CIOs, recruiting is sorting wheat from chaff

The phrase that "people are our greatest assets" is something of a cliché, yet in technology there is some truth in it. Studies done by IBM back in the 1970s showed that the top one per cent of programmers were up to 10 times as productive as the average, and yet had lower software defect rates despite the volume of code they were churning out.

Anyone who has run software development teams will acknowledge that there is a gulf between the best programmers and the also-rans. Yet most companies pay little attention to the process of selecting the best candidates. All too often the process consists of wading through a pile of CVs, picking the most promising ones and conducting an interview or two before making an offer.

A few years ago I spent some time researching this. It turns out that considerable academic research has been done in this area, and there are a number of tools and techniques that can be brought to bear. A striking finding was research that measured an employee's performance five years after they were hired, comparing their performance rankings with their scores at their original interview. The research looked at companies that used a range of techniques and measured the correlation between job success and the selection techniques used.

Companies that did 'normal' interviewing achieved a correlation of around 0.15 with job success (a correlation of 1 is perfect, 0 is entirely random), and following up references fared no better (0.1 correlation). For all the time and trouble that is put into job interviewing and selection, many companies use exclusively a technique that is barely better than rolling a dice.

Intriguingly, the use of ability tests (essentially an IQ test) fared much better, with a correlation of around 0.5. This is still not fantastic, but is a lot better than regular interviews and shows a similar level of correlation across all job types, from finance to sales, administration to management: smart people just do better on average. A variant on this is a job-related test: if you were hiring a welder you would ask them to do some welding, while you could ask a programmer to write or critique some code.

It has been shown that the more sophisticated personality tests can be effective when matching up personality types to particular job profiles. Carefree creative types might not be an ideal match for accounting or actuarial jobs, while thin-skinned sensitive people are likely to struggle in sales roles, where they will encounter rejection a great deal. Statistically, the use of such tests alone has a success correlation of 0.3. This is still less useful than ability tests, and personality tests are also more complex to interpret, and require more qualified people to administer than ability tests.

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