Although psychological tests have long been dismissed by skeptics, many companies are using them--with great success--to match employees to jobs that they won't want to leave.
Some of the toughest CEOs we know recently have become converts to using psychometric tests as a management tool. To find out why, we asked for a 'volunteer' from our staff to become a psychometric guinea pig. Here's his report
Entrepreneurs live in a state of flux. Constant change comes with the territory. But Laura McCann experienced more than her share of corporate upheaval toward the end of 1997. Within the space of a month, McCann, the CEO of a New York City-based private-label clothing manufacturer, began to buy out her partner of seven years, restructured her management team, and started a totally new business with new partners and a larger staff. Now, that's some serious flux.
The impetus? A psychological test. You know, the kind with the bubbles you fill in. Oh, sure, she was also responding to shifting market conditions, a partnership that had hit the skids, and just plain entrepreneurial boredom. But the thing that really persuaded her to move, she says, was a little personality survey called the Predictive Index.
McCann had met Bill Wagner, a consultant specializing in psychometric testing, and become a convert to the Predictive Index, which consists of a relatively simple checklist of 86 adjectives. She had been concerned that a number of her staff members were unhappy with their jobs, including some of her highest-ranking managers. Not to mention that she and her partner were at each other's throats. According to Wagner, the cause of all the trouble was that nearly half of those on the company's management team had personalities that didn't fit their job descriptions. What's more, Wagner concluded, McCann and her partner couldn't have been more poorly matched.
"The test helped me realize that all this difficulty we were having wasn't a personal thing," says McCann. "It just wasn't meant to be." Armed with that viewpoint, she whittled her management team down to a well-chosen few, parted company with her partner, and bid her existing business farewell, and--in what amounts to overnight in company-evolution terms--McCann's new company, International Product Options, was born. All that based on 86 measly adjectives?
Psychological tests have been used by businesses to screen prospective employees for decades. During World War II, the Army Air Corps developed its own test to distinguish potential fighter and bomber pilots. But in the past few years, observe several academics, there has been a markedly increased interest in personality surveys. "The '90s have really been the decade of personality testing," declares John Binning, associate professor of industrial and organizational psychology at Illinois State University in Normal, Ill. "We've seen an incredible resurgence in their usage."
In today's cutthroat labor market, it certainly makes sense that companies would try practically anything to improve their hiring practices. With a dwindling ready-labor supply and the escalating costs of attracting good workers, each new hire becomes increasingly consequential. In particular, small companies, which have always relied on lean but multitalented staffs, are focusing more on whether each potential employee constitutes a cultural fit.
But companies are now using psychometric tests in more management areas and on a wider range of job types than ever. CEOs tout personality surveys as strategic tools that help them design employee career paths, assemble better- functioning work teams, and repair company miscommunication.
Sounds terrific. So why isn't every CEO using these valuable tools? Well, such tests are not without controversy. Having majored in psychology in college, I recall learning that many of these personality surveys had questionable accuracy ratings. First there is the idea of reliability, which in psychometrics refers to whether a test produces similar results when it's given a number of times. More important is a test's "validity," which basically means whether it is testing what it purports to test. Are these tests really an indication of how well someone can perform in a particular job? Do they somehow unfairly discriminate against otherwise qualified applicants?
"Psychological tests make lawyers very nervous," says Jennifer Lauro, cochair of the employment- and human-resources- practices group at Peabody & Arnold LLP, in Boston. "The legal ramifications are frightening. I can't imagine why the average employer would want to use them." (See "The Legal Position," below.) Employees aren't always wild about them either. According to Binning, in many quarters, psychological testing can get an immediate negative reaction. "It still has the reputation of being a voodoo science," he says. "People are afraid the tests will reveal their dark side."
But considering the number of hard-nosed CEOs that I found who were taking these tests seriously, I decided to take a leap of faith. Armed with my psychology degree and a healthy sense of cynicism, I set out to use myself as a guinea pig to explore the most current practical uses--and limitations--of psychometric tests.
In my quest to crack the psychometric code, I first visited Synergy Networks Inc., a $7.2-million network-integration business in Vienna, Va. Synergy's CEO, Mark Gordon, a strapping, ebullient man in his midthirties, is not what a skeptic might expect to find among the testing faithful. He's a nice guy, but you couldn't easily dismiss him as a touchy-feely New Age type. I wanted to see how Gordon was using these tests.
At Synergy, I completed the Predictive Index checklist in a total of five minutes. You have to go through the 86 adjectives twice, once checking those adjectives that you feel describe "the way you are expected to act by others" and once checking those that "you yourself believe really describe you." I must say it was easy to dismiss the survey as a load of hooey--and glancing down the list of adjectives did little to allay my skepticism. Was I fussy? Selfish? Fearful? Who in their right mind would tell a prospective employer that they were? Was I conscientious? Tolerant? Loyal? Who in their right mind would say that they weren't?
