Recruiting the wrong person for a key job may be one of the most expensive decisions any organisation makes. On the other hand, recruiting the right person can transform your organisation for the better.
It has been estimated that it costs organisations the equivalent of the whole of the first year's costs (salary and any other benefits) to put right a wrong recruitment decision. Research reported in a number of test manuals shows that using good assessments professionally as part of the recruitment process dramatically increases the number of right decisions you make.
Typically, firms create job and people specifications, and use personality and ability tests on shortlists or, increasingly, to create candidate shortlists in the first place.
Individual development: Developing existing employees is less risky and less expensive than recruiting new ones. Assessments help focus any training or development programme, finding out levels of knowledge, preferred ways of learning or motivations for learning. They can also create levels of self-insight into respective strengths and weaknesses and set goals as part of effective development plans.
Where interpersonal issues are key to underperformance, test results provide a platform for discussion: they take the heat out of addressing tricky personnel issues.
Team and organisational development: Tests can be used to gauge attitudes, look at the spread of characteristics and skills in a workforce and create the best organisational structure to deliver objectives. International research constantly replicates the finding that diverse teams always outperform a team made up of similar people. Tests identify individual differences - the diversity that fuels a high-performing group of people.
Quite apart from the hard business benefits mentioned above, there are some more subtle, less well-known benefits of using tests. Marketing and branding is one: using good tests makes you look good. It shows you are serious about people issues, and it has even been shown to have a positive effect on how unsuccessful candidates view you.
Education: Psychology - understanding yourself and other people - is a key knowledge area for managers and executives. Learning about tests increases your knowledge while at the same time providing you with tools to apply it in your organisation.
First-time users sometimes get carried away by tests: they want to test everyone about everything. Like any technology, testing isn't about that. It's more a question of using the appropriate test in the right way for each task. The first thing to do is to decide why you're testing in the first place - and if you can't decide, don't use tests.
But good tests used well are no longer seen as a specialist side issue they are a core business resource driving performance.