Friday, January 5, 2007

Beyond the Hiring Basics

Key Topics Covered in This Chapter
• Recruiting online
• Deciding when to use a professional recruiter
• Using the "case"interview technique
• Identifying "embedded personal interests" in order to evaluate candidates
• The importance of organizational culture in matching people to jobs
• The pros and cons of psychological testing for candidates
T he previous chapter described several key steps in the hiring process.This chapter will dig more deeply into three of those steps: recruiting, interviewing, and evaluating candidates. In further exploring the recruiting step, we will examine the recruiting opportunities offered by the Internet and by professional search firms.We will next examine the applica- tion of the "case" interview technique in the interviewing process. Lastly,we will delve into the process of evaluating how well a person will fit into a job and the work environment through an examina- tion of "embedded personal interests," microculture compatibility, and psychological testing of candidates.
Online Recruiting
The Internet is transforming corporate recruiting.
1 alone hosts 18 million résumés (13 percent of the U.S. labor force), and on any given day, several million people are busily combing its site.And is not alone;there are now thousands of Web sites offering job listings. Some 90 percent of U.S. companies now recruit online—and for very hardheaded reasons. Online recruiting lets firms target many qualified candidates for a job, screen them in seconds, and contact the best ones immediately. It is only one-twentieth the cost of want ad hiring and slices fifteen days off the usual forty-three day hiring cycle.
The Web allows managers to reach larger numbers of potential candidates, and in venues that weren’t available in the past. It also allows companies to pinpoint their recruiting efforts and to set themselves apart from competitors through creative electronic tac- tics. But companies that use the Internet solely as an extension of paper-based recruiting practices fail to exploit the power of the new medium.Here are some tips—and some cautions:
1. Broaden the pool of candidates. In a drum-tight labor market, companies must use the Internet to reach both "active"and "passive"candidates.Active candidates are those who post their résumés on online job boards.Passive candidates—qualified workers happily employed elsewhere—make up a larger and more appealing pool. To reach passive candidates,some experts recommend that one or more HR personnel be dedicated to visiting and search- ing through the Web sites frequented by prime candidates.For example,if your company needs Java programmers,consider their probable age and preferences.Mostly between twenty-two and twenty-nine years old,they surf the Web heavily and are likely to visit several sites for information on Java—JavaWorld .com, Java Developer’s java),and same people might check for technology news, for technol- ogy reviews, for music downloads and purchases, for sports,and for news.Every one of these URLs accepts banner advertisements—banners that could be used to recruit candidates who hadn’t given much thought to leaving their current jobs.
2. Focus on the best sources. One lesson people are learning as they pursue online recruiting is that simply posting job open- ings on your company Web site or on big commercial boards, such as , ,or,is unlikely to yield the right candidates quickly—or at all.The reason is that your message is likely to be lost in the crowd. One way to boost the odds of success is to target smaller sites—
specifically,the increasing number of Web sites that focus on particular types of jobs in specific ,for example,positions itself as the number-one site for mid- to senior-level executives. For technical personnel,many recruiters are unaware of the existence of Usenet,a global system of discussion groups.Its bulletin boards can be extremely specific regarding job function and location (for example, lists only job openings in Florida for computer programmers).A moderator even ensures that job postings meet site criteria.
3. Set yourself apart. When talent is in short supply,an employer must adapt marketing logic to its recruiting effort.In effect,it must approach qualified potential recruits as "customers."And the first step in marketing is differentiation. Employers are coming up with clever uses of the Internet to differentiate themselves from competitors.Some companies add a link to on their Web sites,encouraging potential applicants in other regions to compare costs of living and to estimate relocation costs.Others sport résumé builders on their sites.Caterpillar,for example,offers a fill-in-the-blank résumé form on its site () that encourages appli- cants to file on the spot rather than go through the more com- plicated process of writing,printing,and mailing a traditional résumé and cover letter.The form also allows Caterpillar to specify the information it wants from job seekers by inserting, for example,a field for "technical,manufacturing,or computer- based skills."A regularly updated list of available positions at Caterpillar,sorted by location,function,and division,is linked to the résumé-building page.One enterprising company,an IT marketing agency in New York City,went so far as to install a Web camera in its offices so that potential recruits could get a look at the company’s creative workspace.
