How may HR demonstrate the value of a selection system?

Question

What will be an ideal response?

Answer 1

Demonstrating the HR’s Value with HRIS Selection Applications
The HRIS manager plays a key role in proving the value of a selection system through knowledge of how to obtain and use the right data on individual and organizational outcomes that will demonstrate a return on investment in the system. This expertise is also critical for defending the selection system, which is generally a high-stakes event: the use of the selection information determines individual careers and the company’s ultimate success.
Demonstrating the value of selection requires that we know how well the employees who were assessed eventually perform on the job. For instance, if we measure their productivity (e.g., more products assembled or repaired, customers served, or products sold), we may find that people who score higher on the tests also are more productive. As another example, suppose the assessed individuals are supervisors. Among this group, we may find that the higher the supervisor’s assessment scores, the better they supervise their subordinates, have higher skill levels (perhaps as measured with a knowledge test), and have lower turnover than the subordinates of people whose assessment results were not as high. Testing experts refer to this value or return on investment as utility—the extent to which a selection system results in better candidates than would have occurred if the system had not been used (Blum & Naylor, 1968). The quality of the candidates may be defined in terms of one or more of the following (Cascio, 1991):
1. The proportion who are successful on the job
2. The average numeric value of an outcome of interest (such as number of products sold or customers served)
3. The dollar amount of benefit resulting to the organization (such as the annual increase in revenue)
If a selection system produces a higher proportion of successful candidates (for instance, a 10% increase in the number of new financial advisors who, once hired, can pass a government-mandated licensure exam), then that system has clear value to the company. The same can be said of a selection system that results in an increase in some performance criterion (e.g., cable service technicians who are able to complete an average of 20% more installations per day as a result of testing). And the same can be said for a benefit that can be measured in dollars (for instance, the result that for every 10 points higher a salesperson scored on a sales skill assessment, annual sales increased by $1,000).