Why are companies after pre employment tests and what are the benefits they offer?

Throughout any hiring process, it is the job of every employer to get as much of relevant information about the candidate as possible. The only issue with these traditional methods (interviews and resumes) of getting to know the candidates is that this won’t yield the best possible insight. Resumes can be pretty much unreliable and a large number of them have misleading statements. A recent statistic says that 46 percent of resumes have actual lies. Similarly, the unstructured interviews are very subjective and cannot predict the performance of the individual.

So why go for a test? 

In contrast to the above-mentioned statements, a well validated, properly developed test, is an objective means of gathering on the spot job related information on the candidates. The best thing about a pre employment test is that it brings in the much-needed objectivity to the entirety of the hiring process. This is achieved by giving results that can be standardized for all applicants. This way, employers can then use this data in particular to make better informed hiring decisions. 

How does it affect the business?

Companies that use these tests can experience something of a positive tangible impact on their business. The two of the most common hiring points for the HR professionals and business owners together is that organizations all across the world spend so much time on the hiring process, yet they make more mistakes than they can actually afford to make. Pre employment tests are great that way. They can actually help directly with this concern. They do so by consistently reducing the time spent reading all the resumes and taking the interviews of the candidates. Not only that, these tests will really help in reducing the costs and time that is associated with the hiring process

The difference

Once the tests start providing you with objective and reliable data that predicts job performance, you’ll see how this test increases the quality of hire and reduces the number of bad investments or bad hires. Ultimately this will lead to great improvements like reduced turnover and increased productivity because the workforce employed will know what they’re doing. 

Benefits that come with Pre-Employment Testing

  • Pre-Employment Tests offer a great range of benefits. It does the job of streamlining the entire hiring process and it also strengthens the organization as a whole by making sure that the new employees will be successful at their work. 
  • These tests make sure that the alignment between the desired business outcome and the employee selection process is such that the end product equals to increased customer satisfaction, higher sales and lower turnover.

Lets read about the benefits in details.

  1. Higher productivity. Research tells us all the well validated, professionally developed employment tests go a long way in successfully predicting the employee productivity amongst a wide range of industries and job types. These tests have a role to play and their role is to be the most accurate means of performance predictor as they can very objectively determine the skills, knowledge and abilities of any candidate for a given job.

Let’s consider the case of a clothing retailer that wants to improve the productivity level of all its sales associates. (This is measured by hourly sales volume) of the sales associates. These people take the CBST test (Criteria Basic Skill Test) that seeks to measure the basic verbal, math and communication skills and also puts attention on detail. Now the employer examines the relationship between the average sales per hour and the test scores. Say the employees that actually achieved a high score sold 100 dollars of goods per hour and the ones who didn’t do so well sold around 81 dollars’ worth of goods. 

So, the conclusion of this experiment would be that on an average, the employees with a higher score were twenty percent more productive than the ones with a lower score. This then makes it very simple to demonstrate the ROI (Return on Investment) when it comes to Employee testing.

  1. Reduction in turnover costs and increased employee retention. Pre-Employment tests can actually increase the retention scale by making sure that the new employees have the basic aptitude that’s required for the job in question. Other important things are personality and temperament. Pre employment tests make sure that they’re both appropriate. These factors actually drastically reduce laying off employees for poor performance and not finishing their training. It also reduces chances of employees quitting the job.

Let’s look an example of a financial services industry call centre. Like numerous call centres out there, employee retention is a major business challenge. With this in mind, the company administered the CBS Test on the new hires and then analyzed the retention rates after a period of 6 months. What was found out was the employees with the higher scores were not only less likely to quit but also less likely to get fired.

When you reduce a turnover, you can see a wide range of benefits for yourself that can create a wave through the entire organization. When employees see lower turnover rates, their morale gets boosted and the company’s reputation gets elevated externally. This further makes it easier for the company to attract a good number of better-quality candidates. The bottom line is that the company sees concrete benefits when the turnover is reduced. When an employee leaves you have to incur a lot of costs in terms of severance pay and investing in the replacement in terms of training, selection and recruitment. 

For the variety of reasons given above, pre employment test have become the norm in most corporate set ups to reduce training and hiring costs and improve the overall quality of employees. Many companies administer aptitude tests on new hires to see if the test can predict the training period performance. Most of the times the results are 90 percent accurate.