Using the interview in small business.

USING THE INTERVIEW IN SMALL BUSINESS

The interview is one of the most commonly used employee selection methods, particularly in small businesses. Most small businesses focus on developing, producing, and marketing a product or service. Costs which are perceived to be only indirectly

Small business owner/managers may not be aware of alternatives to the interview. Even when they are aware of the alternatives, the costs (e.g., of assessment centers), can be too high for the average small business. In addition, the small number of employees performing any one functional role may limit the use of quantitatively based methods, such as testing and biographical information blanks. Finally, a management which is unsophisticated in personnel operations may incorrectly believe that the interview is subject to less demanding equal employment opportunity standards.

Because small businesses rely so much on interviews, it is particularly important that owner/managers be aware of problems associated with interviews, and with strategies which can increase their effectiveness.

RESEARCH FINDINGS

Numerous studies fo the interview process have been conducted over the last seventy years. A review of this research reveals that interviews are typically flawed in many ways. Arvey and Campion, Schmitt, Mayfield, Wagner, and others have documented the inadequacies evident in employment interviews which have been held up to scientific scrutiny. The two most fundamental criticisms relate to low reliability and validity.

Reliability and Validity

Reliability and validity are two characteristics which any successful employment method must posses. Reliability is the extent to which an employment method can produce consistent or repeatable results from one occasion to another or between two or more interviewers. If, for example, an applicant receives a favorable evaluation on Tuesday, but would have received an unfavorable evaluation on Wednesday in response to the same interview questions, unreliability would be indicated. Similarly, if two interviewers using the same criteria evaluate the same applicant's responses quite differently, this would also indicate a lack of reliability in the interview process.

Validity is the extent to which a prospective employee's rated performance on the interview is related to actual job performance. When an interview is valid, interviewer predictions of high or low job performance are subsequently followed by job performance at that level.

Clearly, reliability is a necessary precursor to validity. If an interviewer cannot look at the same data on two occasions and come to the same conclusions, or if two interviewers cannot agree on the performance of an applicant, it is useless to speculate about subsequent job performance. Similarly, a reliable interview may nevertheless be inaccurate, and once procedures to establish reliability have been adopted, the content of the interview must be developed to insure that the interview is valid; i.e., predictive of on-the-job performance.

Much research has been done to find out why it is often so difficult to conduct reliable and valid interviews. These findings have been summarized in figure 1 according to their likely relationship to reliability and validity.

Improving the Interview

The research literature also offers suggestions for improving interviews. For example, close association between the actual content of the job, as assessed by job analysis, and the interview questions appears to improve the validity of the interview.

Structuring the interview also appears to improve reliability and validity. In a structured interview, the same questions are asked of all applicants, and in some cases systematic scoring rules are applied to responses.

Finally, board interviews, in which a number of interviewers participate simultaneously in any given applicant's interview, also appear to result in higher reliability and validity.

In summary, the research literature suggests that the interview, as it is commonly used, has a long history of marginal success as an employment method. An awareness of potential shortcomings, however, allows one to use current knowledge to develop an effective interview strategy. An effective strategy can help small businesses to:

1. hire the best applicant for the position and reduce turnover,

2. keep personnel operations costs down, and

3. simplify personnel procedures.

APPLICATION

Job Analysis

The most important way of improving interview effectiveness is to relate actual job content to the interview questions. Personnel specialists call the process of identifying job content "job analysis." For the purposes of small business, job analysis can be reduced to identifying a set of "employment factors." For example, asking questions such as, "What can a person do on this job that will affect company productivity?" and "How will I know if the employee is doing a good or bad job?" can help the interviewer to identify employment factors. Once these factors are identified and defined, they can become the basis for constructing interview questions. Examples of employment factors for the job of partner in an accounting firm are found in figure 2.

Work Samples

Second, employment methods should require the applicant to perform tasks which closely resemble, simulate, or duplicate tasks which are actually performed on the job. Ideally, the applicant should actually perform a sample of the job content. For example, two important factors for the job of stylist in a hair salon are Customer Relations and Promoting Retail Sales. An appropriate interview question might be:

Interviewer: "You are cutting my hair.

Pretend you have some scissors in your hand. Come over here and realistically proceed for a few minutes. I will role play the customer. You act as you normally do with a customer."

After this simulation, the interviewer can evaluate the applicant's performance on the above-noted factors.

For example, did the applicant correctly note the dry (or oily) scalp of the interviewer and recommend an appropriate retail product? Was the conversation at the appropriate level of friendliness, given the salon's policy on this matter? Was the applicant's grammar and syntax appropriate for the salon's clientele? Notice also, that an actual work sample, such as working on a model's hair, is a separate and necessary complimentary employment method. One could combine these two methods and attempt to simultaneously observe interpersonal, retail, and hair work skills, but this would likely result in the confounding of all three factors.

