Bad hires can be costly. The U.S. Department of Labour puts the cost of hiring the wrong person at 30% of their salary, while hiring HR consultants suggest it can reach $240,000 and skyrocket to as much as $850,000. Additionally, a bad hire doesn’t just impact your company financially. Productivity and morale can also suffer when you hire the wrong person. In fact, CFOs were more concerned about degraded staff morale (39%) and a drop in productivity (34%) than they were about the financial costs of a bad hire.
Unfortunately, almost three-quarters of employers say that they have made a bad hire recently. The good news, however, is that you can avoid hiring the wrong person for a position. Experts suggest that one of the best ways to ensure an exemplary new hire is to implement a strong selection testing program. Here are the tests you should consider including to hire the best candidates and avoid the fallout from a bad hire.
Aptitude tests are very general tests which should reveal whether or not the applicant has talent in a particular area of work. It can tell the employer whether or not the applicant is more suited to sedentary desk work or manual labor, for example. They are most useful, however, in revealing the candidate’s ability to learn or be trained. This is critical information in jobs requiring substantial pre-employment training.
Personality affects a person’s behavior and in particular, their responses to specific events or challenges. This can be critically important in revealing how a candidate will respond to both situations and team members. Personality tests will measure the traits that are typically associated with job performance success. These traits might include extroversion, self-confidence, tact, sociability, emotional stability or agreeableness. They can even assess a candidate’s openness to new experiences and how conscientious they are on the job.
These kinds of tests can be administered in large groups or one-on-one and are relatively inexpensive and straightforward. They are also largely racially and gender unbiased. The one disadvantage with this type of testing is that candidates may try to give you the answers you want rather than reveal their actual personalities.
Integrity tests determine a candidate’s moral principles, particularly trustworthiness and honesty. Can you trust this particular candidate to get the job done? An integrity test may be able to tell you. These tests are usually conducted via a series of ethical questions related to the past experiences of the candidate.
Skills & Job Knowledge Tests
Resumes are supposed to sell a candidate, but the ability to sell doesn’t necessarily equate to being able to do the job. This is where skills testing comes in. In addition to telling you if the candidate has the skills you require, they can also reveal the amount of skill training that a potential candidate may need to get them up to speed. Examples of these types of tests can include performing a typical office task or a software function or even a physical assessment such as lifting a specific weight.
Job Knowledge tests also confirm that what the candidate claimed on their resume is accurate. They can also, like skills testing, reveal particular knowledge and skills that the candidate may have left out of the resume and that may be of value to you. Job knowledge tests reveal the extent of a candidate’s knowledge of a particular job and are generally delivered as a written test.
Cognitive tests measure the candidate’s ability to think. They include measurements of reasoning, memory, perception, mathematical ability, problem-solving and reading comprehension. They can also be customized to measure the candidate’s knowledge of specific aspects of a job.
Cognitive tests are a good indicator of potential job performance and can be administered in large group settings. The disadvantages of these tests are that they can be time consuming to develop and can be gender and racially biased. Buying tests from reliable vendors can help prevent both of these issues.
Behavior testing predicts how a candidate will react in specific situations. Combined with cognitive testing, this type of testing can give a strong indication of whether a candidate can and will perform the job in the way that you expect. Behavioral tests can also help determine how compatible a candidate is with your company and whether or not they can adapt to the existing company culture. These tests are usually delivered through a series of written questions. In addition to helping you pre-screen candidates, they can also provide insight to managers. This is particularly useful in situations where the manager has less time to spend with a new employee or where an employee may be working remotely.
Situational or Simulation Tests
Situational judgment tests are gaining a lot of traction in specific industries. They reveal essential characteristics of a candidate such as their reactions, maturity or value system. The tests can be delivered either individually or in a group setting. Both allow observation of the candidate in a real-life work situation. For example, a consultant could be asked to recommend a software solution to a client, or a call center employee may be asked to deal with an irate client.
These tests can also involve physical tasks that may be part of a particular job and can be used to measure a candidate’s decision-making ability.
Find the perfect candidate
In addition to being laser-focused on helping you hire the right candidate, your selection testing process must comply with all current federal and state equal opportunity and employment laws. To select the tests that will work for your organization, start by identifying the skills, knowledge abilities and other characteristics that are necessary for the position you are hiring.
The goal of your selection testing program should be to find the best candidate for the position and your organization. Hiring the best candidate doesn’t just ensure the integrity of that particular job. It will also maximize productivity and preserve the morale of your existing teams.