Summary: As organizations realize the importance of skills-based hiring, human resource professionals are relying on AI-based skill assessment solutions to follow fair, personalized, and cost-effective recruitment practices
Source: www.freepik.com
Transform Talent Acquisition with AI-Driven Skill Assessments: A Path to Finding the Right Candidate
Are you still hiring human resources (HR) professionals to sift through mountains of resumes, create a shortlist, conduct interviews, and hire the best-fit candidate? You are not basing your hiring decisions only on educational qualifications and work experience, are you?
Do not be a dinosaur…move to skills-based recruitment practices to reduce costly hiring mistakes. Recruitment is not just a quest for qualifications—identifying and evaluating candidates whose skills and personalities match an organization’s needs and culture is the current mainstay of modern hiring processes.
Thanks to the shift from old-world “jobs” to a fluid portfolio of skills and broadened work structures, skill assessment is the HR professional’s new-age ticket to hiring success. Artificial intelligence (AI)-powered skill assessments are technology tools for the evolved recruiter to find the right talent for skills-based organizations.
In a global survey of 1,019 employers, the State of the Skills-Based Hiring Report 2024, Amsterdam-based TestGorilla, a talent assessment platform, found that 81 percent use skills-based hiring. Of the 1,100 employees surveyed, 90 percent see skills-based hiring as a route to securing their dream job.
If you are a business leader or a chief human resource officer (CHRO), this blog will help you understand why enterprises are shifting toward skills assessment to enhance the hiring process.
Understanding Skill Assessment: AI-based Evaluations with Zero Bias
Unlike traditional resume and interview-based hiring, a skill assessment approach helps HR professionals measure a potential candidate’s skills and capabilities specific to the company’s work requirements.
Definition of skill assessment
Skill assessment is the comparison of the actual performance of a skill with the specified standard for the performance of that skill under the circumstances specified by the standard and the evaluation of whether the performance meets or exceeds the requirements. Skill assessment should comply with the four principles of validity, reliability, fairness, and flexibility.
- Validity: Efficiency in measuring a parameter as claimed and intended.
- Reliability: Consistency of evidence elicited and interpreted.
- Fairness: A Clear understanding of the assessment by the candidate and the exceptional circumstances, if any, of the candidate by the assessor.
- Flexibility: Accommodate variations in the test environment, location, and candidate circumstances without a change in the scope of competence requirements.
A skill assessment evaluation covers a range of capabilities: technical, vocational, professional, communication, critical thinking, adaptability, and problem-solving. Typically, it comprises a series of questions in various formats to assess how a candidate is likely to execute on-the-job tasks in the real world. An AI-backed skill assessment elevates the hiring process with zero bias to minimize bad hires.
We, at ValueMatrix specialize in a deep technology-aided skill assessment technique. Overlaid with behavioral analysis, it yields a “whole-human” candidate profile, empowering smart hiring decisions based on the best-fit approach to promote organisational cultural cohesiveness.
Why Do Skill Assessments Matter: Competencies over Credentials
Organizations are moving towards becoming skills-first, making skills-based hiring a must. This, in turn, calls for robust skill assessment platforms.
Source: Deloitte
AI-doctored resumes end up in a trice in response to calls for talent. Stressed HR managers faced with thousands of applications need a quick, error-free hiring process. They have realized that skill assessment interviews and tests are far more effective than resume reviews and job interviews.
Benefits of Skill Assessment Interviews
You can conduct skill assessment interviews in person, online, and through live video or recorded sessions with due/mutual consent. These interviews use different forms of questioning, supplemented with automatic transcription tools, to let HR professionals focus on making the candidate experience smooth and positive.
Validate Candidate’s Competencies
Skill assessment in the pre-hiring stage helps you mitigate hiring risks as bad hires can prove very costly — as high as 30 to 150 percent of the employee’s annual salary! Skill assessment interviews can help to reduce the cost-of-hiring, time-to-hire and prevent mis-hires by:
- Identifying inflated resumes: A person with certification in Python should be able to demonstrate knowledge of the programming language in a quiz.
- Detecting a lack of soft skills: How a person handled team conflict in the past can reveal how his style impacts team dynamics.
- Evaluating good cultural fit: The choice of images of a work environment in which the candidate expects to thrive can prove alignment.
Remove Unconscious Bias
Skill assessment interviews can enhance diversity in your workforce by objectively evaluating skills, testing abilities directly linked to the job, and reducing the emphasis on personal details, including education and employment history.
The very framing of questions in a skill assessment interview can promote diversity, equity, and inclusion. Some steps that enhance DE&I include:
- A structured and standardized questionnaire restricted to test knowledge of skills for all candidates, minus subjective improvisations
- A scoring rubric that assigns points against predetermined criteria to avoid personal impressions that may influence the grading.
