Pre-hire assessment tools that mine data
deliver true gold: the right candidate for the job.
By Ray Bixler
In today’s war for talent, finding qualified workers is becoming increasingly difficult. In fact, a recent study by Leadership IQ tracked 20,000 new hires and found that 46 percent failed within 18 months. The cost to replace an employee ranges from 50 to 150 percent of a position’s salary. Plus, these totals do not factor in the indirect costs of lost sales opportunities, lack of productivity, and lowered morale. It is clear: Make the wrong choice and your new employee will most likely impact the growth of your business, damage your team’s morale, and cause involuntarily turnover. On the other hand, make the right choice and your new employee has the potential to help your business grow, stay longer, and help the company succeed.
With so much riding on making the right hire, HR has had a recent increased interest in pre-hire performance assessments. A recent issue of Forbes listed evolving assessment science as one of the nine hottest trends in HR technology, and The Atlantic featured people analytics on its December cover, and how it is “already transforming how employers hire, fire, and promote.”
Most HR professionals would agree that past performance is the best predictor of future performance. According to the International Journal of Selection & Assessment, its peer- reviewed, published research shows that organizations that utilize pre-hire performance assessment data in their hiring process achieve clear benefits:
- Anticipate future performance. The higher the performance assessment rating, the better the supervisor performance review once on the job.
- Reduce turnover. Organizations have experience first- year turnover reductions as high as 69 percent.
- Improve satisfaction. By selecting employees with a track record of exceptional customer service, overall customer satisfaction scores increased by an average of 16 percent year-over-year. But there are some underlying issues with the traditional ways of conducting pre-hire assessments. Perhaps the most widespread bias in hiring today occurs subconsciously.
In a recent survey of some 500 hiring managers by The Corporate Executive Board, 74 percent of respondents reported that their most recent hire had a personality “similar to mine.” Lauren Rivera, a sociologist at Northwestern, spent parts of the three years from 2006 to 2008 interviewing professionals from elite investment banks, consultancies, and law firms about how they recruited, interviewed, and evaluated candidates. She concluded that among the most important factors driving their hiring recommendations were shared leisure interests.
What executives should be considering is data collected though a standardized assessment process. Reports that include skills the candidates have mastered, what traits and behaviors they positively display at work, and where they have developmental needs should be reviewed during the hiring process. Reference Checking Reinvented For decades, recruiters and hiring managers attempted to gather behavioral insights on candidates by calling references. But this practice is becoming extinct for a variety of reasons.
- References rarely provide any meaningful feedback. A few years ago, a SHRM study confirmed that because most organizations and individuals don’t want to be held liable for saying anything defamatory, they say nothing at all aside from verifying dates of employment.
- The process is extremely inefficient. “You’re it” telephone tag can take weeks to complete.
- The method is scientifically flawed. The data collection process is not standardized and produces inconsistent results, even when the references actually respond.
Organizations now have to the option to assess candidates’ past performance from references in a way that overcomes the legal, logistical, and scientific shortcomings of dealing with references by phone. Web-based pre-hire performance assessments can be initiated in minutes and completed in less than two days with no recruiter or hiring manager intervention. Research has shown that well-designed pre-hire assessments that gather and manage multi-rater feedback electronically deliver an 85 percent response rate while also mitigating legal risk inherent in phone-based referencing.
Using self-assessments in another path to improve or validate hiring decisions. They are designed to measure cognitive ability, personality traits, and technical, job-related skills. These solutions have the potential to provide valuable insight into candidates during the hiring process, yet shortcomings exist. One of the biggest and most common challenges of self-assessments is they only offers the candidate’s perspective, which, in the end, may be flawed.
Personality tests also have their strengths, but there are several weaknesses:
The recruitment process outsourcing provider mergers with UK-based CPH.
With the growth of global enterprise comes the need for companies to have a global RPO partner with a central point of governance for streamlined multi-country delivery models. The merger accomplishes this and expands WilsonHCG and CPH’s global footprint across North and South America, EMEA and APAC. The combined organization has approximately 300 employees.
