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?
Then I took the test again, this time trying to distort my personality. I decided to try to make myself out to be something that I felt I clearly wasn't: a salesperson. I had tried sales in a previous life and hated it. But I figured I could fake a sales profile by picking all the aggressive and outgoing adjectives and avoiding the meek and mild. Piece of cake.
The results of my "real" test--well, they actually puzzled me at first. The Predictive Index has four scales that characterize any personality: dominance, extroversion, patience, and precision. My dominance came out very high. No surprise there. I'm a pushy guy. My patience was extremely low, which the Predictive Index tactfully calls having a "high sense of urgency." Again, no shock.
But my precision was also relatively low, which troubled me. I'm a reporter--and I consider myself to be careful and thorough. And possibly the most surprising was my highest score of all: extroversion. I was off the chart. Gregarious, life of the party, lampshade-for-a-chapeau, that sort of thing. Now, I'm no shrinking violet, but I had always thought of myself as a little shy. Gordon explained that extroversion wasn't so much a measure of social-butterfly behavior as it was an indication of where you got your motivation. That made sense. I'm definitely more comfortable being in constant communication with my editors. And as for the purported lack of precision, that didn't mean I didn't have an eye for detail; it just meant I would much rather delegate it to someone else.
On the basis of my "real" results, I asked Gordon where I might fit within his organization. Since he was in systems integration, I sort of fancied myself a programmer. But as Gordon saw it, I couldn't be a worse fit. It's very repetitive work, he said, highly detailed, with practically no human interaction. "You'd go crazy within a week," he said, chortling. Accounts payable and anything in human resources were out as well, for many of the same reasons. Instead, he concluded, I'd be a better fit for a position as a sales rep or a manager: I'm a self-starter with high urgency, and I'm comfortable delegating details. Gordon also smiled as he pointed out that my profile was almost an exact duplicate of his. Was I secretly harboring fantasies of starting my own company?
Sales? Entrepreneurship? That couldn't be right. Remember, I had thought I was so wrong for sales that I tried to fake it on my second test. Couldn't Gordon see the difference in the two tests? Well, it turns out, on the second test when I thought I was wildly faking a "sales" profile, I'd managed only to exaggerate my natural profile--which was actually in line with what Gordon seeks in a sales manager. He claims he could tell right away which results were phony. I wasn't that outgoing. And I probably wouldn't be much of a reporter if my precision was as low as my fake test had indicated. But didn't people disagree with their results all the time? "When they do, they often come around later," said Gordon. "People don't always have a lot of self-insight."
I wasn't sure I bought his argument. Maybe that test--or perhaps Gordon's interpretation--was a fluke. So I decided to try again at a different company, not only to see if I could find what I thought was the real me but also to see if I could become a better cheater.
This time I visited United Freight Ser-vice Inc. (UFS), a $13-million floor-covering-transportation company in Phoenix. The testing process was a bit different and a lot more time-consuming. Jim Maloney, CEO at UFS, is an ardent advocate of the Prevue, which consists of an hour-long test in the classic sense: there are words to unscramble, math problems, mental rotation tasks. Plus it has a section with 110 statements I was to agree or disagree with. (For example, "I like to know exactly what I will be doing each day.")
It wasn't hard to figure out that each of the items corresponded pretty closely to one of the four scales on the Predictive Index (dominance, extroversion, patience, and precision), so I had a much better idea of how to cheat this time. Again, I took the test twice, once answering honestly, a second time not so honestly. This time I attempted (successfully, I might add) to make myself out to be a total accounts-receivable nerd.
As Maloney and I discussed the results, I felt as if I were getting my tea leaves read. First he interpreted my "real" test. In conversations, he asked me, did I tend to fly off the topic? Well, yes, I had often joked that my life was an open parenthesis. Did I become bored quickly with routine? Actually, I have a habit of never walking home the same way twice. In fact, the more I heard, the more the results sounded like me. It was kind of spooky.
So where would I fit in at UFS? Well, nowhere. I was totally wrong for an operations position; I'd always be coming up with new ideas, driving everyone else crazy in the process. And as for customer service, well, the less said the better. I'd be great for sales, but Maloney and the other company officers took care of that, since most of the customers were long-term contracts. And there was CEO, but that job was taken.
Then I asked about my second, fake test. Had I successfully portrayed myself as the prototypical accounts-receivable type? Well, Maloney said it wasn't hard to spot the fake. He need only talk to me for five minutes to realize I wasn't an introvert and certainly was not a patient soul. And even if I got the job, I would have been miserable, and my performance would have shown it.
