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3 Ways Assessments Can Make Your Startup Dollars Last
Data shows that personality assessments can lower your cost per hire & the cost of employee turnover, while also improving employee productivity. Here's how.
Venessa Vasilakeris
May 4, 2017
Imagine being in a room full of startup founders. This crowd knows how to raise money, they know how to drive sales, and they know how to close deals. If we ask them what their number-one challenge is, most of them will emphatically tell you that their biggest challenge – by far – is hiring and retaining the right employees.
I think that one of the key reasons why startups find talent acquisition and retention so difficult is that while most founders are experts in what they do, few are experts in HR and recruiting. And they definitely don’t have the time to become HR experts.
To find and retain the best talent, you have to know where to look, how to interview objectively, and how to get the most out of references. Doing all of those things is going to have an impact. Adding personality assessments to your hiring toolkit, in addition to doing those things, will not only improve your quality of hire, but it will also help your bottom line. Here is what you can expect if you add assessments to your toolkit:
Lower Cost Per Hire
Incorporating assessments into your hiring process can immediately decrease the cost of recruiting. Personality assessments provide a clearer picture of how candidates line up against the job they’re applying for. They can also make the hiring process more efficient. And when you combine more informed decision-making with faster decision-making? Boom: lower recruiting costs. As a bonus, the McQuaig Word Survey even provides suggested interview questions to explore any questions you might see from the tool’s reports.
Decrease in High Potential Turnover
Do you calculate employee turnover? If you don’t, you might want to start looking into it: companies that use assessments have lower turnover of high potentials than companies that don’t use assessments (11% turnover vs 18%). Why? By using job profile benchmarks, you can immediately understand how your candidate or employee matches up to that ideal profile, and if you notice any gaps, you’re able to start coaching your employees right away. So not only are you putting people into roles that they’re naturally suited for, you’re also setting them up for success as best as you can from day one – instead of starting the coaching process once a problem crops up. This leads to improved employee engagement and higher rates of job satisfaction, and a lower turnover rate reduces your company’s overall cost of employee turnover. It also leads to every entrepreneur’s favourite improvement…
Higher Productivity!
We asked a bunch of companies what percentage of their employees exceeded expectations on their performance reviews. For companies that didn’t use assessments, the number sat at 45%. Not too bad. But for companies that used assessments, the number jumped to 56%. The proof is in the data: when you put the right people in the right jobs, and they get coaching from day one to leverage strengths and mitigate weaknesses, then productivity really can soar – and so can your profit-per-employee rate.
Not only do personality assessments make the hiring process a whole lot easier, but they can have a measurable impact to your bottom line. And that’s mission-critical for startups who are looking for ways to stretch their dollars.