Problem
Many organizations struggle with selection because predicting how employees will perform once hired is difficult. Hiring decisions are frequently made even more difficult because of a lack of awareness of the key employee knowledge and skills that are needed to function effectively in a job, as well as the lack of good selection instruments and tests that enables hiring managers to identify the best job candidates. These challenges can lead to improper selection decisions, poor employee job attitudes and job fit, and high turnover, so HR professionals have a vested interest in determining better ways of identifying good talent for their companies.
One approach that has been used extensively in other functions, and that is being utilized more frequently in HR, involves the use of primary data to facilitate good decision-making. Using data to drive selection decisions provides hiring managers the right information needed to identify the kinds of characteristics individuals should ideally have to successfully perform work. Information is usually collected directly from employees working in a particular position, often times with a questionnaire, and this information is correlated with performance data in an effort to determine which characteristics are significantly related to the kinds of positive work outcomes that the company expects from its employees (i.e., low turnover, high productivity, etc.). After identifying a list of positive characteristics, HR professionals can develop selection tests and other evaluation tools that can be used to make more appropriate hiring decisions. One organization that has successfully relied on data to enhance decisions related to employee selection is Bon-Ton stores Inc., a retail organization with several hundred stores located in 23 states. The company was experiencing high turnover, specifically among its cosmetic salespersons, and wanted to take proper steps to bring these numbers down to more acceptable levels. The selection test used by the company was apparently not identifying the proper talent needed in this particular job, Bon-Ton turned to the outside recruitment firm Kenexa for assistance with hiring.
A study was conducted to identify the employee characteristics that predicted high job performance in the sales position, and information was collected from several hundred cosmetic associates using a 250-item questionnaire. Performance data were also compiled from Bon-Ton's productivity archives. The analysis enabled the company to isolate the factors that led to job success, and an assessment test and standardized interview questions were developed to make better hiring decisions in the company.
The results have been very positive for Bon-Ton. For instance, turnover statistics for the cosmetics sales associates had decreased dramatically. In addition, sales performance has increased in the cosmetics group, further highlighting the validity of the program. The company is now planning to use this selection approach in other areas of the firm to enhance hiring decisions for other jobs.65
i. Discuss how using a data-driven approach to hiring can enhance selection in companies.
ii. What other methods besides surveying might be used to collect important selection data from employees?
iii. What types of skills will HR professionals need to develop a data-driven approach to selection in companies?