Why Assessment Centers
Are Right For Your Organization

by Allison K. Brenner, M.A.

The Best Predictors of Job Performance

Over 40 years of research into what predicts successful on-the-job performance have shown that the assessment center method of selection is one of the most accurate. Many validation studies and meta-analyses have been conducted for various jobs at various levels of organizations and have shown that there is a statistically significant relationship between assessment center ratings and a variety of indicators of job performance such as performance ratings, turnover, and promotion.

Moreover, research dictates that assessment centers are stronger predictors of job performance when compared with the typical job interview or with personality tests, both of which have very low rates of reliability and in fact, their reliabilities are closer to that of chance. The prediction of job performance using interview methods can be improved when interviews are standardized and structured with questions that are closely tied to the specific tasks of the job through a job analysis. However, the assessment center method still comes out ahead when you consider its high validity results, low racial or gender bias, and high perceived fairness from both candidates and assessors. Considering the high costs associated with selecting the wrong employee at any level, or the costs associated with legal battles over perceived discrimination, it would behoove companies and organizations to select the best method for obtaining the right people in the first place.

What is an Assessment Center?

Assessment Centers (ACs) are testing environments where candidates are rated across a standardized series of activities to provide bases for judgments or predictions of future work performance in the organizational setting. Several trained raters (assessors) perform the evaluations in teams and score each candidate individually and through a consensus process across all performance dimensions measured. The performance dimensions measured are ones judged to be highly relevant and important for the specific job based on a valid job analysis and validated through a content validation process. Using the assessment center method, candidates will participate in several different types of exercises over the course of a day. These exercises are often simulations of job tasks designed to imitate and sample job behaviors that have been identified as job relevant through the job analysis. This method of selection complies with the process for establishing content validity of a selection procedure based on uniform guidelines.

According to the U.S. Department of Labor, Assessment Centers are used by “many Fortune 500 companies and a large number of Federal agencies.” The three common uses for Assessment Centers are: Selection (and Placement), Promotion, and Training & Development.

It is Imperative to Have a Legally Defensible Process

In recent history, more companies and organizations have come up against litigation raised by individuals who felt that they had been unfairly turned down for jobs for which they felt they were qualified. Many court rulings have upheld personnel decisions when they were based upon the use of assessment centers. Many other selection procedures, such as interviews, personality tests, and cognitive ability tests, have not held up as consistently. Adverse impact on minority candidates has been a particular problem with cognitive tests. Court decisions over the last twenty years show that the standardized nature of ACs have strong legal defensibility for many reasons including:

• Provides fairness to minorities and women,
• Ensures that all candidates are rated on the same behaviors by using standardized criteria and rating forms,
• Performance categories assessed in all of the exercises are important determinants for success on the job; that all exercises measure behaviors and performance categories that are required on day one of the job; that the difficulty of the exercises is similar to that of tasks performed on the job; and that the exercises are realistic samples of work performed on the job,
• Assessors are trained to rate candidates,
• Multiple assessors are used to evaluate each candidate, and
• Entire process of administration is standardized for all candidates.

Perceived Fairness by Current and Future Employees

All organizations want to attract the best pool of candidates for hire. One way of keeping a steady supply is to have current employees spreading the word. If current or potential employees feel there is a hiring bias, or perceive the hiring method to be unfair, they are not likely to recommend the company or organization to their colleagues.

Research has shown that job candidates’ perceptions of the selection process can have a consequential impact on the probability of a legal challenge. Assessment Centers as a whole are more reliable and valid than other promotional processes, and therefore tend to be perceived as fairer by both candidates and assessors. Candidates tend to feel that performing simulated job tasks are fairer methods for determining one’s ability on the job than a paper-and-pencil test. If candidates feel that a rejection was based upon a fair process, they are less likely to seek legal reprisal. In addition, for companies seeking a more diversified workforce, the assessment center method of selection not only maximizes the potential for diversification, but also provides minority candidates an environment conducive to less apprehension about the testing process.

Dollar for Dollar – Why it’s Worth the Investment

It’s no secret that there are costs involved in designing, developing and implementing an AC. In fact, the cost per candidate of an AC tends to run a bit higher than other selection methods. Costs, however, need to be viewed from a macro-perspective. Since ACs have considerably higher validity than most selection methods, ACs cost-benefit ratio soars when you consider the dollar returns in the performance of the hired group versus the costs associated with recruiting, absenteeism, turnover, and repeated training. Furthermore, when companies consider other organizational goals such as diversity, ACs can provide strong returns on investment financially, as well as socially.

Ms. Brenner is a consultant to Monster Government Solutions as well as the Principal Consultant for her own company, Personnel Effects, LLC. Her experience includes the design, development, training and administration for over 15 Assessment Centers in the public sector.