How to Measure Quality of Hire
Learn of our 5 great ways to measure quality of hire which makes organisations make informed decisions about future hires.
Employee attrition is the bane of HR professionals and hiring managers worldwide. Given the time, effort, and resources required to attract, recruit, on-board, and develop staff, losing employees after a short period represents a critical business failure.
Moreover, high levels of employee attrition creates a vicious cycle, reducing morale within the organisation which causes even more employees to leave. More unfortunate still, the underlying cause of employee attrition is usually systemic, resulting from ineffective hiring practices. Naturally, misfit between the employer and the employee is the chief cause of employee attrition, and until organisations acknowledge this fact, they will suffer from employee attrition in perpetuity.
In this article, we will outline five key ways that organisations can improve talent retention through their selection processes.
Perhaps the most important issue when hiring for retention is person-role fit. Research shows that employee engagement and job satisfaction are strongly dependent on personality-role congruence in almost all roles.
For example, research shows that extraverts tend to enjoy sales roles more than introverts (Grant, 2013), emotionally intelligent individuals prefer caring roles (Beauvais, Andreychik, & Henkel, 2017), and highly assertive individuals find management roles more engaging (Lounsbury et al, 2016). In these roles, those at the opposite end of the personality continuum will struggle, finding their work to be unfulfilling and awkward, increasing the probability of employee turnover.
The biggest mistake that employing organisations make when hiring for role-fit is relying solely on the traditional employment interview.
Although research suggests that interviews are powerful predictors of performance (Schmidt & Hunter, 1998), the evidence does not suggest that interview performance is associated with role-fit. This is because interviews only measure a select range of characteristics, namely those associated with people skills (Salgado & Moscoso, 2002). For example, a skilled interviewee can convince and interviewer that they are highly organised and hardworking, even though neither of those traits confer any advantage to interview performance. As a result, the interviewer may be convinced that the interviewee is organised and hardworking, but that is purely the result of their interpersonal skills, not their actual standing on these characteristics. This means that interviews will fail to detect misfiting candidates and will screen out high-potential candidates based solely on their people skills, increasing staff turnover.
The solution to this issue is to incorporate valid and reliable behavioural assessments into the selection process.
Unlike interviews, personality questionnaires measure both interpersonal and intrapersonal traits, allowing organisations to directly assess the behaviours which underpin role-fit. This maximises employee engagement and job satisfaction among new hires, increasing employee retention rates and extending the average length of tenure. Using personality questionnaires to ensure role-fit is easy and efficient, one simply identifies the specific traits which are associated with role-fit, and then administer a personality questionnaire to candidates during early stage sifting. Candidates who show acceptable levels of role-fit can then be progressed to the next stage of the recruitment process, reducing the probability of misfit.
Although role-fit represents the primary concern, person-culture fit also strongly underpins employee retention and staff turnover rates. Behavioural scientists are well aware of “organisational cultures”, the shared values, beliefs, and characteristics which collectively define the organisation and its members. Some organisations harbour traditional and hierarchical values, showing strong respect for authority and seniority. Other organisations are more flexible and decentralised, eschewing traditional values in favour of radical change. Congruence with organisational culture is likely to strongly influence commitment and job satisfaction, with misfiting employees feeling alienated and isolated.
Once again, the traditional employment interview is to blame for person-culture misfit. Due to the limited scope of interviews, skilled interviewees are likely to convince interviewers of their suitability, despite being a clear misfit to the organisational culture. Often, candidates will underestimate the importance of organisational culture when choosing an employer, focusing on more proximal concerns like salary, benefits, and career potential. Rarely will an employee consider organisational culture misfit, at least until it becomes a problem for them personally. Some candidates may be aware of the culture-misfit and are planning to leave before they have even joined, viewing the job purely as a temporary stepping stone, worsening employee attrition rates.
Personality questionnaires and behavioural assessments are the solution to minimising culture misfit.
As with job-fit, personality questionnaires and behavioural assessments are the solution to minimising culture misfit. Organisations simply need to identify the specific personality traits and behavioural characteristics required among all employees, and screen for those traits early in the selection process. As a word of warning, to avoid “organisational cloning”, employers must be judicious with the set of traits used during hiring, avoiding a situation whereby everyone in the organisation displays the same personality. Instead, only those traits which are indisputably relevant to culture-fit should form any selection decisions, allowing the majority of personality traits to remain as free variables.
Although not as common as role or culture misfit, common and unfortunate causes of employee turnover are capability issues. Although less frequent, they represent a particularly traumatic form of turnover, both for the employer and the employee themselves. Turnover based on capability occurs when candidates’ skills and abilities are overestimated, and their eventual performance becomes sub-par.
Often, these candidates mean well, and they are well liked by their managers and colleagues, but they simply cannot meet the demands of the role, presenting a highly demoralising situation for everyone involved. These employees are likely to make serious errors in their work, require a disproportionate amount of their manager’s time, and will rely on other team members to pick up the slack, reducing performance at the team level.
Perhaps the largest culprit for capability-based misfit is the use of academic requirements in employee selection.
Eventually, when their underperformance can no longer be tolerated, they are asked to resign or let go from the organisation against their will, further reducing morale. Research shows education to be a poor predictor of job performance, and a weak proxy for overall cognitive ability (Furnham, Monsen, & Ahmetoglu, 2009; Schmidt & Hunter, 1998).
