When using any assessment, employers need to step back and ask themselves one basic question before giving it to a potential employee: Is this test predictive of future job performance? Using well-validated, highly predictive assessment tools can give employers and hiring managers a significant boost when trying to select candidates who will become high performers for the organization. However, all assessment approaches are not created equal. And some will not offer a significant return on your investment. Knowing which types of assessments will be most effective in accomplishing the specific objectives you have identified for your organization will enable you to select a tool with a measurable impact on the bottom line.
Extensive research has been done on the ability of various hiring methods and measures to actually predict job performance. A seminal work in this area is Frank Schmidt and John Hunter’s meta-analysis of almost a century’s worth of workplace productivity data, first published in 1998 and updated recently. The table below shows the predictive validity of some commonly used selection practices, sorted from most effective to least effective, according to Frank Schmidt’s latest analysis that was shared by him in November 2013:
So, which assessment tools should you use in your hiring process?
1. If your hiring process relies primarily on interviews and reference checks, you are choosing to use a process that is significantly less effective than it could be if more effective measures were incorporated.
2. There is no better predictor of job performance than cognitive ability. If you are going to use just one assessment tool as part of your screening process, choose a cognitive ability test.
3. While personality tests do add value to the hiring process, relying solely on them to make hiring decisions is not very effective. Personality assessments are most informative when used along with other tools.
4. Finally, the most effective hiring practices are ones that employ a combination of three assessment tools to make hiring decisions — cognitive ability test, personality test, and a structured interview. A hiring assessment process that combines these three tools has a greater than 70% chance of accurately predicting job performance and thus will provide you with the greatest return on your investment.
PerspectAI is a powerful game-based assessment tool for data-driven talent decisions. The tool follows a three-pronged approach, where a candidate’s cognitive abilities are measured, personality is gauged, and soft skills are analyzed, through a combination of immersive games and AI-based video interview. This multi-dimension approach makes PerspectAI the most effective and holistic tool to gain deep insights into the potential of the candidate.
To know more on how you can bring an in-depth data-driven assessment to your talent management processes, click here.
Schmidt, F.L., & Hunter, J.E. (1998). The validity and utility of selection methods in personnel psychology: Practical and theoretical implications of 85 years of research findings. Psychological Bulletin, 124, 262–274.
. Schmidt, F.L., Oh, I-S., & Shaffer, J. (2013). The validity and utility of selection methods in personnel psychology: An update 10 years later
 Schmidt, F.L. (2013). November 6, 2013 address to Personnel Testing Council Metropolitan Washington (PTCMW) chapter.
Assessments for Work is a 3-part series written by Dr. Puranjaya Singh, Chief Strategy Officer, at PerspectAI. The series takes a deep dive into how assessments can help organizations make better talent decisions. Look out for the next edition of the series on 16th June.