Book Review: Applied Psychology in Talent Management (8th ed.) by Wayne Cascio and Herman Aguinis

NOTE: I am reviewing this I/O psychology textbook from a reader’s perspective (i.e., the student’s/learner’s point of view) and not from an instructor’s perspective.

Applied Psychology in Talent Management (8th ed.) is the newest edition of the Applied Psychology in Human Resource Management textbook by Wayne Cascio and Herman Aguinis. The title has changed with “Talent Management” replacing “Human Resource Management.” But make no mistake, this is an I/O psychology textbook written by two authors with PhDs in industrial and organizational psychology.

Like the 7th edition (published in 2011), Applied Psychology in Talent Management (8th ed.) maintains the same 18-chapter layout and continues to be written and designed for an academic/graduate-level audience. The textbook is very “academic” and “technical” — much more so than any of the other I/O psychology textbooks I have reviewed.

As a matter of fact, the authors wrote this in the book’s preface:

“In writing this book, we make two assumptions about our readers: (1) They are familiar with the general problems of HRM or I/O psychology, and (2) they have some background in fundamental statistics—at least enough to understand statistical procedures on a conceptual level, and preferably enough to compute and interpret tests of statistical significance [italics added]. As in earlier editions, our goals are (a) to challenge the field to advance rather than simply to document past practice, (b) to present a model toward which professionals should aim, and (c) to present scientific procedure and fundamental theory so that the serious student can develop a solid foundation on which to build a broad base of knowledge” (2019, p. xxviii).

Depending on your reading preference, you may either appreciate the technical writing style and scientific details of this textbook (i.e., contents are presented in a very theoretical, statistical, and psychometric nature) or not care much for it. Please understand that this is not a reflection on the substance and quality of the book itself, but it is important to point out.

I examined five topics: (1) the 80 percent rule or four-fifths rule used to determine adverse impact in employee selection [Ch. 8]; (2) recruitment [Ch. 11]; (3) cognitive ability tests in personnel selection [Ch. 13]; (4) job analysis [Ch. 9]; and (5) performance appraisal and management [Ch. 5].

The first topic, well-covered in many I/O psychology textbooks, is adverse impact and the 80 percent rule (or four-fifths rule) used to make an adverse impact determination in employee selection.

The explanation for the 80 percent rule was difficult to follow and the book did not clearly explain what the 80 percent rule actually is. Here’s the explanation (Cascio & Aguinis, 2019, 181):

“[A]ssume that the applicant pool consists of 300 ethnic minorities and 500 nonminorities. Further, assume that 30 minorities are hired, for a selection ratio of SR1 = 30/300 = 10, and that 100 nonminorities are hired, for a selection ratio of SR2 = 100/500 = 20. The adverse impact ratio is SR1/SR2 = .10/.20 = .50, which is substantially smaller than the suggested .80 ratio.”

At the beginning of the book, the authors provided this confusing definition of adverse impact:

“Adverse impact (unintentional) discrimination occurs when identical standards or procedures are applied to everyone, even though they lead to a substantial difference in employment outcomes (e.g., selection, promotion, and layoffs) for the members of a particular group and they are unrelated to success on a job” (Cascio & Aguinis, 2019, p. 19).

Later, in Chapter 8 (Fairness in Employment Decisions), the book provides another definition:

“[A]dverse impact means that members of one group are selected at substantially greater rates than members of another group” (Cascio & Aguinis, 2019, p. 181).

The authors then spend the next few pages showing readers how to assess “differential validity,” without ever clearly explaining what it is. I know this goes back to one of the assumptions of this book about its readers, which is that they have a “background in fundamental statistics—at least enough to understand statistical procedures on a conceptual level.

In comparison, when I looked in the Aamodt (2013) I/O psychology textbook, only half a page was devoted to differential validity and the author explained the concept in one sentence!

In Applied Psychology in Talent Management (8th ed.), the authors zoomed in on differential validity (a test of fairness), and went into extreme details. Unfortunately, by going so deep into the minutiae of equations, sample size, confidence interval, and statistical power, rather than covering fairness in employment decisions more broadly, readers are left asking, “So what is the 80 percent rule in determining adverse impact, and what are all the statistics about?”

