The C-Suite Lacks Confidence in HR Data

The title of this blog is actually the title of a very recent SHRM article:  The C-suite Lacks Confidence in HR Data Analytics.  But Why?  Click on the link I’ve provided and you can read the article.

I’ll save you the trouble of reading this article.  C-Suite executives simply do not believe the data.  Data analytics and confusing top executives who simply don’t have confidence that whatever algorithms are used make the correct assumptions.  An example in the article is Quality of Hire.

The article points out that there is no standard definition of quality of hire.  So the C-suite might see a statistic showing – I’ll make this up – 97.5% of their hires are good performers …. But the research shows that they do not believe it.  They shouldn’t!

A couple of years ago I was Special Advisor to American Productivity and Quality Center study of Quality of Hire.  One of the participating companies you know well and the head of HR made that claim:  he said 97.5% of the people they’ve hired in recent years turned out to be good performers.  Asked about the analytics, that head of HR said hiring managers are asked 30 days after hiring someone, does the person you hired 30 days ago have skills to do the job?  HUH?  Excellent skills?  The skills to do a great job?  APQC asked him, what percent of the people hired turn out to be high performers and the head of HR said, “about 20%!”  Some difference – the CEO’s dashboard weekly shows 97.5% are good hires when in fact only 20% turn out to be the high performers the CEO expected.  How can the C-suite make smart decisions about succession if they do not have a clue how good their employees are?

The SHRM article also states that top executives do not believe that the personality tests administered to candidates separate mediocre from high performers.    They can read validity studies that say the tests are valid but in real life they do not see clear patterns in the tests that separate mediocre from high performers.  I have properly validated personality tests for such companies as the Home Depot and here’s what I found:  The personality tests are easily faked so if a cutoff score is used, C Players answer the questions as though they are Q Players and get this:  the tests eliminate as many A Player candidates as C Player candidates.  Bottom line, I’m not aware of any personality test that is not harmful to a company that uses it for selection, with a cutoff score.

On the positive side of the ledger, I’m proud that Topgrading case studies show tremendous improvements in hiring success.  When CEOs and their C suites can look at 50 people hired with Topgrading and 50 people hired without Topgrading here are the typical analytical data they see:  they know the people hired and judge that 40 out of the 50 hired with Topgrading are A Players, high performers, but only 10 of the people hired without using Topgrading are A Players.  40 vs. 10 – and they know the data are accurate because they know the people hired.

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