Performance prediction science, based largely on Personality Profiling, has made great strides over the past century. Nevertheless, organisations the world over continue making use of obsolete and ineffective personnel selection practices, with significant impacts on organisational performance despite the fact that a voluminous body of literature suggests that personality and cognitive ability tests are the most effective predictors of workplace performance.
Psychometric assessment has been extensively employed to predict performance on the basis of psychological characteristics and traits. Tests of intelligence and personality, both of which have stood the test of time as predictive tools of organisational performance constitute two of the major pillars of psychometric testing instruments.
Intelligence Quotient (IQ) tests, for instance, were initially deployed to detect learning disabilities in young students, whereas personality tests targeted dysfunctional behaviour. Following their wide-spread adoption during World Wars I and II, these methods rose in popularity as tools for measuring performance ability and optimising job placement.
Over time, the objectives of psychometric appraisal have evolved to encompass not only dysfunctional characteristics and traits, but also performance variances across the normal range of psychological characteristics and traits. Despite this evolution and the support it has received from a vast (and still growing) body of academic and empirical literature, its value is often at best underappreciated, even though research on performance prediction has clearly underscored the crucial importance of choosing the right people and of using the right tools to do so.
The preponderance of management executives and Human Resource (HR) professionals agree that for an organisation to be able to compete or to be able to deliver within the parameters of tighter budgets, the most qualified individual for a given position should invariably be chosen. This wide-ranging consensus, however, breaks down when it comes to the question of how to implement this meritocratic ideal in the real world. These differences are accounted for by three very common misconceptions, namely that:
- people underestimate the massive performance and productivity differences that exist between individuals;
- they rely on the idea that formal education is a good proxy for potential performance that they use as a first-tier filter (a shortlisting criterion); and
- they overestimate the effectiveness of common selection methods (such as the widely disproven method of graphology) in second-tier filtering.
Productivity, however, is very unequally distributed. This is not something that has been discovered recently. The so-called Price’s law, dating back to 1963 has it, on the basis of observation and measurement studies, that 50 % of the total output in the creative industry is produced by the square root of the number of people working within it. By way of illustration, with a work force of 1,000 people, 32 people could be expected to produce the same creative output as the remaining 968 people comprising that workforce. This concentration is accentuated even further at the highest ends of the productivity distribution. Similar analyses in music have exhibited the same trends and according to one study undertaken by Moles in 1958, the 10 most prolific composers crafted 40 % of the masterworks in classical music. The productivity and performance differential has subsequently been found to extend to the non-creative areas of work too. Indeed, meta-analytic studies of on-the-job performance variability suggest that the more complex the work becomes, the larger the variability grows.
One possibility of examining this entails the calculation of variability from the average employee’s output level. A variability of zero would mean that all employees perform at the same level (being the average), whereas values that are different from zero indicate differences between individual productivity. A study carried out by Schmidt and Hunter in 1998 found that for unskilled and semi-skilled work, the standard deviation of work output as a percentage of average output is 19 %, that for skilled work it is 32 % and that for managerial and professional work, it amounts to 48 %. Of course, such productivity differences become much more significant when summed across multiple people.
This is the reason why organisations that have the ability to identify, recruit and retain high-performing individuals attain substantial economic and strategic advantages over their competitors. Moreover, it is as important to select the best people, as it is to filter undesirable candidates. The consequences of failing to choose the right people can be substantial, and can result in increased labour turnover, increased recruitment costs, increased training expenses, lost productivity and value chain disruptions, as well as decreases in morale. The cost of identifying the best performer in the first place is invariably lower than the cost of not doing so for a business.
The body of scientific literature dealing with best practices for performance prediction is extensive. The question of why the discrepancy between research and practice has persisted in this area is therefore an interesting first question to be asked in the quest for understanding what can be done to improve organisational performance and bottom line results.
The most common reasons for the failure to employ optimal selection methods in personnel selection are that many HR practitioners and top managers are either not aware of the academic literature underpinning such best practices, or they tend not to believe in the real-world effectiveness of selection tools despite overwhelming evidence to the contrary. Despite the numerous studies analysing the utility and validity of different selection procedures and militating in their favour, the findings manage to penetrate the world of HR practitioners and managers only with great difficulty. HR recruitment praxes also differ substantially across cultures, suggesting a cultural element at play that influences which selection tools are considered and subsequently utilised.
It is clearly established that selecting the best individual for a post requires the utilisation of the best selection methods. Meta-analyses of a vast array of validation studies across a broad range of industries and markets yields an equally clear result, namely that the most efficient and effective method for picking top performers comprises testing for both cognitive ability and personality.
Cognitive ability encompasses the ability to plan, reason, process information, and control behaviour. Cognitive ability testing is one of the best-validated constructs in psychology literature, and its predictive power has been confirmed by thousands of studies carried out over a century of research and empirical testing. While cognitive tests have been criticised (and most of the time rightly so) for cultural bias, there is also a plethora of non-verbal cognitive ability tests that does not discriminate on the basis of cultural or linguistic background.
The second most important performance predictor after cognitive ability is personality. In this area, despite the use of a broad range of models, the five-factor model of personality seems to consistently outdo all the other models when it comes to performance prediction. This taxonomic model describes personality over five variable dimensions that hold across cultures, these being extraversion vs introversion, agreeableness vs antagonism, conscientiousness vs undirectedness, neuroticism vs emotional stability, and openness to experience vs non-openness to experience.
The elements of this model can be formulated in a hierarchical structure of importance in relation to performance. In this case, conscientious would be at the top, followed by emotional stability and with the rest of the hierarchy depending on the role itself. Extraversion, for instance, appears to be a good predictor of success in sales and management settings whereas openness appears to be a good predictor of performance in work settings that rely on innovation and creativity capacity.
While respondents might be able to manipulate the scores from personality elicitations to present themselves in a positive light, especially when questionnaires employ a numeric rating system or Likert scale, this questionnaire snag can easily be avoided by framing the questions and eliciting responses in a different manner.
Personality profiling, while being useful at all levels of staff, has been found to be even more important at the top management levels, where good personalities can serve as an inspiration for a group towards higher levels of motivation and productivity, whereas bad ones can drastically sap group performance.
Comparing effect sizes from performance prediction literature suggests a mean validity of combined cognitive ability and personality testing in predicting workplace performance of r = .65, a very strong relationship as research in psychological research goes.
Personality profiling can also be of great help in building efficient teams in project-team work activity settings. Indeed, the benefits of this approach have been shown to exist even if personality profiles are constructed after, rather than before the assembly of the team. This result depends on the communication of results to all members of a team, together with an explanation of what the profiles themselves imply, and is due to the fact that when team members learn which psychological persona they identify with and what psychological personas other people in the team identify with, and understand the traits of the personas involved, they will be better able to communicate with one another while watching out for the characteristic pitfalls associated with their profile.
Equinox has long been active in the area of Personality Profiling for HR Selection & Team Building.
Equinox can guide you through the maze of cognitive and personality testing methods to choose the set of tools that is best suited for your requirements and to help you capitalise on the differences between employee traits to select the best fit for a role, boosting your organisational productivity and limiting your long term costs in the process.
Equinox can also help you in assembling a team that has the ability to avoid personality clashes and can also help team members understand themselves and one another better with a view to making the process of working as one team smoother and more efficient.
Our services in this area are bespoke and will be tailored for full alignment with your needs.