Hire the best candidate every time!

One of the most challenging tasks for managers and executives is putting a selection process together that truly selects the best candidate for a given position. If you polled 100 companies, you would likely find that each company has its own distinct process and that the results over time from that process have been mixed at best. The most important aspect of the hiring process is its predictive value: the ability to predict the future job performance of a given candidate. So what hiring practices have the highest predictive value? Decades of research on selection processes has resulted in extremely valuable knowledge about the utility of various selection methods and the superiority of specific selection assessments for making the best hiring decisions.

Research over the past 25 years has shown that variability in work performance among incumbent workers is very large. One way to standardize this variability is by measuring the dollar value of output. The accepted formula to measure the dollar value of output is a 40% standard deviation of the mean salary of the job (Schmidt & Hunter, 1998). For example, if the average salary for a job is $40,000, then superior workers (those producing in the 84th percentile for their job, or one standard deviation above the average) produce $16,000 more than an "average" employee and $32,000 more than a "poor" performer. Therefore, managers can increase the economic value of candidates hired by creating a process that reduces the inherent variability among performance of those hired; i.e. by improving the likelihood of hiring a 'high performer.'

What does the optimal process look like? Almost 100 years of employment research concludes that the most valid single predictor of future job performance is General Mental Ability (GMA). Among the various assessment procedures used across all types and levels of occupations, GMA has the combined highest validity and lowest application cost (Moscoso, 2000). As a stand-alone assessment technique, a work sample has slightly higher predictive validity but is much more costly than a measure of GMA. For professional-managerial jobs, GMA predicts roughly 34% of performance success in that job. For lower level administrative jobs, it predicts 26%. For this reason, any selection process should use some measure of general mental ability as a primary differentiator between candidates. From there the question is which procedure(s) will add substantial incremental validity above GMA without prohibitive costs?

Assessment Centers (AC's), a strategy employed by numerous selection processes, meet the first criteria but not the second. A 1998 review of hundreds of assessment procedure studies found that AC's have substantial predictive validity themselves but only add a 2% increase in validity when combined with a measure of GMA. In other words, applicants who score well on measures of intelligence typically also perform well in AC's, so there is little to no additional value in putting candidates through expensive assessment centers, which typically cost thousands of dollars per candidate.

On the other hand, both work sample tests and structured interviews offer the same predictive value as GMA, and significant incremental value when used in conjunction with GMA. A well-designed work sample test will predict approximately 29% of a candidate's performance and a structured interview can predict 26%. Additionally, the incremental value of each is 27% and 24%, respectively. Averaged across occupations, a measure of GMA plus a well-designed work sample test will predict 42% of a candidate's performance; GMA combined with a structured interview will predict 40%. A further advantage of both of these processes is their versatility in the selection of entry level or experienced workers. However, work samples are easier to create for lower-level workers, who typically have much more tangible results compared to higher-level managers. For example, it is much easier to use a work sample to count how many widgets a line operator produces than it is to measure how well an HR director handles a conflict situation.

For this reason, structured interviews typically are used in place of work samples for candidates at the manager level or above. Structured interviews are highly versatile in that they offer a fixed format, can be designed through a job analysis, and may have an accompanying scoring manual. Conventional structured interviews typically consist of a series of questions focusing on job responsibilities, knowledge, and achievements in previous jobs; however, they generally are not based on a formal job analysis. Two types of structured interview techniques that do rely on job analysis are the Situational Interview (SI) and the Patterned Behavior Description Interview (PBDI). In the former, the interview questions involve specific work dilemmas designed to elicit the applicant's intentions as a measure of their future behavior. The PBDI, in contrast, is based on the premise that the best predictor of future behavior is past behavior. Candidates are presented with some criterion relevant to the job and are asked to recall a relevant past incident and to describe their specific behaviors in that incident. One added benefit of the PBDI, also referred to generally as behavioral interviewing, is its flexibility in allowing candidates to use examples from community engagement, volunteering experiences, and educational history in addition to examples from work.

Regardless of the format, both conventional and structured interviews demonstrate significant predictive value. In fact, research has shown that the structured interview is one of the best predictors of job performance and training proficiency, and it generalizes across occupations and organizations.

In economic terms, the gains from increasing the validity of hiring methods can amount over time to literally millions of dollars. Many organizations rely solely on unstructured interviews for hiring decisions. In a competitive world, these organizations are creating an unnecessary disadvantage for themselves. By adopting more valid hiring procedures, specifically a combination of general mental ability and either a work sample or a structured interview, they could drastically improve their competitive advantage.

