05 / 15 / 2002

By ALAN GOLDSTEIN / The Dallas Morning News
 

Hiring decisions always come with risk, but what if a computer program could help managers rely less on their gut instincts and more on measurable data?

That's the idea behind Dallas-based PeopleAnswers Inc. The company employs psychological testing to extract what it calls the "behavioral DNA" from top performers in an organization. Then, the software seeks to find the same qualities – such as energy, optimism and creativity – in job candidates.

The company, which just introduced its Web-based product in February, is working with a law firm to profile the behavioral DNA of some of its most successful partners. The data will help the firm narrow the list of job applicants from law schools, culling the lists of candidates to those who have similar characteristics.

Using the Internet, "we can look at thousands of candidates at a time," said Gabriel Goncalves, president and chief executive of PeopleAnswers, which was started in 2000.

Predicting success

It may seem creepy to some people, but big corporations have grown increasingly reliant on psychological tests for evaluating job candidates. Tough times have exposed many of the bad hiring decisions from the economic boom of a few years ago, and businesses have grown hungry for better diagnostic tools for predicting success, executive recruiters said. Psychological tests are also being used for forming teams of existing employees that need to work together. Rather than find people with matching characteristics, the goal may be to find complementary qualities.

"More companies now are recognizing that the tests are valid, but all this started a long time ago," said Peter Ambler, president of Ambler Associates, a human-resources consulting firm in Dallas.

To be sure, psychological tests – such as Myers-Briggs, perhaps the best known of them – have been around for decades. But in general, the way these tests are administered hasn't evolved much for the digital age. Often, they're offered on paper and faxed to industrial psychologists, who then analyze the results and fax back a report.

Mr. Goncalves, 35, discovered psychological tests at his last start-up, Erapmus Inc., a computer network services firm in Dallas that was acquired in May 2000 by VeriCenter Inc. of Houston.

Erapmus had grown rapidly in the 1990s, but it faced heavy employee turnover, a common problem in the tech sector that Mr. Goncalves attributed in part to heavy demands for travel. Mr. Goncalves began working with an industrial psychologist, and started screening candidates before making job offers. He became a big believer in the tests when he saw his employee defections drop off.

At the same time, Mr. Goncalves realized, the tests could be faster, better and cheaper – using the Internet. Results could be delivered in digestible charts, instead of long-winded academic language, correlating candidate results with specific jobs. And the data could be integrated with the sophisticated software packages already in use by major businesses for managing human-resources processes from recruitment to retirement.

Expert input

Mr. Goncalves sought advice from experts in industrial psychology at Rice University and Texas A&M University, eventually getting them to join his advisory board. The company licensed some of the more established psychological tests, instead of reinventing them, and focused its attention on automating the process.

The software offers an assessment with a range of thumbs-up or down ratings, based on personality indicators relative to the ideal job profile.

A separate scorecard can assess clients on a numerical scale. Using a 100-point index, the program rates subjects against the ideal for traits such as conscientiousness, organization, independence and attention to detail. (Every culture is different, and sometimes, it's good to be playful and to dislike rules and structure.)

PeopleAnswers' client list is quickly growing says Mr. Goncalves, including Interstate Batteries of Dallas, which signed up in April to develop profiles of its retail store managers. The profiles will help the company assess and select new managers.

No service is recession-proof, but PeopleAnswers can make the case for why its services may be needed in bad times as well as good.

"When people are hiring a lot, they need a tool to help them out," said Calvin Carter, vice president for business development at PeopleAnswers. "When they're not hiring many people and don't have the money to waste on bad hires, they need to be more selective. And you have more candidates for an open position."