Experts estimate the cost of a bad hiring decision at 20% to 200% of a year's salary. With stakes this high, it's no wonder more and more companies are integrating pre-employment assessments into their hiring processes.
Mike Russiello is President and CEO of Brainbench, a leader in the assessment space with expertise regarding the “do’s” and “don’ts” of pre-employment testing. Russiello also has served as the Chairman of the Executive Committee for the States Career Clusters Business, Management, and Administration Working Group; the Advisory Committee for the States Career Clusters Information Technology Working Group; and the Executive Advisory Board for CLO Magazine.
In the following interview, Mike covers the critical points you should consider when implementing pre-hire assessments into your hiring process.
What are pre-hire assessments?
Pre-hire assessments cover all of the vehicles by which a candidate is evaluated as part of the hiring process. It includes techniques that are both subjective and objective in nature, which should always have the intent of selecting the best candidate for the job – unfortunately that’s not always the result. The classic subjective techniques are the resume review, interviews and self assessments like personality tests. With 50% of candidates lying on resumes, and many others bluffing their way through the interview, subjective assessment alone is a risky proposition. Adding objective assessment levels the playing field. Objective assessments include knowledge, skills and ability tests, as well as background checks. The proper blend of objective and subjective assessments will dramatically improve your hiring success.
What is the benefit of using pre-hire assessments?
There are three main benefits of using assessments:
1) Increased performance of new hires
2) Reduced turnover
3) Increased efficiency of the hiring process
Every organization depends on the performance of all of its employees. By selecting candidates that are more likely to perform, the performance of the organization increases over time. Additionally, people who perform well are likely to enjoy their work and remain on the job longer, which reduces turnover. Finally, when dealing with large volumes of candidates, using assessments for pre-screening can eliminate candidates that do not fit without taking up valuable time. For HR departments with limited staffs and budgets, this can help you do more with less, without sacrificing quality.
So how do you justify a pre-hire assessment program? We find that one benefit often stands out in every situation, and is usually more than enough to justify the program. For example, if you're hiring salespeople, you can multiply the expected increase in average sales production per salesperson by the number of salespeople you are hiring. If it's turnover that you're trying to reduce, you can multiply the expected reduction in turnover by the cost to your organization of a voluntary turnover. If you're hiring IT staff for an important project, you can estimate the reduction in training time you'll get by hiring candidates who can hit the ground running.
Why do assessments work?
Assessments are great at capturing objective data about a candidate, like do they know how to do basic math, or GAAP accounting. Interviews, on the other hand, are great for collecting qualitative information, such as whether a person is motivated to do a great job, or not. Together, assessments and the interview provide a kind of one-two punch that forms a better picture of the candidate and what he or she brings to the table. Armed with better information, hiring managers can then make better decisions.
Who uses pre-hire assessments?
As far as the types of companies that can benefit from incorporating testing into their hiring process… ALL companies benefit from this practice. A misconception in pre-employment testing is that it is only commonly done among larger, Fortune 500 companies (of which studies have shown that number to be ~65%). In truth, any organization - no matter how large or how small - will benefit by screening their candidates. After all, a company is only as great as the people who work there. Brainbench's client list does include large companies such as Advance Auto Parts, IBM, NASA, and Wells Fargo; but that is only the beginning. Literally thousands of small to mid-sized organizations rely on Brainbench assessments to help them hire right.
Can you cover the Do’s and Don’ts of pre-employment testing?
Objective assessments can be powerful tools when applied to the hiring process. The following is a list of dos and don'ts to consider when implementing an assessment program:
Do assessments increase my legal risk?
When assessments are applied properly, they actually reduce your legal risk, since they add objectivity to the selection process. However, careless use of assessments are just as risky as untrained interviewers. The key is to implement any selection process, assessments included, in a thoughtful manner and to ensure that all aspects of the hiring process are related to job performance.
What should I look for in an assessment provider?
Use the following criteria to evaluate any assessment:
How does it work?
Even as recently as 10 years ago, most assessments were delivered either via paper and pencil, or using software you had to load onto your PC. Technology has made the entire process of pre-hire assessment faster, more cost effective, and more accurate. A majority of on-line assessments are now delivered over the internet. Hiring managers/recruiters select the assessments most appropriate for the job, provides the candidate with instructions to take the assessment (either remotely or on-site), and once the test is complete, the results are made immediately available.
How do I get started?
Once you have a clear understanding of the job, you should select the elements of the job that are most related to performance and are difficult to teach a person once they are on the job. When you have this list, you'll be amazed at how many different assessments are available. With Brainbench, you should start with our Hiring Products Overview, then download the PDF version of our Assessment Catalog (350 KB). Account Managers are available to help you with any questions you may have.