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ERNIE, please use the form on the
linked page. Traditionally, the overall market for Assessment runs about $600M/year.
A tiny component of HR, actual assessment is an even tinier piece. Most of
the companies in the space have built high margin consultancies as an
overlay to the traditional test and measurement business. Expanding into
executive selection, 360 degree feedback systems, managerial training and
'change agency', their core businesses are built on the success of their
operations in defining cultural norms and the likelihood that someone will
fit.
(Just to be clear, we are not talking about the technical certification
business. A straightforward online move, issuers of technical credentials
simply test observable technical skills. When we speak of assessment, it
is in reference to so-called soft skills which range from loyalty to
leadership.)
On first glance, the 'soft skills testing' process would seem to be a
dying remnant of the days of labor surplus. A provocative approach to
maintaining cultural integrity (that's right!), assessment gained traction
as a way to respond to EEO suits. Although the science has been argued up
and down, the essence is pretty smart (if the implications are a bit
seamy).
Cultural values are measurable! The likelihood of a particular fit is a
function of relative correlation to the company value system (norms).
Change can be delivered by tweaking the fit incrementally. Stellar
performance can be modeled and taught. A way to defend corporate culture
in the old days, the techniques are finding a striking new application
today.
Although you can complicate it immensely, the core of the right
response to population decline is an expanded pool of potential employees.
Given a burning requirement to invest in these new corporate allies, the
problem of 'cost-effectiveness' emerges quickly. When they are applying in
droves, an applicant tracking system is a powerful weapon. When they are
hard to find, screening becomes critical. It seems paradoxical that as the
requirement for assessment declines at the moment of hiring it would grow
earlier on in the development of potential employees.
'You only need to pass a pulse test to go to work but you have to be
screened to earn the benefits of a potential employee.'
That's the gist of the new model.
In other words, the only way to control the cost of maintaining a
viable pipeline of candidates in a profound shortage is to be sure that
they fit. Since the numbers grow in proportion to the length of time until
you hire (10 candidates for today's job; 100 candidates for next year's
job and so on), being certain that you are dealing with the right people
increases in importance the further away you are from hiring them. It's
very counter-intuitive.
Meanwhile, Recruiting, Retention and Labor Supply Management are really
just proving grounds. Once assessment technologies are driven into the
mainstream, the ability to measure and predict behavior (including
cultural participation) will generalize to the rest of the web. Part of
the reason that web-driven deconstruction is so powerful is that it
provides a method for older companies to relaunch their core expertise.
What position can Sendouts.com put
your firm in?
A more
competitive one.
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