Find the ideal candidate for your organization

AMSTERDAM, NETHERLANDS – There is an eternal question when hiring: “Is this person really the right person?” Even if a candidate has the skills for the job, does their personality match the culture of the company? Do their goals match those of the organization? In the very short period of a selection process, it is very difficult to get to know the person behind the mask and to find the answers to these questions. A new paper published in Elsevier’s Management accounting research, however, suggests that there might be a simpler and more subtle way to find these answers, and suggests a way to filter out candidates who identify with the organization’s goals and are willing to go the extra mile.

Dr Bart Dierynck, professor of accounting at Tilburg University in the Netherlands and co-author of the article, explains: “Our research shows that relying on management discretion to evaluate employees (versus relying only on objective performance measures) attracts employees who identify more strongly with the objectives of the organization.

Put simply, when an employee knows that their manager will adjust their performance review and, therefore, their compensation at their discretion, they are more likely to choose organizations whose objectives they identify with. This discretion would be based on observations of the employee’s daily behavior, willingness to share knowledge with colleagues, unsolicited suggestions for improving company performance, etc., during their working time.

After performing an elaborate scenario-based experiment that included three stages, participants were first given a task aimed at eliciting their identification (or not) with an organizational goal; in this case, the goal was to reduce carbon emissions. Secondly, some of the participants took on the role of employees and had the choice between a fixed salary contract and a performance salary contract, with or without the possibility of discretionary adjustment by the manager. In the last step, employees indicated, on a scale of 1 to 10, how much extra effort beyond their regular job they were willing to put in to achieve the organizational goal of finding ways to reduce carbon emissions. This effort was factored directly into their salary calculations in the performance-based model, and all employee-participants had access to these calculations.

The researchers concluded that those who strongly identified with the organizational goal were indeed willing to put in much more effort to find ways to reduce carbon emissions. As expected at the time, these employees were more likely to choose performance pay when they had the option of discretionary adjustment. Conversely, under the discretionary adjustment condition, those who identified weakly with the organizational goal were more likely to choose the fixed compensation model.

The bottom line is that the discretionary adjustment component is designed to reward employees who go above and beyond their roles to help the company achieve its goals.

If an employee doesn’t care about these goals, then a fixed compensation model pays better.

“Working for an organization with self-identified goals has benefits for the organization, employee health and society,” says Dr Victor van Pelt, Assistant Professor of Management at the WHU-Otto Beisheim School of Management , in Germany. “Our research shows that when employees expect managerial discretion to be used to evaluate them, they are more likely to rank in organizations with goals they identify with.”

Further study is needed under various employment conditions to assess these results. But this study provides a smart solution to attracting the “right” employees and deterring those who won’t do the job in the long run.

– This press release was originally published on the Elsevier website

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