4. Use recruiting software to avoid being drowned in data. Lack- ing an effective filtering mechanism,your recruiters could easily be overwhelmed by the résumés found on the Web or e-mailed directly to them.Fortunately,several companies have developed recruiting software that allows companies to search the Web and download relevant prospects to a database,where they can be managed and evaluated.Thanks to this type of software,recruiters and HR personnel can spend more time posting jobs,reviewing online résumés,and matching up appli- cants with specific positions,rather than slogging through irrelevant material.
Keep Web Hiring in Perspective
Although two to three million résumés are posted online today, remember that this is a small fraction of the 140 million people in the American labor force. So, from the recruiting company’s view- point, it may be seeing just a small fraction of qualified individuals in its search.And in terms of individuals picking up your company on their radar, the numbers are not entirely encouraging either. Market research firm Odyssey, in San Francisco, estimates that only 12 percent of the 102 million households in the United States include anyone who has hunted for a job online. Nevertheless, many of the "right" people from your recruitment perspective may have posted their résumé online.And as more companies and indi- viduals get onboard, the online recruiting proportions will become more favorable. In terms of quality of recruits, remember that online recruiting is a broadly cast net. Unlike job postings in targeted trade publica- tions, online postings are available to all, regardless of qualifications. Thus, a posting on one of the mega job sites might yield little more than a pile of résumés that will take you hours and hours to screen. This reality underscores the fact that the best source of good people is often referrals from your current employees.
Four Steps
Peter Cappelli,a professor at The Wharton School,advocates a four- step approach to online recruiting:
Step 1. Attract candidates. Many applicants choose potential employers based on the firm’s image.Consequently,Cappelli urges companies to integrate their recruiting efforts with their other marketing campaigns.Here are some tips for that integration and for generating a broader pool of candidates: • Build a recognizable brand by using a recognizable "look"in both recruiting and product ads. • Design your Web page to woo potential recruits:Cite work- place awards you’ve received (for example,Fortune’s "100 Best Companies to Work For") and highlight links to information about your firm’s perks and values. • Encourage employees to e-mail job ads to qualified friends.
Step 2. Sort applicants. Online recruiting can produce a huge number of résumés.The challenge is to sort through these quickly without tossing out the choice candidates.Per Cap- pelli’s findings,here are some solutions: • Electronically screen applicants with simple online questions, such as,"Are you willing to relocate?"or "When could you start work?"Questions like these can screen out the obvious mismatches.(See "A Legal Caveat"for more about screening questions.) • Use online tests and games to elicit information about appli- cants’interests,attitudes,and abilities.
Step 3. Make contact. Online recruiting operates in a different time frame than that to which traditional HR departments are accustomed.It’s very fast! Recruiters not only must rec- ognize this different pace,but must adapt to it.Cappelli offers a few tips for doing this: • Connect a "live"person with a desirable applicant imme- diately. • Get your recruiters to think and act like entrepreneurs.Thus, it may be advisable to take online recruiting out of the hands of old-line HR managers,who may be unused to moving quickly. • Give line managers a larger say in hiring.Decentralization allows candidate-seeking business units to go directly to online job boards to seek their own candidates.
Step 4. Close the deal. Once you’ve made contact,the Inter- net connection should move to the background,and good old-fashioned person-to-person contacts should move front and center.In this step,the people doing the hiring need to concentrate on the traditional business of getting to know potential hires and acquainting them with the organization.If they don’t,too many good applicants will slip through their fingers. Recruiters in this stage should build personal relationships with candidates and let the best of those candidates know that they are wanted.To assure that this happens,one expert cited by Cappelli advocates that recruiters spend only one hour per day on the Web, and the rest of their time in personal contact with qualified candi- dates. Others suggest that one group of recruiters concentrates on finding qualified people and another handles offline interactions. Antidiscrimination regulations are as big a minefield for online recruiters as they are for traditional recruiters. Thus, if you "screen" online applicants with particular questions, psycholog- ical tests, or credit checks you must be sure that these screening elements are job-related—and you must be prepared to prove it! (More about this under "Personality Testing.") Outsourcing online recruiting to an independent vendor does not let you off the hook. In the United States, courts have held firms liable for antidiscrimination violations resulting from their vendors’screening techniques.
