[HRD] Competence, competency and competencies: performance assessment in organisations

Abstract

A number of confusions within the area of performance assessment with regard to the use of terminology, and differing interpretations, regarding competence assessment are discussed. A significant difference between the US and UK approaches to performance assessment is identified as being the issue of behaviours. A hierarchy of terms and their specific meanings is proposed as a first step in addressing the identified confusions. A particular aspect of this hierarchy is its relevance to assessment based on behaviours and attitudes rather than simply on the results of functional analysis concerning a particular job. This has implications for the future direction of performance assessment in the UK, particularly with regard to identifying the differences between average and superior performance.

Article Type: Research paper

Keyword(s): Competences; Performance measurement; United Kingdom; USA.

Work Study

Volume 51 Number 6 2002 pp. 314-319

Copyright © MCB UP Ltd ISSN 0043-8022

Introduction Individuals involved in the assessment of performance by others frequently refer to the competence or competency of those others. This approach was a major innovation in the human resource development field in the 1990s (Collin and Holden, 1997). As with many terms in common use, both competence and competency have a variety of meanings, and this variety of meaning is particularly pronounced as usage moves from the common to the specific. One example that illustrates the point can be found in comparing the meaning as defined in a dictionary, and the range of meanings that can be found within the social science/management context. The Concise Oxford Dictionary of Current English (Sykes, 1987) defines “competency” and “competence” as: ability (to do, for a task); sufficiency of means for living, easy circumstances; legal capacity, right to take cognisance (of court, magistrate, etc.). According to the dictionary, the word is a noun and the forms of competency and competence are readily interchangeable. In the managerial literature, however, the situation is not so clear, as subtle changes in emphasis can be found. Burgoyne (1989), for example, states that competence can be defined simply as the ability and willingness to perform a task. Such a definition is broadly compatible with most usages of the term, although it does possess the added element of willingness (rather than simple ability) to do. Hayes (1979), however, saw competence as being more than a combination of ability and willingness to do a task, and defined it in terms of being a number of possibilities; generic knowledge, motive, trait, social role, or skill of a person. Each of these was also linked to the requirement to exhibit superior performance in their completion. This infers that an individual displaying competence should be able to apply their skills and/or abilities to a work activity. Boyatzis (1982) supports this view in defining competence as “an underlying characteristic of a person which results in effective and/or superior performance in a job”. Further confusion can arise because the social science/management usage of these terms differs from that found in lay usage. The dictionary definitions of the terms are allowed to be used, and frequently are, interchangeably in the singular. This does not happen in any regular sense in the social science/management context, although the terms seem to be frequently interchanged when in the plural form. When these terms move from the academic context and into an organisational context, their meaning can become additionally confused (and confusing) in that it may be unclear whether the lay meaning or the social science/management meaning is to be applied. It may even be the case that the two terms are simply used as synonyms within the organisational communication process. Such disparity of meaning can be argued to be a valid example of what is referred to as “noise” in the communication process, particularly in the context of the assessment of performance by members of workgroups where consistency of meaning can be particularly difficult to achieve. Inconsistent interpretations between workgroup members would be a possible cause of negative conflict and reduced workgroup performance. Noise flowing from multiple possible meanings of the terms competence and competency therefore represents an area where effort should be applied to eradicate the diversity of possible meaning. This paper posits that the resultant quality of encoding and decoding of information within the communication process would thereby be improved, and a more consistent basis for assessment of performance achieved. Such an improvement may have significant benefits for the maintenance of morale, as one example, within an organisation. The issue of meaning An awareness of the possibility of misinterpretation, or decoding, in communication, along with the severity of the potential outcomes of it, has been in existence for some time. One example from almost a century ago illustrates the possibilities quite graphically. During the First World War, a British front-line commander sent a message back to headquarters that was some distance back from the front line. The message was, apparently, communicated orally. In such a case, the diversity of possible British dialects that the message passed through on its way to HQ could have been considerable. There is also the possibility that it was transmitted through individuals for whom English was not their first language. A further possible contribution to the level of communication noise was the stress represented by a combat situation. All of these possibilities may explain why the message that arrived at headquarters was “Send three and four pence. Am going to a dance”. Nowadays, this message may need some explaining in that the currency at the time was pounds, shillings and pence (pennies), so “three and fourpence” referred to three shillings and four pennies; a reasonable sum of money at the time. What perhaps should not have been seen as reasonable was that a front-line commander should want money to go to a dance. However, perhaps the discipline that an army relies strongly upon also meant that nobody questioned the validity of the message, even as it changed from the original form of “Send reinforcements. Am going to advance”. Since the time of the “dance” example, some attempts have been made to distinguish different meanings for terms used within communication and this has applied to competence and competency. Woodruff (1991) suggests that the term competency is being used to refer to two factors: (1) the proven ability to perform a job competently (i.e. to the standards required in employment); and (2) the sets of behaviour the person must display in order to perform the tasks and functions of job with competence. The recommendation flowing from the recognition of this dual meaning is that, so as to avoid misunderstanding, the two senses of the word should be kept separate. In the case of the first meaning, competence can be used to refer to areas of work at which the person is competent, the so-called “areas of competence”. However, when what are being referred to are the dimensions of behaviour lying behind competent performance, a meaning that can be regarded as being “person-related”, Woodruff recommends the term “competency” should be used. A further example can be found in the work by Armstrong (1998), in which it was sought to differentiate between “competence” and “competency”. Armstrong’s perspective was that “competences” describes what people need to be able to do to perform a job well; the emphasis is on doing (perhaps in terms of achieving the desired output?). “Competency”, in contrast defined in terms referring to those dimensions of behaviour lying behind competent performance. These are often referred to as behavioural competencies, because they are intended to describe how people behave when they carry out their jobs. The differences between the two terms can seem overly subtle and may be disregarded by some. Such a possibility would be unfortunate if realised in the context of performance assessment carried out within an organisation. Confusions arising Along with the terms competence and competency, there is also the term “competencies”. This term reflects the recognition of the level of competence for a professional deriving from their possessing a number of relevant attributes such as knowledge, skill and attitudes: more commonly referred to as competencies. A competency therefore becomes a combination of relevant attributes that underlie aspects of successful professional performance. Working from this perspective, and in combination with a systems methodology in which problems are broken down into sub-problems, the following characteristics of the key terms are suggested: competence – an area of work; competency – the behaviour(s) supporting an area of work; and competencies – the attributes underpinning a behaviour. The competence of an individual may therefore be concerned with a particular trade or profession, such as quantity surveying. This could be regarded as being their “area of competence”. Within such an area, the decision regarding whether or not an individual would be regarded as exhibiting competency would be based on their exhibiting the “correct” or relevant behaviours. If, for example, their behaviours included structural analysis but did not include analysis of work-in-progress, they may not generally be regarded as exhibiting competency in their chosen competence. This lack of competency may, in turn, be attributed to their being deficient in one or more of the attributes underpinning that competency (competencies). They may, for example, lack an attribute such as knowledge of the Standard Method of Measurement (the quantity surveyor’s guide to measurement “rules”). The potential difficulties involved in seeking to achieve a consistent interpretation of subtle differences between three forms of the same term within a single organisation may be considerable. However, the confusion does not necessarily end there. In the increasingly global workplace, there is additional potential for confusion. As organisations in one country are acquired by organisations from other countries, differences in use of terminology can lead to confusion and then to conflict. An example can be found by considering two countries sometimes referred to as being separated by a common language; the UK and the USA. A disparity has grown up between approaches developed regarding the perception and assessment of competence developed in the USA, and those adopted in the UK. Confusion has arisen over the use of the term “competency” by organisations such as the McBer consultancy who operated for the American Management Association, and the term “competence” as applied within the Employment Department’s Standards programme. McBer defines competency as “an underlying characteristic of a person which results in effective action and/or superior performance in a job” (Boyatzis, 1982). It is debatable if this definition is actually referring to “behaviours” (competency) or “attributes” (competencies). In contrast, the UK Standards Programme defines a “competence” as “a description of an action, behaviour or outcome which a person should be able to demonstrate” (Training Agency, 1988). This definition confuses behaviour (competency) with outcomes, or area of work (competence). In order to attempt some clarification of this confused situation, an analysis of the differences between the UK and US approaches may be useful, starting with the McBer model from the USA. Underlying personal characteristics v. performance criteria McBer Associates have been carrying out more or less continuous studies in this area for more than 40 years. The underlying personal characteristic approach owes its popularity to research undertaken by the McBer consultancy in the late 1970s, in the USA. This work was one part of an initiative by the American Management Association to identify those characteristics that distinguish superior from average managerial performance. David McClelland pioneered the work and is quoted (Boyatzis, 1982) as identifying competency in terms of being “an underlying characteristic of a person which results in effective and/or superior performance in a job”. Hammond (1989) defined competencies as “not the tasks of the job, they are what enables people to do the tasks”. Thus, personal qualities are the centre of this approach. Competency for McBer is not about micro-sized job task components. In this sense, the approach could be argued to be unlike the micro-movement approach to work study pioneered by Gilbreth, and thus should not be regarded as simply being one more scientific management tool within the industrial era transactional approach to the management of people. Rather, it is a case of competencies being generic underlying characteristics that could be described as part of a macro, rather than micro, approach to management. Within such a macro approach, competencies would, in the three-tier model suggested previously, actually be the micro-element. Competency would represent the meso level, and competence would represent the macro-level element. This then suggests that, ideally, performance assessment