Employee Selection Can Benefit Business

Employee selection might be more important than you think.

Most companies know that their employees are the most valuable resource, but it can sometimes be a challenge to find the best employees. With a plethora of old-age and new-age ways to apply for jobs, the best hiring practices aren't always clear.

For instance, the current economy finds the retail service sector facing problems as resources and consumer confidence continue to dwindle. However, the industry may be able to thwart some of that backlash if it focuses on hiring practices, according to an article by Newswise Business News.

Some members of the Society for Industrial and Organizational Psychology recently completed a study that hiring better employees contributes to better store effectiveness and sales figures. Rob Ployhart, associate professor of management at the University of South Carolina's Moore School of Business; Jeff Weekley of Kenexa and Jase Ramsey, who also works at USC, conducted the study.

“Intuitively, every hiring manager knows that employing better employees is going to lead to better results,” Ployhart said in the article. “The reality, though, is that many retailers maintain a certain amount of skepticism about the value of investing in frontline service employees.

"With high turnover rates, a problem many HR managers face, and few apparent differences among applicants, many organizations simply opt to fill their sales and clerical staffs with enough warm bodies to meet their staffing demands,” Ployhart added.

The study, which examined 114,198 employees throughout the country, is slated to be published in the Academy of Management Journal. The study analyzed employment applications and test scores to determine job-related knowledge, skills and abilities. The tests were based on personality, situational judgments and experience.

The study also found that stores with a greater percentage of employees with higher test scores outperformed stores that had workers with lower scores and stores with higher-skilled employees had an average of $4,000 more in sales per employee per quarter.