What are Competencies?

A competency can be defined as a combination of measurable and observable skills, knowledge and behaviours that an employee needs to be successful on the job.

Competency profiles focus on behaviours, specifically on the behaviours of top performers and on the “how” of getting the job done. They articulate the behaviours necessary for achieving business objectives and organizational success. See the Sample Competency Profile page of this Website for more information.

Why Are Competencies Important?

They are important because they have great predictor accuracy. Used with the right assessment tools, they can indicate how well an employee will perform on the job. Competency profiles are a key component of successful human resources management, including recruiting and selection, performance management, internal staffing, learning and development, career planning, employee recognition, succession planning and (sometimes) compensation. Together with the right skills and knowledge, competency profiles can help guarantee an effectively managed, high quality workforce at all times.

How Can Competencies Help Me?

They can help you be more successful on the job. They can also help your organization be more successful. Hiring against a competency profile ensures a good employee/organizational fit. Competencies are the special characteristics that drive performance, and they can help you to understand what is expected of you. In the same way, they can provide managers with a fair and objective tool for recruiting and hiring the right people, measuring performance, identifying learning gaps, training and developing employees, discussing performance expectations, orienting new employees to the work unit, building strong teams and highlighting employees for succession planning.

Employees with the right competencies have an edge over other employees. Organizations with the right competencies have an edge over other organizations.

Competencies and competency-based management can help your organization become an “employer of choice”.

Competency Theory

Competency theory is grounded in serious scientific data. In 1973, Dr. David McClelland, a behavioural psychologist from Harvard University, published a paper called “Testing for Competence rather than Intelligence”. This paper is often seen as the foundation of the modern competency movement. McClelland reviewed studies showing that traditional academic aptitude and knowledge content tests as well as school grades and credentials, did not predict job performance or success in life and were often biased against “minorities, women and persons from the lower socio-economic strata”.

He then looked for “job variables” that allowed him to predict job performance that was not biased by race, sex or socio-economics. He compared people who had obviously successful jobs or interesting lives with people who were less successful, to identify the characteristics associated with success. He found that more successful people thought and behaved differently. Later, work by McBer and Company and by Hay Management Consultants, among others, showed distinct behavioral differences between average performers and superior performers. Their work showed that superior performers did not just do more work, they actually thought about, and did, things differently and with far greater frequency than average performers.

The Value of Competencies

Organizations using competencies report up to 19 percent increase in value-added output (productivity/resolution of problems/generation of solutions) for routine tasks, up to 48% increase for medium to complex tasks, and up to 120 percent increase for really complex tasks. This means that, depending on the job, the difference between an average performer and a superior performer can translate into millions of dollars in the commercial sector or into exceptional policy decisions in the global social/political arena. In their book, Competence at Work (1993), Spenser and Spencer report that a study by McBer for the US State Department in the early 1970’s found a critical correlation between the competencies and concomitant behaviours of certain Foreign Service Officers and their success on the job. In addition, Dr. David Cohen, President of Strategic Action Group, Toronto, Ontario, has reported that, over a three- year period, one international company saved more than $500,000.00 based on lower turnover, lower training costs and better employee fit after moving to a competency-based H.R. management system. Many other companies (Xerox, IBM, National Rubber, Sprint Canada, the Royal Bank, for example) report similar successes with competencies. Clearly, for most organizations, public or private, moving to a properly implemented competency-based human resources management system is overwhelmingly beneficial.

Competencies: Why Now?

Rapidly changing global political and business requirements, and complex client demands, are causing many organizations around the world to develop and implement competency-based human resources management systems.

If contemporary organizations are to successfully fulfil their mandates in an increasingly complex global environment they will require superior employees on the job at all times. Competencies can help attract, hire and keep the best the market has to offer. This in turn will ensure that your organization is primed to meet the needs and the expectations of both its shareholders and its publics.

How Are Competencies Measured?

Competencies can be measured using a number of different assessment tools. A favourite with employees just getting used to competencies is a self-assessment questionnaire. A self-assessment questionnaire allows an employee to evaluate his or her personal strengths and developmental requirements in a completely confidential way. It consists of a number of statements that resemble the behavioral statements in a competency profile. These statements will ask you how to rate yourself on a scale of one-to-four, or a scale of one-to-ten, in terms of how often, you think you demonstrate the competency in question. Most good self-assessment questionnaires also ask for examples of recently demonstrated competencies. Asking for examples really makes you think carefully about the competencies, and the behaviours that support them.

Another way of measuring competencies is with a 360 Feedback instrument. A 360 Feedback instrument is similar to a self-assessment questionnaire but it asks for input from a variety of sources (managers, colleagues, staff (if appropriate) clients and/or customers as well as from the person being assessed). A 360 Feedback instrument is a powerful tool for determining developmental requirements, and it can provide a strong understanding of strengths and weaknesses for you and your team alike.

Simulations and Roles Plays that measure competencies are usually implemented in assessment centres. Quite often they are based on case studies developed specifically for the organisation in question.

Behavioural Interviewing is an excellent methodology for measuring competencies. It is a process for probing an individual’s past behaviours and is predicated on the belief that “past behaviour is the best indicator of future success.”

Behavior Interviewing is a critical tool for hiring as it produces a good employee/organizational fit.

Using Competencies

Recruiting, Selection and Placement

In a competency-based human resource management system, selection and placement decisions are based on the “fit" or “match” between your competencies and the competencies of the position. The underlying premise is that the better the fit between your competencies and the competency requirements of the position, the higher your performance and job satisfaction will be. High job performance means the organization will want to keep you; higher job-satisfaction means you will want to stay longer in the organization.

Career Planning

Competencies are key for career development. Once you know which competencies are important to your organization and once you have measured your own competencies, you can begin to work on the competencies you need to develop.

Developing competencies can be done in many different ways. Formal courses, Computer-based Learning(CBL), books and videos can all help you develop your competencies. Perhaps one of the best ways for you to develop your competencies, however, is to find a coach or mentor, someone who already demonstrates the competencies you are trying to strengthen. Having the right competencies for the organization will help you to get ahead and be more successful in your current job.

Performance Management

A competency-based system brings a new approach to performance management. In the past, you may have been evaluated simply on qualitative issues such as productivity or results (on the “what” of the job). In future, your manager may be taking a more qualitative approach, looking at your behaviours (the “how” of the job) as well as your results. Completing the self-assessment questionnaire will help you determine your strengths and developmental opportunities. Talk to your manager about ways to enhance your competencies.

Learning and Development

A competency-based performance management assessment process can be linked directly to your personal learning plan, and will identify areas for growth. Modern, contemporary organizations encourage “continuous learning”, which in turn, fosters an ongoing exchange of skills, knowledge and competencies between managers and their employees to benefit both the individual and the organization.


Many organizations use competencies as an objective basis to determine pay. Competencies can remove the personal bias from the reward system


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