Can leaders be identified by psychometrics?
Spotting a good manager is hard. Some firms think psychometric tests help and, as a result, an industry has appeared to supply them.
No one knows how big it is, but the vendors of such tests estimate it to be worth between $2 billion and $4 billion a year, says Nik Kinley, a co-author of ‘Talent Intelligence’, a forthcoming book.
Headhunters such as Heidrick & Struggles and Egon Zehnder are trying to get a foothold in the market. Another, Korn/Ferry, paid $80 million for PDI Ninth House, a specialist vendor, in December. IBM and Oracle, two software giants, have bought firms with a talent measurement arm. Consultancies such as Deloitte and Bain are rumoured to be eyeing similar acquisitions.
Firms like psychometric tests because they are cheap (as little as $30 per candidate) and allow an employer to whittle a mountain of job applications down to a shortlist with minimal effort. However, do they work?
Many seek to measure touchy-feely traits such as personality, leadership potential and ’emotional intelligence’. These are hard to measure. Tests that purport to do so are as likely to mislead as to inform, say Mr Kinley.
Unsurprisingly, the firms that attempt to measure personality disagree. Korn/Ferry says that its blue-chip clients are convinced of its test’s efficacy. It assesses candidates for four ‘leadership traits’: task-focused, social, intellectual and participative. It then compares results against the best talent alreadyworking in the position for which they are applying.
Having studied thousands of examples, Korn/Ferry says the one thing good leaders have in common is a willingness to let new evidence change their views. So the firm asks candidates to put themselves in the position of a manager who has been sent to a tricky overseas office, and judges how well they react to different scenarios.
However, some think such tests are easy to game. John Rust, the director of Cambridge University’s Psychometrics Centre, says the expected answers are usually obvious. Firms, he says, end up “selecting the people who know what the right answers are”. This would be fine for a calculus test, but not for one that purports to measure personality, he argues.
Source: The Economist (2013) Personality Testing at Work: Emotional Breakdown. The Economist. 6th April 2013, pp.71.
- Psychometric Testing: 5 Questions & Answers (cyberfootprint.eu)
- Managerial Attitudes and Corporate Actions (blogs.law.harvard.edu)
- MASN, Korn/Ferry reach accord on lawsuit (bizjournals.com)