I actually found a nice explanation — in another I/O psychology textbook:

“The 80 percent rule is crude and can be affected substantially by sample sizes. With small sample sizes, a difference of one or two people might swing the conclusion from one of adverse impact to one of no adverse impact, or vice versa. As a result, most cases also include a determination of whether the challenged practice had a statistically significant impact on the plaintiff group. If the difference between the majority and minority groups is likely to
occur only 5 times out of 100 as a result of chance alone . . . then one could claim that adverse impact had been demonstrated” (Landy & Conte, 2013, p. 270).

The second topic is recruitment.

“Whenever human resources must be expanded or replenished, a recruiting system of some kind must be established. Advances in technology, coupled with the growing intensity of competition in domestic and international markets, have made recruitment a top priority as organizations struggle continually to gain competitive advantage through people” (Cascio & Aguinis, 2019, p. 256).

“Organizations recruit periodically in order to add to, maintain, or readjust their total workforces in accordance with HR requirements” (Cascio & Aguinis, 2019, p. 257).

“Recruitment is not a ‘one-shot’ activity. It is important to recognize three contextual/environmental features that affect all recruitment efforts: (a) Characteristics of the firm—the value of its ‘brand’ and its ‘personality’ (make the effort to learn how customers and the public perceive it); (b) Characteristics of the vacancy itself (is it mission critical?)—these affect not only the resources expended on the search but also the labor markets from which to recruit; and (c) Characteristics of the labor markets in which an organization recruits (tight versus loose)” (Cascio & Aguinis, 2019, p. 275).

“Three sequential stages characterize recruitment efforts: generating a pool of viable candidates, maintaining the status (or interest) of viable candidates, and ‘getting to yes’ after making a job offer (postoffer closure)” (Cascio & Aguinis, 2019, p. 275).

Overall, I like Cascio and Aguinis’ coverage of recruitment.

The third topic is cognitive ability tests in personnel selection. Cognitive ability tests was placed in Ch. 13 “Managerial Selection Methods.” This is odd because cognitive ability tests are administered to prospective employees at any role or level in an organization, not just those in managerial roles.

The authors explained that, “although the emphasis of this chapter is managerial selection, many of the instruments of prediction described (most notably cognitive ability tests and personality inventories) are also useful for selecting employees at lower organizational levels” (Cascio & Aguinis, 2019, p. 312).

“General cognitive ability is a powerful predictor of job performance” (Cascio & Aguinis, 2019, p. 314). In fact, among researchers, there’s considerable agreement regarding the validity of cognitive ability tests. Although general cognitive ability is a powerful predictor of job performance, use of cognitive ability tests are also likely to lead to adverse impact (Cascio & Aguinis, 2019).

It is recommended that cognitive ability tests be combined with other instruments, such as structured interviews, biodata, and personality inventories (Cascio & Aguinis, 2019).

Despite it being awkwardly placed under a chapter titled, “Managerial Selection Methods,” Cascio and Aguinis did a good job in their coverage of cognitive ability tests.

The fourth topic is job analysis (the book used work analysis instead of job analysis). Curiously, in the 7th edition of the book, Cascio and Aguinis used “job analysis.” The authors defined “work analysis” as follows:

“Work analysis is a broad term that refers to any systematic process for gathering, documenting, and analyzing three features of work: (1) its content (tasks, responsibilities, or outputs); (2) worker attributes related to its performance (knowledge, skills, abilities, or other personal characteristics, or KSAOs); and (3) the context in which work is performed (e.g., physical and psychological conditions)” (Cascio & Aguinis, 2019, p. 210).

I much prefer the definitions by Riggio or Levy:

“Job analysis is the systematic study of the tasks, duties, and responsibilities of a job and the knowledge, skills, and abilities needed to perform it” (Riggio, 2018, p. 65).

“Job analysis is the process of defining a job in terms of its component tasks or duties and the knowledge or skills required to perform them” (Levy, 2017, p. 73).

“It is difficult to overstate the importance of job or work analysis to employment research and practice. . . [W]e see the tools and techniques developed under ‘job or work analysis’ as applicable to changing structures of work, and the use of either term is not meant to convey a focus on rigidly prescribed jobs. If conducted thoroughly and competently, job or work analysis provides a deeper understanding of individual jobs and their behavioral requirements and, therefore, creates a firm basis on which to make employment decisions” (Cascio & Aguinis, 2019, p. 210).

No single type of job analysis data can support all talent management activities (Cascio & Aguinis, 2019). “When collecting work-related information, a variety of choices confront the analyst. Begin by defining clearly the purpose for collecting such information. Since the many methods for collecting such data have offsetting advantages and disadvantages, choose multiple methods that best suit the purpose identified” (Cascio & Aguinis, 2019, p. 234).