When to Use a Professional Recruiter
Rapid economic growth and high employee turnover over the last decade have created a minor industry out of matchmaking between companies and job seekers. These "matchmakers" go by various names, including employment agencies, technical re- cruiters, and executive search firms (or "head-hunters"). Some are very generalized while others specialize in particular fields, such as accounting, information technology, or pharmaceuticals. Most charge on a contingency basis—that is,they only get paid if an indi- vidual is hired. Payment is generally about 30 percent of the new hire’s first year compensation. Those engaged directly by firms to round up a handful of qualified candidates—particularly for senior management posts—charge a nonrefundable retainer, or a contin- gency fee, and expect to be reimbursed for their expenses. So the costs add up. Used effectively, these recruiting companies can save you the time and expense you would otherwise expend in generating and initially screening your own pool of qualified job candidates.And in many cases they do a better job of it. For example, specialized firms generally have very active networks of key people in the industries they serve.If you have a notable vacancy—say for a vice president of business development—head-hunters will get the word out quickly and confidentially to qualified people who would otherwise never know of your vacancy. They also screen respondents so that only qualified candidates are presented for evaluation. Lastly, they can do some of the negotiating that might sour an eventual company- employee relationship.You must determine, however, whether their services are worth the cost. Obviously, you don’t have to enlist professional services when your board is acquainted with the right external candidates or when it plans to hire from within. In his advice to readers of the Harvard Business Review, Claudio Fernández-Araóz, himself an executive search professional, cites other instances when these services are not needed:
• when the candidate pool is small and known to management • when the requirements of the open position and the compe- tencies of the successful candidate are clear • when the position seeking to be filled is highly technical and demands very specialized knowledge and expertise (those hard competencies,per Fernández-Araóz,are easier to evaluate than "soft"managerial and leadership abilities) • when it is a low-level position But he makes a case for calling in a professional search firm in many other situations.The first is when a company is hiring for a very high-level position that has a great impact on the bottom line."Even if an executive search firm finds a candidate who generates only 1% more profits than an alternative candidate does,"he says,"it has paid for itself many times over.Moreover,professional firms are often bet- ter than in-house staff at conducting the fast and confidential searches often required in high-level situations." 4 Outside help also makes sense when diversification or joint ventures create new job categories that the hiring organization doesn’t really understand, or when it needs to bring in some- one from another industry with skills the hiring company lacks. Fernández-Araóz cites the case of a stodgy investment company that decided to look for a new marketing director with experience in consumer product branding—something quite foreign (at the time) to investment marketers. Its search firm had experience in that area and quickly generated a list of excellent candidates from the automobile,breakfast cereal,and clothing industries."The com- pany ended up hiring the breakfast cereal marketing executive,who did indeed rejuvenate the company’s brand," writes Fernández- Araóz. Turning over the job to a head-hunter doesn’t mean that the hiring company and its executives can detach themselves from responsibility.They must stay involved.Fernández-Araóz’s advice for staying involved is to:
• Select a consultant, not just a firm. Hire the consultant as you would a job candidate, through interviews with the person responsible for the search, and check references from past clients. How happy were they with his or her services? And since no one can do the entire job alone, try to ascertain something about the consultant’s supporting staff and their stability as a team.Will that team stay intact while it’s working for you?
• Be aware of potential conflicts of interest. A commission-paid search firm usually doesn’t get paid if the winning candidate is a current employee.That may influence the search firm to exclude your personnel from the pool of candidates,even though their job is to find you the best candidate.A fee-based compensation plan can eliminate this type of conflict.
