Selection testing: A very real but not at all glamorous opportunity for HR outsourcing.
An area we HR professionals frequently ignore is selection testing. An exception is background reference checking (which these days, fortunately, seems to get more and more attention). Background screening comprises a battery of tests used in the selection process.
Before we move on, consider this definition of a selection test: any instrument used to screen in (or out) candidates during the recruiting and selection process. Once you accept this definition, you will also see the outstanding opportunity we have to include this area—at as sophisticated a level as we want, regardless of our organization’s size—in our professional “tool kit” when we use outsourcing as the vehicle. Let me explain.
MAKING THE GRADE
Mary Tenopyr, a very bright Ph.D. with practical expertise, performed serious research in selection testing. One project she successfully completed was an extensive study to determine the degree of correlation between on-the-job performance and selection test results that drew from a vast variety of criteria that included work samples, peer ratings, job knowledge tests, job tryouts, assessment centers, biodata (e.g., application forms), interviews, reference checks, achievement inventories, experience, college GPA, job previews, interest inventories as well as handwriting analysis (which after more than 400 years of use, she found still no correlation), age, personality inventories, honesty, and physical tests. I included the categories here to serve as a reminder of what we might not consider a test actually is.
For just about all organizations except Wal-Mart, a real frustration that we have in the workplace is having the critical mass required to obtain a statistically significant sample size that allows us to meet the validity and reliability requirements not only of sound testing procedures but also to meet Equal Employment Opportunity Commission (EEOC) guidelines, especially because the EEOC requires that any test be validated specifically for each organization. Just as importantly, the economies of scale do not permit us to identify really effective resources in the marketplace. Even if that were not a barrier, how many of us could afford to have a professional in this area with the academic credentials such a job requires?
FINDING A TEST ADMINISTRATOR
Outsourcing to the rescue. If you consider the two aspects mentioned earlier—namely the right instrument and the right test expert—by reaching out and finding the Ph.D. with solid testing credentials, you can then use that person to identify the best combination of instruments for your organization’s unique needs.
To maximize impact, outsourcing this activity must be totally different from a vendor (or even consulting) approach because you will not seek a vendor and choose from the limited instruments he/she may be selling, nor will you seek a consultant to be retained on a project (and turn-key) basis. Both are too transactional for the truly important, long-term relational aspect that truly effective testing requires. In fact, you may even find that unbundling is the most effective route to go, with one or more firms providing testing for various functional areas (e.g., IT, finance, and HR) and another for background screening. In the U.S., it is impossible for even the largest organization—not to mention the CIA—to take on this task internally, especially because there is no centralized database for all criminal information.
What about cost? Consider the potential cost of not doing effective testing. Recent research indicates that more than 50 percent of CEOs hired from outside the organization fail. That is just one position, albeit a most important one. Think of all the first-year turnover you currently have. Put a price tag on it. Then compare that with the cost of a testing program. As long as you don’t have a CFO like I once had—someone who saw vacancies as opportunities for reduced expense—then I suggest you try a program that meets what you are able to afford. Be mindful of the potential cost of the alternative, while recalling statistics indicating an increasingly tight market for talent looming right now and continue as far into the future as anyone can see.