would be a tiered process, commencing at the macro level and progressing down to the micro level, in which the contribution of each tier to the whole “performance” is retained. Such an approach does not appear to have been considered in developing the UK perspective on competence performance assessment. The UK perspective on competence differs from the US perspective. In 1988, the Management Charter Initiative (MCI) was created. MCI is an employer-led organisation, supported by British Institute of Management, the CBI and the UK Government with the overall mission of improving the performance of UK organisations by improving the quality of their managers. MCI met its requirement to identify good practice in management, and disseminate this through the distillation of their research into the publication of national standards of management performance, through the application of a relatively new method for analysing work performance: functional analysis. This determined the activities performed by a sample containing 3,000 managers and helped in the production of a set of management standards containing criteria purporting to represent the skills required by managers in all organisations and in all occupational sectors. The conceptual framework was then essentially adopted in the Standards Programme underpinning the establishment of National Vocational Qualifications (NVQs). The National Council for Vocational Qualification (NCVQ) was formed in 1988, to “secure standards for occupational competence and ensure that vocational qualification are based on this” (see Jessup, 1991). The White Paper (Department of Employment, 1988) stated clearly that the existence of recognised standards of competence, relevant to employment, drawn up by industry-led organisations covering every sector and every occupational group was required. The standards were also required to be nationally validated, resulting in the current linkage between formal assessment (NVQs) and predetermined levels of competence performance. In the UK the term competence has become associated with the work of MCI, NCVQ, and its Scottish relative the Scottish Council for Vocational Qualifications (SCOTVEC). The resulting perspective is one associated not with the underlying characteristics and behaviours that support managerial performance, but with standards of performance in specific functions. A particular problem has resulted from this perspective: difficulty in discriminating between “acceptable” performance (that which meets the pre-determined “standard for occupational competence”) and “superior” performance. The initial findings (a future paper will discuss these in more detail) of ongoing research by the authors into the competencies exhibited by superior and average construction managers in the UK are indicating that the current UK approach to performance assessment (at least within the construction industry) is missing an opportunity for human resource development. The UK approach to assessment is typically based on the methodology of functional analysis, a task-oriented methodology rather than the person-oriented methodologies of behavioural event interviews associated with the McBer model (Iles, 1993), which has been focused on the identification of “good practice” rather than best practice. Functional analysis is a methodology rooted in the practices of industrial era transactional management, as evidenced by its use of systemic analysis to identify or define the key purpose or function of an occupation. This is then further analysed to identify the subdivision or differentiation of the key purpose/function so as to establish the purpose or outcomes that must be met for the key purpose to be achieved. So the overall competence is analysed first into units of competence, then each unit is analysed into elements of competence. For each element a number of performance criteria are specified, presented in the form of the required outcomes. Thus the overall disaggregation process leads to statement of outcomes to be achieved (Holmes and Joyce, 1993). However, these outcomes are at the competence level and largely ignore the competency and competencies factors with their emphasis on behaviours and attributes (knowledge). In essence, the functional analysis approach does not concern itself with those issues that are of significance in the emerging perspective on management referred to as the transformational approach (Banner and Gagne, 1995). Of particular importance in this approach is the emphasis placed upon the emergence of personnel whose authority within the organisation is based on their knowledge (sapiential authority) rather than location within an organisation hierarchy (positional authority). In not including the assessment of behaviours and attributes, the UK approach is leaving itself open to charges of being insufficiently responsive to the changing needs of industry with regard to the assessment, and then development, of the human resource. This is particularly important in that Europe is currently held to be ahead of the USA in terms of knowledge management with regard to both the issue of active pursuit of the objective (relevant tools being in place, underway or attempted) and experience of the application of knowledge management tools and technologies (Work Study, 2000). The inclusion of knowledge management within the human resource development debate raises a further question of whether or not competence can be managed in a similar manner to that currently being applied to knowledge: is knowledge the same as competence? Is evidence of knowledge of the theory of performing open-heart surgery also acceptable as evidence of competence in such surgery? If not, then performance with regard to knowledge and competence should be assessed separately. Conclusions A number of confusions within the area of performance assessment with regard to competence have been introduced within the paper. In particular the use of terminology and the differing interpretations of a given term between the USA and UK approaches to competence assessment is addressed. A hierarchy of terms and their specific meanings is proposed as a basis for debate concerning the future direction of competence assessment in the UK. A particular aspect of this hierarchy is its relevance to assessment based on behaviours and attitudes rather than simply on the results of functional analysis concerning a particular job. It is anticipated that ongoing research by the authors will further contribute to this debate through the identification of criteria for the assessment of competent performance at both the average and superior levels in the competence of construction management.