Competency Modeling: How to Hire and Promote the Best

Standardized tests, intelligence exams, and personality assessments have been in vogue for centuries for selecting job candidates and promoting employees. For instance,

• In Plato’s Greece, civil service candidates were required to pass difficult physical and cognitive tests.
• In China, the Han and Tang dynasties administered tests of literary style and the classics to hire the establishment bureaucrats. Aspirants were required to pass multiple three-day provincial exams and then take a final exam in the imperial capital.

Modern hiring practices have centered on the idea of competencies—specific behaviors, skills, knowledge, and pertinent experiences—identified for successful job performance.

Harvard psychologist David McClelland first proposed the idea of ‘competence’. In 1973, he introduced a then-revolutionary idea that transformed how companies hire and promote people. In his influential paper, titled “Testing for Competence Rather than for Intelligence,” McClelland made a case that a candidate’s GPA, IQ, or scores from intelligence or aptitude tests were not all as valid predictors of job success as was then imagined.

McClelland argued that another set of factors—“competences”—were better measures for explaining job success. To hire the best person for any job, McClelland recommended that organizations,

• Begin by analyzing people who now have the job and people who held that job previously.
• Classify the star performers—say the top 10%—by some logical and meaningful metric.
• Compare the star performers to people who are merely average by a systematic method.
• Identify the traits, characteristics, and behaviors in the star performers and not in the average performers.
• Hire and promote people who have demonstrated the distinct traits and behaviors of the star performers.

Over the years, McClelland’s paper has evolved into “competency modeling,” a widespread methodology that is now at the heart of how many companies manage talent and achieve professional development for employees.

Not only are competencies often hard to define and understand, but testing for competencies through simulation or evidence is very difficult. Not to mention of how hard it is to assess employees quickly. Hence, at many “competency-driven” companies, human resources departments have dedicated teams to develop and implement competency models (see example from 3M, the Minnesota-based industrial and consumer products) to hire, train, evaluate, and promote employees.

Competency models form the baseline criteria for identifying high-potential employees, and succession management procedures.