As a whole, Cascio and Aguinis did a fine job discussing job/work analysis.

The fifth and final topic is performance appraisal and management.

One of the highlights of Applied Psychology in Talent Management is its outstanding coverage of performance management.

Performance management is the ongoing process of identifying, measuring, and developing the performance of individuals and teams and aligning performance with the organization’s strategic goals (Cascio & Aguinis, 2019). It is not a one-time event that takes place during the annual performance-review period. Rather, performance is assessed at regular intervals, and feedback is provided so that performance is improved on an ongoing basis. Performance appraisal is the systematic description of job-relevant strengths and weaknesses within and between employees or groups. It is a critical component of all performance management systems (Cascio & Aguinis, 2019).

“Performance management has both technical and interpersonal components. Focusing on the measurement and technical issues to the exclusion of interpersonal and emotional ones is likely to lead to a system that does not produce the intended positive results of improving performance and aligning individual and team performance with organizational goals” (Cascio & Aguinis, 2019, p. 117).

“Good performance management systems are congruent with the organization’s strategic goals; they are thorough, practical, meaningful, and specific; they discriminate between good and poor performance; and they are reliable and valid, inclusive, and fair and acceptable (Cascio & Aguinis, 2019, p. 117).

360-degree feedback systems broaden the base of appraisals by including input from self, peers, subordinates, and even clients. There are four advantages to 360-degree feedback systems: (1) 360-degree feedback result in improved reliability of information on an employee’s performance because it comes from multiple sources; (2) 360-degree feedback takes into consideration a wider range of information about performance; (3) 360-degree feedback often include information about task performance as well as contextual performance and even counterproductive work behaviors; and (4) 360-degree feedback can decrease biases since it comes from multiple sources (Cascio & Aguinis, 2019).

“There is no such thing as a ‘silver bullet’ in measuring the complex construct of performance, so consider carefully the advantages and disadvantages of each measurement approach in a given organizational context” (Cascio & Aguinis, 2019, p. 117).

What I like: I like the “Evidence-Based Implications For Practice” section at the end of each chapter. There is a lot of great information in this textbook, but you must spend time looking for and carefully study the information because it is very, very easy to miss.

One chapter that I did not review, but appreciate is Ch. 10 Strategic Workforce Planning (SWP). SWP is “an effort to anticipate future business and environmental demands on an organization and to meet the talent requirements dictated by these conditions” (Cascio & Aguinis, 2019, p. 237).

SWP systems include several interrelated activities: Talent inventories to assess current resources (skills, abilities, promotional potential, assignment histories, etc.); and Workforce forecasts to predict future HR requirements (numbers, skills mix, internal vs. external labor supply). Combined, talent inventories and workforce forecasts help identify workforce needs that provide operational meaning and direction for action plans in many different areas (including recruitment, selection, training, placement, transfer, promotion, development, and compensation). Finally, control and evaluation to provide feedback to the workforce planning system and monitor the degree of attainment of HR goals and objectives (Cascio & Aguinis, 2011, 2019).

What I didn’t like: I have two major gripes about Applied Psychology in Talent Management. The first and biggest gripe is the verbose writing style. The authors took an inordinately long time to explain even basic concepts and somehow manages, in the end, to still confuse this reader. Simple explanations or definitions sound as though a lawyer had written them.

My second gripe, related to the first, about Applied Psychology in Talent Management is its tendency to delve too often and too deep into elaborate, scientific explanations for every single topic, which can cause readers to have trouble seeing the forest for the trees. The book often took readers so deep into tiny details of a topic that it failed to help readers see the bigger picture.

A great example illustrating this is the book’s in-depth coverage of utility analysis. Cascio and Aguinis (2019) devoted half of Ch. 14 and several pages in Ch. 16 delving into the complex details (including formulas and equations) of utility analysis. Despite the intense coverage, I was still unsure (1) what utility analysis is, and (2) why it’s important/applicable to I/O psychology.

In the Landy and Conte textbook, on one page and in 4 sentences, I found the answers to my questions of what utility analysis is and why it’s applicable (or not) to I/O psychology:

Utility analysis is a “technique that assesses the economic return on investment of human resource interventions such as staffing and training” (Landy & Conte, 2013, p. 300).

“Utility analysis uses accounting procedures to measure the costs and benefits of training programs (Landy & Conte, 2013, p. 300).