I decided that Maloney and Gordon might be onto something useful. The tests certainly seemed to have pegged me, despite my best efforts to cheat. I decided to turn my energies to finding the most original and effective examples of how smart CEOs are using psychometric tests.
You probably think you know what traits to look for when angling for top performers. But you might be surprised. Beth Armknecht Miller thought the same thing until she started using psychometrics. The co-owner and vice-president of Atlanta-based MA&A Group, an information-systems-development company, Miller uses an industrial psychologist who employs his own battery of surveys. She says the information she gets helps her identify some otherwise unlikely candidates. "He pointed out some things that just blew my mind," she says. "Like the best salespeople are actually the ones who aren't overly confident, because they're always trying to prove themselves. That's hard to obtain in an interview."
The key to long-term employee satisfaction and retention, the thinking goes, is to hire right in the first place. The latest thinking on psychometrics, however, is that its most common use--recruiting--may not necessarily be its best use. Even among testing enthusiasts, not all agree it should even be a part of the hiring process.
Dale Van Aken, CEO of Syncro Technology Corp., a software developer in Langhorne, Pa., uses the Myers-Briggs Type Indicator (see "Type Talk," below) to promote better communication and team creation at his company, but for recruiting he relies on more standard methods. "If you interview well, it's not that hard to gauge how candidates would test anyway," he says. If he excluded a candidate based on test results, Van Aken says, he'd fear that he was throwing the baby out with the bath water. He--like numerous other CEOs--has found tests to be most valuable after an employee is brought on board.
Twice a year Kathleen Doyle, a principal at Thompson Doyle Hennessey & Everest, a real-estate-management firm in Boston, holds what she calls her semiannual all-staff retreat. This past January she and her staff of 14 went to a Vermont ski resort. Using the staff members' Myers-Briggs profiles, she discussed ways in which individuals could communicate more effectively. "We came back understanding how to get messages across to each other better," she says. For example, she says, the psychological profile of most of her salespeople indicates that they don't mind working in a crazed atmosphere. "In fact, sometimes they work better that way," Doyle says. But her office manager and support staff have different needs, according to their profiles. "They want a calmer environment," she says. So Doyle and her staff are now looking at ways to avoid unnecessary time crunches while still maintaining the responsiveness her customers expect.
Mark Gordon, who is so sold on the Predictive Index that at all times he carries minigraphs of the test results from each of his staff members, says the testing came in particularly handy when, in late 1996, he merged with a network-cabling company. Gordon says the tests helped him map out the company's restructuring and put people in the right positions. "It was important that we retain the [cabling company's] management team and have it mesh with my team effectively," he says. "But we wanted the rest of the employees to feel comfortable, and while we had the opportunity, we wanted to craft a position around them."
For example, Gordon points to two employees who at merger time did effectively the same job: managing field personnel, which included recruiting, training, and scheduling staff, plus managing projects day to day.
Those employees also handled presale requirements, which involved establishing customer needs and rendering the bid. Gordon decided to split the field-manager position into two distinct roles. Charles Haskell, who joined Synergy from ComLink, the acquired company, became the personnel and project manager. "His profile showed high urgency," says Gordon, "which is important when you're managing some 30-odd cable installers and multiple projects simultaneously." And Phil McCreedy, from the Synergy side, took charge of presale. "He had design credentials, plus higher patience and a little higher precision," says Gordon. "The design process is repetitive, and with bids accuracy is important."
Still, the transition was hardly tension free. Sales-support manager Erin Niesslein says that when the companies first merged, the atmosphere was "them" versus "us." "Nobody was getting along," she says. "Nobody trusted each other, because nobody knew each other." So the entire management team sat down with consultant Bill Wagner, who discussed the group's profiles and pointed out where the tension was coming from: job insecurity. "Some of the people that we thought were obnoxious just wanted to survive," says Niesslein. "They thought they needed to make themselves look necessary." After the managers' group session, Niesslein claims, the situation was "probably a million times better than it was before. We all started mingling with each other, and since then we've been doing more collaborative work."
Relying on the Predictive Index for solving every sticky situation at work can have an unintended backlash effect, however. For example, when one account executive at Synergy was perceived as acting a little too hostile toward her support staff, Gordon sat down with her and her graph. He pointed out her high dominance and low patience. "That sense of urgency will act like a coiled spring when she really wants something," explains Gordon. "And when that energy gets channeled into her dominance, she can get explosive." Gordon tactfully tried to tell this account executive that while she needed to maintain that aggressiveness in the field, she needed to "leave her guns at the door."