- Masking of all personal information during the initial screening to ensure the selection is based on performance in the assessment
Improve Employee Retention
Skill assessment interviews that evaluate a candidate on multiple parameters can significantly improve retention.
Skill assessment interviews minimize voluntary and involuntary turnover by:
- Candidate-Job Fitment: Testing a candidate for technical knowledge, cognitive abilities, and soft skills required to fulfil the job obligation
- Future Career Path: Matching the candidate’s career aspirations with the growth opportunities within the organization
- Upskill and Reskill Plan: Offering constructive feedback and providing a training and development plan that helps the candidate stay relevant
AI-based skill assessments help organizations find talent, evaluate candidates’ proficiency, and foster diversity.
Types of Skill Assessments: AI Profiles the Real Candidate
Different skill assessments help human resources professionals hone their hiring skills and pick the best candidates for ever-evolving roles in various sectors.
- Technical Assessments: When a candidate claims credentials, the best way to ascertain the truth, level of proficiency, and real-world application is to test competencies. Coding tests, programming tasks, simulations, and data analysis evaluations are some tools to measure technical skills.
- Cognitive Assessments: A candidate may have theoretical subject knowledge, but leveraging it in real-world situations is what matters. Problem-solving abilities, adaptability, critical thinking, and judgment skills are measured. Tests in pattern recognition, logical reasoning, numerical reasoning, and objectivity determine cognitive skills.
- Soft Skills Assessments: Skills with an interpersonal angle, such as communication skills, team spirit, time management, creativity, and resourcefulness, are essential to succeed in the workplace. Psychometric tests that measure these traits and analyze emotional intelligence and work ethics are critical:
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- Situational Judgment Tests: Deployed to test how candidates in customer service and managerial roles respond, they present hypothetical work situations and evaluate if the candidate can make sound decisions under pressure.
- Role-Playing Assessments: Used to analyze how a candidate in customer-facing or managerial roles uses people skills.
An organization introducing AI-backed skills assessment should find the right mix of tests to provide the best talent in the least time and at the lowest cost.
How Does AI Enhance Skill Assessment: Analytics of HR Metrics
The role of AI in skill assessment is limitless! The top ten ways that artificial intelligence tools and platforms improve skill assessment in the recruitment cycle are:
- Automation: It takes over repetitive tasks such as resume parsing, candidate profiling, and conducting tests, reducing hiring time.
- Compliance: Ensures compliance with labor and data privacy laws, transparency in communication, and non-discriminatory hiring practices.
- Scalability: Serves the different growth stages of an enterprise to handle a high volume of applications with flexible hiring processes.
- Fairness: Mitigates human bias with anonymized personal details and a focus on skills and performance indicators through “blind” hiring practices.
- Personalization: Designs real-time tests with adaptive questions based on responses, which reduces wrong hires and improves the hiring experience.
- Transparency: Identifies close-fit candidates through a decision-making process based on data-driven hiring.
- Consistency: Uses a uniform set of criteria to test candidates impartially to maintain hiring standards.
- Reliability: Reduces errors with an objective approach to evaluating a person’s skill sets to achieve healthy hiring metrics.
- Insightfulness: Analyzes candidate behavioral traits and performance metrics to align with company culture as a hiring strategy.
- Optimization: Prioritizes continuous learning to achieve efficiency and improve the hiring approach.
Measure of AI Impact on Skill Assessments
When the HR department of an enterprise embraces AI for its recruitment process, automated and AI-driven skill assessment tools, solutions, and platforms are the first stop. Industry estimates have found that when HR professionals use AI-powered skill assessment platforms, the impact on HR metrics is manifold:
- 30-50 percent reduction in time-to-hire
- 20-45 percent decrease in cost per hire
- 25-35 percent improvement in quality hires
- 30 percent enhancement in candidate experience
- 10-15 percent more application screenings than humans
- 20-30 percent increase in assessment accuracy
- 15-25 percent rise in the interview-to-hire ratio
It is evident that organizations that invest in skill assessment solutions today are simply investing in talent quality and workforce retention.
Best Practices in Conducting Skill Assessments: Personalizing Candidate Experience
There is no shortcut to preparing a skill assessment framework for your organization. You have to go about it in a very detailed manner. Skill assessments help to recruit new talent or to evaluate the existing talent pool within your company.
- Create a Skill Ontology: Generative AI can create a skills ontology. A simple approach would be to list jobs in your organization. Next, list the skills needed to execute these jobs. Follow up with the proficiency level of skills required for different tasks, and finally, grade them according to importance to the business. Do the same for new jobs surfacing due to technology or business growth.