• Work as a team. Finally,Fernández-Araóz advocates teamwork between the hiring company and the search firm."Your full involvement is critical,"he says,"starting with the problem definition,through the homework stage,and into the final offer.While consultants can add value throughout this process, nobody knows the job and the organization better than its own executives."
5 Case Interviewing
General guidelines for conducting a hiring interview were offered in the previous chapter.Following those guidelines will help you get an accurate fix on the job candidate.Having many people interview the candidate and ask questions from their individual perspectives can improve accuracy even more. Some companies go further, employing "case interviewing"to get a deeper understanding of the applicant and how he or she approaches problems. Case interviewing is a method that subjects a job applicant to a scenario and business problem similar to those encountered on the job. The candidate is expected to respond with one or more 40 Hiring and Keeping the Best People well-reasoned solutions to the problem. For example, in a case designed for evaluating a marketing manager candidate, the inter- viewer might describe the general characteristics of an industry and its customer market and then ask the candidate what strategy he or she would use to establish a new product line in that market.The candidate’s description would reveal something about the candi- date’s ability to deal with ambiguity, identify possible solutions, and organize his or her thinking on strategic questions. Management consulting firms, which are continually recruiting new members (the typical turnover rate in that industry is around 22 percent) have used the case interviewing method for many years, and for obvious reasons.They need people who can develop a strate- gic viewpoint. Other leading firms have picked up the technique— Frito-Lay, Johnson & Johnson, Kraft, Microsoft, Staples, and Dell among them.As cited in a Harvard Management Update article on this subject,a Staples manager said that:"Case interviewing enables us to see first-hand how a candidate tackles a strategic question and com- municates possible solutions . . . .It also pinpoints those who can see the big picture." 6 According to Melissa Raffoni, author of that article, case interviewing has traditionally focused on testing problem-solving abilities. Interviewers who use it can observe how candidates approach a problem, the logic they apply, and their choice of questions. However, she notes that interviewers can also test job-specific skills:for example,by asking candidates for market man- agement jobs how they would approach pricing and sales forecasting. According to Raffoni,the power of case interviewing is threefold: 1. It gets as close to real-life situations as possible.It’s a chance to see someone’s mind work with little or no preparation.This allows you to evaluate interviewees who have well-polished answers to conven- tional questions such as "Where do you want to be in five years?" 2. It helps candidates gain a better understanding of the job.I have had many candidates end a case and say,"I was a little unclear about the job before the interview;this gave me a better sense of what’s involved." 3. It tests a variety of skills.Case interviewing can test competen- cies such as strategic thinking,analytical ability,and judgment,along with a variety of communication skills,including active listening, questioning,and dealing with confrontation.Particularly for positions where there is no "right"background or "typical"candidate—that is, no requirement for specific degrees or experience—case interviewing allows you to put everyone on the same footing. 7 The case interviewing technique has some drawbacks. For starters, it requires substantial time, perhaps more than a company has available.This argues in favor of applying case interviewing to higher-level applicants only. It also favors individuals who are natu- rally "fast on their feet" over others who process and respond to information in different ways. Nor is this method useful in testing motivation,leadership,or a person’s ability to work with others.For these reasons, Raffoni urges that case interviewing be used in con- junction with traditional methods.
