What is the Utility of Selection?

Utility refers to the overall usefulness of a personnel selection or placement procedure. The concept encompasses both the accuracy and the importance of personnel decisions. Moreover, utility implies a concern with costs?costs related to setting up and implementing personnel selection procedures and costs associated with errors in the decisions made.

The utility of a predictor or selection method depends upon four factors:

1. The accuracy or validity of the predictor.

2. The selection ratio.

3. The base rate of success.

4. The costs and benefits of selection decisions.

Generally, utility of a selection method is higher when it results in a higher base rate of success for a job. Base rates of success increase when a higher-validity predictor is used and when lower selection ratios are used. If a base rate is already quite high, it is difficult to find a predictor that can "beat the base rate." In this case, utility of a predictor will be low since there is little room for improvement. The factors of validity, selection ratio, and base rate, however, do not consider the costs of making selection decisions and, particularly, the costs and benefits of these decisions.

Costs and benefits of selection decisions can be divided into actual and potential costs and benefits. Actual costs include those for all applicants, including recruiting and selection process costs and costs for newly hired employees, such as orientation and training costs, wages, and benefits. Potential costs are those associated with selection errors. Potential benefits come primarily from hiring applicants who exhibit the ability to succeed in the job.

Ref: Thomas.H.Stone

Realistic Job Preview (RJP)

The realistic job preview (RJP), a new concept in recruiting and selection, is a method of communicating to an applicant or new employee what it will be like to actually perform a certain job. RJPs perform a valuable function in employee orientation, reducing reality shock and thus speeding the socialization process.

Realistic job previews can be developed in a number of ways. The most common method is to interview current employees, asking them to state actual experiences (good and bad), and attitudes toward the job. Another way is to film or videotape employees at work and ask them for comments. Information provided in an RJP should not be all positive; employees are encouraged to state some of their problems and frustrations. This information is presented to applicants or new employees verbally or in films, videotapes, or booklets.

Research shows that RJPs lower job expectations without completely "turning off" applicants to jobs. Additionally, RJP advocates argue that previews will create more positive job attitudes and contribute to reduced turnover. From a cost/benefit standpoint, it is advantageous for employers to provide applicants with realistic job previews as early in the employment process as possible. If applicants have a realistic perception of the job they are applying for, they are in a better position to determine if they are a good match for the job. An organization can save selection, hiring, and start-up costs if an applicant discovers that a poor match exists early in the process.
The currently limited use of RJPs in the recruiting and selection process stems from management's concern that too many applicants will reject job offers if they are provided with a true picture of the job. However, empirical study found that realism of job previews did not "drive away" applicants or cause candidates to reject job offers. RJPs need not be used exclusively before hiring; using them after hiring, as part of the orientation process, provides benefits as well.

Validity of Selection Method

If selection methods are invalid, employee selection decisions are no more accurate than decisions based on a toss of a coin. Validity is the degree to which a measure accurately predicts job performance. Selection methods are valid to the extent that predictors measure or are significantly related to work behavior, job products, or outcomes. The process of demonstrating that a predictor is significantly related to a measure of work behavior, job products, or outcomes is validation.

The validation process demonstrates that a significant statistical relationship exists between a predictor and a criterion measure of successful performance on a job. A predictor is any piece of information that can be used to screen applicants. Predictors include information from application blanks (education level, experience, and so on) and reference checks; scores on tests of skill, ability, or aptitude; data from interest and personality inventories; and interviewer ratings of an applicant. Criterion measures are any measures of work behavior, job products, or outcomes that have value to an employer. Job success is an abstract concept that means different things to different employers.

Major Types of Validation

There are three major types of validation used to validate predictors. They are

(1) criterion-related validity;

(2) construct validity; and

(3) content validity.

Criterion-related validity.

A predictor has criterion-related validity if a statistically significant relationship can be demonstrated between the predictor and some measure of work behavior or performance. Examples of performance measures are production rates, error rates, tardiness, absences, length of service, and supervisor's ratings. Suppose a department store uses as a predictor for its sales personnel one year of sales experience. To validate this predictor, the employer would have to demonstrate that a statistically significant relationship exists between one year of sales experience and some measure or measures of work behavior or job products, perhaps number of sales and/or low percentage of errors in ringing up purchases.

Construct validity.

Instead of directly testing or using other information to predict job success, some selection methods seek to measure the degree to which an applicant possesses psychological traits called constructs. Constructs include intelligence, leadership ability, verbal ability, mechanical ability, manual dexterity, etc.

Constructs deemed necessary for successful performance of jobs are inferred from job behaviors and activities as summarized in job descriptions. They are the job specifications part of job descriptions. Construct validity requires demonstrating that a statistically significant relationship exists between a selection procedure or test and the job construct it seeks to measure. For example, does a reading comprehension test reliably measure how well people can read and understand what they read?

Content validity.

A selection procedure has content validity if it representatively samples significant parts of a job, such as a filing test for a file clerk or a test of cash register operation for a grocery checker. Selection tests that approximate significant aspects of a job are called job sample tests. Job sample tests require applicants to perform certain aspects of a job's major activities, thus demonstrating competence at tasks which are an actual and important part of the job. Significant aspects of a job are determined through job analysis and set forth in job descriptions of jobs. Job sample tests should approximate aspects of the job as closely as possible, since this increases content validity.