Five ways organizations can get the most from their employee assessments.
By Tom Schoenfelder
Do psychometrics really work with regards to hiring and development? After all, people are the most valuable asset in an organization, so it makes sense to explore all avenues for hiring the best talent. When considering personality tests and other tools like aptitude and reasoning assessments for that purpose, organizations are looking to gain a competitive advantage, but they don’t want to waste money.
However, companies may be asking the wrong question. They shouldn’t be wondering whether or not psychometric instruments work; they should be exploring if they are using psychometric instruments correctly.
Consider this: The majority of organizations are leveraging validated instruments from leading assessment companies—not some dollar-store questionnaire or a free phone app. The purpose of an authentic psychometric tool is to quantify personality drivers, and a well-designed assessment will do just that. However, how companies apply the findings determines whether it works or not.
Unfortunately, some organizations treat the process as some sort of crystal ball that can magically reveal whether a job candidate is good or bad. In fact, assessment results are merely data, and the results are neutral without context. It’s what businesses do with the data that makes assessments useful.
On a fundamental level, organizations use these tools to compare an applicant’s personality drivers to the known requirements for the position they are looking to fill. Consider a staff accountant role: Management would look for applicants who are detail oriented, have extended task focus, and are responsiveness to rules and structure. On the other hand, a CFO candidate should display strategic thinking, business acumen, and influential communication. Even within the same functional area, different motivators are needed for different roles.
But treating assessment results as a one-and-done value is selling short all the other ways that psychometric tools can improve and support overall hiring and talent management efforts. When applied correctly, psychometrics and assessments can offer organizations five other benefits.
1. Psychometrics improve consistency in hiring practices. Companies that use psychometrics-based assessment tools on an enterprise-wide basis are able to ensure that applicants for accounting, product development, sales, manufacturing, and other departments are all screened for identical criteria.
A properly constructed assessment instrument is EEOC-compliant and removes race, gender, age, and disability factors from a job candidate’s profile. Although no hiring or promotion decision should ever be based solely on the results of an employment assessment, such a tool can act as an internal filter in limiting unconscious assumptions about superficial qualities.
2. Psychometrics reduce hiring-manager bias. Some managers have the tendency to hire candidates who have similar traits as themselves. The problem with that approach—besides its utter subjectivity—is that it overlooks some important facts. It takes different sets of motivators to successfully execute different jobs within a department, and having a team of diverse talent always outperforms putting a bunch of people in a room with redundant skill sets.
Once the attributes required for success in a given role are known, teams can hire based on an objective job models instead of on biased gut feelings.
3. Psychometrics enable management to measure applicants against top performers in similar roles. Pre-employment assessment results would be useless if there was no way to sort the information in a meaningful way. The good news is that this practice has been around for quite a while, and extensive research has gone into connecting the results of past assessments to top performance in different jobs and industries.
A study conducted by Caliper of 300 new sales hires within its client base, representing a range of industries and company sizes, found that by integrating assessments into the hiring process, these companies were able to double their chances of hiring a salesperson in the top 25 percent of its workforce.
What this means for HR professionals and hiring managers is that applicants’ psychometric profiles can now be compared to those top performance metrics that show key performance indicators for various positions. For example, if a company is hiring a salesperson, they can see how well the applicant’s personal drivers measure against the ideal job model for the sales role.
4. Psychometrics provide a foundation for analytics data. This is the age of big data, an unstoppable wave of complex statistical analyses that are informing everything from athletic performance and marketing strategies to the development of artificial intelligence technology. Many companies are collecting and utilizing big data on all aspects of their businesses, including talent management.
By collecting psychometric data on existing team members, it’s possible to identify high-potentials and future leaders, reorganize for improved performance, and spot organizational talent gaps.
5. Psychometrics lay the groundwork for employee development. Many HR professionals fail to get their money’s worth from assessment results by discarding the findings once the hire has been made. Here’s a secret about psychometric data: They don’t just show performance drivers and motivators; they reveal inhibitors as well. Imagine someone is hired to oversee, develop, and launch a new product line for an untapped market. This individual’s assessment results suggest an agile and innovative thinker, an information seeker, and an action-oriented decision-maker—all desirable attributes for such a role. However, the results also indicate the new hire might have difficulty getting organized and coordinating implementation. This allows management to know where support is needed and where coaching efforts should be focused.
In an ideal world, applicants would always line up perfectly with the ideal job model for the role. Realistically, they will have weaknesses and need coaching and support to overcome them. With psychometric results on hand, companies skip the painful step of finding out the hard way what an employee’s limitations are. Such data can support onboarding and training plans, coaching and development, and grooming for future promotion.
Tom Schoenfelder, Ph.D., is SVP of research and development at Caliper.