Hiring Based on Embedded Personal Interests
The previous chapter discussed the importance of identifying the "personal characteristics" that a candidate needs to possess in order to fulfill the requirements of any given job—characteristics such as motivation, intelligence, and interpersonal skills. People who are deeply and passionately interested in the activities that define their jobs, and are more skilled at executing them, are more likely to be successful in their work.Therefore we will explore the important role of personal characteristics here in more depth. Based on interviews with some 650 professionals in many indus- tries over a ten-year period,psychologists Timothy Butler and James Waldroop developed a conceptual framework that outlines eight "embedded life interests" through which people generally find per- sonal expression: 8 1. application of technology 2. quantitative analysis 3. theory development and conceptual thinking
4. creative production 5. counseling and mentoring 6. managing people and relationships 7. enterprise control 8. influence through language and ideas These core interests are grouped into three main categories in tables 2-1,2-2,and 2-3:application of expertise,working with people,and control and influence. Since these interests can be very useful in evaluating the "fit" between job candidates and the positions they aspire to,let’s consider each of them in turn. Application of Technology People with a life interest in the application of technology are intrigued by how things work and are curious about finding better ways to use technology to solve business problems. As Butler and Waldroop write, "People with [this] life interest often enjoy work that involves planning and analyzing production and operations sys- tems and redesigning business processes." 9 They cite the example of a money manager who acts as his company’s unofficial computer consultant because he loves the challenge of this type of work more than he does his regular job. How do you spot people with this interest? See who gets excited when plans are hatched for a new computer system or a process reengineering project. Quantitative Analysis "Some people aren’t just good at running the numbers,they excel at it.They see it as the best, and sometimes the only, way to figure out business solutions.Similarly,they see mathematical work as fun . . . . Not all ‘quant jocks’are in jobs that reflect that deeply embedded life interest," write Butler and Waldroop. In fact, more than a few find themselves in other kinds of work for the wrong reason: because
they were told that following their true passion would narrow their career prospects. To identify people with this particular interest,look for individu- als who are intrigued by cash-flow analysis, methods for forecasting sales,and other numbers-based activities.If a market manager is more
interested in the analysis of customer data than in what’s said in a cus- tomer focus group,he’s probably a quantitative analysis person. Theory Development and Conceptual Thinking "For some people, nothing brings more enjoyment than thinking and talking about abstract ideas," say Butler and Waldroop."People with this interest can be excited by building business models that explain competition within a given industry or by analyzing the competitive position of a business with a particular market." To spot a theory and concept person, look for someone who could easily have followed an academic career, who subscribes to academic publications, and who enjoys conversations about abstract concepts. Creative Production These people are imaginative,"out-of-the-box" thinkers.They are comfortable and engaged during brainstorming sessions.Write But- ler and Waldroop,"[M]any entrepreneurs,R&D scientists,and engi- neers have this life interest. Many of them have an interest in the
arts. . . . Many people with this interest gravitate toward creative industries such as entertainment." These individuals, say the authors, are easy to identify. Uncon- ventional clothing is a giveaway.Also, they are less interested in the features of current products than in whatever is new. Counseling and Mentoring Individuals bitten by this bug like to teach. In business, teaching takes the forms of coaching and mentoring.Many like feeling useful to others;some genuinely take satisfaction from the success of those they counsel.To spot a counselor/mentor, simply observe how they interact with their direct reports. Managing People and Relationships Individuals with this life interest enjoy dealing with people on a day-to-day basis.They derive satisfaction from workplace relation- ships, but they focus much more on outcomes than do people in counseling/mentoring category. For this life interest, look for people who like to motivate, organize,and direct others. Enterprise Control These are the people who like to be in charge, whether it’s their high school class or a division of a corporation.They are happiest when they have decision-making authority over their little piece of the universe. How do you spot them? Per Butler and Waldroop: "These individuals . . . ask for as much responsibility as possible in any work situation. . . .A person with this life interest wants to be the CEO,not the COO." Influence through Language and Ideas These people enjoy storytelling, negotiating, and persuading.They are most fulfilled through writing, speaking, or both, and are often drawn to careers—such as public relations,journalism,and advertis- ing—where these are viewed as regular and important skills. These people tend to be the volunteers who write up the proj- ect proposal or make the new product presentation to the company sales force. Because many people have more than one interest, these categories of life interests may overlap in an individual. For example, a financial manager who enjoys using her special quantitative skills may be a very good "people person" and want to work with marketing personnel. So don’t try to pigeonhole individuals too narrowly. Hiring primarily for interests is far more potent than hiring for skills and values for several reasons: • A job that satisfies someone’s deepest interests will keep that person’s attention and inspire him or her to perform and achieve.For example,Sarah had no formal training in biology
