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MGTO 324 Recruitment and Selections. Personnel Judgment and Decision Making Kin Fai Ellick Wong Ph.D. Department of Management of Organizations Hong Kong University of Science & Technology. Prologue. Recruitment and selection are Prediction process
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MGTO 324 Recruitment and Selections Personnel Judgment and Decision Making Kin Fai Ellick Wong Ph.D. Department of Management of Organizations Hong Kong University of Science & Technology
Prologue • Recruitment and selection are • Prediction process • We predict the future performance of job applicants • Judgment process • We judge the future performance of job applicants • Decision making process • We have to decide which applicants to hire
Prologue • We know that human beings are subject to judgment and decision biases • How do these biases influence personnel selections? • Which aspects in decision making should we pay attention to?
Part 1: Hiring Standards • Hiring standards • The cut scores representing a passing score • A single score from a single predictor • A total score or an average score from multiple predictors • Applicants with scores higher than the cut scores are predicted or judged to be successful • should be hired • Applicants with scores lower than the cut scores are predicted or judged to be not so successful • Should be rejected
Part 1: Hiring Standards • Hiring standards • When the predictor’s validity is 1 • There is no error, indicating that the prediction is perfect • All applicants with scores higher than the cut scores (i.e., > X) are indeed successful • All applicants with scores < X are indeed unsuccessful • When the predictor’s validity is lower than but close to 1 • There are some errors, indicating that the prediction is not perfect • Most applicants with scores > X are indeed successful (no errors) • Most applicants with scores < X are indeed unsuccessful (no errors) • Some applicants with scores > X are indeed unsuccessful (errors) • Some applicants with scores < X are indeed successful (errors)
Part 1: Hiring Standards • Hiring standards • When the predictor’s validity is close to 0 • There are some errors, indicating that the prediction is not perfect • About _____ applicants with scores > X are indeed successful (no errors) • About _____ applicants with scores < X are indeed unsuccessful (no errors) • About _____ applicants with scores > X are indeed unsuccessful (errors) • About _____ applicants with scores < X are indeed successful (errors)
Part 1: Hiring Standards • Effects of setting the cut scores on errors • When a high score is used • No. of True positive (correct hit): increase or decrease? ↓ ↓ • No. of True negative (correct rejection): increase or decrease? ↑↑ • No. of False positive (false alarm): increase or decrease? ↓ ↓ • No. of False negative (miss): increase or decrease? ↑↑ • When a low score is used • No. of True positive (correct hit): increase or decrease? ↑↑ • No. of True negative (correct rejection): increase or decrease? ↓ ↓ • No. of False positive (false alarm): increase or decrease? ↑↑ • No. of False negative (miss): increase or decrease? ↓ ↓
Part 1: Hiring Standards • How high the cut score should be? • It depends on the costs of “false alarm” and “miss” • For jobs of which the costs of “false alarm” are significantly higher than “miss”, probably we should set high scores • E.g., medical doctors, clinical psychologists • For jobs of which the costs of “miss” are significantly higher than “false alarm”, probably we should set low scores • E.g., salespeople, insurance agents • See you textbook for the specific methods to determine the cut scores (p. 550 - p.554)
Part 2: Judgment and Decision making biases • I am going to present three well selection biases • Escalation of commitment • Bazerman et al. 1982, Organizational Behavior and Human Decision Processes; Schoorman, 1988, Journal of Applied Psychology • Decoy effects • e.g., Highhouse, 1996, Organizational Behavior and Human Decision Processes; Slaughter et al., 1999, Journal of Applied Psychology • Number size framing • Wong & Kwong, in press, Organizational Behavior and Human Decision Processes; Wong & Kwong, 2005, Journal of Applied Psychology
Part 2: Judgment and Decision making biases • Escalation of commitment • Increasing commitment to a losing course of action, particularly when one is personally responsible for the initial decision • (data from Schoorman, 1998, JAP)
Part 2: Judgment and Decision making biases • Condition A • Condition B
Decoy Effects • Condition A • Condition B
Decoy Effects • Condition A • Condition B
Decoy Effects • Condition A • Condition B
Decoy Effects • Condition A • Condition B
Free Throw Performance Reggie Miller Mike Bibby Hit %: 89 80 Miss %: 11 20
Response Scale: Performance ratingsContext: HR (Performance appraisal) Wong and Kwong (2005, Experiment 2, JAP)
Response Scale: ChoiceContext: HR (Personnel selection) Wong and Kwong (in press, Experiment 3a, OBHDP)
Response Scale: SalaryContext: HR (Compensation) Wong and Kwong (in press, Experiment 3b, OBHDP)