“A utility analysis can provide training evaluators and organizational decision makers with an overall dollar value of the training program” (Landy & Conte, 2013, p. 300).

And here’s why most of the I/O psychology textbooks only briefly mention utility analysis: “To perform utility analysis, training evaluators use complex formulas that are beyond the scope of this book” (Landy & Conte, 2013, p. 300).

Furthermore, Cascio and Aguinis’ decision to devote an exorbitant amount of time and attention to covering utility analysis while completely ignoring and neglecting coverage of motivation is a huge misstep. Why? Motivation is one of the most widely researched and thoroughly explored topics in I/O psychology (Levy, 2017; Riggio, 2018). Every I/O psychology textbook I examined — seven in all [Aamodt, 2013; Landy & Conte, 2013; Levy, 2017; Muchinsky, 2006; Riggio, 2018; Spector, 2017; Truxillo, Bauer, & Erdogan, 2016] — had a chapter dedicated to motivation.

Finally, another glaring omission is the lack of a glossary or at least definitions of terms on the side of the page. I have never seen an I/O psychology textbook not include either a glossary or definitions of terms on the side of the page, until now. Applied Psychology in Talent Management (8th ed.) had neither.

Takeaway: Without question, Applied Psychology in Talent Management (8th ed.) is a useful industrial/organizational psychology resource to have. However, be warned, the book’s contents and writing style are geared toward a decidedly academic audience.

The book is not fun to read, but it is helpful when you’re doing research. To be fair, the publisher’s website did state that this textbook takes “a rigorous, evidence-based approach” and the authors did write that one of the assumptions of this book is that readers possess a decent grasp of statistics.

My two biggest criticisms of this book are: (1) that it is too verbose (when simple, clear, and direct are more effective), and (2) that it often takes readers so deep into tiny, irrelevant details of a topic that it fails to help readers see the bigger picture.

Because the book follows the traditional academic writing style, it is “heavy” and makes reading and locating information difficult and tiring. If the goal of a textbook is to get students interested in a subject, doesn’t it make sense to use a writing style that is readable and not long-winded?

I/O psychology textbooks contain identical or very similar information (e.g., training and development, job analysis, employee selection, performance management, etc.), but the manner in which the material is presented can make the choice to go with one textbook over another an easy and obvious one.

For the reasons stated above, when I want to learn about any I/O psychology topic, my first choice is to turn to Paul Levy’s Industrial/Organizational Psychology: Understanding The Workplace or Ronald Riggio’s Introduction to Industrial/Organizational Psychology because of the extremely readable writing style of either textbook. If I need to conduct further research, I would then turn to more research-intensive, academically-written resources like the Applied Psychology in Talent Management (8th ed.) book for a deeper dive. There’s no doubt in my mind that Applied Psychology in Talent Management (8th ed.) is a useful tool to have in my I/O psychology toolbox. It’s just not my favorite or preferred tool.

Written By: Steve Nguyen, Ph.D.
Leadership + Talent Development Advisor

References

Aamodt, M. G. (2013). Industrial/organizational psychology: An applied approach (7th ed.). Belmont, CA: Wadsworth.

Cascio, W. F., & Aguinis, H. (2011). Applied psychology in human resources management (7th ed.). Upper Saddle River, NJ: Prentice-Hall.

Cascio, W. F., & Aguinis, H. (2019). Applied psychology in talent management (8th ed.). Thousand Oaks, CA: Sage.

Landy, F. J. & Conte, J. M. (2013). Work in the 21st century: An introduction to industrial and organizational psychology (4th ed.). Hoboken, NJ: Wiley.

Levy, P. E. (2017). Industrial/organizational psychology: Understanding the workplace (5th ed.). New York, NY: Worth Publishers.

Muchinsky, P. M. (2006). Psychology applied to work (8th ed.). Belmont, CA: Thomson Wadsworth.

Riggio, R. E. (2018). Introduction to Industrial/Organizational Psychology (7th ed.). New York: Routledge.

Spector, P. E. (2017). Industrial and organizational psychology: Research and practice (7th ed.). Hoboken, NJ: John Wiley & Sons.

Truxillo, D. M., Bauer, T. N., & Erdogan, B. (2016). Psychology and work: Perspectives on industrial and organizational psychology. New York: Routledge.

Disclosure: I received a print copy of Applied Psychology in Talent Management (8th ed.) as a complimentary gift, but my book review was written as though I had purchased it.