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What's the value of using psychological assessments?
Adding a psychological assessment to your selection process is
a good business decision. Here’s why:
A valid assessment uses techniques shown to have a high correlation
with job performance:
| Technique |
Correlation1 |
| Mental abilities testing |
.53
|
| Job simulations |
.50
|
| Structured interview |
.40
|
| Biographical questionnaire |
.40
|
| Personality inventories |
.40
|
| Unstructured interview |
.20
|
| Reference checks |
.14
|
| Resume/application blank |
.10
|
(Note: a statistical correlation of .20 or greater is considered
strong)
Turnover is costly and often related to the hiring decision:
- Up to 75% of turnover causation is related to the
hiring process2.
- A poor hiring decision is estimated to cost (conservatively)
30% of an employee’s first year salary3.
Conversely, a strong selection process has impressive bottom-line
impact.
- Hiring competent employees is associated with a
nearly 1% increase in corporate market value4.
- High performing companies are seven times
more likely to use a validated selection test than their low
performing competitors5.
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