Our selection assessments at Roselle Leadership Strategies, Inc. include four ability tests aimed at calculating a candidate's true GMA, as well as personality tests, proprietary open-ended sentences and a structured interview aimed at determining how a candidate is likely to act and perform on a day-to-day basis. Our primary objective is to reduce the variability in performance of employees hired in order to increase dramatically the economic value of each hire, specifically, and of the organization, generally.

Works Cited

Kataoka, H.C., Latham, G.P. & Whyte, G. (1997). The relative resistance of the situational, patterned behavior, and conventional structured interviews to anchoring effects. Human Performance, 10, 47-63.

Moscoso, S. (2000). Selection interview: A review of validity evidence, adverse impact and applicant reactions. International Journal of Selection and Assessment, 8, 237-247.

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.

About the Author

With a Master of Business Administration Degree from the Opus College of Business at the U. of St. Thomas, a Masters Degree in I/O Psychology from the Illinois Institute of Technology and a Specialists Degree in Compensation Management. Ben is Managing Director of Roselle Leadership Strategies, Inc. Website: www.roselleleadership.com Blog: http://leadershipstrategies.typepad.com/blog/

Human Resources 2.0: How To Do More With Less

Do-more-with-less - that's the new mantra for managing human talent in the economic downturn. Amidst layoffs and reduced venture capital financing, companies are seeking innovative solutions that balance their continued need to solve complex problems with their hiring and budget constraints. In this article, we will teach you how to deploy an efficient model for managing your company's staffing needs. Whether you're a garage start-up or a multinational corporation, the Distributed Agent Model allows you to stretch your budgets further and dynamically grow and shrink based on your business needs.

Managing Your Human Capital
While the Distributed Agent Model may sound like something from a spy novel, companies such as InnoCentive.com and DuPont are using it to tap into brainpower outside their company. Probably the most popular incarnation of this model is crowdsourcing, where a problem is broadcast to a large audience with the hope that someone in the crowd will solve it. Here is a step-by-step approach to using the Distributed Agent Model within your organization.

Step 1 - Define and Scope Each Task
It's useful to think of your company's complex problems in terms of tasks that can be completed in a sort of global factory with workers distributed around the world. For example, an online travel site might use remote agents to act on complex hotel reservation requests that a computer simply couldn't handle such as "make a hotel reservation that would be perfect for a Valentine's Day surprise." Clearly a computer couldn't define what "perfect" meant, but perhaps a distributed set of workers, organized effectively, could find a great chic boutique hotel that fits the bill. The important pieces of this example are that tasks can be as complex as your workers can handle but they should be self-contained, meaning everything needed to complete the task is tightly packaged up within it. What you're looking to avoid when designing your task is the kiss-of-death for a distributed agent model: manual intervention. AskSunday.com, a New York based virtual concierge service, does a great job of allowing remote agents handle complex tasks such as booking travel plans.

Step 2 - Source the Right Workers
Seek workers who possess the core competencies you need for the task. Unlike conventional staff hiring, since you are recruiting for a specific task, "hiring up" or opting for over-qualified candidates could result in an agent population that is unenthusiastic and less motivated.

Consider intrinsic rewards in addition to, or even instead of, financial compensation. Finding a way to give your agents a pat-on-the-back, even a "virtual" one, goes a long way. ThisNext.com, a social shopping site which uses human agents to source unique online deals, does a great job of this. ThisNext.com rewards its agents with both novel "thank-you" gifts as well as kudos in the form of public recognition of their successes for all members to see.

Step 3 - Automate the 99% Case
Most of what your agents do should be completely autonomous and not require any manual intervention. The moment your system requires manual intervention, you have introduced a scalability problem into the system. For example, for a task such as proof-reading an essay, if a staff member is required to skim through the finished product, you have just created an expensive bottleneck. Of course, occasionally you will need to manually intervene in order to take corrective action or to re-assign a task - make sure that this is truly the exceptional case. TutorJam.com, an online tutoring company, has developed a complex Java-based backend system that allows hundreds of tutoring sessions to take place simultaneously without intervention. The system uses a combination of educators and automation to detect unusual situations.