or environmental science,yet her passion for bird-watching led through several levels of self-study and field experience. Initially hired as an intern by a state chapter of a major environmental organization,she eventually rose to the rank of Chief Ornithologist. • A person may be good at a particular job (that is,possess the perfect skills),but if the job doesn’t let that individual express core interests,he or she won’t be happy with the work for long. For example,Phil earned his chemistry and took a job in the R&D unit of a global chemical firm.As a bench scien- tist,he did an outstanding job and earned regular promotions. So when Phil quit his job to take a management position with another company,his boss was very surprised.When asked why he had made this choice,Phil replied:"I’m really not that inter- ested in science." • It’s far easier to help someone acquire or strengthen skills than to make that person feel an enduring passion for his or her work. Certainly,skills play an important role in matching the right per- son to the right job.And new hires must have enough of the appro- priate background, experience, and ability to perform well on the job fairly quickly. Nevertheless, a perfect "interests match" increases the likelihood that the employee will stay with the company more than a perfect "skills match"will. Southwest Airlines provides a striking example of a successful company that puts attitude and interest at the top of its hiring agenda.Southwest is the most profitable company in its industry and enjoys a personnel turnover rate that is about half the industry aver- age. Its hiring practices have a great deal to do with this. Southwest only hires people who are disposed to providing the friendly service that its customers expect and appreciate.With the exception of jobs that require technical skills, such as pilot, mechanic, and attorney, Southwest is less concerned with an applicant’s toolkit of skills than with his or her attitude. Southwest’s approach to hiring is part of the corporate DNA created by its founder and retired CEO,Herb Kelleher."If you don’t have a good attitude,"according to Kelleher,"we don’t want you,no matter how skilled you are.We can change skill levels through train- ing. We can’t change attitude." 10 For Southwest, a good attitude means a sense of humor, a sense of teamwork, and a desire to make customers happy. To determine a job candidate’s core interests, try asking these questions during the interview: • What have you most liked doing in your other jobs? • What do you like to read? Or,if you’re glancing at a newspaper or magazine,what kinds of articles and advertisements are most likely to catch your eye? • What do you enjoy doing in your spare time? • What stage of a project really excites you the most? You can also show the candidate tables 2-1,2-2,and 2-3 and ask him or her which one or more of the eight core business interests seem particularly appealing. Once you’ve determined where the job can- didate’s interests lie,you can determine whether those interests are a good fit for the open position. Hiring for Microculture Beyond matching the right person to the right job, finding the "right fit" has a cultural component. Jobs within organizations have cultural contexts, and you want to make sure that the person you’re thinking of hiring will strengthen these contexts,not seriously con- flict with them. Consultant Dwight Gertz once described how a national chain of mall-based cookie shops inadvertently fell afoul of the "right fit" issue many years ago when its human resource department encour- aged very self-directed people to apply for shop manager positions. "We want independent people who want to be their own bosses," the recruiting literature stated. Once these people were hired and placed in the company’s training program, however, they quickly discovered that everything from what to bake, when to bake it, and in which quantities was strictly determined by the company’s oper- ating manual. In reality, the company did not want entrepreneurs; it wanted people who could follow its time-tested procedures for run- ning a mall cookie shop.It neither had nor encouraged an entrepre- neurial culture. Not surprisingly, few of the new managers lasted more than a year. 11 There was a cultural mismatch between the company and the people it recruited. Large and small companies alike have macro- and microcultures, and it’s important that a job candidate can work effectively in each. A macroculture is an organization’s way of doing things, its general values,the ways in which people relate to one another,and so forth. These same companies are likely to have microcultures as well—cul- tures that characterize different departments or job functions. For example, to the outside world, a particular organization may appear to have a very formal macroculture, with employees in serious- looking business suits and adhering to strict rules of conduct.Yet within this same organization there are likely to be many different microcultures: the software product-design department, for exam- ple,may be home to shaggy-haired engineers who dress in jeans and sneakers and who routinely play practical jokes on one another.The people and culture of the R&D department are probably very dif- ferent from the "suits"who work in marketing and finance. Your firm almost certainly has microcultures. Do you know what they are? The key to hiring right is to understand those micro- cultures and to choose people who will fit into, enjoy, and enrich them. So, if a job candidate truly enjoys wearing a formal suit to work every day and keeping conversations with colleagues strictly professional, she’s probably not the right candidate for the funky, friendly little software group just down the hall! If you find it difficult to define the culture of your unit or work group, the questionnaire in figure 2-1 can help you figure it out. Knowledge of the existing culture can help you hire new employees who will fit in and thrive.
