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You're Hired!: Business Plus Brains Equals On-the-Job Success

    
 
You're on the third round of interviews for that dream job. Five minutes into it, you're thinking: Am I dressed right? Do they like my personality? Can they see I'm conscientious?

While it's natural for job applicants and their interviewers to focus on appearances, an overwhelming amount of research shows that grooming habits and charm are not very good predictors of how well a person will perform on the job. In fact, mounting evidence suggests that managers should focus more on their applicant's mental ability. Researchers in the Henry B. Tippie College of Business at The University of Iowa even say that I.Q. is the single most important factor in determining an applicant's long-term job performance.

Frank Schmidt, Ralph L. Sheets Professor of Management and Organizations, is convinced that, when it comes to getting the job done, conscientiousness and integrity are far less important than intelligence. Schmidt is known internationally as an expert on the determinants of job performance, the relation of personality traits and mental abilities to job performance, and the ability of integrity tests to predict future job performance.

"What it comes down to is that mental ability is the capacity to learn on the job and problem solve," says Schmidt from his office in the business college's John Pappajohn Business Building. "The way that works is that people with a higher general mental ability learn the job or the job training program faster, and typically solve problems faster and better than others."

Schmidt has consulted with General Electric, the Gallup Organization, American College Testing, AT&T, Samsung, and even the Central Intelligence Agency, among many others. He says research has shown that the best way to determine an applicant's level of mental ability and to predict job performance is to use standardized tests and structured interviews. By doing this, he says, companies can better match the right person with the right job, and that enhances productivity and profitability. It also increases employee job satisfaction, because research shows high-performing employees are more satisfied.

The problem is that only about one-third of companies use standardized tests to screen applicants. As a result, according to the Gallup Organization, as many as 80 percent of workers don't truly fit their jobs.

That's where Sara Rynes, John F. Murray Professor of Management and Organizations in the Tippie College of Business, comes in. Rynes is exploring why so few human resource departments are putting these research findings into practice.

"One reason for the gap between research and practice is that very few practicing human resources managers read the research literature," she says.

Rynes published a study in the Academy of Management Executive Journal that surveyed nearly 1,000 human resources managers and executives who averaged

14 years of experience in the field. When she tested their knowledge of basic aspects of employee performance, many of the managers and executives failed.

So what were some of the most widely held misconceptions? They ranged from issues of personality and intelligence to compensation and participation. One question posited: "Tests to check for integrity don't work because employees lie on them." Two-thirds of human resource managers agreed with this statement, but they were wrong. Research indicates that integrity tests—which measure aspects of conscientiousness, emotional stability, and agreeableness—also add considerably to prediction of job performance when used in conjunction with ability tests.

Misconception 2: "Encouraging employees to participate in decision making is more effective than setting performance goals." Four in five agreed despite the fact research has shown it's important to develop the goals first and then encourage participation. In fact, on average, performance improves 16 percent from goal setting but only one percent from efforts to improve employee participation.

Misconception 3: "Most errors in performance appraisals can be eliminated by providing training that describes the kinds of errors managers tend to make and suggesting ways to avoid them." Wrong again. Research shows that training actually can introduce errors. Furthermore, many of the errors managers make during appraisals often happen for interpersonal reasons, such as avoiding conflict with their employees. Mere training won't help with that problem.

Misconception 4: "Employee surveys overestimate pay's true importance to workers." Nearly six in 10 respondents agreed, but again they were wrong. More than three decades of studies indicate employee surveys consistently underestimate the importance of pay-for-performance in keeping employees motivated and productive.

Misconception 5: "On average, conscientiousness is a better predictor of employee performance than intelligence." More than seven in 10 agreed, but a substantial amount of research, including work by Schmidt, suggests it is not true. "We're not saying that conscientiousness is unimportant," Rynes says. "As Professor Schmidt has shown, if you combine measures of ability with conscientiousness, you considerably improve predictability of how someone will do on the job."

But the bottom line, she says, is that managers and employees don't like the idea of hiring people based on their mental ability.

"What we have learned is that most people don't like taking ability tests because they feel they can't control the outcome," Rynes says. "They think hard work is a better predictor because they can control that more than ability. They also think values are more important than ability because, again, they feel they can change or modify their values to fit a company more readily than they can alter their ability."

The reality is, she says, that managers can improve people's performance in their organizations in two ways. They can change the kind of people they hire, or they can try to do better with the people they already have.

"It's part of human nature to try to focus on doing better with what you already have," Rynes says. "People like to talk about training, development, and participation. That's where they feel hope and inspiration. And there's nothing wrong with that. In fact, it's a great thing to develop your people, so long as you don't forget about getting the right people—smart, conscientious, and emotionally stable people—into the organization in the first place."

-Melinda Pradarelli

This story originally appeared in the Winter 2005 issue of Spectator.

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