Applications: Utility Concerns in Choosing an Assessment Method

Randy May works for a small airline based on Nantucket Island, Massachusetts. He recently won two million in the New England Lottery and decided to invest his winnings, ultimately, in a chain of ice cream shops in the Cape Cod area to gain potential future earnings. Figuring he had enough money to open up ice cream shops in both islands of Nantucket and Martha’s Vineyard, as well as two shops in Falmouth and Buzzards Bay, he signed a contract with a local builder and began construction of the shops. After beginning the process of construction, he was faced with the next task of hiring employees to staff the four ice cream shops. Throughout his calculations, he estimated
In this equation it will read as follows 50(1)(.30)(2400)(.80)-100(100), which will equal $18,800. On the contrary, if Randy selects the dollar gain from using work samples on the applicants selected, then the equation he will need to follow will read as 50(1)(.50)(2400)(.80).-100(150) which will equal $33,000.
If Randy can only use one method, which should he use?
For Randy to make full economic gain, it is imperative he select the right applicants for the job. If he ultimately desires to solely make economic gain, then he should choose the work samples selection method. If instead he decides to select the right candidates for the job, then the interview success should be reflected in how each applicant performs his or her daily job duties. Since the job he is hiring for is an ice cream shop, the interview can help him determine if an applicant will provide quality customer service, as well as reveal a little about there personality and character overall. The work sample portion though will prove how well an applicant can truly work on the job and with “hands on” execution. For Randy to decide on the right method to utilize, it will be solely up to him.
If the number of applicants increases to 200, how would your answers to questions 1 and 2 change? If the number of applicants was to increase to 200, then the economic gain equations would change to the first equation, the interview and job performance equation would equal