It does not matter how fancy your business processes or technology may be, success usually comes down to one thing: the people who work in the company.

Huge slabs of corporate cash are spent on hiring the right people and enticing them with enough motivation and career opportunities to stay with the company. Get it wrong and the costs can be crippling. “If you recruit the wrong person, then you are potentially tripling their salary in terms of the cost to the business,” says Caroline Beard, director at Xancam Consulting, a firm of business psychologists. But how do CIOs ensure that they have found the right person for the job?

The obvious answer is to advertise for candidates with the right skills and experience, then interview them to establish whether they have the personality and drive to match.

However that will only take you so far. Apart from the fact that it is relatively easy for someone to make all the right noises in interviews, they will only tell you what someone has achieved, not where their potential may lie.

“Typically, you recruit people on what they’ve done before and what they know and that’s not going to be enough any more,” suggests Beard. It is no longer enough because companies – and people’s jobs – are changing so fast. With the need for corporate agility becoming ever more key, companies need staff with skills that can shift as the business shifts and skills that they may not have used yet.

Examining options

With so many demands, companies are turning towards personality and ability testing to back up interviews and give them extra insights into the true potential of future staff.

While an interview provides a superficial snapshot of someone (on their best behaviour), psychometric testing is more of an MRI-scan into people’s true motivations. “The classic interview mistake is to look at whether a person’s face fits,” points out Beard. “What companies need to do is to look at it much more in depth – someone’s ability to think strategically and their emotional strength.”

There are hosts of different types of tests, most of which fall into two main categories of ability – numerical, verbal skills or technical capabilities – and personality. As you move up the corporate ladder, personality tests become more important.

Fujitsu Services used personality testing as a way of stepping off the recruitment treadmill and pinpointing internal talent for the key role of client account manager. “The traditional account management role is a responsible senior role and we’d reached the stage when we were continuously recruiting outside the organisation which was expensive,” says Rachel Rose, head of talent management at Fujitsu.

“We are a large organisation and thought that there must be people internally if only we could find them. So we decided to find a way of identifying people who could get up to speed within a year and opened it to anyone in the organisation.” Fujitsu spent time identifying the qualities needed to fulfil the high-level role of account managers. Namely, to be able to think strategically, multi-task and have the ability to foster good relations with clients in the £100m-plus bracket.

The shortlisted 40 candidates (out of 300 applicants) were put through a number of different tests devised with the help of Xancam to assess whether they had the right mix of these skills.

These tests included putting together a business case, based on ‘live’ client issues, developed by existing account managers, as well as giving a presentation. But to test how they would cope with stress and unplanned events, they also told them they had a meeting with the CIO.

“The most useful of all the tests was the Cognitive Process Profile, which measures people’s ability to deal with various levels of complexity,” says Rose. The test basically assessed, through using symbols rather than language, how people solve problems.

It identifies five levels of ability, from someone who needs to process information as it comes in, one piece at a time, right up to level five – where someone can deal with complex problems.

So it looks at how people can cope with ambiguity and whether they need structure in the working environment.

“We didn’t use that in isolation, because you could be a level five but no good at some of the more emotional intelligence needed for this job,” points out Rose.

Making the grade

These types of skills became apparent in the interview and roleplay. At the end of the process, people were either deemed not ready, to have potential or to be ready now. Most fell into the middle category and gained useful information about how they could pick up the necessary skills to make the transition.

The tests were tough and some senior people who from the outside would seem perfect for the job, did not fit the profile. In the end, 10 people from sales, IT and procurement moved into the account management role.

All the 40 candidates got feedback about their results, which helped them identify where their strengths lay and which areas needed work to improve their careers. The company was so pleased with the results that Rose’s job was changed to specifically look at how internal talent can be identified in other parts of the business.

Starting with one specific job role is typical, suggests James Bywater, head psychologist at assessment company SHL. “Inevitably what organisations do is start with a ‘problem child’ and look at where there are lots of them and they have a big impact or poor performance,” he says.

“The classic in an IT department are people who are selected for their technical skills and move into sales or management, but after a few years it’s just not working and you need to work out whether they are struggling,” says Bywater.

Like Fujitsu, Portman Building Society also had a recruitment problem, in their case coping with a high turnover of in-store and telephone customer advisors.

“We were experiencing quite a high turnover for those roles – though lower than for a call centre – and it was expensive if people left within six months to a year,” says Paula Jordan, associate director of HR at the building society.

The company decided that it needed to look at its recruitment process and to try and work out the types of people who would be both be good in the roles and stay with the company. Portman started by working out a profile of a customer services representative. “We looked at the profiles of people who were good at the job and those who weren’t and ended up with a profile of the type of person who would be successful in one of those roles,” says Jordan. With the help of SHL, Portman created a test to identify these skills. The results have been impressive.

“Our turnover rate in the first six to 12 months is drastically down and we also find the candidates really like the process. They are asked to do something that’s quite tough and feel that the people they work with will be quite good,” says Jordan. “Line managers have been a little harder to convince,” she admits. “They’ve taken the attitude: ‘show me that it works’. And we have shown them.”

One of the key advantages of the process is it has helped standardise the recruitment of customer service people across the business. The company is now looking at using the same techniques for sales people.

Staff reshuffle

Personality tests are not only useful as recruitment tools but also for building internal teams or reshuffling people after a major restructure. “You can use them to ensure you’re saving money as you get the right people and don’t have to recruit; in terms of spotting talent in an organisation; or to help benchmark the existing set up on an organisational and an individual level, and as a basis to run a team,” says Beard.

“When people move to a new role it means you can give advice on how that person will make the transition and which elements will either help or hinder them,” she adds.

It gives a vocabulary for people to talk about emotional stuff, which is not easy in a work environment and not even in a home environment for some people.

According to Caroline Dunk, principal at CDA, an organisational development and change management consultancy, about 70 per cent of companies use these types of tests in some way but not everyone uses them correctly, particularly with the spate of internet-only tests springing up. “A number of the tests are quite poor – there are no restrictions or regulations. But the British Psychological Society is setting up a test registration service at the moment,” says Dunk.

“It’s very attractive and seductive to be able to assess people this way but you need to check them out and you have to understand that they shouldn’t be used in isolation.”

And do not pigeonhole people either, warns Bywater. Just because someone is happy locked away being a programmer, does not mean they will always feel like that.

People change and you should not assume that just because an assessment says one thing that people’s attitudes will not alter over time. Used properly in conjunction with interviews, work placements or other measures, personality tests can be a huge help in spotting and keeping talent. Just as importantly, from an individual perspective, it can help people identify their own strengths and weaknesses.