Luck is never enough. Instead, double your hiring success by using effective interviewing techniques, validated assessments, and reference and background checks. If you believe that it sounds like a lot of work and money, it is cheaper than the cost of turnover from bad hires.
Many CEOs and executives boast to me about their innate ability to hire someone by gut feel and tell me stories about their success. I ask, “How do you know that the person you didn’t hire would have been better?” The response is usually a nervous grin followed by silence.
Empirical evidence from researchers looks at the results of different interviewing techniques and assessments and is able to compare the results to the performance of applicants once they are on the job. This research technique is an effective way to “validate” a job selection methodology and see which ones work best.
These studies have been done repeatedly over the years. They consistently show that hiring by “gut feel” or what researchers would call “unstructured interviews” is one of the worst predictors of job success.
You have a lot riding on hiring success. While it is impossible to have a perfect selection process, and during a tight talent economy you do need to hire quickly, technologies exist to have both a fast-moving and predictive hiring process for your job openings.
You begin by streamlining your job application process to make it fast, easy, and not a dreaded chore for the job applicant, and use chatbots to keep the job applicants up-to-date on where they stand in the process. Next, use a combination of structured interviews and validated job or personality assessments to help you in making your selection. If an assessment is not validated, don’t use it because it may be poorly developed or have a hiring bias that can leave you vulnerable for hundreds of thousands of dollars of discrimination costs. Finally, track your results to ensure your success in hiring job candidates that perform well on the job is increasing.
This last tip is especially important because the cost of a bad hire can cost you up to 30% of the first year’s salary and more than $200k for a manager if you fail to address their bad performance in the first six months of employment.
Let’s look at the best hiring methods as determined by industrial/organizational psychologists. Based on the research in my book, Hack Recruiting: The Best of Empirical Research, Method and Process, and Digitization, they are the following:
- Work Sample Test which is a hands-on simulation of part or all of the job. It can be used to select the best among experienced workers.
- General Mental Aptitude Test which includes IQ tests and other tests of general mental ability, unique relationships, and reading, writing, and mathematics needed on the job. They work if they are validated for the job family and do not adversely exclude otherwise qualified job candidates based on demographic factors.
- Structured Interviews which are planned and go into detailed fact-gathering on the person’s work history and look for matches to the required job competencies and teamwork skills and alignment to the company’s purpose, values, and culture.
- Peer Ratings, which have high reliability compared to other methods, but they are hard to get during an interview process with external job candidates.
- Job Knowledge Test. For example, assessment tests for Microsoft Office and project management skills for project coordinators or software coding for software engineers).
- Training and Education Behavioral Consistency Method. This is hiring people whose training, education, skills, and previous experiences align with the job. This method requires a structured interview or assessments to discern who is or is not a job fit.
- Job Tryout Procedure usually a 30- to-90-day period for unskilled workers works best with heavy doses of training and coaching.
- Assessment Centers are rated low for most jobs and much better for leadership and sales roles.
- Unstructured Interviews (or gut feel), is not much better than a coin toss.
However, the most important insight from this research is that companies can significantly improve their ability to hire great job performers by using a combination of these methods. The best combinations are the use of General Mental Aptitude Tests with one or more of the following:
- integrity tests
- structured interviews
- work sample tests
- conscientiousness tests
- job knowledge tests,
- peer ratings
- training and experience competency models.
The use of reference checks and background checks significantly improves the company’s ability to verify the accuracy of the job candidate’s claims and detect when someone has lied or exaggerated their accomplishments. Finally, informative onboarding processes and coaching significantly improve the success of new hires and helps to detect early the bad hires that slip through even the best hiring processes.
If you are enamored with your ability to use gut feel for hiring, I encourage you to think again, consider the evidence, and use the combination of hiring methods proven to identify the best performers.
Victor Assad is the CEO of Victor Assad Strategic Human Resources Consulting and works with companies to improve their recruiting, HR operations, leaders, teams, and cultures. Today’s blog has excerpts from his new book: Hack Recruiting: the Best of Empirical Research, Method and Process, and Digitization. You can buy it online at Amazon, Barnes and Noble, and Archway Publishing.