Step 4 - Incorporate a Feedback Loop
When you have hundreds of agents "running around" performing tasks, you will need a quick way of assessing the successful completion of a task. Perhaps, having two agents independently completing the same task and comparing results might make sense. In many cases, simply having a "feedback loop" can signal that a task was completed successfully. For example, if the consumer can implicitly or explicitly acknowledge or even rate the quality of a completed task, a feedback mechanism is established. Be creative in defining your feedback mechanism - in many cases, a simple check of the volume of web traffic visiting the finished product or a quick 5-star rating system similar to Amazon.com or EBay.com may suffice. In both cases, a rating mechanism allows you to quickly evaluate the effectiveness of a particular worker or task.

Step 5 - Jump Start Your Learning Curve
This is where your strengths as a Web 2.0 company really come into play - agile deployment and fast product cycles. Your first attempts at a framework for managing human agents will be imperfect. The reality is that handling distributed human agents and the resulting problems could leave you scratching your head. Frequent releases and iterative upgrades will help you continually improve and refine your system and set you on the path to achieve your business objectives.

Tell Us About Your Experience
Our experience launching TutorJam.com, a K-12 online tutoring company, has shown us how flexible and scalable the Distributed Agent model can be in meeting the diverse educational needs of our customers. Let's get a dialogue going; Share your tips and stories with other organizations looking to capitalize on the growing trend of distributed agents, and tell us how you do more with less.

About the Author

Nathan is currently Vice-President of TutorJam, the premier online tutoring company. He has over 7 years of engineering experience at technology firms including Microsoft, Slipstream Data, and Texas Instruments. He holds a Bachelor's in Math and Economics from the University of Waterloo, a Master's of Science from the University of Washington and is an MBA candidate at Duke University.

The Six Biggest Applicant Lies!

Although statistics vary widely, there is widespread agreement that a substantial number of resumes belong in the "fiction" section of the bookstore. The rate of fraud can be as high as 40% and higher according to different sources. Applicants certainly have the right to put their best foot forward, and puffing their qualifications is an American tradition. But when puffing crosses the line into fabrication, an employer needs to be concerned. When you hire an applicant who uses lies and fabrication to get hired, the issue is that the same type of dishonesty will continue once they have the job.

What are the six most common fabrications from job applicants? According to a nationally recognized background checking firm, Employment Screening Resources (www.ESRcheck.com), they are:

1. Claiming a degree not earned: Yes, believe it or not, applicants will make up a degree. Sometimes, they actually went to the school but never graduated. Some applicants may have had just a few credits to go, and decided to award themselves the degree anyway. On some occasions, an applicant will claim a degree from a school they did not even attend. The best practice for an employer is to state clearly on the application form that the applicant should list any school they want the employer to consider. In that way, if an applicant lies, the employer can act on the lack of truthfulness regardless of whether the educational requirement is part of the job requirements.

2. Diploma Mills or Fake Degree: A related issue is diploma mills or fake degrees that can be purchased online. For those that actually attended classes, read books, wrote papers and took tests to earn a diploma, you apparently did it the old fashioned way. Now, getting a "degree" is as easy as going online and using your credit card. There are even websites that will print out very convincing, fake degrees from nearly any school in America. In fact, the author obtained a degree for his dog in Business Administration from the University of Arizona--and the dog had been dead for ten years. A transcript was even obtained and the dog got a "B" in English! Some sites will even provide a phone number so an employer can call and verify the fake degree. Some of the degree mills even have fake accreditation agencies with names similar to real accreditation bodies, in order to give a fake accreditation for a fake school.

3. Job Title: Another area of faking is the job description or job title. Applicants can easily give their career an artificial boost by "promoting" themselves to a supervisor position, even if they never managed anyone.

4. Dates of Employment: Another concern for employers is applicants that cover up dates of employment in order to hide "employment gaps." For some applicants, it may be a seemingly innocent attempt to hide the fact that it has taken awhile to get a new job. In other cases, the date fabrication can be more sinister, such as a person that spent time in custody for a crime who may be trying to hide that fact.

5. Compensation: A related issue is pay - applicants have been known to exaggerate compensation in order to have a better negotiating position in the new job.

6. Lack of Criminal Record: Nearly every application will have a question about past criminal conduct. Although employers may not "automatically" eliminate a job applicant without a showing of a "business necessity," if the person lies, then the employer would have grounds to deny employment based upon dishonesty.

The common denominator in all of these: they can be all be discovered by a program of pre-employment screening. To quote a phrase popular in the 1980s. "Trust, but verify."

