Goal: DEVELOP, IMPLEMENT AND ASSESS AN EMPLOYEE SELECTION SYSTEM FOR A BANK TELLER POSITION

Role: You are the regional Human Resource Director of Simmons Bank in Arkansas.

Part 1: Employee Selection and Assessment

Identify and employ the necessary sources to develop an abbreviated list of factors for the ideal teller candidate to possess. They should include at a MINIMUM:

- Education level required and preferred
- Experience needed
- Required academic skills
- Required knowledge (relevant content)
- Required social skills
- Any intrinsic characteristics
- ?????

Choose the selection methods: Identify which selection method (e.g., résumé, interview, test, role-play exercise, reference check or personality inventory) you would recommend for each of the factors you listed above. You can use the same selection method more than once if you believe it is appropriate for more than one factor.

For each selection method, indicate why that was your preference. What distinguished that method over something else?

Now that you have identified selection methods for the candidate factors, you must decide how to score each of these assessments. Based on your responses above, decide how each factor may be scored and develop a point system for that factor. A common approach to performing this task is to have some type of numerical rating system that may include one or two minimum requirements. Your task is to develop a rubric (point system) to "score" applicants for each of the factors. In developing your rubric, review the job description information. Factors that are required should receive the baseline score.

Factors above minimum usually receive more points and those not meeting the requirements are rejected outright.

Part 1: Employee Selection and Assessment (continued)

For each selection method, provide the mathematical values for the scale to be used (this is just an example - use what works best) with each method. Be sure to include descriptive anchors with the corresponding value of each method (add the columns &/or rows you need).

Identify Selection Methods, Values, and Anchors for Rubric

Respond to the following questions based on your outcomes.

(a) Which applicants scored the best based on the scores you entered into the table?

(b) What difficulties did you have applying your scoring system?

(c) Based on this applicant data, would you make any changes to your rubrics? If yes, please describe.

Part 2: Selection Strategy

Now that you have created a system to assess applicants on the six key factors, you must decide how to process this information.

Employee selection systems have multiple assessments, and organizations must decide how to integrate them. One assessment strategy is compensatory and allows an applicant's strengths to compensate for weaknesses in another area. For example, a recent college graduate may score highly in the educational requirements for a job opening but score low in terms of work experience. A compensatory strategy will help the recent graduate's limited work experience be "compensated" by his or her high level of education. A compensatory selection strategy may be unweighted or weighted. In an unweighted strategy, all of the factors have the same highest score possible and scores are simply added together. The applicant with the highest score is considered the best and offered the job. To apply this strategy to this exercise, convert all the factors to a possible high score of 100. For example, multiply each education score by 10 (highest score possible for education = 10, so 10 x 10 = 100). Then, add the scores for each applicant.

Using your response in the previous table, answer the following questions.

1. Who scored the highest? ______________________________________________________

2. Do you think this person is the best applicant? Why or why not?

3. Who scored the lowest? _______________________________________________________

4. Does your ranking of the applicants appear to be accurate? Why or why not?

You have just completed an unweighted compensatory approach to employee selection. The other option is a weighted compensatory approach. In this approach, one or two factors are identified as more important than the other factors and, hence, deserve more weight in deciding the best applicant.

Additionally, one or two factors may be considered least important and would have less weight.

To try this out, create a second scoring table and answer the questions that follow.

1. Which of the factors do you consider the most important in terms of selecting bank tellers?

Defend your choice. Now place it in the first row of the table above, Weighted Compensatory Table.

2. Based on your answer to the first question, double the points for the four applicants for this factor. Record the answers in the table above.

3. Of the remaining five factors, which two do you see as least important for selecting bank tellers?

Defend these choices and move them to the last rows just above Total.

4. Based on your answer to question 3, divide the points in half for the four applicants for these two factors. Record the answers in the table.

5. For the factors not mentioned in questions 1 and 3, copy the scores from the previous table into the table below. Total the scores for the four applicants.

Answer the following questions using the second table.

1. Who scored the highest? __________________________________________________

2. Do you think this person is the best applicant? Why or why not?

3. Who scored the lowest? ___________________________________________________

4. Does your ranking of the applicants appear to be accurate? Why or why not?

5. When you compare your answers using the unweighted to the weighted approach, which approach do you think was better? Why?

The other selection strategy is called noncompensatory. Instead of adding the scores on all of the assessments, a noncompensatory strategy establishes cutoffs for each assessment. An applicant who fails to meet or exceed a cutoff is rejected from the selection process.

The cutoff can be a passing score on a test/ inventory, a rating level (e.g., good) or a characteristic relevant to the job (e.g., valid driver's license). The job description is used as a guide to determine what the cutoff(s) should be. For example, in terms of education for the teller position, the job specification indicates that a high school diploma is required, and so the cutoff is established at this level. The challenge occurs for factors that do not have clear guidance as to the cutoffs. If a requirement is not specified in the job description, then subject matter experts (people knowledgeable about the job-usually either long-term incumbents or supervisors) determine cutoffs based on their own experience with the job. They will also consider the expected qualifications of applicants when determining these cutoffs. Based on your knowledge and experience with bank tellers, create a table with cutoff values for each of the six factors.

Similar to the compensatory strategy, there are two options for a noncompensatory approach. One noncompensatory option is called a multiple cutoff approach. In this approach, cutoffs are applied for every factor for all applicants. Apply your cutoffs listed in the table above to the four applicants.

Which applicant(s) remains? _______________________________________________________

If no applicant met all of the cutoffs, would you rather lower the cutoffs or restart the recruiting process? Why?

