Although many people use the terms competency and skill interchangeably, these two words mean very different things, especially in the corporate learning space. When you’re training, evaluating or hiring an employee, you shouldn’t look only at their skills. They also need the right knowledge, attitudes and behaviors—the required competencies—to be successful in their job.
At the end of the day, you can’t have one without the other. Skills are about equipping people with tools. Competencies are about making sure they know when, where and how to use them. Together, they help people, departments and organizations achieve business goals.
Let’s dive deeper into the differences between competencies and skills and why they matter.
What Is a Competency?
A competency is the set of skills, knowledge, behaviors and attitudes required to do work well, which include the following:
Skills: Knowing how to do a given task
Knowledge: Understanding when to act and which skill to use
Attitudes: Having the willingness to act
Behaviors: Adopting or defaulting to a manner of acting
Competencies can be divided into three broad categories:
Functional or technical competencies are specific to a given role. In essence, it’s about figuring out which set of outcome-oriented proficiencies your employees must have to be successful in their jobs.
Organizational competencies are unique to the organization and are often tied to business needs. For this reason, they can play important roles in helping leaders understand and articulate how the work that employees are doing contributes to larger strategic goals.
General competencies, which may also be called professional or cross-functional competencies, go beyond a single role or organization. They’re more universally applicable within industries and can be transferrable throughout someone’s career.
Ultimately, having the right competencies in place helps people do their jobs, complete projects and achieve goals.
What Is a Skill?
A skill is a learned ability to complete a task according to a set of standards that are often tied to quality, outcomes and time. In essence, it describes what someone can do proficiently.
Skills typically fall into one of two buckets:
Hard or technical skills tend to be more connected to individual tasks, jobs or industries. Since they evolve continuously, they also need to be updated more frequently.
Soft or durable skills, by comparison, are valuable across roles and companies and don’t come with the same expiration dates.
Because skills tend to be more focused and granular, their initial professional development pathways can also be more streamlined. If you have someone on your team who wants to improve their communication, they can take a course geared toward that. But to make sure the ability sticks over time, they need motivation and reason to use it, and they need opportunities to practice, perfect and use it. What bigger goal does the individual skill contribute to for the person and the organization?
Competency vs. Skill Examples
By seeing how competencies and skills interrelate, you can better understand the differences between them. Consider these three examples:
Why Competencies Matter in the Workplace
We’ve established what competencies are, but why should organizations care? What difference do they make? Put simply, competencies matter because they’re what drives business outcomes.
Building on competencies can make training more scalable because they provide clear, repeatable pathways for development. They can help organizations identify the right people and teams for the right jobs more easily and quickly. Competencies can also be motivating for learners, as they’re often tied to tangible outcomes and goals for growth.
Does your organization still need to put considerable effort into helping its people develop the right skills? Absolutely. But you need to know why they’re developing them. What gaps are they filling? Which goals are they tied to? How are you tracking progress and giving people opportunities to use their skills, knowledge and behaviors?
Aligning skills with competencies can help your organization answer those questions and round out its training and business strategies.
Developing competencies to drive growth
As Dematic’s business grows, it needs to ensure that new employees can quickly gain the competencies they need in order to contribute high-quality work.
Frequently Asked Questions About Competencies and Skills
If you focus solely on a person’s skills, you risk overlooking other important attributes required for a job. They may look good on paper, but they may not yet have the right knowledge, attitude or work habits to meet expectations.
Competencies are made up of skills—plus knowledge, behaviors and attitudes.
Skills are crucial parts of competencies, but competency is not a skill in itself.
Key competencies and skills vary depending on the job, career stage and industry. A job or task analysis can help you determine which competencies and skills are required for a particular position.
You should focus on cultivating skills to develop competencies and equip your employees with the knowledge, behaviors and attitudes required to effectively apply new skills and improve workplace performance.
Both. In some instances, people may need discrete skills to take on or advance in a role. In other cases, they’ll need broader sets of competencies (skills, knowledge, attitudes and behaviors) to be successful.
For each position, your organization should encourage managers and L&D teams to work together to identify the competencies most critical for success. Then you can more easily identify skills gaps and pinpoint where employees need to focus their training and professional development.
Once you know what competencies are required for existing and future positions, you can more easily isolate skills gaps. Now you know where to begin reskilling or upskilling to prepare people for those positions, and you can confirm the need for a larger investment in your company’s L&D program.
Haley Wilson is a Content Marketing Manager at D2L, specializing in the corporate learning space. She holds an Honours Bachelor of Arts degree from the University of Guelph as well as a Master of Arts focused in history from Wilfrid Laurier University.
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