Our skills are put to the test every day at work, whether by seeing a difficult project through to completion, having a tough conversation with a subordinate or peer, executing a successful interview, or taking on a worthy yet inexperienced opponent in the company’s cutthroat chili contest.

However, the thought of taking actual “tests” makes many of us shudder, bringing back painful school days flashbacks. Add to that the fact that many companies are thoroughly vetting candidates a la Sarah Palin (or not?) pre-hire, and the stakes are suddenly a bit higher for all involved.

According to Scott Erker, a senior vice president of development at Development Dimensions International, more than 80 percent of midsize and large companies use personality and ability assessments for entry and midlevel positions as either pre-employment or new-employee orientation tools. 

What does that mean, exactly? Well, personality tests can be administered to either potential candidates or to current employees - but the end goals may be very different. For example…

Cut Turnover in Half?
Many times, as mentioned above, these types of tests are administered before a candidate even gets hired. Erker says that by getting the right-fit candidate, companies can reduce turnover by up to 50 percent – and save roughly a year’s salary in recruiting and training costs that would have been incurred with a candidate who either quit or was let go due to inadequate performance. Companies are using personality tests to weed out either unqualified candidates or candidates who just don’t test out to be a good fit for the role. This strategy is a win-win in that by getting the right people in the right types of jobs at your company, you avoid finding out that a candidate is all wrong for a particular position, and in turn, a candidate finds out the same before it’s too late and they realize that they hate. getting. out. of. bed. in. the. morning.

Woo Generation Y Candidates.
These newest workers are the next big thing, and organizations are scrambling to meet this generation’s new demands and plan for the looming retirement of baby boomers. The rules of hiring, training, and retaining Gen Y workers are different, and companies are constantly seeking out new strategies to set themselves apart and build up a quality work force. Through personality tests, employers can create an internal/external talent acquisition plan, allowing them to assess the potential of candidates early on or work with current employees to strengthen gaps and weaknesses and groom them for future success. Gen Y candidates are very self-aware and self-involved, and tests such as these speak to their need to grow and develop both professionally and personally with the company of their choosing.

Build Better Relationships.
Personality tests can also give employees insight into their own work styles, as well as the work styles of their peers. As everyone is a bit different, by understanding and accommodating each other’s styles, employees can improve their communication and working relationships. At Axciom, a global marketing services firm, workers wear their colors on a badge while at work (determined from Birkman test results: green =communicator; red=problem solver; yellow=detailed scheduler; and blue=planner). By understanding why “Bob in finance loves meetings so much” or “Laura gets angry when her coffee breaks aren’t planned out,” employees can alter the way they interact with their co-workers – and in turn increase effectiveness.

Promote your Leaders.
Many organizations, such as the University of Arkansas for Medical Sciences, are using personality tests to assess which employees are ready for leadership roles within the organization and to help them structure their leadership programs. This also plays into better retention of Gen Y employees, as management can set those who are poised to become future leaders on a long-term plan for success. 

However, despite the many companies who laud these types of tests for the benefits they bring to the table, some critics contend that there remain few government regulations surrounding personality tests in the workplace, and others say that these types of tests may encourage faking of results. Still others raise ethical concerns about utilizing these types of tests in the workplace.

But this is only a test…

Right?