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Leadership Development Blog

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The True Cost Of Employee Skills Assessments

Posted by Paul O'Keefe on Jun 7, 2016 9:40:00 AM

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Every company wants to maximize employee productivity, increase profits, and position employees to perform their best. To help achieve those goals, you should start by asking some simple questions: Who do you have working on your team? What are their skills and strengths? What are their weaknesses and deficiencies? Are they best suited for the teams and positions in which they've been placed?

It’s important for employers to know thoroughly the people who are working for them. They must see their strengths and their weaknesses clearly. It’s best to know this information as soon as possible. It’s also helpful to provide employee assessments over the course of employment to capture changes. Having the wrong people in positions for which they have no aptitude is a recipe for failure in the long-term. The detrimental cost of not investing employee assessments can be incredibly hazardous to company health and employee satisfaction in the long run.

What Is An Employee Skills Assessment?

There are a wide range of employee skills assessments available depending on the needs of your organization. You can test for relevant knowledge, cognitive abilities and work skills. You can test for physical and motor skills, if physical labor or manual dexterity is needed, and language proficiency, if language skills are necessary for adequately performing the job. Organizations may choose to test "intangibles" such as personality, emotional intelligence and integrity. Given the nature of the position, a number of these tests may be necessary.

See what an actual employee skills assessment test looks like.

When Should Employee Skills Assessments Be Conducted?

You can test employees at any time. You may choose to assess individuals before they’re hired. Testing individuals before they’re hired bears the greatest benefit because you can find out whether or not they’re suited for a certain position before they're onboarded. This is much wiser than relying on a great interview and "good feeling" in your gut. When using pre-employment tests, you have to be aware of the legal problems that may arise as well. You have to make sure the tests don’t violate federal, state and local Equal Employment Opportunity laws, such as Title VII.

If you opt not to use pre-employment testing, you can still assess your workers while they’re employed with you. This can be done upon first hiring, to ascertain their strengths and weaknesses and where to best place them. You can also test them periodically during employment in order to drive their professional development and ensure they're in the most suitable position.

The Cost Of Not Assessing Your Employees’ Skills

If you fail to assess skills, the first outcome you will experience is hiring the wrong individuals for various positions (if you don’t use pre-employment assessments) and placing employees in positions they’re ill-equipped to handle. Other costs for not assessing your employees include:

  • Having to play catch up
  • Experiencing an increase in turnover
  • Seeing an increase in accidents, mistakes and mishaps
  • Stunting your employees' professional growth

Here are the implications of each...

The Cost Of Playing Catch Up

If you don’t conduct an employee skills assessment, you can easily place the wrong person in the wrong position. It’s easy to do if you rely solely on the interview, resume and references.

What do you do when you hire someone for a position for which they have no real knowledge or aptitude? Your organization will spend a substantial amount of time and money trying to play “catch up” with this employee’s knowledge base so they can do their job. That time translates into hours of training that takes away from time working on actual assigned duties. If you have to provide a trainer for the new employee, the trainer’s time and effort then becomes a cost as well.

The Expense of Employee Turnover

If ill-suited workers are not trained sufficiently, they will be unsuccessful, which leads to more resignations and terminations. Many companies hang on to uneducated, unskilled or unqualified employees for too long before realizing they’ve sunk too much money into development and it’s time to let them go. Or, the underdeveloped employee will realize their deficiencies and become unsure of their place in the company, which leads to looking for other jobs. Either way, losing those workers will cost you. It will lead to the recruiting, hiring and training of even more employees–some of which will experience the same issues if no process is implemented. It's much cheaper to conduct a skills assessment prior to hiring or immediately upon hiring.

The Cost Of Accidents, Mishaps And Mistakes

Failing to conduct skills assessments can lead to mishaps and mistakes that can be extremely costly, and, in some work environments, dangerous or even fatal. In many white collar jobs, it’s not so much a problem; only your profit margin, productivity and customer satisfaction may suffer because of employees holding positions they’re not equipped to fulfill. However, if you’re in a high-demand, high-stakes industry, where ill-equipped employees can easily make mistakes, it could cost millions of dollars and employee lives. Are you ready for that sort of cost?

Stunted Professional Growth Is An Expense

Over time, people change; duties change. If you never conduct any benchmark assessments on your workers over the course of their employment with your organization, you'll have a hard time seeing those areas that have experienced growth, and areas that haven’t seen growth or overall change. Benchmarking is an excellent way to see what changes have occurred in your employees, in their positions and in the organization itself, plus the adjustments needed to stay successful. Benchmark assessments help you keep the right personnel in the right positions so your business continues functioning in an optimal manner.

You can also use assessments as the foundation for setting up individualized professional development plans for your employees to help them grow and move forward. This is especially a concern of millennials, who tend to feel that not enough emphasis is placed on their professional growth in their places of employment.

Use Employee Skills Assessments To Avoid Higher Employee & Productivity Related Costs

The upfront costs of employee skills assessments are minimal in comparison to the costs of not assessing your workers properly. A caution has to be made here to ensure that your assessments remain within the boundaries of federal, state and local EEO laws, as stated previously.

In deciding whether to use employee skills assessments, you should weigh the benefits against the costs. Truly, the costs of not assessing your employees at the outset and during their tenure with your company are too great and point in favor of conducting employee assessments. The question becomes: Which tests are most suitable for your organization? A few well-timed and -administered employee skills assessments will serve your company well in the long-run.

To get more information on the Employee Skills Assessments that are right for you and your employees, contact Edge Training at 800-305-2025.

You may also be interested in these employee development posts:

Topics: Employee Development, leadership development, Employee management, Millennial Development

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