Assessments are touted as one of the most effective ways to objectively identify the top candidates. But what assessment should you use? Do they really work? What should you look for in your assessment partner? It's more confusing out there than it needs to be, and I am always happy to share my thoughts on what helps make programs successful.
The key to assessment success? Validity, validity, validity. Validity is just a fancy word for evidence that a test does what it claims to do.
All employment-related assessments should have research evidence to back up their intended use. No exceptions! If you want to use particular assessments in hiring, there should be evidence they predict on-the-job performance for similar roles. If you want to use assessment to guide employee development, there should be evidence the competencies or skills measured are actually important for success or satisfaction at work.
Be wary if your prospective assessment provider cannot produce details regarding the research conducted on the test (e.g., a technical manual). Neither references nor testimonials count as validity evidence.
There are a range of ways to implement assessments, from purchasing "off the shelf" with little assistance to getting a professional recommendation or even developing custom assessments.
Assessment really works when the competencies assessed are ones that are important on the job. Off the shelf can work for you, if your testing needs are clearly understood (e.g., typing test for admin roles) or if reputable provider happens to have a standard product designed for jobs just like yours.
In most cases, though, investments made to have professionals study and document job requirements and recommend corresponding assessments result in a more effective assessment program.
ROI: What to Expect
What will happen when you start testing your candidates? Are all new hires superstars and are bad hires forever averted? Unfortunately, no.
Assessments are not perfect predictors. However, there is more than 100 years of evidence that, on average, over time, people who score higher on job-related tests perform better on the job. It's not magic, it's science. Well-designed assessment programs invariably pay for themselves in terms of improvement to company talent decisions.
With turnover, for example, better hiring from online testing and structured interviewing generally reduces attrition by about 10 percent -- that is, 10 percent of whatever your problem was.
As always, the bigger the problem is, the bigger the impact from intervening. If you have 80 percent annual turnover in a particular role (e.g., call-center agents), reducing to 72 percent or better should be no problem for a good assessment program.
If you had only 10 percent turnover, though, you might only shrink that by a percentage point, because you don't have much of a turnover problem to solve. Even so, in almost any scenario, the savings in turnover costs easily pay for the costs of even a lavish assessment program.
Selecting a Partner
Whether your organization decides to use technology-enabled assessments in hiring or to inform training and development, it's important to choose a partner that can provide important and objective information about people.
There are great products and great companies out there ... and there are others that provide information of dubious value.
The relationship is critical. Whether it's your account rep or consultant or the newsletters you receive or the training, your partner should seem credible and professional to you. You should be able to rely on your partner to provide informed advice on the use of assessment in your organization. They should keep you on track for success and out of trouble by promoting best practices in program implementation and ongoing enhancement.
It is your company and employment brand, your hiring or development process, and ultimately your reputation on the line for demonstrating ROI.
When you have the right partner, you should feel that you have the support you need to build a successful program. In fact, the best assessment partners should be more than willing to help you deploy assessments across the entire enterprise for virtually all of your talent decisions, across the employee lifecycle.
Ken Lahti, Ph.D., is director of product strategy and development at PreVisor, which has created performance and turnover calculators to help identify the impact of using assessments in the hiring process.