But for the account executive, Gordon's handling of the situation was not entirely helpful or pleasant. "I would have preferred he pulled me aside to say, 'We're having a problem,' instead of dragging charts in and trying to psychoanalyze me," she grumbles. "I'd rather have him chew my butt off," than endure his analysis, she says. But on the positive side, the survey results did verify that her confidence and people skills made her a great match for her sales position. At least, she says, "that gives me some job security."
When Jim Maloney was looking for a credit manager for UFS, he intentionally sought someone without collection experience. "I don't agree with the way most people collect money," he says. "I wanted a less aggressive, more sociable guy."
Kevin Bertrandt was exactly what Maloney was looking for. He especially prized Bertrandt's considerable computer skills, but he wanted to compensate for what the Prevue indicated might be a problem: Bertrandt's tendency to be too nurturing, too afraid of offending people. Together, Maloney and Bertrandt designed effective yet comfortable collection methods. Bertrandt scripted a soft-sell approach that he reads from on many of his collection calls. As a result, the average time it takes UFS to collect receivables is fewer than 35 days.
For Mark Gordon, understanding the emotional needs of each employee is a bottom-line business issue. Knowing how best to motivate employees, he says, is the most practical way to keep them highly productive. "You get what you want by giving them what they want," he notes. But that doesn't mean you can make bad fits work. "Even if people can change, it's not cost-effective to wait and see," says Maloney. "But you can help them learn to respond in alternative ways. You change what they do, not who they are."
That approach worked for Gordon when he formed Synergy Networks, in 1992. Not long afterward, one employee was promoted from technician to salesperson. This employee's sales numbers turned out to be well below Gordon's expectations. Gordon suspected that the employee--an agreeable, accommodating sort of fellow--wasn't pushing hard enough. He was also reluctant to delegate details, and he spent too much time on office tasks. Gordon's sales manager opted for a little tough love and told the employee flat out that he didn't think he had what it took. But if the employee really wanted to stay, he had until the end of the year to turn his numbers around.
The employee was also given the psychometric survey, and Gordon laid out a blueprint for him by comparing his Predictive Index profile with that of an ideal sales candidate. He needed to push harder for the close, to be less afraid of offending someone, and to entrust more administrative tasks to his support team. "By year-end he was closing some of our biggest deals, with higher profitability than anyone else," says Gordon. The adjustment has not been entirely pleasant for the employee, but it has been possible. "I want to be myself, but many times you do things that are a stretch to provide a good home for your family," he says. "To succeed I have to listen to these guys."
Before Mark Gordon began using the Predictive Index, he worried that he wasn't patient or numbers oriented enough to run a company. Was he empathic enough to help employees with their problems? Was he conversant enough with detailed financial statements? As it turned out, he didn't have to be, at least not if he subscribed to the Ronald Reagan theory of management: just surround yourself with people who can do the things you can't. "The Predictive Index helped me understand that I was the right guy for the job," he says. "I was trying too hard to be what I wasn't." But would he always be the right guy? "I'm OK for now, but if we did a $100-million roll-up overnight, I might not be the guy to run it," he says.
Which means either making the necessary changes or cultivating a replacement. UFS's Jim Maloney has a plan to replace himself, which he hopes will free up his time to work on the business rather than in the business. That, and to do a little yachting in his spare time. "To run this company, you need the people part and the details part," says Maloney. "I'm very people oriented, and I spent 20 years forcing myself to be organized."
To replicate that mix, he's tapped Nick Sblendorio as vice-president. Sblendorio shows characteristics that match many of those in Maloney's entrepreneurial profile, including the social skills. Maloney has paired him with operations manager Jeff Payne, who has the organizational skills Sblendorio lacks. "The idea was, Let's find someone who has both sides of me," says Maloney. "But maybe that's two different people."
Maloney says that as he's planned his exit strategy, psychometric tests have been of paramount importance. Whether the pairing of Sblendorio and Payne works out or not, he says, the Prevue or some test like it will help him figure out why it didn't work and what might work better instead. "Most people plan this on a real hit-and-miss basis," says Maloney. "I want the comfort of knowing that if I got hit by a Mack truck, what we've built here will last. I'm not there yet, but I'm pretty confident I'm looking down the right alley."
Christopher Caggiano is a staff writer at Inc.
The Myers-Briggs Type Indicator (MBTI) is one of the most commonly used instruments. It will churn out one of 16 four-letter codes (for example, ENFJ, ISTP, ESTJ, and so forth) that purportedly embodies the respondent's mental style, although most people fall somewhere on a continuum for each trait. The letters correspond to the following categories:
Extroversion/introversion. Determines the source of your mental energy. Extroverts (E) get charged up through other people--for example, peers and supervisors. You know, the hanging-out-by-the-watercooler types. Introverts (I) rely on their own internal wherewithal and pretty much keep to themselves--like the guy in accounting who's been there for years, although no one is quite sure what he does.
