Sherrie Suski is Senior Vice President of Human Resources at Tricon American Homes.
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While the move to hire for competencies and behavioral skills has gained popularity because it offers a description of what the standards of excellence look like and help to guide performance feedback discussions, it is difficult to quantify such abstract concepts in any way that’s consistent across an organizations and reliable, which can lead to poor hiring or promotional choices that cost companies in the long run.
That’s why organizations need to make hiring decisions based on assessable skills instead of competencies, especially as the looming recession makes every dollar count more than ever. When an organization can assess for things such as skills mastered and experiences achieved, its hiring managers are better able to accurately determine which candidates are most likely to excel in their positions.
Competencies Versus Skills
Skills are specific abilities gained through education, training and experience that are needed to do a job well. These are distinct job-related proficiencies such as analyzing statistics, creating invoices or fixing a leaky pipe, depending on the industry. A skill is unambiguous, with little room for interpretation.
Competencies are a bit harder to define. Competencies are more broadly characterized behaviors and knowledge that can help a candidate succeed in a role. Examples of competencies include the ability to plan strategically, exhibit data-based judgment or employ innovative thinking. Competencies are abstract in nature, making them harder to track and assess.
While both are critically important to achieving success in a role, competencies complicate the hiring process because they are more difficult, if not impossible, to quantify. How can a hiring manager test whether a candidate is able to plan strategically or improve business processes? While personality tests and assessments can shine some light on a candidate’s behavioral tendencies and competencies, hiring based on competencies leads to guesswork, and no organization wants to invest its hiring budget on “maybe.”
Skills Aid In Data-Driven Hiring Decisions
Organizations that hire based on skills are better able to make data-based decisions within the hiring process, leading to a number of benefits. According to a 2022 survey by Deloitte, skills-based organizations are:
- 107% more likely to place candidates in the right positions.
- 98% more likely to retain high-performing employees.
- 57% more likely to anticipate and adapt to change effectively.
In my own experience, I have seen how organizations that use a skills-based model for hiring outpace competency-based businesses in a variety of areas. Some of the benefits of skills-based hiring I have seen in my own experience include:
- Making better hires both internally and externally. When organizations can easily see who has the skills necessary to perform a job well, they tend to fill positions with people who excel in their jobs.
- Developing more effective certification and training. With skills easily identified and tracked, it’s easier for organizations to find and fill gaps with training programs and certifications that are laser-focused on pressing needs.
- Making better compensation decisions. Tying skill levels to compensation takes the headache out of raises for both employers and employees.
- Giving more accurate performance reviews. Assessing for skills mastered and lacking provides clear feedback to the employee and can help create a definitive plan for growth.
- Setting clear expectations of employees. When employees know what skills are necessary for their positions, they can work to hone those skills and there is less confusion about their responsibilities.
- Being better prepared for market shifts. When the market changes, companies need to be ready to adapt as quickly as possible. Being able to easily track what skills are already available within the company allows leaders to know which new skills are needed and which current skills can be transferred to the new environment.
Hiring For Skills Starts With The Job Listing
Hiring for skills begins with crafting a skills-based job posting. While a job posting may include competencies that can help a candidate succeed in the position, a list of skills and experiences required in the job posting informs potential employees of what is required at the very beginning of the hiring process, acting as an initial filter for hiring managers.
Input necessary skills requirements into your organization’s candidate management software so that it only allows candidates with the necessary skills to move forward in the hiring process. At the interview stage, it will be up to the hiring manager to verify that the applicant has the listed skills before proceeding.
Internal Hires And Promotions
To use a skills-based approach when hiring or promoting internally, an internal skills database can help. An internal skills database will track the verifiable skills of all employees so that candidate analysis is simpler for the hiring manager and puts the best people in positions where they can excel. This database can also assist your organization in finding company-wide skills gaps and filling them with additional training.
Skills-Based Hiring Takes The Guesswork Out Of Hiring Decisions
Every HR professional knows that hiring is one of the most tedious and difficult parts of running a business. With a skills-based approach to hiring decisions, hiring managers and HR professionals can make more informed decisions that lead to better hires, more efficient practices and improved company-wide results.
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