Hotel Online  Special Report

Retaining Human Capital 
Through Assessment
With assessment tools, interviewers can now make more 
informed decisions in the promotion and placement process

Hospitality Business Review, Volume 3, Number 5
Conrad N. Hilton College, University of Houston
October 2001

by Alan T. Stutts
Dean, Conrad N. Hilton College Barron Hilton Distinguished Chair

In the last issue of the Hospitality Business Review, J. W. Marriott, Jr., wrote, "Finding and keeping employees has never been easy. But now, full employment has converged with a service and information economy,  making recruitment and retention the most pressing challenge facing American business today." Human capital distinguishes successful from unsuccessful businesses in the hotel, restaurant, and tourism industry. While one product is, for the most part, indistinguishable from the next, the human capital that creates and delivers the product often makes the difference as to whether a guest is satisfied or dissatisfied and whether a guest becomes a long term client or not.

With that said, it is interesting to note that two of three new hires will fail in the first year, two of three employees would rather be working somewhere else, ninety-five of one hundred applicants will exaggerate to get a job, most hiring decisions are made in haste ( during the first five minutes of an interview ), turnover costs thousands of dollars for every departing employee, and eighty percent of employee turnover is avoidable.

Ninety-five percent of recent college graduates said they would be willing to make a false statement in their resumes in order to get a job. Forty-one percent admitted they had already done so.1  Historically, employers depend upon resumes, references, and interviews as sources of information for making hiring decisions. In practice, these sources have proved inadequate for consistently selecting employees who will be retained by a business.  When training employees, a "one size fits all" approach has failed to provide the desired results. When selecting people for promotion, usually excellent employees have too often been miscast into roles they could not perform satisfactorily. Clearly, an essential ingredient for making "people decisions" has been missing from the formula.

The use of assessments has become essential to employers who want to put the right people into jobs, provide employees with effective training, help managers become more effective, and promote people into positions where they will succeed.

The use of assessments has resulted in extraordinary increases in productivity, while reducing employee relations problems, employee turnover, stress, tension, conflict, and overall human resource expenses.

Several factors contribute to the failure of traditional hiring methods. Resumes often contain false claims of education and experience, while omitting information that would help employers make better hiring decisions. Business references are of little value, because most past employers will tell nothing but name and term of employment.

These realities are the reason interviews have become the most influential factor in hiring and promotion decisions. However, experience shows only coincidental correlations between the ability to deliver well in an interview and to deliver well on the job. Research shows that only one employee in every seven hired after a successful interview delivers well on the job. Unfortunately, many employers in our industry have accepted these poor results and the high cost of excessive turnover as a business reality.

Assessing behavioral traits can improve hiring success rates to thirty-eight percent. When both thinking abilities and behavioral traits are assessed, the right people are hired fifty-four percent of the time. Adding occupational interests to the assessment increases the rate of successful hiring to sixty-six percent. However, the most impressive results are achieved when an integrated assessment is used-  one that measures behavioral traits, thinking, occupational interests, plus job match. An integrated assessment employs cutting edge technology and empirical data to assess the qualities of the total person and, in so doing, the individual qualities of candidates are compared to the qualities of employees who are performing their duties in a superior manner. The integrated assessment can successfully identify potentially excellent employees better than seventy five percent of the time.

A recent review of four pre-hire assessments and employee assessments development revealed a remarkable rate of predicting job match and providing a list of factors that should be considered to enhance employee performance. A review of four assessments from the Assessment Center, Inc., in Houston, Texas, the Sales Indicator, the Performance Indicator, The Profile and the  Step One Survey, revealed remarkable results in predicting job match and  providing a blue print for enhancing supervisory and managerial performance. 2

The 80/20 Rule suggests that eighty percent of all products and services are sold by just twenty percent of the sales-people. This presents interesting challenge to executives who direct teams of salespeople. A revealing analysis of several sales organizations indicated that half of the people comprising the sales force did not have the behavioral characteristics required to effectively perform the duties of the sales position for which they were hired and the remaining fifty percent had the potential for success in sales, but were not hired to sell the right kind of product or service. The conclusion was that only about twenty-five percent of those working in sales positions are a good match with the work they are doing. Thus, the 80/20 Rule IS only valid because people lacking sales essentials get hired and others are not matched with the right products or services. 3
The Sales Indicator

The Sales Indicator, made available by Assessment Center, Inc., assesses five qualities that make successful sales people: competitiveness, self-reliance, persistence, energy, and sales drive. In addition, it predicts on-the-job performance in seven critical sales behaviors: prospecting, closing sales, call reluctance, self-starting, teamwork, building and maintaining relationships, and compensation preference. It was interesting to note that company, sales position, department, manager, geography, or any combination of these factors could be used to customize the Sales Indicator.  Completed in just fifteen to twenty minutes online, a report was instantly available to an interviewer or manager, with easy to read charts and suggested questions that might be used in an interview or become the basis for professional development plan. Most important, the correlations between the Sales Indicator scale scores and measures of sales success were significant and valid.

