In this article, we will walk you through four key arguments for using tests in your candidate selection.
Let's start with the basic facts: Most people agree that hiring is painstakingly difficult. It is usually really tricky to even understand what you are looking for in a candidate. Then, you will also have to find reliable ways of evaluating those characteristics. And, lastly, you will want to avoid bias in the process.
But not only is hiring difficult, it is also really important. Studies show that organisations with a highly effective recruitment process have up to 3.5 times the revenue growth of their less savvy competitors, and they are also twice as profitable. Making the wrong hire, on the other hand, is extremely costly - often up to 2.5 times the annual salary of the position for senior and complex roles.
In other words, solving the challenge of hiring is well worth the effort. According to us at Alva, using psychometric tests is an excellent start. Here are four arguments why:
- Well-crafted tests are powerful predictors of job performance. For decades, researchers have studied which selection methods actually predict future job performance. And this is where we find our first key argument: According to this research, some of the strongest predictors are well-crafted tests of personality and logical ability. Their accuracy exceeds that of many of the most widely used selection methods, such as the CV, years of job experience, and the classical unstructured job interview. Simply put: Good tests do a much better job than many traditional methods at finding the right person for the job.
- Psychometric tests help you broaden your candidate pool. Tests enable you to look past the demands that restrict you pool of eligible talent unnecessarily. For instance, research shows that grades can be completely discarded when you use personality and logic tests. The same thing often goes for arbitrary demands such as “three years of sales experience” or “must have gone to one of these five universities”. Think of how many more promising talents you could find if you got rid of some of those taken-for-granted hurdles.
- Psychometric tests is a great way of reducing bias and discrimination in your hiring. Did you know that tall and attractive people have a better chance of getting hired through traditional job interviews? Or that applicants with foreign names often have a 50 percent smaller chance of getting a call-back after a CV screening? With psychometric tests, a large part of these types of biases are eradicated. Tests are objective and structured, meaning that they are the same for all candidates, and they follow a structure that is set beforehand. All in all, this amounts to a much more fair selection method.
- Psychometric tests scale really well. There are other selection methods that are also highly predictive, such as structured interviews and work sample tests. However, these are all quite resource-intensive. For instance, interviewing 50 candidates would take 50x the time compared to interviewing one. Therefore, this method is usually more suitable for the later stages of a recruitment process. With tests, however, there is very little time-add involved when you go from testing one candidate to, say, 50. Hence, psychometric tests work very well in the early phase of candidate screening.
To summarise, the case is clear: By using evidence-based tests in recruitment, you will substantially increase your hiring accuracy, decrease your number of false negatives, reduce bias and discrimination, and also equip yourself with a scalable screening tool.