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More companies are using personality tests to assess job candidates and develop new hires.
Kris Frieswick, CFO Magazine
July 1, 2004
If I'm ever asked to take a handwriting test for a job, I'll probably say no. That's because, according to handwriting and document examiner Ruth Holmes, my penmanship reveals that I am, among other things, stubborn, highly analytical, and skeptical of authority. Based on these results, I'm not sure I'd hire myself. But my reaction to her analysis is beside the point, explains Holmes, founder of Pentec Inc., a 21-year-old forensic and personnel consulting firm that serves corporate clients, individuals, law-enforcement agencies, and the legal community. The issue is whether someone else would hire me.
As employers start to hire again, they are increasingly taking steps to ensure that the hires they make are a good fit — not only with the job description but also with the people with whom they'll be working. Companies are doing this through handwriting analysis and other types of personality tests. Among the latter, the most commonly used are the Myers-Briggs Type Indicator (MBTI) assessment, which uses multiple-choice questions to determine the test-taker's four-letter personality "type"; and the Rorschach, in which the subject is asked what images he or she sees in random inkblots, the results of which are then analyzed by a psychologist.
Although a survey by the American Management Association shows that the percentage of companies doing such testing fell off between 1999 and 2001, a spokesman for the group says employers will resume testing as hiring activity increases. PepsiCo, Sara Lee, and Hewlett-Packard have all used such tests in hiring or management training, and companies that use them swear by their ability to dig beneath such issues as credentials and experience and get at the basis of a person's character, aptitudes, and weaknesses — information vital to assessing whether an applicant can succeed in a given position.
Leslie Murphy, managing partner of client services at 1,400-employee accounting and consulting firm Plante & Moran, in Southfield, Michigan, is one longtime fan of the tests. In fact, the firm gave her one before hiring her as an auditor in 1973. "We don't make any experienced hires without personality testing," says Murphy. "The firm has been doing it for 50 years."
Murphy says that testing is essential to preserve the culture of the firm. "We need to hire people who are supportive" of that, she adds. It seems to work: she says the firm has half the turnover of its competitors, that the tests help managers train and communicate with employees better, and that "over time, you understand what type of person works well in which role."
Of course, Murphy has an interest in extolling the virtues of such tests: Plante & Moran not only uses them internally but also sells assessment services based on them. The tests can be expensive, with the price for some running into the thousands of dollars. But because of the potential for increased turnover and training costs, forgoing them can be even more expensive, says Steve Gravenkemper, manager of the assessment and organizational development practice at the firm. Making a bad hire can cost from 30 to 150 percent of an employee's salary, depending on the person's position in the company, he says.
That explains why personality testing is common for C-level positions. And as highly paid employees who are not always as well versed in social skills as they could be, CFOs are especially good candidates for testing. One of the most common findings about CFOs that Plante & Moran makes, says Gravenkemper, "is that the person is task-focused and well meaning, but doesn't realize the impact he or she has on others."
In contrast, D'Anne Hurd, who until earlier this year was CFO of Starbak Communications Inc. in Waltham, Massachusetts, has found through MBTI tests at several different firms that she has a good mix of skills for a CFO. Under the MBTI criteria, she is an ENTJ — which stands for "extroverted, intuitive, thinking, and judging" — meaning she's not only fact-based and makes decisions in an orderly way, but also has good communications skills.
Some companies use personality tests at senior levels for purposes of training and development as well as hiring, which Gravenkemper says is critical for an executive who lacks social skills. "It's important to give that person feedback about how they're perceived inside the organization," he says.
Hurd's testing at NaviPath, a former employer that was a CMGI subsidiary, for example, was part of a senior leadership development program. "We did the profiling so we'd know how to relate to one another," she says. "I thought we were OK before, but the relationships between team members were much better after the testing."
But many companies still shy away from personality tests because of a significant limitation: they can be easy to game. That's what Steve Prelack says he did when he took the MBTI back in 2000 while interviewing for a CFO position with a food-services firm. "I knew what kind of a personality they were looking for," says Prelack, now CFO of VelQuest, a software maker in Hopkinton, Massachusetts, "and I didn't find it difficult to pattern my answers [for that]." Also, personality is not always a key hiring consideration for many finance staff positions. "I guess I could see the benefit of testing a customer-facing employee before hiring him," says Prelack, "but when it comes to something like a controller position, I'm more concerned with nuts-and-bolts skills than personality."
Another hurdle for companies that are considering testing is the potential legal challenges it brings. Many companies, including BellSouth Corp. in Atlanta, have faced class-action lawsuits from minority candidates who think the tests they took discriminated against them. That's why it's crucial for companies that use personality tests to make sure the tests have been validated under the Equal Employment Opportunity Commission's standards, says Teresa Butler Stivarius, an employment attorney with Epstein Becker & Green PC in Atlanta.
"The test you use has to measure what it says it's going to measure," says Stivarius, "and you have to make sure that it doesn't have a disparate impact on minorities." But she cautions that it isn't enough to have your tests validated under the EEOC's standards: a company could still be liable if its tests have a negative result for minorities. Unless you measure the results by looking at the applicant pool, determining what percent are minorities and then figuring out what percent the test is weeding out, she warns, "you may be on the wrong side of a lawsuit."
Also, companies can run into trouble with privacy laws if the tests ask questions of an overly personal nature. Target Corp. found that out the hard way in 1991 when it was sued for asking applicants for security positions to take the Minnesota Multiphasic Personality Inventory, as well as several other tests, which potential employees claimed unduly invaded their privacy by asking questions about religion and sexual preference. "The point is that using these tests is a business-risk decision for employers," says Stivarius. "You have to ask if the benefits are worth it."
That's a no-brainer for Leland Bassett, who has used handwriting analysis to hire every employee in his company, Bassett & Bassett Inc., for the past 12 years.
"I was initially skeptical," says Bassett, "but it really does work. It's very cost-effective. Basically, what [our analyst] is doing is looking at nonverbal and unconscious communication that we all provide in our handwriting."
Bassett says the most important information he gains from the handwriting analysis is whether applicants will fit into the company's "international, multicultural" environment. "We have people from all over the world working here," he adds. "I need to know if an applicant is going to be uncomfortable with that."
Kris Frieswick is a senior writer at CFO.