Career advancement and skills development are important. In fact, we can go further than important: they are really, really important. We all know that both companies and employees are looking at career advancement and skills development as the top drivers for retention as well as attraction into a job. It's sufficient to read your LinkedIn feed to see how everyone is talking about and getting involved in the new fad: skills.
The question remains though:
How do companies know their team's skills are at the level they say they are?
In a survey of engineers at one company, 42% thought their work ranked in the top 5% among their peers. Conversely, another survey, at a different company, showed that the top 25% tended to think that their skills lay in the 70th to 75th percentile, although their performances fell roughly in the 87th percentile (quoted in [1]). These are just two examples from many where cognitive biases can be seen at work, with results that could introduce risk and lost opportunities to businesses.
There are many cognitive biases that affect all of us in our jobs; we are all human after all. When it comes to assessing our skills and capabilities some of these cognitive biases may cause some people to either overestimate or underestimate their actual level of competence. And in some sectors, for example, those that have roles that are hazardous, this can be a concerning risk, not only to business outcomes, but more importantly the risk that people may get injured or worse. And in other sectors, such as the financial sector, placing an individual in a role that is not aligned to their capability can cause adverse effects to customers and indirectly to others as well.
How can cognitive biases affect how a person perceives their skills?
There are several cognitive biases that can produce these types of effects. To pick a few of the more commonly known ones:
- The Dunning-Kruger effect may lead an inexperienced person to overestimate the level of their ability without realising it. Equally well, the converse can apply: an experienced and knowledgeable person may underestimate their level of competence.
- The over-confidence effect: many studies show that generally people are over-confident in their abilities (aka 'the better-than-average effect'), with significantly over 50% of people thinking they are above the median level. And as above, there is also a worse-than-average effect that some people can display.
- Self-serving bias will push people to assess their capability in a way that does not adversely impact their self-esteem, which means they view their own skills favourably, and attribute any under-performance or failure to factors external to themselves as opposed to their own skill level.
Whilst not everybody displays these cognitive biases, and those that do may not display them all of the time, they pose a challenge to any skills and competency management process. Namely, how does a business or a manager assure the skills and level of competence of one of their team are what that person claims them to be? To be clear, it isn't that a manager can't trust the individual, as these cognitive biases are unconscious and hard for the individual to be aware of or counter, as they are part of being human. Nevertheless, these cognitive biases can introduce risk to a business, especially where that business needs suitably qualified and experienced personnel (SQEP) in roles.
To counteract the biases, at the hiring stage HR will take up references although these may be pro-forma in nature; and HR may scrutinise qualifications, certifications and accreditations on the new hire's CV. If you've read some of my other articles, you'll be aware that I do not believe that a qualification in itself confers a competence on an individual, rather that it just shows that they have a certain level of theoretical knowledge (even if that included practical assessments). Qualifications, certifications and accreditations certainly help a person develop and apply skills, but depending upon the awarding body and the assessment format, they may add very little with regards to competence and competency.
Similarly, after competency assurance through onboarding and orientation processes, in some sectors and disciplines, workers are required to periodically take knowledge tests or practical tests to evaluate ongoing competency levels, or commit to and demonstrate continuous professional development (CPD) of their capabilities and skills.
This ongoing management of competencies, what they are to ensure they are the ones the business needs, and what level they are to, to help a business develop overall competency profiles that match its market and regulatory needs, requires an effective competency management process that includes appropriate assurance sub-processes. This helps minimise the risk of assigning someone into a role they do not have the competency to undertake safely or successfully. It is only by understanding what level of competence a role needs, and what level of competence a person has attained, that the appropriate role assignment can be made.
The foundations include the careful identification of the skills and skill-levels needed for a role, and appropriate measures to provide assurance that the levels an individual has are understood by managers. For some tasks, this assurance can be by periodic practical testing of the skill. But what about in more complex situations, where there are many factors that the worker must take into account in deciding how they will undertake an activity successfully? Or where the worker is faced with a novel set of challenges to overcome? Or when there is ambiguity and uncertainty to deal with? These are the things that can't be practised.
Novel challenges, ambiguity and uncertainty are an added complication for competency management and sometimes overlooked. In today's dynamic business environment, the activities people undertake often have novel or VUCA aspects to them. Just consider the context of business transformation, new technology, societal changes and the like. As a result, managers need greater assurance not just that their team has the right skills at the right level (competence) but also the right attitude to apply these to achieve the desired business outcomes (competency). In turn, this means a robust competency management process is even more essential in some businesses and sectors.
Our eSQEP solution provides managers with team, project and company-wide maps of employee competencies. eSQEP shows managers that the overall competency profile of their team(s) matches the needs of the role they are assigned to. The assessment process output is an assured competency passport that facilitates the internal marketplace for cross-functional team deployments. The company-wide, cross-functional visibility of teams and their competencies (regardless of where they are currently deployed) supports the reduction of talent hoarding by managers, whilst helping attract and retain the very best people for your company.
[1] Ehrlinger, J., Johnson, K., Banner, M., Dunning, D., & Kruger, J. (2008). Why the unskilled are unaware: further explorations of (absent) self-insight amongst the incompetent. Organizational Behavior and Human Decision Processes, 105(1), pp98-121.
Originally published on LinkedIn.