How to Screen for Cultural Fit-HR Magazine

Here are 10 steps for developing an integrated hiring process that includes prescreening for cultural fit:

1.  Analyze the Culture
Who are we … really? To identify people who will fit your company’s culture, you must know what it is. Paul Connolly, president of Performance Programs in Old Saybrook, Conn., and an industrial psychologist, begins by questioning leaders—executive groups or heads of divisions or plants. “I want to know what people on the top of the food chain say the culture is,” he says. “Then, I monitor them to make sure they actually do what they say.”

Scott Erker, senior vice president of selection solutions at Development Dimensions International in Pittsburgh, studies culture from the top down and the bottom up. “Ask the top what the culture is that’s making you successful. Go into the trenches and ask the same question. Then identify the similarities and disconnects.” 

Usually, consultants identify five to 20 drivers, values, motivators or the like, then relate them to the company culture and translate them into core competencies that the business requires. The business link is key.

For example, if your company’s culture values teamwork, Erker asks, what is special about the way you go about it? “When you’ve isolated what it actually takes to make your teams work effectively, the key competencies or success profile that teamwork requires will be what you’re looking for in your selection process,” he explains.

Linking the culture to competencies also can help deflect hiring discrimination lawsuits. “If we can tease out the notion of culture, break it out and anchor it to job-related factors, we can support decisions that lead to a good cultural fit,” says Mickey Silberman, managing partner at Jackson Lewis LLP in Denver.

2. Develop a Strong Brand
Branding serves as your opportunity to tell potential candidates what your business is about. Depict culture accurately in branding and you’ll help applicants self-select in or out. Career portals, messages from top executives, testimonials, virtual job tours and more—all should be designed to give applicants a feel for what it’s like to work for your company. For example, hospital operator HCA’s web site clearly describes the working environment and the company values and portrays the type of employees who prosper there.

Describing your culture on your web site and elsewhere is fine, with one caution: “You can talk about the culture piece so people who don’t fit in will opt out, but if they say they’re qualified, culture can’t take precedence over qualifications,” Silberman advises. “The web site should include language saying, ‘We are looking for the most qualified people for the job.’ ”

Some online job portals, such as Nationwide Insurance’s, offer candidates diagnostic self-help for gauging fit. Nationwide’s candidate-assessment instrument has about 40 questions. Potential applicants complete it and receive one of three designations. “It gives you an honest upfront assessment. Based on the way you’ve answered, it tells you whether you’ll find the culture to be inviting and in alignment with your beliefs,” says Rocky Parker, SPHR, Nationwide’s associate vice president of talent acquisition in Columbus, Ohio. Nationwide officials make no decisions based on the instrument and consider candidates who choose to apply regardless of their results.

Parker says that even when candidates who score well decide not to apply, the company may stand to benefit. “I’m an HR guy, but I’m selling insurance. If your assessment says you’re a good match with Nationwide, it may drive you back to us when you’re in the market for insurance.”

3. Use Properly Validated Assessments
Unlike with self-selection instruments used at the discretion of a candidate considering whether to apply, when employers intend to use the results in screening or decision-making, tests must meet rigorous legal and professional standards. “You need to have done a cultural analysis,” says Ken Lahti, Minneapolis-based director of product strategy and innovation for PreVisor. “Prove that the questions have some relationship to turnover. The test has to be validated. All this is harder than putting together a self-diagnostic tool. It can take six months to a year to get the data you need and track it.”
Typically, candidates complete online tests or assessments as part of the application process, usually, but not always, before the interviews. To avoid identity fraud, some employers require applicants to take them on-site.

4. Conduct Behavioral Based Interviews
Many employers are establishing structured interview procedures to help vet candidates to determine if they possess core competencies, drivers or values central to the company’s culture.

“Load up the interview process with questions that delve into competencies you can’t train for or don’t want to train for,” Erker says. “For example, I can’t train someone to be a self-starter; I can’t train for judgment or integrity. In contrast, I can train someone in planning or how to use a calendar.”

Behavioral interviewers ask each candidate the same open-ended questions, then score responses on a scale. Interviewing is based on the principle that what you did previously in your life is a good predictor of what you will do in the future. Interviewees are asked to give an example of a situation when they faced a dilemma, a problem or a situation. In contrast, when you ask hypothetical questions, you get less revealing hypothetical answers.

5. Include Auditions, Role-Play
Observe candidates in action by giving them a chance to try out the job either directly or through role-playing or other online or live simulation. Some companies, such as Sunglass Hut, observe candidates in live selling situations. When that isn’t feasible, hiring managers role-play as a customer. As a rule, auditions or role-playing come late in the process when an applicant has completed diagnostics, interviewing, and reference and resume validation checks.

