Predictable talent

By Simon Slater, managing director, First Counsel Consulting

A third of a century ago, in 1973, the US Justice Department did a remarkable thing. It provided a grant to an organisation called the HR Chally Group for scientific research into selection methods. From the origins of this project, the company went on to pioneer a ‘world class sales’ benchmark for some of the planet’s largest corporations.

With a database of over 400,000 candidates, 100,000 business decision-makers and 1,500 sales forces, it became the inventor of actuarial selection methods and one of the world’s leading providers of sales-effectiveness solutions. As a direct result of its ongoing research, HR Chally created an instrument called ‘predictive assessment’. Scores of companies have since beaten a path to its door in order to use its methods. And now, many years on, the research has been applied to 350 other job categories.

All of these businesses have one thing in common: they aim to be as certain as they possibly can be that a candidate they select will be successful in the role.

It is a widely held view that most appointments are made on the following basis:

30 per cent interview;
30 per cent reference and background check;
30 per cent assessment results;
Ten per cent gut feeling.

What predictive assessment does is to revolutionise the effectiveness of the selection process. If we accept that before using any of the established tools, the chance of hiring success is no better than 50/50 (the flip of a coin), it is interesting then to note that extensive research carried out by the International Personnel Management Association in 1999 found that the maximum improvement over chance brought about by existing methods was a seven per cent increase, taking selection accuracy to 57 per cent.

These methods include the typical interview process, personality tests, experience tests and score-able interviews. They clearly have their merits and the resultant improvement in selection accuracy is worth having. But I would argue that when people are so expensive to recruit, develop and retain, organisations should take even more trouble to ensure that their decisions are the right ones, especially for senior leadership roles. Then it becomes even more of a risk-management issue.

The predictive-assessment methodology developed painstakingly over the past three decades is now proven to produce selection accuracy of 25–30 per cent better than 50/50 (chance). That is a 75–80 per cent chance of success compared with 57 per cent. This represents, on average, a 35 per cent boost to selection accuracy.

According to HR Chally, to make good people-selection decisions, managers in organisations need to know: a)what skills it takes to do the total job and how important each skill is to success; b) what personal traits motivate someone to use their skills; and c) what are the failure points for unsuccessful incumbents? Predictive assessment answers all of these questions. It defines the critical skills and key competencies required to make a success of a role. But it is predictive; not descriptive. It is based on detailed position profile development and validation. And one assessment collects no fewer than 866 points of data (or ‘DNA’) to help clients be more certain of the right appointment.

In partnership with Celia Nicholson, the UK’s pre-eminent practitioner in predictive assessment and HR Chally’s European associates, First Counsel Consulting has been working to adapt the predictive-assessment methodology to three of the most pivotal roles in the modern law firm: managing partner/CEO; head of practice group; and equity partner. We’re doing this for two very good reasons. In a world about to be impacted by the Clementi Reforms, we anticipate that decisions over key appointments are set to become even more important than in the past. Also, the war for talent is such that getting it wrong in future is likely to become more expensive than less.

The long-term success of law firms over the next ten years will in significant part be related to the rigour of its selection processes for both new appointments and internal promotions, especially among those charged with leading and managing the business. As competition within the legal-services market continues to intensify, the well-led and managed firm will fare better than the firm with weaker, less effective leadership and management.

A firm that uses an instrument as powerful as predictive assessment for its most important appointments stands a much greater chance of success than the firm that doesn’t. Ensuring that an organisation meets its strategic objectives and implements change for the long-term benefit of its people and clients is a matter of good stewardship. Appointing the right people to lead this effort has never been so important.

Simon Slater is managing director of First Counsel Consulting. He can be contacted at simon.slater@first-counsel.co.uk