Skills vs Competencies: What's What

Do you know the difference between skills and competencies? Here's how to tell them apart to improve your skills management process.
Natalia Rossingol

In recent years, companies have been shifting to hiring people on the basis of their skills and competencies instead of their diplomas. A degree completion is no longer the main indicator of job applicants' potential, and this opens many doors for candidates who have been rejected because of degree inflation. But what is the difference between skills and competencies? Knowing how skills and competencies are different can become the first step to skill-based hiring. Let's dive in.

What are competenices?

A competency is defined as knowledge, attitudes, and behavior that let employees effectively perform tasks in a specific job. It’s a complicated concept that entails a set of abilities helping a person make high achievements. Competencies show how a person becomes a successful employee.

A competency can also be described as an ability to properly use knowledge, behavior, and skills to get the desired results. The examples of competencies include talent management, the ability to communicate effectively, strategic planning etc.

Speaking about competencies, we should also point out the term “core competency” which means core behaviors making you stand out in your workplace environment, both among immediate colleagues and among other companies. Core competencies can be defined as abilities to deliver value to customers and create a competitive advantage in your industry. The core competencies include analytical abilities, decision-making, digital literacy, cultural competency, etc.   

What are skills?

On the contrary, skills are learned abilities you need to complete a specific task. In other words, they determine what you can and cannot do.

For example, if a person hasn't learned any programming languages, they won’t be a good fit for a software engineer position; if a person cannot make pies, they won’t be a good baker.

This way, skills are easier to track and more manageable. They range widely, and their varying levels can be measured.

Skills are usually divided into two groups – hard skills and soft skills:

Hard skills require technical knowledge and training, and are demonstrated through specific qualifications and professional experience. They are teachable – you can learn them through formal education, certification programs, or right at the workplace. They are also easy to measure. The examples of hard skills are computer programming, patient care, accounting and finance, graphic design, organizational skills, math or foreign language proficiency etc.

Soft skills relate to personality traits that determine how you work and act in a work environment, showing the way you interact with other people. They are not unique to a particular job – even more, they are actually needed in every job. Soft skills are harder to teach and measure. The examples of soft skills include leadership, etiquette, team working, communication skills, perseverance, adaptability, and so on.   

The difference between skills and competencies

Skills and competencies may sound similar by definition. However, they are not the same, and need to be differentiated. A competency is a broader concept – actually, it can include skills as its component parts: without a specific learned abilities and training, an employee would not be able to demonstrate a competency. Including several skills needed to succeed in business, competencies represent a holistic approach to describing a person’s abilities. Skills are more concrete. In any case, they are both important to job success.

Clarifying the differences between these two concepts, we can get a better understanding of how to achieve career advancement. So let’s look at the characteristic features of both skills and competencies, paying attention to the differences:   

Skills:

Skills can be developed. They are easily defined, and much easier to acquire than competencies. For example, it’s possible to learn a foreign language or web design in a short time period, even from scratch – you’d have a structured system to follow, and over time, you can reach a certain level.

Skills can be measured. To know precisely what skills employees already have, an HR or a business owner can use various tools to check that. As we mentioned before, hard skills are easier to measure: you use quantifiable data like test scores that helps you get a clear picture. This way, people can easily track their progress, using standard rating systems like those designed by Lumina Foundation. 

Soft skills are more challenging to measure as they concern interpersonal communication in teams. However, there are some ways which still make it possible. These methods are mostly based on analysis and observation, and are pretty subjective. Here we've got some examples:

  • Tests. Remember that results a test shows are not always accurate because such test are conducted in “laboratory conditions”;
  • Self-assessment. As it is with tests, a questionnaire a person fills in can show a very subjective picture as they often reflect self-perception;
  • Peer feedback. Team members can share their feedback about each other’s performance and personality traits, as well as the ability to be a part of a team.

Skills are applicable. Work can be decomposed into three categories, namely tasks, projects, and roles. Projects consists of tasks; and roles in teams determine how exactly these tasks will be performed. But the thing is, tasks cannot be performed without skills. This way, skills are fundamental components on which work is based, and which directly influence its quality.

Skills are transferable.  Some skills (like technical skills, writing skills and so on) can easily transfer from one job to another as they can be applied in different fields. For example, foreign language proficiency can be a requirement in both mass media and logistic companies. The transferability of skills gives candidates an opportunity to try working in different industries.

Competencies:

Competencies are rigid. While it can take a month, roughly speaking, to get a skill, it would take years to get a competency. For example, you can learn to work with data analytics software in a couple days (specific skill), but how much time would it take you to become an expert in data analytics (competency)?   

Competencies are value-based.  They are closely tied to a specific organization, reflecting values and culture that exist in it. Regardless of the job you do, a company requires you to follow rules, sometimes rules of a thumb, and expects you to share the same goals and ideals, this way connecting people within an organization. Naturally, what is valued by one organization is not necessarily valued by their competitors.

Competencies are non-transferable. While skills can be easily transferred across organizations, this is not the case with competencies. Competencies, representing a unique set of knowledge and behaviors, cannot be easily applied at a different workplace. They require more context: some behaviors and communication styles can be appropriate at one company, and completely inappropriate at a different one, let alone in a different field.   

The necessity to differentiate the categories of skills and competencies is also dictated by the fact that job descriptions are often skill-based or competency-based. Applying for a job, you should pay attention to what exactly an employer is looking for. This is reflected in a way a job description is composed.

A skill-based job descriptions provide a job title, skills, and responsibilities required to perform a task. A competency-based one also mentions the behaviors an employer expects you to demonstrate – how exactly you use your knowledge and skills. It provides more context, and is more popular in business world today, for this reason.  A job description can also be a mixture of the two approaches, being both competency- and skill-based.

So when you’re preparing a CV, read job descriptions carefully and list the competencies and skills you possess. Besides, you could also incorporate them in your work experience and describe the results you delivered due to these competencies and skills. This will let an employer see if you meet the job requirements and fit their organization.

The same concerns measuring performance: while many organizations rely on competency system, others rely on the skill one. Both systems evaluate employees, identify areas for growth, and offer opportunities for improvement. The difference is that in the first case it lists expectations to succeed in a particular role, and in the second one the unit of measurement is a skill as an ability to perform a task.

These are many tools you can use to measure skills and competencies (yes, competencies are much harder to measure, but some tools do exist.) A few examples include:

For skills:

EdApp, SkillBase, SurveyMonkey, Brilliant Assessment etc.

For competencies:

Competency-Based Assessment Tool (CBAT), the Myers-Briggs Type Indicator, The Motivational Appraisal Personal Potential (MAPP) career assessment

We should also mention that at different stages of their career, people would need different skills and competencies. At the beginning of it, the focus will most likely be on technical knowledge and expertise; while later, if one wants to get out of the comfort zone and go further, they would have to develop competencies like the ability to influence and negotiate, as well as strategic thinking. It’s also important that once competencies are gained, one should never neglect hard skills.     

skills vs competencies

It’s hard to say what’s more important, a skill or a competency. A narrow focus on relevant skills can make you a great specialist able to perform a specific task, but probably won’t help you get a key position. On the other hand, without basic key skills and training you won’t be able to reach competencies, and it will be virtually impossible to move forward.

Competencies and skills are inseparable, and always go together. However, these are two different categories which shouldn’t be confused as they both are vital for your professional success, each in its way. This way, to climb up the career ladder, an employee must develop both of them - learning new skills and gaining relevant competencies.

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