- Define Core Competencies: To facilitate recruitment, you will need an in-depth range of assessments to test and evaluate potential candidates’ skills. Ensure you cover different aspects of the job, including technical, cognitive, communication, and other soft skills.
- Select Appropriate Assessments: Pre-design the proper test or assessment for each job advertisement. It can be a series of tests developed for different skill sets or a comprehensive one designed to find the best-fit candidate for a particular post.
- Standardize the Skill Assessment: Every candidate experiences the same test, and you earn points for employer branding for fairness in the recruitment process. Ensure consistency, informed consent, compliance, and DE&I principles are followed.
- Give Candidates Feedback: Empower candidates with clear instructions on how to take the test, and after submission, provide feedback about the evaluation. Whether or not it culminates in hiring, transparency boosts the employer branding. Constructive feedback can result in employer referrals.
If you do not want to settle for ready-to-use tests in the market, you can choose to rope in a trusted technology partner offering a skill assessment platform with customization options and standalone tools such as:
- Application Tracking System
- Candidate Relationship Management
- Candidate Sourcing
- Filtering and Short-listing
Also, take a closer look at unique attributes:
- Evaluation Areas: Technical skills, job-specific knowledge, problem-solving, critical thinking, cultural fit, learning agility, growth mindset;
- AI Techniques: Gamification, including scenario-based games, interactive tasks, simulations, and puzzles; Natural language processing, including written and spoken responses, sentiment, tone, and language;
- Immersive Experiences: Tests conducted in virtual reality and simulated environments to assess real-world performance
- Event-driven Automation: Interview invites, interview follow-ups, assessment task prompts, onboarding tasks, exit interviews
- Intelligent Document Processing: Resume screening, candidate profiling, compliance check
Needless to add, machine learning insights for personalized assessments and predictive analytics reports that enable a SWOT analysis of a potential hire are imperative. Selecting a tool that integrates seamlessly with the existing HR technology stack makes sense. User-friendly interfaces for recruiters and candidates with learning and development modules for career progression and succession planning are also must-haves.
Case Studies: Successful Implementation of Skill Assessments
Multinational companies are already playing with innovative forms of skill assessments. Here are some examples:
- Recruitment Chatbot at Stanford Health Care: This leading US hospital hired nurses despite the shortage after COVID-19. The chatbot matched candidates to available jobs and helped aspirants complete the application process. Or continue where they left off on their cell phones.
- ML Job Match at Amazon: This online retailer uses NLP and ML to match candidate profiles with available roles based on skills, interests, and experience. The company engages, informs, and evaluates potential candidates, leading to an increase in diverse hires.
- Psychometrics at Citigroup: The multinational investment bank and financial services use logical and numerical reasoning tests to hire. The numerical reasoning evaluation comprises tough questions in succession, and the pictorial logical reasoning is “challenging.”
- Seedlink at L’Oreal: The cosmetic giant has hired talent humans may have overlooked through its AI solution, Seedlink, which asks candidates open-ended questions. The software was rescued when 12,000 applications came in for 80 internship positions.
- Gamification at McDonald’s: The burger outlet in Australia launched the Macca’s Burger Challenge Game online to test speed, coordination, and memory to fill 14,150 positions across 1,025 restaurants. Aspiring candidates have to wrap a burger in 45 seconds.
Source: Website Screenshot
Future Trends in Skill Assessment
As we step into Industry 5.0, combining cutting-edge technologies with human strategic thinking will force people to focus on skills that will complement the thinking machines. Human-machine interactions would catalyze creativity, productivity, and efficiency. Skill assessment will continue to focus on technological expertise, complex problem-solving abilities, collaborative mindset, team spirit, data literacy, lifelong learning, and ethical behavior.
The expected level of proficiency would be higher. The focus would shift to an inclusive workforce with diversity in hiring and training practices, particularly in development teams that build AI technologies. We will see the battle to remove human bias and ensure technology is inclusive, primarily in AI-driven development projects for skill assessments.
Ready to enhance your hiring process? Discover how the AI-powered skill assessment platform from ValueMatrix helps you find the perfect candidates, saving you time and dime.
About us
ValueMatrix is helping organizations build culturally cohesive teams with AI-powered recruitment and retention strategies. We have educated corporate leaders on the need to involve and encourage all generations to adapt to enterprise values and participate actively in pursuing excellence.
Our AI-powered skill assessment platform transforms talent recruitment into a speedy, cost-effective exercise. We partner HR professionals to achieve HR metrics such as cost and hiring time.
