Quality of hire

The use of screening and online testing programs has evolved over the past decade. The focus used to be on increasing hiring process efficiencies by reducing cost and time to hire. Today, leading employers are demanding solutions that will give them competitive differentiation. The answer is a selection process that identifies people who are capable of driving their business results.

PreVisor’s 2007 Business Outcomes Report represents 29 unique research studies conducted by PreVisor and partner companies. The studies were completed in conjunction with major UK, US and international corporations, and provide insight into the direct correlation between key performance indicators and the businesses’ pre-employment testing initiatives.

Assessments have positive impact
Business outcome studies were conducted for clients across multiple industries (financial services, wireless communication, retail, healthcare) as well as job roles encompassing sales, customer service and clerical functions.

The summary analysis found:
• 80 percent had a favourable / very favourable outcome.
• 20 percent were found to have a negligible impact, or the data was found to be inconclusive.
• None of the studies resulted in an unfavourable outcome.

“We are very pleased to have been able to deliver such strong and compelling business results for our clients,” states Caroline Paxman, PreVisor Senior Vice President of Professional Services. “The majority of studies were able to show clear linkages between high performers on the assessment and strong performers on the job – as measured by our clients’ own business results. This allowed the HR team to demonstrate direct ROI on an important human capital-based initiative.”

Finding 1: High scoring agents sell £8730 more
In a broadband communications company, customer service representatives who scored well on the pre-employment assessment solution completed their calls more quickly and generated more revenue per call than lower scoring counterparts. The company calculated each high scoring agent generates annually £9k more in revenue than low scorers.
Finding 2: Turnover reduced, sales and productivity jump
In a telecommunications call centre, agents who scored higher on the assessment solution achieved a sales quota 24 percent higher than lower scorers. They also showed increased productivity (with average handling times 40 seconds faster). These agents were more likely to stay with the company, reducing turnover from 33.5 percent to 12.5 percent.

Finding 3: Reservation agents boost sales by £480 a day
High scoring reservation agents for a resort and amusement destination generated nearly £70 more per hour in reservation sales than agents who scored low on the assessments – a difference of almost £480 per day per agent.

Finding 4: Assessments realise reduction in theft
Retail sales locations that were staffed with shop assistants who scored high on the conscientiousness assessment experienced less stock shrinkage – about £24k less per year. Across the chain’s 1500+ stores, this translates into nearly a £37 million difference in annual inventory shrinkage.

These results are just some of the most dramatic that were found, however they are not unique. The common denominator in the overall Business Outcomes Study Summary was that assessment solutions implemented did have measurable impact on client business results. Not only are the tests used in each solution backed by validity data, they have very specific correlations to each role, goal and company need. The trend toward the use of online screening and assessment should only accelerate when seen in light of these results.

The future
Employers across all industries realise how critical it is to focus on the quality of candidates they select into their workforce. Kristopher Fritsche, Selection & Assessment Program Manager at EMBARQ, states: “In staffing, recruiting, or talent management, ROI has been discussed in terms of ‘cost-per-hire’, ‘time-to-hire’ and how fast a system pays for itself. Measuring quality of hire has been hard to get at, and actual on the job performance correlated to individual test score items is rare. Now we have a way to work with senior management in strategic workforce planning – and show them how it profits business.”

About PreVisor
PreVisor, a leading provider of pre-employment assessments and employee selection solutions, follows the rigorous standards of industrial-organisational psychology. PreVisor’s UK clients include Barclays, British Telecom, BBC, AEGON, Carphone Warehouse, EMBARQ, and Logica CMG.

For more information, please contact PreVisor UK: Jeff Holmen, Director of International Business Development on +44 (0)1344 742 813 or visit us online at www.previsor.com.