The monthly job report from the Bureau of Labor Statistics has become an uneasy gauge for the American economy. There are lots of people scrambling for what positions there are, but we rarely reflect on how those people get picked, and whether that matching process could be made more efficient. I have long been fascinated by the ways in which organizations select people. Hundreds of studies reveal the profound limitations of the traditional interview. Interviews favor candidates who are attractive, sociable, articulate and tall. They also favor the manipulative candidates, or those who know how to make a positive impression even in a brief interview. But these candidates aren’t always the best job performers.
We all know of instances in which a poised, charming job candidate turns out to be a disaster on the job. It can be difficult for an interviewer to see past the appeal and flattery to predict how the person will actually perform once hired. The challenge of picking the best person is substantially heightened in the current difficult job market, in which advertised openings often receive hundreds or thousands of applications. It is time consuming to conduct so many interviews, but the bigger problem is that traditional job interviews are simply not very good at selecting the best candidates.
I invited each of the MBA students in my leadership class to interview two other students from class and predict which of the two would score better on the mid-term exam. Had they just flipped a coin, they would have picked the better performer 50% of the time. In fact, they predicted correctly 56% of the time. This result is consistent with the research literature on interview effectiveness: the unstructured face-to-face job interview is a poor predictor of subsequent performance.
Nevertheless, managers are consistently overconfident in their ability to identify the best candidates using a job interview. We cling to the fanciful notion it is possible to perfectly predict future job performance, despite overwhelming evidence against it. We all want to believe that we are good judges of character, yet we do not bother to collect the evidence that would be necessary to test that belief. Rather, managers rely on gut intuitions about whom to hire.
It would be better for firms, candidates, and the American economy if instead we hired those with the skills to be successful. To do that, organizations would have to figure out what really contributes to employee success and how to assess it. Fortunately, research has identified a shortcut. One skill that contributes to performance at most jobs is mental ability. Undoubtedly, intelligence is just one of many skills and abilities that facilitate job performance, and firms can improve their ability to predict performance by also considering other job-relevant abilities. But if you have to pick one, general mental ability is the one beneficial trait most consistently identified in numerous studies conducted over many decades of research. A test of general mental ability might be as simple as an online IQ test that could be completed in under an hour. Although high intelligence is not essential for every job, the evidence shows that it usually helps. Moreover, intelligence tests are cheaper to administer, simpler, fairer and less vulnerable to bias than the traditional job interview.
A simple intelligence test, combined with a structured interview, will provide the essential data for a vastly improved hiring process. Organizations should structure the interview by putting each candidate through the same sequence of questions asked by the same set of interviewers. Then interviewers should assess each candidate’s response to each question with some sort of quantified rating. These ratings should then be averaged for the interview and for the job candidate.
Using structured interviews and intelligence tests to select candidates reduces hiring managers’ flexibility to hire according to their gut instincts. That might be a problem if it means that they neglect the issue of a new hire’s fit with the culture, norms and values of the organization. But the truth is that the interview is often a lousy way to assess fit. If fit is important, the best approach is to determine exactly how fit matters and explicitly assess that using a structured test or structured interview questions.
Hiring decisions are among the most important any organization makes. That’s why organizations large and small owe it to themselves and their stakeholders to make this important decision based on a consistent process. While the American economy has seen amazing innovations and productivity growth over the last 50 years, there has been just about no innovation in hiring methods. The current economy provides American employers with a tremendous opportunity. The larger the applicant pool, the bigger the payoff to better hiring practices. Now is the perfect time to do some fundamental rethinking of how organizations select people.