Naturally, a wide range of variables account for an individual’s level of academic achievement, with cognitive ability and work ethic accounting for a small proportion. More importantly, these academic achievements were typically attained many years, perhaps even decades prior, showing limited usefulness to the present day. The most pernicious issue however, is the interaction with social economic status (SES) and educational achievement. Research shows that higher SES background individuals do better in education, benefiting from tutors, private education, and more time to focus on studies (Paterson, 1991). This inevitably advantages low-performing individuals from high SES backgrounds, creating the illusion of competence through privilege, setting themselves up for failure.
The solution to capability-based misfit is to utilise cognitive ability assessments during the screening process. Cognitive ability, particularly in highly complex work, has been shown to predict performance more strongly than any other construct (Schmidt & Hunter, 1998). This is because cognitive ability underpins learning, decision making, and problem solving in the workplace, influencing all areas of performance. Low levels of cognitive ability are therefore the primary cause of capability issues, representing a discrepancy between the cognitive demands of the role and the individual’s available cognitive resources. By incorporating cognitive ability into the recruitment process, you minimise the probability of hiring individuals that struggle to learn and solve problems, reducing or even fully mitigating the risk of capability-based attrition.
Along with capability issues, another unfortunate cause of employee attrition is misconduct, whereby staff are caught acting inappropriately. For example, staff may be stealing from their employer, taking unsanctioned leaves of absence, or acting with hostility towards their colleagues. In the occupational psychology literature, these are known as “Counterproductive Work Behaviours” (CWB), and represent actions which actively harm the organisation itself. These behaviours tend to increase costs for the employer, reduce the employee’s performance, and may even negatively impact employee retention at the team-level, as team members may leave in response to the offending employee’s behaviour. Once the employee has overstayed their welcome, they will either be forced out of the organisation or will resign in disgrace, reducing employee retention rates.
Unscrupulous candidates are especially likely to employ lies and manipulation during their interviews, increasing the probability of performing well.
Once again, interviews are likely to blame for misconduct-based attrition rates. Unlike with role / culture fit, where interviews simply fail to identify misfit, employees that display CWB are perhaps even more likely to perform well on interviews. Naturally, unscrupulous candidates are especially likely to employ lies and manipulation during their interviews, increasing the probability of performing well. Perhaps the best architype for this behaviour is the “corporate psychopath”, a self-serving individual who lacks empathy and compassion, but enjoys office politics and engages in shady corporate activities. Such individuals are likely to impress interviewers using their superficial charm, exaggerating their competence and winning the confidence of their employers.
To avoid hiring candidates who are likely to be expelled for misconduct issues, employers should incorporate integrity testing into the selection process. Research shows integrity tests to meaningfully predict performance in the workplace, reducing the probability of displaying CWBs and increasing organisational citizenship behaviours (Schmidt and Hunter, 1998). These assessments identify the specific traits which underpin honest and trustworthy behaviour in the workplace, assessing these behaviours subtly and tactfully. Test Partnership’s TPAQ-45 complete profile contains an integrity scale for this reason, allowing employers to directly measure integrity and avoid misconduct-based turnover.
The final issue which is solvable using an improved recruitment strategy is stress related attrition. Adverse stress related illness and burnout are leading causes of employee attrition, and have especially deleterious effects on people’s lives. Resistance to stress and burnout is at least partially mediated by certain personality constructs, including emotional stability and resilience, acting as a buffer against these threats (Best, Stapleton, & Downey, 2005). Naturally, some people will inevitably show lower levels of resilience and emotional stability, feeling emotions more strongly and living with higher levels of negative affect. When their occupation places them under stress or pressure, they show an exaggerated response, drastically reducing their quality of life and placing them at risk of attrition or sick leave.
Unlike other causes of attrition, interviews are somewhat effective at predicting low levels of emotional stability (Salgado & Moscoso, 2002). Naturally, the most neurotic and anxious candidates tend to display this during the interview, visibly appearing uncomfortable and nervous. However, interviews are ineffective at identifying candidates who are fairly anxious or neurotic, which is particularly dangerous. Often, successful candidates will appear to be happy and effective, but over time their resilience begins to waiver, resulting in a delayed onset of stress and burnout. This tends to complicate matters, as they may be beyond their probationary periods, getting stuck in a loop of stress related absence and sick leave before eventually leaving the organisation.
The solution is to directly measure resilience and emotional stability in the recruitment process using behavioural assessments. This allows HR practitioners and hiring managers to identify those with fairly low levels of resilience, who would otherwise succeed at the interview stage itself. For example, Test Partnership’s TPAQ-45 complete profile measures both resilience and emotional stability directly, allowing organisations to incorporate these constructs into selection decisions. Depending on the role, some organisations may require higher levels of resilience than others i.e. telesales and call centre roles. Consequently, HR practitioners must consider the required level of resilience for each role, and select for resilience more stringently if needed.
Unfortunately, many organisations who struggle with employee retention are looking for a quick fix. Rather than tackle the underlying causes of employee attrition, they adopt “easy-win” approaches i.e. team building events, free yoga classes, and motivational videos etc, which are seldom effective. Instead, organisations must return to the drawing board and identify the cause of misfit, allowing them to truly remedy the issue and maximise employee retention from the ground up. Although this may be a bitter pill to swallow, the sooner this fact is acknowledged, the sooner the organisation can reap the benefits, ridding themselves of unwanted employee attrition for good.
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