Human resource utility models: An investigation of current models' assumptions and perceived accuracy
Description
This study investigated (1) the tenability of the assumptions underlying human resource utility analysis models, (2) methods of operationalizing these models, and (3) manager's perceptions of the accuracy of results from these models. The investigation was conducted using several behavioral and sales performance measures from 434 sales-representatives who attended a product information and sales strategy training program. Low positive relationships were observed between behavioral performance and the value of performance, demonstrating that it is tenable to assume a linear (but not a perfect) relationship between behavioral performance and the value of performance. Such linear relationships, however, were not uniformly observed, which suggests that the tenability of this assumption may be moderated by the latent behavioral and economic domains as well as the operationalizations of the utilized measures. Alternative methods of operationalizing the utility model's components, including the effect size (i.e., d) as well as alternative methods of calculating and summarizing variability in the value of employee performance (i.e., $\sigma\sb{y}$ (sometimes referred to as SDy), A$\nu y,$ and A$\sigma\sb{\rm R}),$ yielded results with different levels of accuracy: some components were quite accurate (overestimating the parameter by 2.3 percent) and others were quite inaccurate (overestimating the parameter by 107.2 percent). These levels of accuracy were perceived to be significantly different by human resource and training department managers in a Fortune 500 company. These managers' ratings, on average, indicated that some methods of estimating utility components are accurate enough for decision making purposes. Implications for utility analysis research, performance measurement research, and the use of utility models for applied human resource decision making are discussed