For some employment factors, such as ability to operate office equipment or writing ability, role playing and simulation during the interview is less than ideal. It is important to know when not to use the interview, or to supplement it with actual job performance samples. (See "Non-Interview Factors" below.)

"What If" Questions

When it is not possible to simulate a situation, "what if" questions should derive directly from the job. A "what if" question is one in which the applicant is asked what he or she would do in response to a hypothetical situation. Figure 3 illustrates some "what if" questions and response categories on an Interpersonal Skills factor for the job of accounting firm partner. By recalling critical interpersonal events and incidents which had occurred in the organization, the interviewer developed questions to determine whether applicant's attitudes were consistent with company policy. (Note that response categories reflect this organization's preferences, and are not necessarily shared by or applicable to all organizations.)

Structuring

Structuring the interview requires that the interviewer(s) ask all applicants the same questions. In addition, one can apply predetermined scoring criteria to responses. These criteria should be categorical in nature. It is impossible to anticipate all of the answers that interviewees might give, but it is possible to anticipate the salient characteristics of good or poor responses. Specific responses can be evaluated by comparing them to categorical scoring criteria. Figure 3 illustrates the use of categorical scoring criteria for interview questions for the job of partner in an accounting firm.

It is important to note that these scoring criteria represent a value system. For example, the organization which developed the scoring criteria found in figure 3 apparently felt strongly that the behaviors which received three-point scores were characteristic of how they wanted their partners to behave in these types of situations. Another firm might disagree, and would rate the same behaviors lower, or would choose to emphasize different behaviors entirely. The point is that the behavior is neither good nor bad in the abstract, it is simply desirable or undesirable in a particular setting. Designing and evaluating interview questions in this manner allows an organization to employ people with compatible value systems.

Board Interviews

Structuring and the work sample approach can be incorporated into board interviews. This approach forces the board to fix the content of the interview before the interview process begins. Board interviews also provide a structure for evaluating responses, and thereby help to organize the thinking of the interviewers. As a result, the interview focuses on the content of what applicants say or do, and members of teh interview board can avoid unproductive arguments that might ensue when using individually conceived factors and scoring criteria.

Use of work samples, structuring, and board interviews does not require technical knowledge of statistics, psychometrics, or psychological testing. Indeed, one might argue that the small business is at a relative advantage in using these interview strategies, because those who do the hiring in a small business are more likely to be quite familiar with the job content than a personnel officer in a larger organization, whose only knowledge of a job may come from the job analysis process.

NON-INTERVIEW FACTORS

The interview can provide good simulation of work performance when social, interpersonal, and motivational issues are assessed. Some factors, however, are not amendable to assessment by the interview. Under these circumstances the work sample strategy can be useful if it is operationalized differently. Often, it is possible to take part of a job and formulate it into a work sample. For example, setting priorities is often important in management jobs. By reconstructuring a past incident into memos, letters, and other documents, one can construct a realistic test of a manager's performance in a particular situation. The memos, documents, etc. are presented to applicants, who can then be evaluated on their ability to set priorities. Similarly, using a typing test constructed from actual company documents, having secretarial applicants construct a filing system from a sample of real company files, or requiring an applicant stylist to work on the hair of a model are other examples of this strategy.

In the last analysis one may choose to use the interview, knowing that it is less than fully appropriate. At a minimum the interviewer can then proceed with appropriate caution.

EQUAL EMPLOYMENT OPPORTUNITY

All employment methods, including the interview, are subject to Equal Employment Opportunity Commission scrutiny. If an employment method has adverse impact, the burden falls on the employer to demonstrate job relatedness or validity. Validity then constitutes a legal defense. One strategy for demonstrating validity is to show a logical relationship between job content and the employment method. This strategy is called content validation. Careful use of the work sample approach to the construction and conduct of the interview will provide strong evidence for content validity.

SUMMARY

No business can afford to hire inadequate personnel. The small business is particularly burdened in this regard, since each employee constitutes a large percentage of the workforce. The research literature suggests that adopting a structured work sample approach to interview construction will increase interview effectiveness. Small businesses should not find it difficult to adopt this approach.

The use of role playing, work samples, structuring, and board interviews can help small businesses to limit the need for personnel specialists and to keep personnel staff costs low. At the same time, they will increase the effectiveness of hiring procedures. None of the methods described requires the creation of a new personnel position, the acquisition of a new personnel technology, or a large investment in time. The suggested approaches are likely to be quite cost effective.

An interview which does not work is very expensive. Consider the costs of recruiting, training, and compensating an unproductive employee, and then add to these the cost of repeating the whole process. An ineffective interview, no matter how easy it is to develop, is not "cheap." Specific estimates of savings can be developed, but an example can better illustrate the utility of the proposed methods.

Imagine starting a new business and hiring ten employees, three of whom must be replaced in the first year. If the hiring "hit rate" could be improved from 70 to 90 percent, so that poor selection decisions were reduced from three to one, considerable savings would results. Under almost any set of circumstances, adopting the techniques outlined in this article would be far less burdensome than replacing two employees.