“Since 2012 we’ve been seeking a global partner that met our high expectations of quality and performance. Not only did CPH meet that criteria, but they are a natural culture fit for WilsonHCG. The decision to merge has been solidified during the last 18 months, as we learned more about each other’s values and ambitions,” said John Wilson, Founder and CEO of WilsonHCG and CEO of the combined organization. “Not only is the market dictating a need for global capabilities from a single vendor model, but our clients expressed a need for further on-site and in-market support around the world. Top talent is what powers companies across the globe, and our comprehensive human capital services and consultative recruitment delivery approach will provide an unparalleled talent acquisition solution for these organizations. Together, we will redefine human capital solutions by delivering high-touch, transformative recruitment services to our clients.”
We all live in a world populated by brands. Your company is worried about your consumer or customer brand, your social responsibility brand, HR, specifically your “employer brand.” Would you bet your job and career on your provider’s brand? Whether you want to or not, you will.
I am not advocating only engaging the largest provider companies for your needs
Leading the Leaders
Earlier this month, I had the opportunity to steal some minutes of three veritable industry leaders who will be speaking at our HRO Today Forum in May. I posed the same questions to the trio around the main challenges HR faces today, and discovered a common thread in their answers: leading the leaders.
When I asked Joe Cabral, senior vice president and CHRO for North Shore-LIJ Health System, about what is driving his talent management strategy, he said investing in leadership: “We are working on helping leaders become better leaders
The finalists for our first annual CHRO of the Year awards.
By The Editors
For our first annual CHRO of the Year awards, HRO Today is recognizing those CHROs with the capabilities to adapt to a competitive business environment in order to deliver the insight needed for HR transformation. We understand the importance of CHROs who drive workforce initiatives through innovation with measurable excellence in employee engagement and retention to prove it.
We have a roundup of incredible finalists. These CHROs are responsible for providing leadership to ensure talent acquisition and retention, business growth, and a culture that can lead in a global workforce.
New research from The Hackett Group examines HR’s top priorities.
By Natalie Bression, Harry Osle, and Lynne Schneider
The pressure is mounting on HR to change the balance of the services it offers while keeping costs and headcount in check. The Hackett Group’s 2014 Key Issues Study reflects how HR organizations are attempting to successfully shift their service mix and the required enabling capabilities
Human capital management industry leader Allegis Group announced this week that it is formally combining the recruitment process outsourcing (RPO), managed services provider (MSP), and integrated talent operations of its subsidiary Allegis Group Services with the MSP and RPO operations of Australian-based Talent2 under the name Allegis Global Solutions. This continues the integration of the two businesses that has been underway since late 2012 when Allegis Group entered into a joint venture to take Talent2 private.
The combined businesses (www.allegisglobalsolutions.com) create one of the largest human capital solutions management firms in the world.
In Asia, Australia and New Zealand, the recruitment managed services division of Talent2 will continue to operate as part of Talent2 while the transition to the new organization, Allegis Global Solutions, takes place.
SIRVA Worldwide, Inc., provider of relocation and moving solutions, has expanded its repertoire with the recent acquisition of SMARTBOX, a Virginia-based portable moving and storage services company.
SIRVA offers over 50 mobility solutions in 170 countries, providing more than 230,000 relocations per year. The acquisition of SMARTBOX easily integrates with existing offerings and expands the value proposition for customers and clients. The investment adds to SIRVA’s “do-it-yourself” mobility solutions within its extensive list of services.
SMARTBOX will continue to operate under the SMARTBOX brand and will maintain its 19 franchise locations throughout the United States and call center operations in Richmond, Virginia. Founder, CEO and franchise-owner Bryan Bostic will also continue to operate as a franchisee and will provide consulting services to SIRVA.
SAP welcomes industry vet Mike Ettling as head of global cloud HR. Ettling will oversee the cloud for HR line of business, which includes leading cloud solutions from SuccessFactors, an SAP company, and the SAP ERP human capital management solution, and help to manage the more than 17,000 customers worldwide that use them.
Ettling was most previously the CEO of NGA Human Resources, multimillion global HR and payroll services provider. Ettling managed relationships with leading HR technology companies and successfully guided many of the world’s largest companies in finding HR solutions that fit their business needs
Cindy Fiedelman worked to ensure the cultural differences between American Airlines and US Airways didn’t plague the merger. Mission accomplished.
By Russ Banham
As anyone who has participated in a corporate merger or acquisition will attest, all the work leading up to the transaction pales in comparison to the post-merger integration tasks. At the new American Airlines, which merged with US Airways in December, a key consideration is blending two very different cultures from a combined workforce standpoint, says Cindy A
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