In part three of this three-part “Ask an I-O” series, we’ve asked Sam Lawson, one of our Talent Management Specialists, to weigh in on a variety of topics including future trends in I-O Psychology, AI in employee selection, and leadership development. I-O Psychology is the science of human behavior in organizations, and psychologists and practitioners in the field conduct research in areas such as employee selection, engagement, motivation, and performance, and leverage that information to develop practical solutions for improving organizational effectiveness.
Sam received his Master’s in Industrial-Organizational Psychology from the nationally ranked Minnesota State University, Mankato terminal Master’s program. His passion and primary area of focus at Corvirtus is leading product development and enhancement in the form of pre-employment assessments, as well as analyzing assessment and engagement data. When not working on product, Sam consults with and develops custom selection, development, and engagement solutions for customers across a variety of industries.
Industrial-Organizational (I-O) Psychology is the science of human behavior in organizations. As the name suggests, there are two sides in the field: the industrial side is focused more on employee selection, performance, and training, while the organizational side is focused on how organizations affect employee behaviors – leadership styles, cultural and social norms, and group dynamics.
As I-O psychologists and/or practitioners, we are trained on the theories, principles, and research in areas such as job performance, employee engagement, leadership, and employee testing in order to improve organizational effectiveness through developing and evaluating custom solutions. These solutions include pre-employment assessments, training and development programs, and performance management systems, among others.
It’s also important to note the difference between I-O Psychology and Human Resources. I-O psychologists are trained as scientist-practitioners to build and evaluate the effectiveness of the tools that HR uses regularly, such as pre-employment assessments for screening job candidates. People in HR are trained primarily as practitioners to oversee the tools and systems designed by I-O psychologists. I-O Psychology is a more scientific, evidence-, and data-based approach to organizational effectiveness.
Two trends that will continue to be highly prevalent as we enter a new decade are Artificial Intelligence (AI) and Work-Life Enhancement (WLE).
Many people think of AI in terms of robots taking over our jobs, but in the context of I-O Psychology, an ever-growing number of organizations are leveraging AI to streamline their recruitment and selection processes, among others. In a nutshell, AI software utilizes custom algorithms that are created specifically to link job performance criteria to candidates that best match the desired qualities and abilities, as well as parse through hundreds of resumes to save time for hiring managers and recruiters. Even with these solutions available on the market, the jury is still out on whether AI has a place specifically in employee selection, such as video interviewing platforms that claim to analyze candidate responses, body language, tone, emotional state, and keywords stated in each response – and using this information as a basis for moving candidates to the next step in the process or making an offer of employment. It’s important to do your research before leveraging the various AI solutions on the market, such as their validity (i.e., their ability to precisely evaluate candidates on job-relevant criteria) and their ability to reveal and account for bias in the hiring process – both of these will keep your organization out of legal trouble. For example, Amazon found that the platform they created to review candidate resumes was actually exhibiting bias based on candidates’ gender. The program was trained to screen candidates by using years of data during which the majority of resumes were received and passed along for interviews by men – the AI was screening resumes using a built-in bias in favor of men, creating a gender bias.
WLE will continue to be a hot topic in I-O Psychology, with an increasing number of companies implementing flex scheduling and supporting mental health awareness. It’s no secret that satisfied employees tend to perform beyond expectations and stay with their organizations, as opposed to looking for work elsewhere – so why would organizations not do everything in their power to ensure their employees are engaged and driven to perform in ways that set them up for long-term success?
The jury is still out on whether AI has a place in employee selection with employment decisions at stake. Major advancements in AI technology have resulted in companies creating a variety of screening tools, such as video interview platforms and hiring assessments, that are then used by organizations worldwide – with the goal of helping companies improve their ability to screen for job performance criteria and culture-fit – faster than ever before. Video-based interviews, for instance, utilize algorithms to analyze speech content, tone of voice, emotional states, and nonverbal behaviors during the interview. It’s critical that the data being used to develop these algorithms is free of bias, unlike Amazon’s resume parsing platform, for example, that has since been discontinued.
These tools leave many questions unanswered around ethics, legality, and the ability to predict job-relevant outcomes in screening and assessing candidates. While traditional assessments that screen for personality characteristics and cognitive ability have been found to be reliable and valid predictors of job success through evidence-based research and position-specific validation studies, there is far less information about the new wave of AI-driven selection tools. It is not always clear what they assess, whether they are valid, or how exactly they predict performance. That’s not to say that all AI-based selection tools are ineffective, but rather it’s important when exploring these tools to thoroughly research how they were validated, the way in which the algorithms were developed and what data and scientific evidence they are based upon, and whether they are free of bias, among other things – which is something that should be done with any hiring tool, AI-driven or not.
Leadership development has major implications at both the individual and organizational level. Our employee experience surveys have consistently shown that opportunities to learn and develop on the job is one of the key drivers of intentions to quit and look for another job. So at the individual level, employees are much more likely to stay with their organizations for the optimal amount of time when provided with opportunities to develop new and existing skills, contributing to a more positive culture and greater retention rates. When this happens, the organization reaps numerous benefits. Companies that are focused on investing in human capital deliver stock market returns 5x higher than companies with less emphasis on human capital3. Outside of financials, leadership development helps organizations attract and retain top talent, as opposed to losing star employees and high potential candidates to competitors. When organizations invest in their leaders, it creates a positive culture and employee experience that will result in greater levels of retention. Developing people internally is much more cost-effective than hiring and training someone from the outside. Furthermore, strong leaders are more capable of leading organizations to where they need to be to achieve greater levels of success.
Building bench strength mandates effective succession planning to ensure that the organization will continue towards its intended results, despite attrition through turnover and retirement (particularly salient in our current environment with the Baby Boom generation). This planning allows you to anticipate and fill succession gaps – and not lose critical organizational knowledge and skill you cannot recover. This requires understanding what drives engagement in the organization to ensure top performers and key contributors stick around. You can think of bench strength and succession planning as a talent pipeline, where current leaders are at the end, but there’s always a supply of employees filling the pipeline to cover attrition – and growth!
Additionally, identifying employees with high leadership potential is critical for building bench strength and maintaining a full pipeline of talent. Even with low turnover, it’s important to provide as many development opportunities to employees as possible, even to those who aren’t necessarily high potentials, to provide a positive employee experience and increase engagement and satisfaction. High potentials or not, employees can leave at any time, so providing a consistently positive employee experience aided by ample development and growth opportunities helps improve retention rates and reduce the likelihood of turnover. Lastly, organizations are always evolving and adapting their strategies. Aligning these strategies with their people is important for remaining on top of the competition, so organizations should regularly evaluate their development initiatives to ensure that they are setting their people up for success as the company and its strategic initiatives change over time.