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Leadership Assessments

How do you hire people who can adapt and succeed in a diverse and evolving workplace, while driving corporate culture?

Leadership assessment is a process used to identify people’s unique characteristics as they pertain to leading, managing, and directing others.  Assessments not only provide information about the fit between an individual and the requirements of a particular job, but also provide insights regarding people’s future potential and their fit with the company’s culture.  Including leadership assessments in the hiring process gives decision-makers the data needed to make legally defensible, accurate, data-decisions. 

Why are leadership assessments so important?

Businesses today require leaders who can make difficult decisions, empower employees, and pivot quickly.  Organizations must secure and develop these leaders by investing time, energy and money into employee/leadership development, teambuilding, executive coaching, assessing high-potentials for future leadership positions and pre-employment screening. 

When hiring teams responsible for onboarding a new leader lack a valid approach and structure, they can place emphasis on applicants’ experience, degrees, education, as well as their gut feelings.  These have all proven to be poor predictors of performance and contributes to the high rate of failed hiring decisions.  

Leadership assessments can confirm or debunk “gut feelings” but more importantly, they provide data about an individual’s characteristics as they relate to the position, cultural fit, and future potential.  Assessment can also answer questions decision-makers have about candidates, including:

  • Culture capability:  To what extent will this leader create a customer focused culture that is shared throughout the organization?
  • Talent management:  To what extent will this leader invest in practices that manage the flow of talent into, through and out of the organization?
  • Performance accountability:  To what extent will this leader create performance management practices (e.g., compensation) that reinforce the right behaviors?
  • Flow of information:  To what extent will this leader manage information flow to gain information imbalances?
  • Work practices:  To what extent will this leader establish organization and work practices that deal with the increasing pace of change in today’s business setting?

Business case for using leadership assessment as part of pre-employment testing.  The cost of a bad hire depends on the job’s scope and level. In a recent survey by Career Builder, companies lost an average of $14,900 on every bad hire they had made in the past year, and this is a common mistake.  Nearly three in four employers (74 percent) say they've hired the wrong person for a position. A white paper published by the Center for American Progress indicated that the cost of a bad hire for positions paying $75,000/year or less is about 20% of an employee’s annual salary. The cost of a bad hire for highly complex positions that require specialized training and/or education tend to have disproportionately high turnover costs as a percentage of salary (up to 213%).

How do you decide on an assessment process?

The higher the organizational level for which the assessment is being used, the more important it is to use a rigorous, comprehensive process.  It is understandable that some organizations fear that they might insult high level candidates by asking them to complete a long (and potentially uninteresting) series of tests.  While that might have been true two decades ago, most executives in today’s business world have been, and expect to be, assessed as part of a company’s selection process. 

How can FHSG help?

The beauty of FHSG’s approach to leadership assessment process is that it is customized to client needs and situation.   FHSG can use the following to methods to assess high potential leaders:

  • Structured interviews based on a job analysis.
  • Mental abilities tests that evaluate reasoning and problem solving capabilities.
  • Personality testing designed to provide information about a person's motivations, preferences, interests, emotional make-up, and style of interacting with people and situations.
  • Integrity testing, which assesses an applicant's tendency to be honest, trustworthy, and dependable.
  • Multi-rater assessments in which an individual’s manager, peers, company leaders, and customers evaluate that person on behaviors linked to leadership effectiveness.