Companies could make more suitable hires and better predict which employees will do well using personality assessments, according to behavioural science specialist Hogan Assessments.
According to managing director Zsolt Feher, companies “think” they test personality with unstructured questions during interviews. However, in most cases the questions are random, stereotyped and very general. There also tends to be an unconscious bias in the questions.
Mr Feher said: “Good assessments can predict who will [be] the best in a certain position, who would possibly [be prone to] accidents or – what is even more important in financial institutions – who is going to have counterproductive behaviour.
“Businesses have moved towards the added value from human capital in the last couple of decades – who you hire and who you develop. [It] is a matter of business survival. Many think they can do the hiring well, but studies show, even after 20 years in business, our own unconscious biases heavily influence our decisions."
Since the mid 1980s, personality assessments have grown in popularity. The tools are more widely used in the US than in the UK or the rest of Europe. In continental Europe there is still a higher degree of skepticism, according to the company.
One adviser in the UK, who has seen the benefits of adopting personality assessments for existing and new staff, is Robert Lockie, managing director at Bloomsbury Wealth. The company uses the Disc model when trying to ascertain if people are in the right positions and how to manage individuals.
Disc is an acronym that stands for 'dominance, influence, steadiness and conscientious'. Mr Lockie said that using these character traits helped him understand how to manage and communicate better with employees.
He said: "We knew nothing about hiring and managing people properly before. Like most people in smaller businesses you start of doing the job and as you grow you end up with a larger number of people to look after.”
Hogan Assessments works with firms globally to choose candidates or to identify which existing employees bring the most value to the business. It does this combining a psychological and statistical science-based approach.
Ima Jackson-Obot is a features writer at Financial Adviser