If many applicants exceed the cutoffs, would you rather increase the cutoff levels, hire all remaining applicants (if possible) or take a compensatory approach for those that exceeded all of the cutoffs? Why?

Another noncompensatory method is called a multiple hurdle approach. In this approach, cutoffs are arranged sequentially. The first cutoff is applied to the entire applicant pool. Those applicants who fail to meet or exceed the cutoff are rejected. The remaining applicants are then subjected to the next cutoff, where more applicants will be rejected. This process reduces the applicant pool at each hurdle. At the final hurdle, only a select few will remain. Organizations usually set cutoffs that are less costly and more objective as the initial hurdles. More subjective and often more time-consuming assessments are set at the end of the selection process. The multiple hurdle approach saves organizations money because not all of the applicants are assessed on all of the factors. This approach, however, can be time-consuming because each cutoff must be applied and then evaluated before moving to the next cutoff. Reflect on your cutoffs and arrange them in a new table below to establish your own multiple hurdle system.

Now answer the following questions.

At the end of hurdle 6, which applicant(s) remained?

What would you recommend if you had no remaining applicants or several applicants remaining?

Do you prefer this method over the multiple cutoff method? Why or why not?

Part 3: Evaluating the Selection System

You have now created a selection system for the job of a teller. The final step in a selection system is to make sure the system works properly. As discussed in the overview, there are two ways to ensure that the system is working. One approach takes a legal perspective to ensure that organizations do not discriminate in hiring. There are two types of discrimination: disparate treatment and disparate impact (also known as adverse impact). Disparate treatment discrimination refers to treating applicants differently based on a protected characteristic (for example, age, sex, national origin, religion). An example of disparate treatment discrimination is not considering women for leadership positions. This type of discrimination is considered intentional and therefore easy to identify and correct or prevent.

Disparate impact discrimination is considered unintentional. This form of discrimination indicates that all applicants were treated equally; however, this equal treatment had an unequal effect related to a protected characteristic. The most common approach to identify adverse impact is to apply the fourfifths rule. The four-fifths rule states that adverse impact exists if the selection ratio of the minority group is less than four-fifths (or 80 percent) of the selection ratio of the majority group. A selection ratio is the percentage of those hired based on the percentage of those who applied for the job. Selection ratios must be calculated for each protected group. The selection ratio of the minority group is compared with the selection ratio of the majority group (often "males" or "Caucasians"). The simplest way to calculate adverse impact is to divide the selection ratio of the minority group by the selection ratio of the majority group. If the result is less than 80%, then adverse impact exists.

Simmons Bank has collected the following data over the past five years:

Based on this information, the selection ratio for men is 20% (40/200), whereas the selection ratio for women is 15% (45/300). Dividing the minority group (the group with the lower selection ratio, women) by the majority group (in this case, men) results in an answer of 75% (15%/20%). Since the result is less than 80%, adverse impact exists. The organization needs to explore the selection process to identify what may be the cause of this disparity.

In this part of the case, you will conduct this analysis. The bank compiled selection data on three racial groups during the past year:

Caucasians, African-Americans and Latinos. The data is as follows:

1. What is the selection ratio for each of the three groups?

2. Does adverse impact exist when you compare the African-American applicant pool with the Caucasian applicant pool? Show your work.

3. Does adverse impact exist when you compare the Latino applicant pool with the Caucasian applicant pool? Show your work.

Another way to assess the effectiveness of the selection system is to examine the decision-making accuracy. Employee selection is basically a system to predict which applicants will succeed on the job.

Highly qualified applicants are expected to perform well on the job. Similarly, seemingly less qualified applicants are not expected to perform well on the job. Unfortunately, the hiring process is complex. Some applicants can put on a "good show" and still be mediocre employees, whereas other applicants may interview poorly but still be excellent employees. Organizations cannot assume the selection process is working well without collecting and analyzing data.

One option to calculate the decision-making accuracy of a selection system is to classify applicants into one of two categories: strong applicants (ones who appear to be highly qualified and are predicted to do the job well-a good hire) and weak applicants (ones who do not appear to be highly qualified and are predicted to not do the job well-a poor hire). Once hired and after sufficient time (typically six months to a year) has passed, employees can also be classified into two categories: good hire or poor hire. After all of this data is collected, the overall decision-making accuracy of the selection process (the total hit ratio) can be calculated as the percentage of correct predictions.

1. Calculate the total hit ratio by adding the correct predictions and then dividing that number by the total number of decisions made. What is this percentage? Do you think this percentage is impressive? Show your work.

2. What percentage of weak applicants turned out to be good hires?

3. What percentage of strong applicants turned out to be good hires? This percentage is known as the positive hit ratio.

4. Compare your answers to questions 2 and 3. Do you think the bank's system is effective?

Part 4: Reflection on Employee Selection

1. You have made a number of decisions in creating, implementing and evaluating a selection system for bank tellers. Which of these decisions do you think is most critical? Why?

2. An employee selection approach to hiring is more complex than hiring employees based on who they know or casually scanning a résumé and asking a few "off the cuff" questions for an interview. When you think about your work experiences, do you think the organizations you worked for took an employee selection approach when hiring?

3. If you answered yes to question 2, do you think the organization was effective in hiring employees? If you answered no to question 2, do you think the organization should have adopted a selection approach to hiring? Explain your response.

4. What do you perceive as the overall advantages and disadvantages of an employee selection approach to hiring?

5. After reflecting on this exercise, would you recommend an employee selection process to hiring for virtually any job? Why or why not?