This study examined the utility implications of three commonly used personnel selection methods in terms of social and economic equity. The comparative analysis stemmed from the controversial issues of weighing social policy as identified by EEOC standards and affirmative action guidelines against an emp1oyer's right to hire the most productive job applicants. How the social equity and productivity issues are addressed, according to an organization's desired outcomes, can help determine the type of selection procedure adopted. In terms of productivity, the top-down raw score approach was by far the best, followed by the minimum cutoff procedure and the within-group standardized score method produced the greatest selection of minority groups, followed by the minimum cutoff procedure and the top-down raw score approach. The top-down raw score approach clearly showed a disparate impact on minority groups, while the within-group standardized scoring method demonstrated adverse impact on the white group, indicating a potential for reverse discrimination. The results from comparing these selection strategies in terms of the gain in productivity and in social equity are of enormous assistance when making a final decision as to the appropriate selection strategy.
Evaluating the social and economic benefits of personnel selection procedures is becoming increasingly important.(1) Personnel administrators are frequently confronted with the task of justifying employee selection programs because they consume large proportions of an agency's operating budget. Simultaneously they are supposed to insure that neither erroneous selection nor rejection occurs. personnel administrators not only must develop efficient predictive models of job performance, but also must take into account the values placed by the organization on the integration of minorities and women into the workplace.(2) Thus in order to choose a selection program that provides the desired outcome, one must combine a priori prediction with the cost placed on alternative selection methods.
One approach to determining the best selection procedure is use of selection utility models.(3) These models enable the decision maker to evaluate a number of viable selection strategies in terms of costs and benefits and to compare the estimated net gain in productivity (dollar value). Due to the difficulty in dealing with some of the parameters, however, these models have only recently been refined enough to become a useful tool.(4)
Nevertheless, as utility models have become operational, legislation has evolved regarding the rights of minorities and women in the area of personnel selection. The Supreme court's interpretation of these laws also has been evolving rapidly. The choice an organization makes hinges on the desirability of achieving certain social objectives within the framework of the current law, combined with the economic consequences of various selection procedures. Typically, personnel selection programs try to minimize errors in forecasting job performance by maximizing measurement accuracy and predictive efficiency.(5) The Uniform Guidelines on Employee Selection require that content, criterion-related, or construct validity must be demonstrated in the selection tests.(6) While these classic validity approaches to personnel selection are important, they remain deficient to the extent that benefits and costs of various selection strategies are not stressed. In order to evaluate selection procedures in terms of their utility to the organization, one must combine predictive efficiency with social outcomes. This leads to an optimal selection strategy, which is the subject addressed by this study.
The utility of selection procedures is determined by estimating the net gain in productivity of selected applicants. Assessment formulas have been around for nearly 40 years.(7) Unfortunately, few studies have actually applied these formulas because of the difficulty in quantifying some of the parameters. …