Predicting Success in Hiring 

"Tests are the most powerful predictors of success". That's according to Richard Nelson, quoted in the San Francisco Chronicle. According to Nelson, applicants have been fooling bosses and interviewers for centuries, but they can't fool psychological tests, personality indicators, IQ tests, and a whole slate of other pre-employment screening tests now coming into use.

Nelson should know. He's a professor of marketing at San Francisco State University and a former sales executive. He has tracked job performance of a study group of 520 employees for as long as 20 years. His study showed that no other method was able to predict job performance. Nothing worked as well as pre-employment testing.

In Nelson's study, which was conducted through the university, a group of 523 job applicants were put through a series of pre-employment tests prior to being hired. The hirings took place between 1968 and 1986. When the test predictions are compared to actual job performance, the results showed that the testing was highly accurate in predicting future job success.

Anyone who has ever tried to hire and manage sales personnel will know that an 85% success rate is simply astounding. Most sales managers will tell you that the average success rate for sales people is about 10%. One in every ten sales people will succeed. Managers who can produce less turnover than that are considered heroes. And, a 92% success rate on sales managers is equally astounding.

In fact, most managers would agree that a hiring success rate in the mid-80th percentile is the kind of statistic that can spell the difference between a mediocre company and an extraordinary one.

Psychological and personality indicators first took a significant role in the hiring arena during the fifties, often based on technology developed during the Second World War. By 1964, a study by the National Society of Sales Training Executives showed that 83 percent of the companies surveyed used tests In their hiring years.

But problems with validation on some of the instruments, coupled with charges that some were racially and culturally biased caused pre-employment testing to fall from favor during the years of the civil rights movement. Now, as better, more effective tests and indicators, free from charges of bias, have arrived on the market, managers are rushing to include them in their hiring process. In fact, employee and applicant testing is thought to be one of the growth industries of the next decade.

Nelson allays the fears of managers new to testing by pointing out that a test measuring attitudes is not really any more ominous than a typing test given to potential employees. What's more, with many of the tests in use, it isn't a matter of passing or failing. The best candidates for some jobs, he says, may have lower scores on some tests. Often the tests do give a yes or no on the intrinsic value of the person as an employee, but rather give an insight into placement of an individual into the right job for them.

Take the case of Hold and Hooker, a large apartment real estate management company in Orlando, Florida. Sandra Shaklin, their Administrative Director was skeptical when her boss first decided to start using written pre-employment indicators in their hiring process.

"I didn't have much faith in their use," she says. "But then something happened. We had hired a young lady as our receptionist (this was prior to their decision to use pre- employment testing). Although she was obviously intelligent, personable and professional, she just didn't seem to be happy in the position. When we started using Personality Plus (a highly acclaimed employee screening and placement tool), we decided to see if it could help us place her in a position more suited to her talents. I was amazed at the results. Not only did the Profile describe a personality that we recognized as hers, but it recommended that her talents would be best utilized In a sales/leasing position. We've since placed her in the recommended position, and not only Is her performance excellent, but she is thrilled at her new career".

Steve Thurber, Vice President of Operations for Pace Realty Corporation in Dallas, echoes her experience. Pace began testing all applicants being considered for employment in February of last year. "Since that time", says Thurber, "the profiles have been a determining factor in our hiring process, and have given us the opportunity to review the candidates in depth before we actually hire them. This extra step has enabled us to prevent a high turnover in our company. They have also given us an added measure of making the right decision In our hiring."

Compared with other methods of predicting future applicant performance, no other method came close to pre- employment testing. In a 1984 study by J.E. and R.F. Hunter for Psychological Bulletin, ability composite tests ranked above all other methods in predicting job performance.

According to the Hunter's study, the two most common factors which decide an applicant's fate, how they do in the interview, and what experience they have, were insignificant predictors of future job success. Even reference checks are significantly less predictive than testing. Today, employers have a wide variety of pre-employment tests they can use.

• Aptitude tests: Tests which measure an applicant's ability to perform certain necessary job functions.
• Integrity testing: Sophisticated paper and pencil questionnaires, called Indicators, can predict attitudes of the applicants. Work ethic testing: Instruments predicting productivity, attendance and punctuality. Personality Profiling: Personality profiles give an objective look at the elements of an applicants personality, and compare them to the elements needed for the job to be filled.
• Psychological assessments: An extremely detailed and accurate, in-depth view of the applicant, with suggestion on both how to interview and how to manage the person.
• Substance abuse testing: Alcohol and drug testing through urinalysis.

Whichever method of testing you choose, it's important that you get expert help in setting up the administration of your hiring process and in using the results of these testing instruments correctly. Once you have done so, you are likely to find that your company will begin to sharpen its competitive edge, as you build a group of motivated employees who have been placed in the right positions.