Sensing/intuiting. Explains how you absorb information. Sensing types (S) like empirical data and tend to be literal and methodical. Intuitive types (N) rely more on patterns and relationships. Bored by details, they tend to talk in generalities.
Thinking/feeling. Refers to how you make decisions. Thinkers (T) are logical and objective. Feelers (F) deal more with emotions and tend to be empathic and consensus driven. According to Myers-Briggs experts, men tend to be thinkers, whereas women tend to be feelers.
Judging/perceiving. Refers to how quickly you make decisions. Judging types (J) need closure--like the colleague who's always pushing you to get to the point in meetings. Perceivers (P) make decisions more slowly. They're spontaneous, and they often procrastinate--like the crew down in creative who seems only to be playing floor hockey all afternoon.
The Legal Position
How nervous should you be about the legalities of personality tests? Cautious, perhaps, but not paranoid.
Although Jennifer Lauro, cochair of the employment-practices group at Peabody & Arnold LLP, in Boston, is skittish about tests, she says she's never actually taken a case involving them to court. "But I'd be very surprised if these tests weren't biased in one way or another," she says. Michael Delikat, cochair of the employment-law department in the New York office of Orrick, Herrington & Sutcliffe, agrees that psychometric tests are fraught with potential problems. "There have been a number of challenges, some of them successful," he says. For example, there have been discrimination-based claims, usually concerning "ability" or "aptitude" tests.
As with any human-resources policy, to use tests effectively you need to take some reasonable precautions:
Ask for a warranty of indemnification. One way of making sure you're dealing with a reputable testing outfit, says Delikat, is asking for a signed agreement stating that the testing company will reimburse you for any legal muddle. You probably won't get it, but it can't hurt to ask.
Avoid tests that reveal physical or mental impairments. The Americans with Disabilities Act (ADA) limits the use of medical tests by prospective employers before a job offer is made. Make sure the test wasn't intended to expose such medical conditions as schizophrenia and manic depression, both covered by the ADA.
Check your state's privacy laws. About 10 states--California, for one--have some sort of privacy protection in their constitution. Should an employee refuse to participate, don't take disciplinary action against him or her, says Lauro. "If that employee is terminated, he or she might make some sort of privacy claim," she says.
Measure your hiring impact on subgroups. Keep records to see if the process appears to affect certain groups more than others. If it does, it could appear as if you're targeting them.
Rich Goldberg sensed that a key client was "starting to drift." As CEO of Warm Thoughts Communications, a $4-million marketing-communications company in Secaucus, N.J., Goldberg sought a way to "rein them back in." So he and his staff created a profile based on their knowledge about the client. It turned out that their sales approach had been way off base. In terms of personality characteristics, the main client contact was very low in extroversion but high in dominance and detail. But the assigned salesperson was an inveterate people person. "The client needed facts and figures," says Goldberg. "The salesperson was trying to build a relationship, which was actually agitating the client." Goldberg counseled his staff to keep conversations with this client short, use facts, figures, and ideas profusely, and clearly spell out the company's commitments to the client--exactly what this client wanted.
That sort of personalized selling is hardly new, but a working knowledge of psychometric tests can make it even more focused. Ken Wolff, CEO of Prescient LLC, a sales-force-outsourcing company in Silver Spring, Md., uses the concepts embodied in the Predictive Index to tailor his sales pitch to the prospect's controlling personality factor: dominance, extroversion, patience, or precision. Rather than asking prospective clients to take the tests, he relies on the overt trappings of the personality factors: speech patterns, office decor, style of dress. For example, highly dominant people, he says, tend to control conversations and interrupt a lot. They dress to impress no one but themselves, and tend to have offices that showcase business or sports victories. Extroverts, on the other hand, are more warm socially and dress more for status.
Here, based on the scales of the Predictive Index, is a primer on how to recognize and sell to four common personality types:
|High A||Controlling||Dress for themselves||Gadgets, items showcasing victories|
|High B||Friendly||Stylish, status oriented||Family pictures, status symbols|
|High C||Shy||Old, comfortable||Well-worn furniture, club affiliations|
|High D||Formal||Neat, traditional||Immaculate, strictly business|
WHAT THEY WANT:
High A: To control the process
High B: Consensus; to better their own reputation
High C: An old comfortable chair; to trust you
High D: To avoid blame
HOW TO CLOSE THE DEAL:
High A: Let them call the shots; don't interrupt
High B: Develop a relationship; recognize their status
High C: Avoid pressure; stress reliability
High D: Stress quality; respond with facts