Good screening and background checks help make the right match for every open position
The retailer was fed up with ditching job applicants he liked in interviews just because they scored poorly on integrity tests. So he quit testing. And the horror story that followed that decision illustrates the importance of preemployment testing and background checks.
Thomas Cormack, director of operations at Personnel Systems Corporation, a Chicago-based human resource assessment, evaluation, and development company, had just returned from overseas when he called to check on his disillusioned retailer-client.
"He asked if I had read in the paper about the guy who kidnapped his ex-wife and raped her. It was the last guy he hired," Cormack recalls. The moral: A pre-employment test that costs less than $10 can sometimes save a company the thousands it costs to replace a bad match, or the legal fees to defend against liability lawsuits for negligence in hiring a troubled or troublesome employee. Tests range from evaluating cognitive skills to identifying personality traits, and can help employers avoid bad apples and match good ones to the right jobs. But how do you determine what to test? Where can tests be found? Do you have to hire expensive consultants or can you do it yourself?
While Fortune 500 companies can afford to hire HR personnel trained in "psychometrics" (measurement of cognitive and psychological traits), many small and medium-sized businesses don't have the financial resources.
HR professionals can, however, rest assured that there are plenty of experts, research, and resources to help even the smallest company navigate these waters. American businesses are prolific pre-employment testers. A recent American Management Association survey showed that 43 percent of its responding members assess applicants with basic math and/or literacy tests; 60 percent required specific job-skill testing of applicants; and 31 percent use psychological tests.
When to test
"The question is not, `Can we do better than we're doing now?' but `Do we need to do better?"' suggests Dr. Barbara Plake, director of the Buros Institute of Mental Measurements at the University of Nebraska, which arranges annual critiques of hundreds of tests and publishes the results. "Maybe your workforce is humming along and you don't recognize any real problem. The old adage is, `If it's not broke don't fix it,"' she says.
Plake, however, suggests that companies conduct a cost-benefit analysis. "If you need improved sales or productivity, the cost of a testing program may be worth it," to get the right new hires in the right jobs. Conversely, "If you're bottom line, blacker than black, you might not realize a meaningful gain from an assessment program," she says. An example is customer-service call centers, which typically have a turnover rate between 30 and 60 percent, according to Tampa-based HR Directions. When a fourth of new hires are leaving in the first year, making the decision to test becomes easier given that it costs $8,000 to $12,000 per employee for advertising, recruiting, interviewing, and training expenses.
Some firms, however, say testing is essential, especially in a tight labor market where the pool of available workers is depleted of the best and brightest.
"Obviously, many things make up the hiring or screening process, like reference checks, background checks, and work history," says Cormack. "But to really gain true insight on a person, you need to do some testing."
Seattle aircraft-maker Boeing uses a pre-employment assessment test for hourly-- paid mechanics and electricians who perform assembly work, and is happy with the results.
"Our managers have noticed that once people come on line after taking the pre-employment tests, they tend to be better performers and show up for work," says Linda Sawin, manager of assessment services in Boeing's human resources department. …