How Behaviour Assessments Can Improve Employee Performance and Retention

Every employer wants to hire top performers. But once they're on board, the focus shifts to retaining them. Employee turnover rate in India reached as high as 21% in 2021. Hence it is needless to mention that it has become a key concern for many companies, given the high expenses and time it takes to hire someone new. 

Losing a new hire not only costs money but can also stall business operations. Traditional methods of hiring such as interviews might not accurately predict how long an employee will stay. 

This is where behaviour assessments come in - offering a science-based and trustworthy way to gauge how well a candidate fits the role or company leading to better employee retention and performance. Assessments can help tie up the loose ends in your employee retention strategies by filtering potential candidates.

How Behaviour Assessments Can Boost Employee Performance

Behaviour assessments are one of the key employee performance improvement tools for any company that wants to improve employee performance and create a strong team culture. These tests help: 

• Identify possible conflicts among employees or teams before they grow into big problems.
• Determine areas where employees might need extra training or help reach their highest potential. 
• Build a better workplace that boosts output and job satisfaction by gaining more insight into each person's character and how they act.

What Employee Retention Means and the Challenge of Employee Turnover

Employee retention refers to the total number of employees who exit an organisation during a specific time. This figure includes those who leave on their own, get fired, are laid off, or have their jobs terminated for any reason.

Companies face a major challenge when it comes to staff leaving. Finding new employees costs a lot—businesses put in a lot of time, effort, and money to get the right people on board. But if a new hire doesn't stick around for long, it can set back the company’s operations in the long term. This also drags down productivity and team morale. That's why more and more companies are trying to hire people who not only have the hard skills they need but who'll also fit in well enough to stay for the long haul.

To tackle this problem, companies look at figures such as the employee retention rate.

Let's look at an example: A SaaS company has 40,000 employees. In the last fiscal year, 500 employees left. Then the employee retention rate will be = ((40,000-500)/40,000) X 100 = 98.75%

Benefits of Employee Retention

1. Increases efficiency: Employees who've been around a while know how to get things done. They know how to boost their productivity, which saves time otherwise spent in training new hires.
2. Boosts productivity: Some delays are unavoidable when you bring in a new hire. The time it takes for them to catch up to the processes and tools and get them used to the new workplace slows the overall output down for some time.
3. Improves team spirit: Staying with a company for a long time makes the employees feel they belong. When leaders show they value this, employees often become more committed and motivated. On the flip side, high turnovers can bring morale down.
4. Reduces costs: Companies factor in recruiting and training when they determine the budget to hire someone. If a business can keep its already existing talented employees, it avoids spending money to find and train new replacements. 

Why Interviews Are Not Accurate Enough in Predicting Retention

When interviewers ask candidates if they plan to stay with the company for a long time, most will say yes. This doesn't mean they're not telling the truth—it's just how interviews work. Let's face it, no job seeker wants to hurt their chances by saying they might leave soon. Doing well in interviews doesn't mean someone will stay in a job for a long time. A person can be great at answering questions and presenting their skills, but how long they stick around depends on various factors such as how well they fit with the company and how satisfied they are in the long run. Judging someone on all these factors becomes quite tricky, if not impossible in a normal interview. 

The Impact of Behavioural Assessments

Every job has an ideal personality type. Think about what makes a good salesperson, for example. They're outgoing, hard-working, and persistent. These traits not only help them do well at work but also make them happier in their job and less likely to quit.

In the same way, companies have their own unique cultures and values. When someone doesn't fit in with the company culture, they might feel that they don't belong, lose interest in their work, and become unfulfilled in their job. This can make them want to leave sooner rather than later. Certain roles favour certain traits, a principle that applies to the company as well. Employees who can’t align with the company's way of operating are less likely to feel committed, involved, or content. This implies they're more likely to quit.

Behavioural assessments provide a science-based way to predict job and company fit by:

• Finding key traits: Giving quick access to top-notch psychological and psychosomatic test measures.
• Assessing fit: Executing validation research to make sure the tools work well in the company's specific setting.
• Predicting retention: Keeping the communication clear so the hiring team remains updated throughout the process. 

How Behavioural Assessments Go Beyond Interviews

With behavioural assessments, companies can pinpoint the actions and qualities needed in a person that matter most in a specific job. These tests shed light on things such as:

• Resilience: How well does the job seeker deal with pressure and letdowns?
• Dedication: Does the person have the push and drive to perform in challenging scenarios?
• Cultural alignment: How well does the candidate's personality align with the company’s core values and culture?
• Objectivity and bias removal: While interviewers may inadvertently favour certain candidates based on biases or gut feelings, behavioural assessments offer a more objective analysis of a candidate's fit for the role and organisation.

Case Study: A Mid-Sized Financial Firm Enhancing Retention with Data-Driven Insights 

A mid-sized financial services firm faced high employee turnover and declining performance, despite offering competitive benefits. To tackle this, they integrated behavioural assessments into their hiring and employee development processes. These assessments helped match candidates to roles that aligned with their personalities, improve team dynamics by balancing complementary traits, and create personalised training programs. By understanding employee behaviours and work preferences, the firm optimised its workforce for better performance.

For example, after struggling with turnover in a customer-facing role, the firm used behavioural competency evaluations to hire candidates with good interpersonal skills. This improved retention in that department by 2x in just six months. Overall, there was a 3x reduction in turnover, and a noticeable increase in the team’s productivity.This highlights the power of insights that behavioural assessments provide.

Conclusion

Executing assessments as part of your employee retention strategy is an investment in a well calculated precaution, which proves far better than the bottlenecks companies face in searching for band aid solutions to employee retention later on.

Through employee engagement assessments, you can better profile the demands of each function, advise and educate managers on how to maximise team performance, create specialised learning and training opportunities, and predict possible team conflicts.

Looking for the best quality behavioural assessments and proctoring solutions for your company? MeritTrac is the answer. Contact us today to get a free demo and sign up for the best and smoothest talent development process you can experience.

FAQs

1. How do behavioural assessments help make teams more efficient?

Managers can make teams more productive by knowing the behavioural traits of each team member. These insights help in assigning appropriate roles according to individual strengths and lead to better teamwork, communication, and performance.

2. Can leadership development programs benefit from behavioural assessments?

Of course. Leadership development programs can be customised as per the person's strengths and weaknesses by using behavioural tests, which help tap into leadership potential. 

3. Which sectors stand to gain from behavioural assessments?

Behavioural assessments are relevant and highly effective in all sectors one can think of that prioritise employee performance, engagement, and retention. Industries such as healthcare, banking, IT, manufacturing, and education can highly benefit from these tools.

4. How often should businesses employ behavioural assessments?

Companies can take advantage of behavioural assessments in all the major stages of an employee's lifecycle, including hiring, performance evaluations, team reorganisation, and leadership development. Periodic tests can also help businesses track shifts in team chemistry and personal growth.

5. How much does it cost to implement behavioural assessments?

Behavioural assessments for employee performance and retention come in different packages based on the service needed. But in many cases, the long-term advantages—such as better performance, increased retention rates, and lower hiring expenses—soon outweigh the initial investment. Features such as online proctoring solutions make these tests a more viable, trustworthy, and budget-friendly solution for companies.