About the Author

Lester Rosen runs http://www.esrcheck.com and has authored two books. He is a frequent presenter nationwide at human resources, fraud and security conferences, and was the chair of the steering committee that founded the National Association of Professional Background Screeners (NAPBS) and served as its first co-chair. He has testified as an expert in negligent hiring cases in California, Florida and Arkansas.

While Others Are Firing, You Should Be Hiring

In tough economic times, most organizations' first and most predictable reaction is to cut expenses; in today's service economy, the largest expenses are manpower-related. The result is that thousands of talented employees have been released into the marketplace. This increase in talented unemployed workers creates a great opportunity. When others are cutting, now is the time for you to redefine, realign and rehire to pick from the best and create a more powerful and greater performing team.

Most companies are stuck in industrial-age thinking; they feel that any employee can do any job. This encourages their "layoff" and "cut" approach to managing expenses in recessionary periods. However, as our economy moves from the skill-focused (make things) industrial age to today's talent-focused (make ideas) intellectual age, we need new and more personalized performance from each employee. There are very few one-size-fits-all roles anymore; each role now requires specific talents and thinking to be done well. And in a period where we need more done with less, it is critical that all roles have the best and highest performing employees.

Our people are our profits, particularly in an intellectual and service workplace. What employees know, and how they use what they know, advances our innovation, efficiency and profitability - but only if employees work in roles that allow them to use their talents and strengths; performance today is more based on thinking and natural abilities than learned skills or rote procedures. This requires organizations to implement a more significant process to assess employee talents and match them to the talents needed in each role as the method to hire effectively. Today's recession has created the ability for proactive organizations to select from the great amount of new available unemployed talent in the marketplace. So as others are terminating and cutting, use the three steps of redefine, realign and rehire to attract and hire the best talent now available to improve the performance power of your team. This talent availability will not last for long.

Use this three-step process to ensure you have the best performing team:

Redefine - An intellectual economy requires significantly different work from its employees than does an industrial economy. In an intellectual workplace employees make more unique decisions - they think their way through the day. Since each of us thinks differently, not every employee is a good fit for every role. Therefore, it is critical to clearly define the talents and strengths (thinking) needed in each role. Once defined, existing employees and new candidates can be reviewed to determine whether their unique talents and strengths match those needed in the role. The more closely the employee's talents are matched to the talents needed in the role, the greater the potential for significant employee performance. Talent assessment tools will help identify the language and definitions needed to create a talent profile for each role so that the right employees can be sourced. In yesterday's industrial age, skills and experience drove performance. In today's intellectual age, thinking, talents and strengths drive performance Clearly redefining the talents needed in each role in the organization will allow for effective employee realignment or a successful new hire.

Realign - it is critical to keep great talent; however, talent is only perceived as great if it is appropriate to the role. If I am an extraordinary salesman (my talents encourage relationship building and great personal contact) but I work as an accountant, I will never fully use my talents and the organization will neither notice, nor benefit from, what I do intrinsically well; it is critical that each role allow the employee to maximize his/her talents. Once all roles have been redefined for talents, assess your existing employees to determine whether they are working in the right roles. Many times you may have great employees whose performance is average or disengaged because they are not working in their talent areas. When properly realigned, they become more connected to their work, more engaged in their jobs and contribute more significantly to results.

An economic downturn, with the focus of doing more with less, is an opportune moment to realign employees to ensure the right employees are in the right roles. Though great organizations don't wait for a recession to realign (they commit to hiring employees into the right roles), a recession more readily allows for personnel changes. Use the recession to realign employees to the right roles and move out employees whose talents do not match the talent needs of the organization. Keep only those employees who are fully contributing and driving results.

Rehire - In the process of redefining and realigning, it is frequently noted that the required talents are not available in the existing manpower. This may be from the assessment that certain employees are in the wrong roles (and that no better match for their talents exist) and therefore must go, or new roles are created requiring an external candidate. In either case, a need to rehire exists. The starting point for all rehiring is to clearly understand the talents needed in the open roles, then develop a sourcing plan that will locate candidates with the required talents. Today's leading organizations source candidates by presenting the role and its required talents. Candidates are encouraged to respond with talent-based resumes, not skill and experience resumes. This better defines the critical thinking needed to be successful in the role and shares this information with the population of available talent. Focusing the hiring discussion around talents naturally encourages more qualified candidates, a more meaningful interview process and a greater likelihood of hiring the right employee.

Today, we are in tough economic times. But with difficulty comes opportunity. Now is the time for organizations to redefine, realign and rehire. It is critical to focus on building the best team, in any economy. It is critical to have a team where each employee works in his/her talent areas. It is critical to take advantage of the supply of unemployed talented employees in today's recession to rebuild your team into one that is more connected, more powerful and more focused on performance.