Psychological Testing MANAGER WANTED:A department of ISTPs (introverted sensing thinking perceivers) seeks an experienced ENTP (extraverted intuitive thinking perceiver) manager for a long-term and profitable relationship.No control-freaks or heavy judging types,please. The use of psychological testing to screen job applicants is growing. In a 1998 American Management Association survey, 45 percent of 1,085 member companies reported administering one or more tests to job applicants,up from 35 percent in the previous year.Because of the time and expense involved, these tests are more often given to prospective managers than to lower-level employees,for whom tests of job skills are often more appropriate. 12 Should you and your company use psychological testing? On the one hand, experts counsel caution. Unlike college-entrance exams, pre-employment tests aren’t a rubber ruler for arbitrarily weeding out candidates.They can’t provide a magic solution to your company’s turnover problems. What’s more, if you use the wrong test—or ask even a single inappropriate question—you expose your company to the threat of a lawsuit. So why give these tests at all? One big reason: Used properly, psychological tests may predict success on the job better than any other measure.Among psychological tests, cognitive ability tests are the best.And personality tests, once generally viewed as worthless, have lately won some support from academic researchers. Testing has some built-in advantages over other means of selection, such as a lack of bias. A test asks the same questions and applies the same standards to everyone, and can thus counterbalance an interviewer’s stereotypes. For example, a hiring executive may have a bias against people who are overweight or who didn’t go to the "right" schools. A person’s weight and school affiliation are not good predictors of success. But everyone involved in hiring deci- sions has biases—including some of which they may be unaware. Testing helps remove these biases. Psychological tests can also give a sense of how a prospective employee would fare within a company’s culture. Here are some tips from experts on how to make pre-employ- ment testing work for your organization: 1. Specify your hiring needs. American Golf Corporation, head- quartered in Santa Monica, California, has 1,000 managers overseeing more than 14,000 other employees in 270 locations across the country.American Golf has for years required all prospective managers to fill out a commercially available personality measure called the Predictive Index."It has been useful," says Tom Norton, director of recruiting. "What we’re careful of is matching [an applicant’s] personality or work style to the supervisor they’d be working for. If some- one really likes working with people and requires a lot of supervision, he or she probably wouldn’t work well with an introvert." 13 American Golf’s approach illustrates one of the main requirements (and advantages) of psychological tests:knowing what you’re looking for."It’s important to look at what charac- teristics are being used in the job.That helps to guide what tests should be used,"says William Harris,executive director of the Association of Test Publishers,a trade association based in Washington,D.C. 14 Before administering tests,the hiring firm should understand the specific requirements of the job in ques- tion and the values and behaviors that define the workplace’s culture.Indeed,some think that the self-study a company must undergo in preparation for using pre-employment tests is the most valuable component of the process. 2. Don’t rely on tests alone. Think of testing as just one leg of a three-legged stool,with the candidate’s record and conven- tional interviews being the other two.At American Golf,the personality measure "is one piece of many,many things we look at for each candidate,"according to Norton."It can vali- date other opinions we gather from things like interviews and references.It can sometimes raise an issue to look further into. [The test] is never anything we base a hiring decision on by itself."
