The Human Capital Show

1. The Human Capital Show With Host Janet Walsh (c) 2008 Profitability Channel

2. Human Capital Show Janet L. Walsh President Birchtree-HR, LLC Human Capital Financial Management (770) 590 8338 Telephone www.birchtreehr.com Website walsh@birchtreehr.com Email (c) 2008 Profitability Channel

3. Birchtree-HR, LLCHuman Capital Financial Management HR Strategic Planning Executive Compensation Performance Management Global Start Up Operations Producers of the award winning “At The Table HR Simulation” Teaching HR and business leaders how to increase financial performance through HR operations www.birchtreehr.com 01 (770) 590 8338 Telephone (c) 2008 Profitability Channel

4. Special Guest Brandon Young, MA, PHR Manager Testing and Measurement Mountain States Employers Council, Inc. Denver1799 Pennsylvania StreetDenver, Colorado 80203303.839.5177 toll free: 800.884.1328 (c) 2008 Profitability Channel

5. Testing and Assessment (c) 2008 Profitability Channel

6. Staffing Concerns …. • Hiring new employees is a big investment • Finding top candidates is time consuming • Companies are flooded with applicants • Who is qualified? Who is not qualified? • Workload to sort through applicants has increased • Bad hiring decisions/losing applicants is a problem

7. Employee Performance and Business Outcomes…The Facts • Good hiring decisions have positive impact on business results • Poor hiring decisions • Negatively impact performance and productivity • Increase turnover and staffing costs • Inefficiently use managerial time • Lower customer satisfaction

8. People are generally the single largest investment for an organization but employers often do not approach the acquisition of new hires with the same diligence they study and think through the acquisition of new office equipment. (c) 2008 Profitability Channel

9. The Pre-Employment Testing Solution… • Many employers use skill tests and behavioral assessments to predict success in both the organization and the position. • Risk management for bad/negligent/careless hiring is reduced • Replaces “gut feel” with metrics and measures • Improves staffing efficiencies • Quantifies success characteristics (c) 2008 Profitability Channel

10. Documented Facts Support Assessment Use… • Handler, 77% of respondents indicated that assessments have a positive impact on their organization. Of those who collect metrics 86% indicated assessments have a positive impact. • Transportation company was able to reduce counterproductive work behavior by using a personality measure saving the company $1M annually. • Large book retailer achieved millions of dollars in additional profits through increased sales and reduced shrinkage and theft after implementing an instrument to measure work styles (c) 2008 Profitability Channel

11. More Facts…. • Broadband Communications Company, Customer Service Representatives who scored well on the pre-employment assessment solution completed calls about 20 seconds quicker and generated more revenue per call than lower scorers. Over the course of one year, the company calculated that each high scoring agent will generate $18K more in revenue than low scorers. • Warehousing and Distribution role, 43% of associates scoring high on a customized job fit measure remained on the job after 90 days, whereas only 23% of those scoring low were retained. • Several hundred Retail Sales Consultants for a Wireless Carrier, estimated staffing focused on candidates who scored highest on the assessments would generate an additional $17K per month aggregate in product features revenue. (c) 2008 Profitability Channel

12. Even More Facts…. Call center in the Telecommunications Industry, Agents who scored higher on assessments achieved a sales quota 24% higher than lower scorers, while also showing increased productivity through an average handling time that was 40 seconds faster. These same Agents were much more likely to stay with the company with turnover dropping from 33.5% for all locations to a mere 12.5% (measured as rolling 90-day averages). Retail Sales locations that were staffed with Associates who scored high on a Conscientiousness assessment experienced less stock shrinkage – almost $50K less per year. Across the chain’s 1,500+ stores, this translates into nearly a $78 million dollar difference in annual inventory shrinkage. (c) 2008 Profitability Channel

13. What Makes Assessments Successful? • Alignment between the outcomes of the tools and the actual business and recruiting and hiring goals of the company is critical. Desired end goals should be defined: • improved performance, increased productivity, improved process efficiency, reduced turnover, etc. • Financial investments should be considered prior to developing or purchasing selection tests. • “Is the potential information and use of the information worth the financial investment and what is the potential return on this investment?” (c) 2008 Profitability Channel

14. What is the ROI? • Value of better hiring decisions. – extensive private and public research has shown that well designed assessments can improve the average performance of newly hired employees by 5% • Value of avoiding “Regrettables” – conservatively the average cost of hiring an employee who engages in counterproductive work behavior such as theft is $7,500 based on retail theft statistics. • Value of reduced turnover – when designed properly, tools can reduce turnover by 10% or more. • Value of increased staffing efficiency – reduced administrative time screening candidates (c) 2008 Profitability Channel

15. Validity of Measures • While it has been conclusively demonstrated that psychometric tests can significantly improve human capital decisions and result in productivity gains, inappropriate use can not only totally negate the benefits. • Critical to ROI and legal defensibility (c) 2008 Profitability Channel

16. Outcome and Results… • Goal of any test or assessment is to predict job performance and your assessment program should measure as much of the whole person as possible. • Do they know how to do the job? • skill or knowledge tests • Can they do the job without great stress? • personality or work style • Do they want to do the job? • attitude or motivation (c) 2008 Profitability Channel

17. Tips…. • Ascertain what positions are best served by assessment. Look specifically at areas of high turnover or job dissatisfaction and pivotal talent pools within the organization. • Implement the best tools and practices, automate – lower costs and time; measure results; continuously improve. (c) 2008 Profitability Channel

18. Thank you for watching the show! (c) 2008 Profitability Channel

19. Human Capital Show Janet L. Walsh President Birchtree-HR, LLC Human Capital Financial Management (770) 590 8338 Telephone www.birchtreehr.com Website walsh@birchtreehr.com Email (c) 2008 Profitability Channel

20. Birchtree-HR, LLCHuman Capital Financial Management HR Strategic Planning Executive Compensation Performance Management Global Start Up Operations Producers of the award winning “At The Table HR Simulation” Teaching HR and business leaders how to increase financial performance through HR operations www.birchtreehr.com 01 (770) 590 8338 Telephone (c) 2008 Profitability Channel

21. Thanks for Watching! (c) 2008 Profitability Channel