Why Psychometric Testing Doesn’t Work in Sales

Why Psychometric Testing Doesn’t Work in Sales

Hiring right is imperative for business, as not doing so is indisputably costly. In order to determine which candidate is likely to succeed in a given sales role, many organisations employ psychometric tests. Although such testing has been in use for over half a century (Cappelli, 2007), time has proven that it reveals very little, if anything, about actual job success. In fact, the correlations between measures of personality and measures of job performance have repeatedly been shown to be weak. As such, there is general consensus among researchers that much more than just personality needs to be accounted for in the quest for accurate job performance prediction. In their extensive review of the relevant research, Morgeson et al. (2007) conclude that careful thought is necessary when considering the validity of personality measures for the purpose of making employment decisions. Despite this, the popularity and prevalence of psychometric testing remains strong within sales organisations.

What’s wrong with psychometric testing?

As mentioned, the use of psychometric testing for the purpose of hiring remains prevalent within sales organisations. Specifically, tests that utilise broad-based approaches, such as the “Big Five” personality assessment, remain popular despite their limited success. Worth noting is that many assessments disguise the “Big Five” personality traits, such as “Extraversion”, by using trait name variations, such as “Sociability”, thus claiming better job performance prediction. Nonetheless, these tests still measure personality. The broadness of scope is perhaps the main issue with such tests, given that the area of job performance is actually fairly narrow and specific. Indeed, meta-analytic research has found that such tools account for less than 6% of variance in sales effectiveness. Put differently, psychometric tests simply describe a candidate’s characteristics in order to infer potential. For instance, a personality descriptor might label a candidate as “extrovert”, saying that he/she will be good in sales as a result. Such a statement is not necessarily true as being “extroverted” might well be a useful personality trait but not necessarily a predictor of sales success. Arguably, personality tests are outdated as the results they produce lend themselves to the profile of a salesperson from the 1980’s, who is irrelevant in today’s job market where many other sales roles are needed. Put differently, psychometric tests do not acknowledge the possibility that jobs with superficial similarities may require different competencies for success.

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Scientific actuarial assessments

The difference between a personality test and conducting actuarial based assessments to determine the specific skills required to perform a sales role is substantial. Whereas psychometric testing is broad in focus, scientific tests are specifically designed to measure the competencies, behaviours, traits and temperaments that predict specific job behaviours, thereby measuring narrow, job-related constructs. Rather than reporting on personal characteristics, actuarial assessments measure the best predicted job performance in specific areas. This is done using actuarial validations of the behaviours and attributes which are the differentiators between success and failure in a given role. The predictive power of scientific assessments far outweigh existing “off-the-shelf” personality measures, as they take into account that jobs with surface similarities could require different skills and motivations for success. For example, although “extroverts” tend to make good retail salespeople, they actually perform worse in B2B sales. Actuarial assessment is thus superior as it focuses on the substantive competencies, behaviours and temperaments that are critical to successful placement. In other words, subjectivity is removed.

The use of psychometric testing in sales is problematic as it invariably fails at accurately predicting job success. Rather, the criterion-related validation approach is far more appropriate. This appropriateness is easy to illustrate with real word examples of major customers. General Motors, for instance, achieved a 35% annual increase in sales per service parts salesperson without using any other sales development technique (Chally). As such, the statistical demonstration of the relationship between scores on an assessment and the job performance of sample workers should be at the core of your company’s selection method.

SalesRehab uses a scientific approach to find and profile the right type of salesperson specifically for your organisation. With Chally’s actuarial assessments, SalesRehab scientifically assesses sales skills to get the right fit, as well as manages response handling to remove frustration from the recruitment process.

SalesRehab ensures that the right fit and type of salesperson is hired for your sales organisation.

Click here to download the “5 steps to hiring the right salesperson” eBook – a step by step guide to hiring the right sales person for your company to avoid the massive cost implications of hiring wrong.

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