The Performance Indicator

I hear, on at least a weekly basis, either a manager or executive in the hotel, restaurant, and tourism industry express frustration at an employee's counterproductive behavior or an employee's inability to understand simple instructions. The Performance Indicator, another assessment made available by Assessment Center, Inc., is a management tool that breaks the inhibitors to effective communication, management, and productivity. It can reduce conflicts in personality and style that get in the way of problem solving. The management report developed by the Performance Indicator provides essential information about a supervisor or a manager, describing significant job-related behavioral tendencies in seven key areas: productivity, quality of work, initiative, teamwork, problem solving, response to stress and conflict, and work motivation. The assessment, comprised of thirty questions and completed online in fifteen minutes, creates an individual report and a management report that is filled with specific, individualized suggestions for working more productively with each person reporting to a manager. The Performance Indicator evidenced high construct validity and scale reliability in assessing the qualities of a supervisor that may enhance or create difficulty in the supervisor/employee relationship.

The Profile

The Profile, another assessment available from Assessment Center, Inc., is an all-purpose assessment that measures the qualities that make up "The Total Person," including thinking style, reasoning, occupational interests, and behavioral traits. The Profile could be used for placement, promotion, self-improvement, coaching, succession planning, and job description development. The Profile can be completed online in approximately sixty minutes and produces seven types of reports: individual report for self understanding, placement report suggesting the potential job match, multi-job match report that might be used for succession planning and reassigning employees to new positions, coaching report for training and development, profile summary to more accurately define job requirements, summary reports for a snapshot of the candidate, and graph reports for a visual analysis of job match. The Profile shows high validity and reliability in predicting job match for management positions.

The Step One Survey

The Step One Survey, the final assessment reviewed from Assessment Center, Inc., is designed as a pre-hire assessment to evaluate integrity, substance abuse patterns, work ethic, and reliability. The assessment utilizes anew approach, using direct admission questions that explore an applicant's attitudes and background. The applicant's responses are then compared with two distinctly different groups, recently released ex-convicts with a history of theft and substance abuse and long-term service employees with excellent work histories. The Step One Survey provides a valid and reliable indicator as to whether the applicant thinks like people who have been convicted of serious crimes or people who have histories of integrity, responsibility, and drug-free, long-term employment. However, I would conclude that it is best utilized as only one-third of the employment decision, with the other two-thirds divided between resume, references, background checks, and interviews.

In conclusion, as J. W. Marriott stated, "[finding] and keeping employees has never been easy. But now, full employment has converged with a service and information economy, making recruitment and retention the most pressing challenge facing American business today." However, the author believes an integrated assessment that compares the qualities of a candidate with those of successful employees, supervisors, and managers can substantially assist an employer in finding just the right person for the job. 

1 Nations Business. (1999, May).
2 The Step One Survey, The Sales Indicator, The Performance Indicator, and The Profile were provided by the Assessment Center, Inc., in Houston, Texas. E-mail:
3 Greenberg, H. & Greenberg, J. ( 1980,September/October). Job matching for better sales performance. Harvard Business Review

Dr. Alan T. Stutts is dean of the Conrad N. Hilton College of Hotel and Restaurant Management, University of Houston, Houston, Texas. In this capacity, he has successfully developed short and long term strategies at the college that have enhanced teaching effectiveness, publications by the faculty, and service provided by the faculty. He has created a bachelor's and master's degree curriculum that is responsive to a changing hospitality industry, and he has enhanced the international program sponsored by the college in China and other countries in Asia. In the Conrad N. Hilton College, Dr. Stutts is also a professor hotel and restaurant management with tenure, and he holds the Barron Hilton Distinguished Chair. He teaches students about the operation of hotels, resorts, restaurants, and casinos, with particular reference to design, marketing, and human resource management.


Hospitality Business Review
Dr. Ronald A. Nykiel, Publisher
Conrad N. Hilton College, University of Houston
Houston, TX 77204

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