The following is a case study examination of the effectiveness of the Customer Serivce and Collections Fit Index assessments for reducing employee turnover rates based on data supplied by a large client organization.
The Company
The company is one of the largest providers of call center management and collection agency services in the United States.
The Challenge
The project was organized to study the effectiveness of DeGarmo Group’s assessment solutions across locations and lines of business at the client organization. The company suffered from higher than acceptable rates of voluntary employee turnover.
Client leadership was particularly interested in the impact of the solutions across locations that have a more substantial impact on the business operation. To that end, DeGarmo Group collected data using an experimental design which allowed for a direct comparison of the accuracy of employment decisions with and without assessment information.
Assessment Strategy
DeGarmo Group implemented the Customer Service Fit Index (CSFI) and Collections Fit Index (CFI) assessments to identify and screen out turnover-prone job applicants during the talent acquisition process.
In contrast to typical pre-employment assessments that measure job skills, the Fit Index System® focuses on job-related applicant differences in work tolerance and personality characteristics.
Study Design
For both Collections and Customer Service jobs, a group of applicants was hired without completing the appropriate Fit Index assessment. Separately, a group of applicants was hired after completing the appropriate Fit Index assessment, but the test results were not made available, and thus did not influence the hiring decision.
Assessment and criterion data for the case study was collected from 418 people from several call center locations. Specifically, there were 223 (53%) cases of data for the Customer Service Fit Index (CSFI), and 195 (47%) cases of data for the Collections Fit Index. Additionally, 396 applicants served as part of the control group and did not participate in the assessment process.
Comparison of results for the assessment versus control groups would provide insight regarding the effectiveness of the Fit Index System for the client organization. The success rate for the assessment process will be indexed as a percentage difference between turnover rates for both the assessment and control groups. For example, a success rate of 15% would indicate that turnover was 15% lower for applicants who passed a Fit Index Assessment, versus those who were in the control group.
Assessment Impact
Data was used where direct comparisons across locations or accounts of interest could be made, and where the proper assessment was administered for the target position.
For the Customer Service Fit Index (CSFI), results indicate that applicants with a passing outcome have a 26% greater success rate than failing applicants. Two-thirds (66%) of all control group applicants (i.e., who did not participate in the assessment process) terminated employment. The success rate for applicants who passed the Customer Service Fit Index was 26% greater than for applicants who were not tested.
Applicants who passed the Customer Service Fit Index were much more likely to remain on the job than the control group for every account operated by the client organization. The impact of the CSFI was greatest for a telecommunications account, which also was the largest account group in the biggest contact center included in the study. Specifically, the success rate was 31% higher for those applicants who passed the CSFI, than for the control group.
For Collections results indicate that applicants with a passing outcome have a 17% greater success rate than failing applicants. The CFI outperformed the control group in both collections contact centers by an average of 17%. That is, turnover was 17% lower among those who passed the CFI than for those who were in the control group.
Return on Investment
The information below provides a perspective on the relative utility of the Fit Index System as part of this case study. It is important to note that while this ROI analysis examines direct hire costs, there are far more costs to the business as a result of voluntary employee turnover (lost productivity, business continuity, etc.). Therefore, any results reported below should be viewed as very conservative underestimates of total utility.
Client leadership estimated that the average cost per hire for entry-level call center employees is $800 per person. This estimated figure is far below the industry average for similar positions.
Based on these figures, the estimated annual ROI for the Fit Index System in 2010, using a 3:1 selection ratio is $764,000 (saved an additional 955 hires).
Since the system was implemented in 2007, this client organization assessed a total of 55,764 people with the Fit Index System. Using the same process for extrapolating savings, at a selection ratio of 3:1 during that time, savings is estimated to be $3,297,600.
The case study results for the Fit Index System® (FIS) are quite favorable by all technical, professional, and legal standards.
Contact Information
Contact DeGarmo Group for more information on this case study or for information on the Fit Index or Fit Interview Systems using the information provided below.
The DeGarmo Group, Inc.
101 N. Main Street
Bloomington, IL 61701
(866) 433-4276
sales@degarmogroup.com
www.degamogroup.com