3. More is better (up to a point). Tests aren’t one-size-fits-all.To test for personality traits,experts advise instruments such as the Personality Research Form,WAIS-R,or the Executive Profile Survey.To examine a candidate’s interests,try the Jackson Voca- tional Interest Survey.To measure cognitive ability (the term that has replaced IQ),a test such as the Watson-Glaser Critical Thinking Appraisal may be in order.It’s not uncommon for companies and their consultants to give candidates several different tests at one sitting—one each for personality,interests, integrity,and cognitive ability,for example.A battery of tests in which each has some variance increases predictive power.Be warned,however,that the cost of testing will rise as more tests are administered.But given the costs involved in living with or firing a bad hiring choice,money spent on additional testing may be well spent—particularly when dealing with a top- management position. 4. Psychological testing is not for amateurs. Proper interpretation of results, even results of an off-the-shelf test, takes doctoral- level training in statistics, testing, and assessment. In fact, you cannot even get your hands on the test since distribution of the most powerful tests is strictly controlled to prevent misuse. Tests such as the Jackson Personality Inventory, the 16PF Per- sonality Profile, and the Guilford-Zimmerman Temperament Survey are available only to members of organizations such as the American Psychological Association.Although there are no licensing requirements for test-givers and test consultants, the APA serves as a de facto licensing board, and psychologists found to have applied tests improperly can be decertified. The services of a consulting psychologist typically run about $1,500 to $2,000 per senior-level candidate,and the more extensive a screening,the higher the cost.A CEO screening may run somewhat higher. 5. Beware of pitfalls. Employment lawsuits are forcing testers to be very,very careful.Several laws and regulations of recent years—the Equal Employment Opportunity Commission’s rules,Congress’s prohibition of lie detectors,and,most signifi- cantly,the American Disabilities Act of 1990 (ADA)—sharply restrict the content of pre-employment tests.One veteran of the testing business claims that his firm can now use only about 10 percent of the tests they once used;the remainder fall afoul of the rules.Retail chain Target Stores,for instance,goofed by giving job applicants its own test,which included questions from two standard tests that predated the ADA.The test included a few now-taboo questions on health,sexual prefer- ence,and religious beliefs.Target was sued in 1991 for employ- ment discrimination and settled out of court for $2 million. To be legally bulletproof,all questions on a pre-employ- ment test must have predictive validity.That is,the test-giver must be able to show not only that a test accurately measures the traits it seeks to measure but also that it predicts behavior in the specific job in question.That’s no small task,so test developers routinely spend millions of dollars and months or years on large-scale field studies before releasing a test.And every firm that uses them needs to validate the tests it uses with data from its own employees in order to be protected from litigation.It helps to have evidence that the tests work else- where,but the real key is to show that they work for you! It is feasible for companies to construct their own tests, complete with predictive validity. For example, Procter & Gamble has designed a test that meets validation criteria for distinguishing the potential performance of a brand manager. Few companies, how- ever, have the money and expertise to invest in the design of their own tests.Instead,they rely on testing consultants. Summing Up This chapter has elaborated on several specialized techniques that can improve your hiring process: • Online recruiting is fast,inexpensive,and can increase your pool of candidates.Recruiting software can help you with this and make the material found on the Web more manageable. • Professional recruiters can save you time.Although they come at a price,if you engage a competent one,your money will be well spent.Specialized firms have active networks of key people in the industries they serve and can get the word out quickly and confidentially to qualified people.They also screen respondents so that only qualified candidates are presented for evaluation. • We considered the use of the "case interview" method—a useful way to measure a candidate’s problem-solving ability. This method subjects a job applicant to a scenario and business problem similar to those encountered on the job. If you use this method, look for how candidates approach the problem, identify alternative solutions, and organize their thinking. • Evaluating job applicants on the basis of embedded life interests is a macro approach to matching people up with jobs at which they will excel.Unless specific technical training is a prerequi- site,many companies are better off hiring based on embedded interests than basing candidate choices on skills,which can often be easily taught. • Hiring for cultural fit may be just as important as any other evaluation parameter.Culture defines an organization’s ways of doing things,general values,and the ways in which people relate to one another.You want to avoid trying to fit a square peg into a round hole. • Many companies are using psychological tests to learn more about people in the final candidates’pool.But exercise caution: Only deal with tests—and testing consultants—that can safely pass muster on the antidiscrimination front.

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