How Next-generation human performance technology is challenging the status quo of psychometric assessment for Financial Institution hiring.

Can psychometric assessments identify high performance talent?

Financial institutions, from banking to insurance, have a history of relying on psychometric assessment in their hiring processes, but competitive pressures, the rise of remote work, and a tight job market has led Financial Institutions human resource professionals to reassess how they choose high performance talent. As the Harvard Business Review forcefully argues, across the board most enterprises are now hiring “wrong” and not only are they hiring wrong, they are spending more money than ever to do it.

There are a range of enterprise level psychometric assessment options like Hogan, Wave, OPQ ,DISC, and Myers Briggs. These all have their pluses and minuses and have traditionally served as useful tools for HR professionals when it comes to employee selection and development. 

Human resource professionals for Financial Institutions have also developed and, in many cases, pioneered innovative capability frameworks which help map out behaviours, skills and knowledge an organisation needs in order to succeed.

While psychometric testing can still be a valuable tool, and capability frameworks matter, used in isolation these methods are often expensive, time-consuming and failing to deliver the kind of actionable insights that many human resource professionals, project managers and leaders of new initiatives require. 

The challenge is so pressing and still so widely unsolved that McKinsey and Company openly wondered in an analysis of the problem: “How can banks and other firms assess intrinsic traits—which can account for big variations in performance—to tap into great talent?”

Fortunately, psychometric assessments and capability frameworks are no longer the only option. Next-generation human performance technology that is fast and scalable exists.

This technology harmoniously combines psychometric assessment with the core advantages of capability frameworks.

The emergence of this technology in recent years has given those in Financial Institutions in need of forming or developing high performance teams a powerful and scalable advantage.

This is especially important in the current environment in which Financial Institutions are facing significant competition for workers.

How is Next-generation human technology built?

Next-generation human performance technology is built on a Define, Compare and Act (DCA) framework. It works by twinning the deep-dive, qualitative human insights possible in psychometric assessments with the contextual insights of a capability framework which most Financial Institutions have concluded is essential for appropriate hiring and workforce management. The key breakthrough here is that without the context, no performer, however talented, can thrive. If you don’t map the role, the culture and the person simultaneously and integrate this insight, then you are unlikely to maximise human performance —you’re basically taking a shot in the dark.

This is how DCA works:

– First, you Define your unique environment and specific capabilities required for role or business success

– Then you Compare existing employees and job candidates against these needs and each other in an unbiased manner, and

– Finally, you Act on this information with confidence to hire the best candidates into positions or invest in existing employees who possess strong potential.

Alternative to psychometric assessment for financial institutions.

The advantage of using this next-generation human performance technology is being felt across enterprises of all sizes where it is challenging intuitive hiring and management assumptions with rich individual data framed within rich role and environment data. But in many ways,  Financial Institutions are best situated to benefit, especially those enterprises committed to realising the promise of both psychometric assessments and capability frameworks in unlocking human performance.

Find out how Movember’s Chief People Officer partnered with AbilityMap to evolve their Global Leadership culture using a HR tool that surpassed off-the-shelf capability frameworks.

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