Why are we still using traditional interviews?

If you’re responsible for selecting employees into your organization, you should know two fundamental truths about hiring. First, it's critical to the future of your organization that you hire only high-quality candidates who can quickly contribute to the success of your business - what differentiates companies today is the quality of talent employed. Second, hiring mistakes can be costly. Some studies have shown that direct costs attributable to a hiring mistake can exceed three times the annual salary allocated for the position. This includes direct costs, such as recruitment fees, time spent recruiting, advertising, salary, and training. But, there are also hidden costs such as lost sales, lost customers, employer brand erosion, and the impact on team process and employee engagement. Not to mention, the cost of a bad hire increases appreciably if the mistake is not rectified early in the person’s employment. To quote Ray Kroc, the mastermind behind the success of McDonalds Corporation, “You're only as good as the people you hire.” Every time you hire a new employee you change the character and potential of your organization for better or worse.

So how do you hire better candidates? And why do so many companies struggle in this area? Knowingly or not, many hiring managers are biased. The reason you like someone or something is rarely based on rational thought - more often, it’s based on intuition and a gut feeling. With candidates, you may like the way they look, smile, dress, act, or speak. They may remind you of yourself or someone you know. They may have interests like yours or know people who you know. Or, they may be good at one or two aspects of a job, and you readily assume or want to believe that they will be effective in other areas.

Making quick assumptions based on personal impressions is a common tendency, even among seasoned interviewers. Psychologists have coined a number of terms to describe these biases, such as halo error and similar-to-me effect. Regardless of what causes inaccuracies in hiring decisions, the result is a hard-dollar cost associated with making poor selections. There are, of course, several methods for avoiding biases and making successful hiring decisions. One of the most effective tools organizations can use to increase the likelihood of hiring the right people is behavior-based interviewing.

Behavior-based interviews represent a more systematic and standardized process of evaluating job candidates than is typical of traditional interviews. Behavior-based interviewing is founded on the principle that the best predictor of future performance is past performance in a similar situation. Therefore, the questions asked in this type of interview tend to focus on behavior and are designed to evoke how an individual responded to a variety of specific situations and the results of their actions.

Because prior behavior is presumably verifiable, candidates often provide more truthful and representative answers about their own behavior than if asked about a hypothetical situation. This information often reveals a candidate’s level of experience and potential to handle similar situations in your organization. Behavior-based interviews typically ask candidates:

• To describe relevant on-the-job situations
• What led to the situation?
• Who was involved?
• What actions did the person take to address the situation?
• What were the outcomes/results of the person's actions?

The behavior-based interview offers the advantages of more conventional, unstructured interviews without many of the challenges. Behavior-based interviews demonstrate higher reliability and validity through the application of the same job-related questions for each job applicant, an emphasis on past experience – the best predictor of future performance - and anchored rating scales to benchmark responses.

Research shows that behavior-based interviews are able to predict performance with as much as 36% accuracy. While failing to predict almost two-thirds of an applicant’s job performance may give pause, hiring managers should take comfort in two facts – first, this represents a gain of as much as 30% efficiency over traditional interviews; second, few other hiring tools perform better in terms of predicting performance. Not to mention, when translated into monetary terms a 30% gain in efficiency often represents millions of dollars in savings for an organization that makes as few as a hundred hiring decisions per year.

Hiring the right people isn't rocket science. Behavior-based interviews maximize the quality of information obtained about a candidate and minimize bias, while still retaining all the benefits of more traditional interviews. The initial investment in developing a behavior-based interview process will pay off quickly and give hiring managers the confidence that they are hiring only the most qualified candidates.