According to research by Society for Human Resource Management, around 18% of companies are using personality tests as part of their recruiting process. The industry itself is worth around $500 million a year, with a rapid growth of 10% annually.
The reason companies are widely deploying personality assessments during their course of hiring is simple – to ensure that they have hired the right individual. However, employers and HR practitioners would understand that this is not an easy task. There is an underlying sophistication behind finding the right person befitting the job, team and company. Thus, most of them turn to personality tests to avoid the cost of a bad hire, but, is it effective?
Personality tests are among the least effective predictor of job performance, according to Frank Schmidt’s meta-analysis of a century’s worth of workplace productivity data. Instead, he found that measures like cognitive ability, or a combination of both, have higher predictive validity for job performance.
In spite of that, many companies are still using personality assessments without actually understanding the effectiveness of the practice. In fact, according to a 2014 Harvard Business Review article, 50% of HR professionals were unfamiliar with current HR research findings. Thus, although personality assessments can appear to be helpful and inexpensive, they can present severe drawbacks when used in high stakes application like hiring.
One perfect example – the all-time favourite personality test – Myers-Briggs Type Indicator (MBTI), has been the subject of criticism by many researches. Nevertheless, it is still used by 89 out of Fortune 100 companies and generates $20 million a year in revenue – despite the publisher of the test explicitly warned against using it for hiring.
One obvious criticism for personality tests such as the MBTI is the potential for faked answers. Participants are more inclined to distort their answers to present themselves in the best possible ways for their prospective employers. As personality tests are rather transparent, it is simple to guess which answer is deemed right – and get away with it as there is no objective way to verify the answers unless until the person is hired.
Besides that, most personality tests tend to classify and label people into one particular type exclusively. In MBTI, one can only be either extrovert or introvert. However, traits should not be mutually exclusive as human beings are more than just “either/ors”.
Brian Little, a Cambridge University professor states that people often “take it as a badge and stamp on their forehead” once they associate themselves with a trait. This is a problem as pinning ourselves into categories will only limit ourselves, often doing more harm than good. “If you only see yourself as an extrovert or as one of those four-letter codes on the Myers-Briggs,” Little says, “you will have foreclosed on paths that might open to you if didn’t think in terms of types of people.” For example, one might think that only extroverts thrive in leadership roles. The late Apple founder, Steve Jobs, was labelled as a wildly successful introvert.
Slotting labels on others – beside ourselves – can also lead to adverse effects. When we associate others with a perceived personality type, we tend to judge them based on their traits. This is where our cognitive bias takes over, as we are likely to blame it on someone’s personality when things go wrong in the office, rather than looking at the situation objectively. This fits with people’s simplistic view of the world as it is easier to label and box people than to find the root of the problem.
For one, organisations need to identify the business needs. Knowing the business needs is crucial to identify gaps in the business – and how workplace assessments can help to choose the right employee to fill in the gaps.
This might seem obvious, but reducing the risk of cheating helps to maximize the predictive accuracy of these assessments too. In order to prevent candidates to ‘beat’ the tests, refrain from using assessments that are transparent. Instead, encourage them to elaborate – which will offer more insight into themselves.
Hiring the right people for the company is an important, albeit difficult task. Opting for short-cuts to build your team might ease immediate pains but pose problems in the long run, especially since the cost of a bad hire is estimated to cost up to five times in salary. Recruiting your champion team often takes time, so patience is definitely virtue. After all, “You can have the best strategy and the best building in the world, but if you don’t have the hearts and minds of the people who work with you, none of it comes to life.”