6. Learn the Law
Even if well-intentioned, it’s against the law to have a process, procedure or assessment that has the effect of excluding or otherwise discriminating against legally protected applicants. “We want to shake you from the general idea that you can hire people based on nonjob-related reasons so long as you’re not intentionally discriminating,” says Silberman. Consider:

Discrimination. Employers face legal challenges based on theories of both disparate treatment and disparate impact. Disparate impact cases, potentially the most costly, often grow into class actions. Complainants in disparate impact cases need to demonstrate statistically that hiring practices have a disproportionately adverse impact on them and the protected class they belong to. Discrimination has occurred, the argument goes, not because of anything intentional on the employer’s part, but because components of the hiring process yielded discriminatory outcomes. If the statistics suggest bias, the employer has the burden of proving that the process is not discriminatory. Failure results in a finding of “systemic discrimination.”

Contract compliance and affirmative action. Some 24 percent of companies in the private labor sector have sufficient dealings, directly or indirectly, with the federal government to make them subject to the affirmative action regulations of the Office of Federal Contract Compliance Programs (OFCCP). That means, in addition to legal proscriptions against workplace discrimination, these employers must have affirmative action plans and follow them. OFCCP audits about 7,000 employers annually, or 5 percent to 7 percent of those eligible. Silberman, who defends 200 to 300 audits a year, says the monetary recovery from employers for lack of compliance has gone from $23 million in 2003 to $52 million in 2007. Of the $52 million, 95 percent of the penalties were levied following findings of applicant-to-hire adverse impact. The focus of most of these inquiries was testing.

Testing. Tests should help make the hiring process fairer. Everyone takes the same test and has to get the same score or finish in the same range to qualify. Before a test can be adopted, it must comply with the Uniform Guidelines on Employee Selection Procedures. They require the test to be predictive as to performance or turnover. It can’t just be predictive of attitudes. To prove it is predictive, it must be validated. But it also must be validated to prove it is nondiscriminatory, and that’s a potential headache.

When companies purchase tests from vendors, they do so with assurances that the instrument has been validated against discrimination. That means there is sufficient evidence to confirm that people in protected categories who take the test will not be adversely affected in the scoring. In most instances, that appears to be good enough. But all that changes when statistics point to a possible adverse impact on protected groups.

When adverse impact is indicated, according to Silberman, the vendor’s validation of the test is not good enough. “I’m asked to defend these tests before the EEOC [Equal Employment Opportunity Commission] and OFCCP all the time, and I haven’t found them to be defensible.” Employers must demonstrate that those in the protected classes scored within two standard deviations of the mean. Structured interviews with scoring mechanisms must meet the same requirements and must be validated as well.

7. Produce Meaningful Metrics
Isolate cultural fit data within your cost-per-hire, time-to-fill and quality-of-hire statistics. Monitor climate and culture regularly. In addition, some companies, including Lincoln Industries and Nationwide Insurance, report on the percentage of hires promoted. “We want to have 65 percent of our non-entry-level positions filled through our internal selection process,” says Dan Krick, PHR, vice president of people resources at Lincoln Industries in Lincoln, Neb. “It tells us whether we’re selecting the right talent and developing them.”

8. Train Interviewers
Give attention to training managers in behavioral interviewing. “There’s a serious lack of skill in how to ask a question, follow up and be able to derive a result,” says Jeff Cooper, senior business consultant for Authoria’s Talent Management Practice in Waltham, Mass. They need to know what information they can rely on in making decisions and what is outside the law.

9. Keep Good Records
In an audit or discrimination claim, you will be asked to produce records to substantiate your decisions. Silberman says employers often drop the ball when it comes to documentation. “Recruiters need to use disposition codes that tell the reasons why they rejected a person, but they can’t produce the document or any other document that records the reasons.” Many employers have converted to computerized applicant tracking systems that combine all recordkeeping requirements.

10. Monitoring: HR’s Critical Role
In the end, culture remains the province of human resource professionals: monitoring it, studying it and making sure procedures and policies designed to produce the right fit conform to the law. “We do the research, present it to the leaders and interpret it,” says Charity Hughes, SPHR, organizational change manager at SCA Tissue North America in Philadelphia. “It’s up to us to ask the key questions: Are we who we say we are? Do we need to change to gain a competitive advantage? Are we complying with the law?”

The author of this special report is a contributing editor of HR Magazine, a lawyer and a professor of management studies at Marist College in Poughkeepsie, N.Y.

Web Extras

• SHRM white paper: The Right Balance: Aligning Cultural Fit with Diversity Goals
• SHRM article: Personality Counts(HR Magazine)
• SHRM article: Use Personality Tests Legally and Effectively(Staffing Management magazine)
• SHRM article: Try 'Peer Interviewing' to Find the Perfect Candidate For Your Team(Managing Smart)
• SHRM white paper: How Corporate Culture Affects Organizational Value(HR Knowledge Center)
• SHRM research: Organization Development: A Strategic HR Tool(Research Quarterly)
• SHRM research: Organization Culture and Identity: How Leaders Make the ‘Connection’
• Sample branded careers page: HCA
• Online assessment for candidates: Nationwide Insurance