riskier actions

Time-based differential pay (aka shift differential pay)

additional compensation provided to employees who work during non-standard hours, such as evenings, nights, weekends, or holidays. serves as an incentive for employees to take on shifts that are typically harder to fill due to their timing

Kouzes and Posher's - The Leadership Challenge: 5 Practices of Exemplary Leadership

1. Model the way

2. Challenge the process

3. Inspire a shared vision

4. Enable others to act

5. Encourage the heart

The Electronic Communication Privacy Act (ECPA) (1986)

establishes rules for access, use, disclosure, interpretation, and privacy protection of electronic communication, including emails, phone convos, and data transmissions. protects against unauthorized interception and access to electronic communication and provide civil and criminal penalties for violations

SMARTER goals

Specific, Measurable, Achievable, Relevant, Time-bound, Evaluated, Revised

IRS Intermediate Sanctions

penalties imposed by RS on non-profit organizations to prevent excessive compensation and benefits to executives, ensuring that pay is reasonable and aligned with market standards

Consolidated Omnibus Budget Reconciliation Act (COBRA)

ensures employees who lose their jobs have the option to continue their group health insurance coverage for a limited period, typically up to 18 months, as long as they pay premiums

Nonverbal messages

cues communicated without works, often through body language, facial expressions, and posture

Appraiser

responsible for evaluating employee performance, providing structured feedback on strengths and areas for improvement during performance reviews. focuses on assessment rather than ongoing skill development/problem-solving

Immigration and Nationality Act of 1952 (INA)

categorizes non-citizens based on:

-resident vs. nonresident

-immigrant vs. nonimmigrant

-documented vs undocumented

Absenteeism

the habitual non-presence of an employee at their job, often without valid reasons. high absenteeism rates can lead to decreased productivity and increased costs for the organization

Incremental budgeting

method where the new budget is based on the previous period's budget, with incremental changes made for the new period. often involves minor adjustments and allows for the carryover of unspent funds, making it suitable for situations where departments need to use remaining budgets before the fiscal year ends

Zero-based budgeting

method where each new budget cycle starts from a "zero base," requiring all expenses to be justified for each new period. this approach ensures that every financial allocation is scrutinized and justified, rather than relying on past budgets, promoting efficient resource allocation

Activity-based budgeting

assigns cost based on specific activities or outputs, focusing on the relationship between cost, activities, and outputs. method is useful for organizations aiming to link spending directly to performance metrics, but may not be applicable for new initiatives without historical cost data

Formula budgeting

distributes funds based on a pre-defined formula, often using factors like enrollment numbers or service levels. method ensures consistent and equitable allocation of resources but require a clear and agreed-upon formula, which may not be present in scenarios without established allocation structure

The Copyright Act

protects original works for authorship, including written content, from unauthorized use. content writer must understand this law to ensure their work does not infringe on others' copyrights and to protect their own original creations. this law covers various aspects, such as reproduction rights, derivative works, and distribution

Nominal group technique

structured, in-person group decision-making method where participants first generate ideas silently and independently, then share them round-robin, clarify, and privately rank or vote on them. designed to prevent louder/higher status voices from dominating, ensuring equal participation and a clear, prioritized list of solutions. ideal for cross-functional/sensitive topics

The Securities and Exchange Act (1934)

established the Securities and Exchange Commission (SEC) to regulate the trading of securities, such as stocks/bonds in secondary market. designed to maintain fair and efficient markets and protect investors by enforcing laws against fraud, insider trade, and other financial misconduct

Organizational entry

phase where an individual begins their career within an org. focuses on onboarding, initial training, and gaining the foundational skills needed to succeed in the new role. learning company policies, job expectations, and workplace culture while developing technical/soft skills necessary for their position