As Published in Business 2 Business , June 2004

Testing for Cognitive Skills - Fluid Intelligence or IQ

Which Intelligence Should Employers Test?

By Ira S. Wolfe

I recently began to encounter a few problems with my laptop. That seems to happen to me routinely, about fifteen months or so after I purchase a new laptop. I'm told the reason is because I have so many programs installed and software conflicts are inevitable.

The fix is quite simple according to my computer guys – backup all the data, re-format the hard drive, re-install Windows, and then re-load all my programs. I tried that a few years ago and vowed never again. Although I didn't lose any data, the time to re-install all the programs cost me far more in time (and frustration) than just going out and buying a new laptop. What was most frustrating was that I didn't have the original discs and CD-Roms for several programs and since we re-formatted the drive, I wasn't able to use the data we saved. Ever since that time, I just purchased a new computer with faster processing speed, more storage and more mobile features and used my old one as a digital filing cabinet.

By purchasing a new laptop, I had the latest and the greatest - but as I found out that means little without the right software and data loaded on the hard drive. Until I can load the right software and transfer the data, my new laptop is functionally useless.

Now you may be thinking - who cares about my laptop. You probably have your own troubles and really don't want to read an article about my computer troubles. I use the computer analogy because scientists compare two kinds of our intelligences, fluid and crystallized, to the components in a computer. Differentiating between these two intelligences is very important. Why? Because they can determine if an employee might be “smart” enough or too smart to do a job.

Fluid intelligence is defined as our on-the-spot reasoning ability, the ability to think on our feet, learn on the fly. It includes the speed and accuracy with which we can analyze information – with accuracy. Crystallized intelligence, on the other hand, is our accumulated information and vocabulary acquired from school. It also encompasses the skills, experience and knowledge acquired from everyday life.

Think of fluid intelligence as the computer hardware, specifically the processing chip. Now think of crystallized intelligence as the computer software, the programs that control the computer. Finally think of the data stored inside the computer as an individual's lifetime of accumulated knowledge. For instance, let's say that you want to create a budget using MS Excel®. You install the same version of the software (crystallized intelligence) on two different computers. One computer is a Pentium® 4 Processor at 2.66GHz, the other is a 486 Processor with 133 mHz. You input exactly the same data and hit “query”.

No one could doubt for a minute that the Pentium® 4 Processor wouldn't get the answers faster. But what if time wasn't a concern? Is it possible that both computers could reach the same conclusions and therefore be equally effective? The answer is yes.

Now let's say that you had two computers with similar processors but different software programs and data of different quality and reliability. Would it really matter if the processors were state of the art? Only if speed was the only critical factor and accuracy and reliability wasn't.

In an older person, his or her processor may become worn out or obsolete just like an old computer. But the older employee still possesses a great deal of data and powerful software from his many years of living. He might run slower but he still gets results. What that means is that the old person's "system" (strong software and an extensive body of data) may prove superior to a younger system (young person) that has faster "state of the art" hardware unless the younger person also can acquire the information quickly.

When is this important? In this information economy, knowledge and skills requirements will continue to change. Employees need to become "life-long-learners" and constantly renew their abilities to add value to the services they perform. This requires a bigger hard drive, more memory and faster data access to keep pace with demand. Historically this is a problem. Older workers have had decreased learning rates (and often times older workers have been less motivated to learn new things). In computer-ese, the processor is slow and the hard drive is full.

There is good news though - tasks that use well-practiced skills or familiar information are generally not affected by age. That means that employees of any age don't require the highest level of cognitive skills for many jobs. The aging workforce however often displays superior performance by relying on "crystallized intelligence" (routine thinking). The bad news is that when routine practices and skills don't work anymore, these employees still may rely on past experiences and old information to solve problems that never existed before.

Jobs are also becoming more complicated and complex tasks that require taking in new information at a fast rate and analyzing it quickly may become more challenging with age.

The implications of cognitive skills and an aging workforce for businesses has serious concerns for business. Employers may have no choice but to replace their talent. The workforce is aging. At the stroke of midnight, January 1, 2004, the youngest of the Baby Boomers began turning 40, the official entrance to “middle age.”

Second, organizations have encouraged aging workers to take early retirement or out-sourced, re-engineered, and downsized them. In an attempt to innovate and adapt quickly to market fluctuations, they attempted quickly to “upgrade” their people “hardware”, their aging workers. Since transferring knowledge and experience from worker to another has not yet become a perfected science, employers lost much of their knowledge and skills base in recent years. And every time an experienced, older worker leaves, it is like buying a new computer but not having any software to install or data to save.

With older workers leaving and few young workers possessing enough knowledge and experience to replace them, organizations are caught between the proverbial rock and a hard place – how do they innovate and keep ahead of the knowledge curve without losing the rich history of their company and their clients?

Keeping up with continuous learning and rapid-fire market changes requires the ability to acquire new knowledge on the fly and the ability to adapt and implement it quickly. That means hiring the right person requires more than just personality; it requires an understanding of the employee's skills and experience as well as his potential to learn and handle a continuous flow of new and changing information.

But many employers make the mistake of hiring individuals with high cognitive skills to do jobs that require just average or even below average skills. These individuals then become unchallenged very quickly in the job. They get bored or quit. Many of our clients now suspect (after assessing employees) that a significant cause for their turnover in the past has been over-hiring for cognitive skills.

This confirms our own studies and experiences. Several job benchmarking studies for clients have shown that even in highly skilled and professional jobs like engineering, technology, and financial services, the “ideal” cognitive skills range for top performers falls in the lower 50 percentile of the population. These top performer job profiles also revealed that many of the most de-motivated and more challenging employees to manage had the highest levels of cognitive skills.

This resulted in several changes in the way these clients recruited, promoted and retained employees. By identifying that many of their best employees had average and even low cognitive skills, they were now able to recruit individuals who were more than capable of handling the workload and would be challenged enough by the complexity and demands of the work to remain in the job and stay motivated.

A second advantage of identifying the proper range of cognitive skills required to perform a job, managers were able to expand the pool of available candidates. Individuals possessing the highest levels of cognitive skills make up less then 15 percent of the population; individuals with average skills make up 68 percent of the population, nearly 4.5 times the labor pool than those with high cognitive skills.

A third advantage to understanding cognitive skill levels is that you don't want to lose good talent. While an individual might be a poor cognitive match for a job, it doesn't mean you should avoid him or her, especially if the personality and values matches are good. Individuals with the right drives, soft skills, and attitude are hard to find. Recognizing a diamond in the rough when they see one, managers who assess cognitive skills hire these very bright people anyway but either put them on the fast career track for promotion or challenge them with additional responsibilities or projects.

On the other hand, if a job requires higher cognitive skills than an employee might possess, this alone should not disqualify him or her if the personality, values, and skills (or potential) is a good fit. Less than optimum skills don't mean the employee can't do the job but that it might just take a little longer for him or her to become as proficient as the next employee. But given time and proper training, this employee (as long as the personality is a good job fit) can become a steady, reliable and effective employee.

How can employers evaluate cognitive skills? While the behavioral interview still remains an excellent “test” of skills and experience, it is genuinely ineffective at evaluating the general abilities associated with fluid intelligence and personality.

For information about TotalView™ Assessment System which assesses cognitive skills and employee personality, contact Ira S. Wolfe (iwolfe@super-solutions.com) at 717.656.4632. Ira is the founder of Success Performance Solutions and author of Understanding Business Values and Motivators ( www.understandingbvm.com ) and The Perfect Labor Storm ( www.perfectlaborstorm.com ).