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1 Why your finance director should care about assessment The procurement decision for assessment and engagement is more important than ever before because the stakes have been raised, says Andreas Lohff smart. valid. preferred.
2 The procurement decision for assessment and engagement is more important than ever before because the stakes have been raised Employee assessment has traditionally been an HR issue. Finance directors have paid it scant attention, apart from possibly reviewing a cost-benefit case prepared by recruiters and sanctioning the spend. However, now there is a very pressing reason why financial controllers and other senior managers should pay much greater attention to assessment. In the past, assessment was essentially a risk management strategy. It was used to minimise the risk of early attrition and the expense of making a bad hire. This expense includes the cost of having to re-recruit and re-train staff as well as the disruption that disengaged employees can cause. Assessments also helped to avoid counterproductive behaviour in the workplace and the damage that can be done to a company s reputation and to customer relationships through fraud, corruption, sabotage, betrayal of company confidentiality, theft and destruction of property. Counterproductive behaviour also includes harassment and bullying of colleagues, aggressive or other harmful behaviour, illicit absence, malpractice and actions that can cause serious or fatal injuries. Assessments have helped to minimise this behaviour by enabling employers to recruit individuals whose abilities, personality and values were aligned with the goals of the business. The big difference with assessments today is that talent analytics can also be developed from the data that psychometric tests provide. Assessments have become better at predicting who will be productive in your organisation, who will be engaged by your culture and who will stay with you. However, more pertinently, the data they provide can essentially help your organisation to make better talent decisions in the future. Beyond HR Here is why this whole issue is relevant to finance teams. A total of 84% of the value of your business is intangible assets, according to a US study of S&P 500 businesses. Predominantly that means your people and their ideas. More than any other factor, the success of your business depends on the people you employ. Not your products or services, not your strategy; it is all about your people. At a recent summit event held by cut-e, 100 HR practitioners from financial services companies told us that the number one challenge they face is retaining top performers, while their second biggest challenge is hiring talent. With a growing recognition of the need to recruit and retain the right people, assessment has moved beyond the bounds of HR. It has become a crucial strategic priority for organisations and that is because it directly impacts on their sustainability and future value. Now, consider this. By 2020, according to PwC, 50% of your workforce will be millennials. To attract, recruit and retain young talent in the future, finance directors should be demanding that their organisation takes the following six actions now: 1 Make your employer brand distinctive Building and communicating a compelling employer brand that encompasses the reputation of your organisation, its distinctive strengths and the value that employees gain will help to attract the right individuals. Reaching out to different audiences will encourage individuals with different experiences and different backgrounds to apply.
3 2 Improve the candidate experience Research shows that 46% of job applicants rate their recruitment experience with organisations as poor, while 64% will share that poor experience on social media. Get your selection process right by ensuring that it is short, visually-engaging, interactive, objective and indicative of the everyday situations that individuals will experience in your workplace. Use assessments that provide exactly the same testing experience, regardless of whether candidates take them on a mobile device or a desktop computer. Incorporate Realistic Job Previews, with typical on-the-job challenges, to help applicants self-assess their suitability for every role and make an informed choice about whether your organisation is right for them. 3 Future-proof your organisation by appointing change-ready staff The speed of change driven by factors such as the internet, mobile devices and cloud computing is outpacing our ability to adapt. You cannot protect your organisation against technological developments but, with a digital competency framework, you can recruit and develop employees who have the digital skills and capabilities to embrace technology, collaborate with others and work more effectively through change. 4 Use analytics to make data-driven talent decisions Assessment data not only helps you to maximise the person-job match, it also enables you to transform your talent management practices. For example, identifying the skills and attributes that differentiate top performers from average performers in each role can help you to create a success profile of an ideal employee. This will give you a better understanding of the competencies, personality, knowledge, skills, experience, attitude, values, behaviours and outcomes that bring success to your organisation. 5 Measure the value of assessment Business-impact validation studies provide data-based evidence that will improve your selection process and the candidate experience. For example, when a multinational financial services client studied 2,800 employees, linking their assessment results to their performance, it proved that cognitive ability and personality testing improved the quality of people it hired. The company also found a way to predict early attrition and it established that its top performers delivered 50% more profit than its good performers.
4 6 Keep your talent engaged Assessments can help you to recruit individuals who are wired for engagement ; in other words, they are likely to feel engaged working at your organisation. Once appointed, employees increasingly want control over where and how they work. This not only means that you need to empower them to work autonomously, you also need to continuously listen to them and find ways to improve the employee experience. Studies show that companies with a more engaged and committed workforce consistently outperform their competitors. Consolidation Few industries have consolidated to the extent that the assessment industry has. The market used to be dominated by scientists and private entrepreneurs but, following a spate of acquisitions, there are now fewer but more globally-oriented providers to choose from. The procurement decision for assessment and engagement issues is now more important than ever before, because so much more is at stake. Due to the fact that the future prosperity of the business is on the line, finance directors should be insisting on an even greater return on investment when they sanction any assessment spend. About the author & cut-e Andreas Lohff is a strategic assessment specialist and a distinguished business psychologist. As CEO of Aon Assessment Solutions, he leads the company s growth and manages its international development within the Global Talent, Rewards and Performance practice. Andreas co-founded cut-e Group, a global talent management and assessment specialist, in 2002 and was its managing director when the company was acquired by Aon plc in cut-e and Aon, as Aon Assessment Solutions, undertake 30 million assessments each year in 90 countries and 40 languages. Published by HR Director This article was first published by HR Director on 23 rd December 2017, UK More information about talent analytics and how assessments can create a tangible return on investment:
5 About cut-e Founded in 2002, cut-e (pronounced cute ) provides online tests, questionnaires and gamified assessments for attraction, selection, talent management and development. The company s smart, valid and innovative psychometrics have made it the preferred partner of multinational organisations. In May 2017, cut-e was acquired by Aon plc, a leading global professional services firm providing a broad range of risk, retirement and health solutions. cut-e now operates as part of Aon s global offering in talent solutions, helping clients achieve sustainable growth by driving business performance through people performance. cut-e and Aon, as Aon Assessment Solutions, undertake 30 million assessments each year in 90 countries and 40 languages. info@cut-e.com cut-e.com C1045INT 12.17
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