ARTICLES

THE ROI OF ASSESSMENT TESTING
 

AN ARTICLE PUBLISHED IN THE HUMAN RESOURCES MAGAZINE

A human resources manager needs to navigate himself between the need to make a valid and accurate decision that requires depth and insight about the candidate, and strict budgetary constraints. The requirement is for optimization in the process, at the basis of which is contact with a large quantity of candidates whereby only a small part of them shall in practice be accepted for the position.

Where has the market being going in recent years and what are the leading techniques?

There are three main schools of thought in use in the large recruitment departments; there are three trends in selection of employees in recruitment departments in which there are large scales of recruitment – starting from personality assessment and in particular assessment centres which is the most veteran technique. By way of computerized psychological tests that were a breakthrough in the 90s, and as far as empirical selection tools that are measured in terms of ROI that have come into use in the past five years.

 

Assessment centres - The rationale of the tool: Behaviour within a group reflects the behaviour of an individual in an employment position. Designated simulations can examine specific coping mechanisms of the candidate for a job. Representatives of the organization observe the behaviour and this raises the soundness of the decision. Advantages: in a short time period it is possible to sort a large group of candidates by way of a tool with relatively high level of validity, which provides a solution for the requirements of the position. One can compare between several candidates in parallel for the same position. The tool is very reliable; the recruiting manager can participate as an observer, can see the potential employee and his relevant behaviour and can judge to what extent he is suitable for the position and the organization. The tool provides not only information as regards the suitability of the candidate but also provides information to the manager how to manage the employee correctly. Disadvantages: Although it started as an exclusive, reliable and in-depth selection tool, the tool has become a mass product that creates negative feelings with the candidates and creates an image boomerang vis-à-vis the organizations – candidates enter into a large group, are screened within a short time and experience failure. It is an expensive tool and relatively long in the event that a high professional standard is maintained.

 

Computerized skills and personality test – The rationale of the tool: the tool enables initial, reliable and relatively sound examination of cognitive skills, lines of character and behaviour. The tests base themselves on broad based validation and reliability tests and allow fast decision making. The results are clear, quantitative, and enable the decision maker to create clear criteria for each position as regards acceptance/non-acceptance/  Advantages: generic testing, a sort of “shelf product”, which can be used  easily for a very wide range of positions. The test gives clear results as regards the intellectual skills of the candidate and provides a reliable initial picture as regards the personality of the candidate and his pronounced lines of character. The test is shorter than a day of full assessment and therefore saves time and costs. The advanced versions of these tools are via the internet – so that tests can be performed at home and the tests are adaptive: the test adjusts itself to the level of the examinee and thereby saves approximately 30% in time. Disadvantages: It is difficult to receive an accurate picture of the candidate or about specific questions, constitutes an initial test however the computerized test finds it difficult to provide an in-depth response as regards the suitability of the candidate. The duration of the test: relatively to the developing alternatives, is long: between one to two hours. There is a glass ceiling as regards the measure of the reliability; candidates are left with the feeling of “a difficult exam” due to the intellectual tests.

 

Designated empirical tests measured in terms of ROI – in Biodata – The rationale of the tool: the tool provides clear answers vis-à-vis the measurable criteria that the organization requests: identification at the start of the recruitment process as to who shall be accepted in practice, who shall abandon the process, who shall function well, to which unit the candidate is suitable. The tool examines to what extent the candidate shall comply with the specific requirements that the organization defines – acceptance, functioning, decrease of the abandonment aspects, classification and suitability for the various units.
 

Advantages: the tool provides a clear and unequivocal score vis-à-vis the criteria that the organization has placed. It streamlines the selection process and examines itself in ROI terms for the organization. The tool measures itself as compared to the savings in practice for the measurements that the organization has defined: increase of percentage of those accepted in the selection process and decrease of the resources expended for the selection process, significant reduction of percentages of abandonment and reduction of costs for replacement of employees, correct and effective classification for the various units, increase of the functioning of employees in quantitative measurements such as: increase of scope of the sales by the sales and service personnel and more. The tool is particularly short (up to 20 minutes).

 

Disadvantages: the tool does not provide comprehensive diagnostic knowledge as do the assessment centres or the computerized tests. The tool requires a mass of candidates in order to achieve results upon which it is measured, and therefore it is particular suitable for relatively large organizations. In order to provide definitive results there is a need for customization of the tool for each organization which takes between one and two months.
As the large organizations require fast and practical tools – this increases the tendency of the recruitment departments to use two types of relatively new tools more and more: computerized tests and empirical tests.
Every test that works well and reliably, creates significant ROI for the organization, however at present organizations wish to measure it clearly, so that it is measureable and transparent. The assessment centres and the computerized tests do no measure themselves against the results in practice of the position, but rather tests in longitudinal studies the level of correlation between the test score and the criterion measured  and the best score and the criterion measured as an administrative and abandonment assessment. These studies create a correlation from whch is it difficult to create a clear and measurable ROI. On the other hand the empirical tests measure themselves absolutely as compared to clear measurements of the organizations such as acceptance, abandonment and functioning and therefore create a clear ROI. It seems that the current trend requiring selection tests to be not only effective, of short time duration and making savings, but rather also measurable in ROI terms, shall become stronger in all the organizations that refer more and more to human resource departments as a corporate partner in the organization.

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Biodata HR

office@biodatahr.co.il

Telephone: 09-9715146

5 Sapir Street, Ampa House, POB 12290

Herzliya Pituach 46725

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