We will work through this economic challenge. When we do, many organizations will be weaker because their recessionary approach was to cut the largest expense - their talent. Their cuts and layoffs have now provided you with a great selection and variety of quality workplace talent. Use this opportunity to redefine, realign and rehire the best employees. When the recession is over, your workforce will be more connected, more engaged and well ahead of others.

Jay Forte, a former financial executive and educator, now performance speaker, author and talent management consultant, is a nationally ranked Thought Leader and President of Humanetrics. Jay teaches organizations how to ignite passionate employee performance, create loyal customers and maximize bottom line results through a new and more effective method of management known as the Fire Up! Process. He has helped organizations of all sizes become more performance-driven and financially successful.

As an expert in activating employee performance, he is regularly interviewed by national publications and as a guest on business radio programs. His many dozen articles have been nationally and internationally published. He is the author of the new book, "Fire Up Your Employees and Smoke Your Competition; How to Invite, Incite and Ignite Employee Performance", an innovative, practical, hands-on manager guide to activate exceptional employee performance. Get the book at http://www.FireUpYourEmployees.com

See his daily performance tips called BLOGucation at http://www.HumanetricsLLC.com He can be reached at jay.forte@humanetricsllc.com or at 401.338.3505

Article Source: http://EzineArticles.com/?expert=Jay_Forte

4 Trends Driving Workplace Flexibility

Many organizations now offer an alternative to the traditional Monday through Friday 9:00 a.m. to 5:00 p.m. job. A workplace is thought to be flexible if employees have flexibility in scheduling (e.g., flex time and compressed workweeks), flexibility in the number of hours worked (e.g., part-time or job sharing), or flexibility in the location of work (e.g., telecommuting, satellite office). With benefits such as increased worker productivity, greater ability to attract and retain talent, and higher employee morale, capitalizing on the trend of workplace flexibility is important to your small business success in the coming years. Here are four driving forces behind the push towards increasing workplace flexibility.

4 Trends Driving Workplace Flexibility

1. Technology
In the past we gathered together in office buildings during a standard 40-hour workweek because we had to physically be present to accomplish our work. Today, that isn't necessary because of all the advances in technology. Computers and laptops, cell phones and VoIP, the Internet, cloudworking and online collaboration tools, all enable us the freedom and flexibility to work from a variety of locations on our own timetable.
2. Globalization
Business has become increasingly global, thanks to the advances in technology. Internet access and e-commerce have changed many things; we now buy and sell our goods and services around the globe. We have offices, team members, customers, and suppliers residing in a variety of different countries and time zones. As a result, our business must be operational more hours in the day to service the needs of our global audience. Flexible work arrangements which allow employees to work a variety of schedules helps accomplish that goal.
3. Demographic Shifts
There are more women in the workforce and more dual-career couples than ever before. In fact, only 16% of families fall into the once common model of the man working outside the home while the woman stays home with the children. Dual-career couples are seeking flexibility in the workplace as an effort to relieve some of the work and family conflict they commonly face.
4. Expectations of Generation Y
Love them or hate them, Generation Y has some serious expectations when it comes to workplace flexibility. Flexibility in where, how, and when they do their work is more important to them than a high salary when job hunting. The Millennial Generation doesn't understand the "punch clock" mentality, will be pushing for shorter work days with a focus on increased productivity, and they don't buy in to the belief that flexibility is a perk or has to be earned--they expect it for themselves and everyone else from their first day on the job.

These trends will be a driving force behind workplace flexibility initiatives for the foreseeable future. Has your business adopted a flexible work arrangement that is available to everyone? I urge clients to adopt the ultimate flexible work arrangement: a results-only work environment (ROWE). In a ROWE, you are free to work where, when, and how you see fit - you have flexibility over scheduling, hours, and location of work. Regardless of which type of flexible work arrangement your business chooses to adopt, now is a great time to put it into practice because this trend isn't going away anytime soon.

© Copyright 2009 Ashley Acker

About the Author

Ashley Acker, Ph.D., WorkStyle Design Expert and ROWE Coach, works with small business owners and their teams to redesign work so everyone wins. Learn how to boost your team's productivity, develop a competitive advantage in your business, and enjoy unlimited freedom and flexibility with our FREE report, 5 Secrets to Change the Way You Work…FOREVER!