A company used three different selection methods
Subject: Business    / Management    
Question

1. A company used three different selection methods to select entry level business process analyst: 1. Structured interviews (validity coefficient 0.62) 2. Mental Ability Test (validity coefficient 0.54) 3. Work sample (validity coefficient 0.50). A total of 120 job applicants were given the test and they hired 25 applicants for the position. The intelligence test cost the company $22 per person, the work sample test costs the company $40 per person, and the structured interviews cost the company $55 per person. The standardized score (z-score) of the 25 applicants (selected for the position) on the intelligence test was 0.72, structured interviews 0.82, and for work sample test 0.63. The standard deviation of job performance expressed in dollars for the 25 applicants was $8,000. Given this data, calculate the utility of the three different selection methods and make recommendation to the company as to which one they should use for the future. Assume that 200 applicants applied for the job instead of 120 and the company hired 25 of the 200. What happens to the utility using these different methods? Show your calculations as an appendix (this does not count towards the 2 pages limit).

The formula for utility is: Ns*rxy*SDy*Zx-Nt(C) where

Ns = Number of applicants selected for the position

rxy = Validity coefficient of the selection method

SDy = Standard deviation of job performance expressed in dollar terms

Zx = Average test score of those selected expressed in standardized unit (z-scores)

Nt = Total number of applicants

C = Cost of assessing each applicant


2. A company sells consumer products like soaps and detergents using door-to-door sales. That is, salesmen make calls at homes, demonstrate their products, sell and collect payment on the spot. As the manager of the company, you are wondering the best way to assess the performance of the salesmen. That is, how to assess, what to assess, when to assess, who should be involved in the rating, etc. Discuss how you would implement a performance appraisal system for the outside salespeople in terms of the above challenges?


3. A local oil and gas company in Houston hires the following categories of employees: 1. Petroleum Engineers at all levels (entry level, senior level, middle-management level, etc.). 2. Clerical employees (entry level only). 3. Senior management staff (both internal and external searches are done). The company employs about 3,000 employees in the Houston area. The company is interested in revising its compensation package to be externally competitive. They want to conduct their own market survey of wages and benefits paid by the competitors. Help them identify the relevant labor market, competitors, and the key areas they should focus on in designing the survey. Note that I do not expect an actual survey but the areas they should cover in terms of whom to survey, what to survey, and where to survey.


4. A hospital is interested in conducting ethics training for its employees (doctors, receptionists, medical assistants, etc.,). Discuss how you would go about doing the training in terms of what should be covered, who would conduct the training, where the training would be held, how you would select employees, etc.