Why Outcome-Based Skills and Competency Frameworks are Critical to Drive Better Hiring and Internal Mobility

It’s the million dollar question: How do you determine from the get-go who will make a successful hire? The answer is obviously complex.

To begin, hiring success is not an easy determination. It would be shortsighted to say hiring success occurs at the point of “offer accepted”, or Day One of a new hire’s work journey. After all, we’ve all experienced that regrettable hiring “miss” when a new employee doesn’t perform or quits early on.

The point of successful hiring should instead be measured in a continuous manner, moving later into the employee’s lifecycle, months and even years in, when they are performing quality work, measurably making an impact on the company’s bottom line. 

Unfortunately, this extended timeline between hiring decision and defined success creates a vacuum of uncertainty and disconnect. As a result, hiring decisions have historically been made based on concrete, verifiable resume facts. Education and experience are given significant weight, matched with job description details in the hopes that it will predict employee success. But this is not actually the case. 

Once you connect the dots from hiring decision to true hiring success, a pattern emerges – one that shows resume bullet points, experience and education are often not real predictors of new hire performance. In fact, it’s an employee’s skills and competencies that play a critical role in whether they can do the job at hand. And it is exactly this epiphany that is behind the shift organizations are making to skills- and competency- based hiring. 

82% of companies identified skills as a priority and
54% are increasing their investment in skills in 2023.
Aptitude Research 2023 HR Tech Mid-Year Trends Report

Moving to a skills- and competencies-based approach can be complicated, but ends up as a very big win for everyone from recruiters and hiring managers to the talent themselves. 

Here’s why you should be hiring using skills and competency frameworks based on outcomes, and how you can transform your entire recruitment pipeline to quickly and easily surface top talent who will fit smoothly into your organization and become exemplary performers.

What Does “Skills and Competencies” Mean?

Skills are commonly divided into two different silos: hard skills, which are focused on learned capabilities, such as knowing how to use Excel, how to write a specific type of code, or being able to type 85 words per minute, and soft skills, which are focused more on the ability to get things done, such as handling tense situations at work or interfacing positively with customers or clients.

Hard skills: quantitative and measurable.
Hard skills can be more easily scored and measured. Role-specific required skills are often put into a laundry list of what the hiring manager thinks a candidate needs to know how to do to be a good fit—but knowing how to do things doesn’t ensure the candidate can do them well, or achieve good results.

Often, these things can be taught by mentors or peers, providing knowledge gained on the job. McKinsey research suggests that work experience contributes between 40%-60% of an individual’s overall human capital value.

Soft skills: collaborate and relate.
A front-running candidate might not have all of or even most of the hard skills on the list, but if they are smart, competent, and trainable, they might be a better hire than someone who checks every skills box but is incapable of creative problem solving, effective time management, or simply working with others to actually get things done. Soft skills play an important role, it turns out, in employee fit, productivity and even growth.

Competencies: the key to outcomes.
Core competencies focus on what outcomes employees achieve with these skills, especially when combined with attributes like being a self starter or having the right temperament to work well as part of a team. A person may possess both hard and soft skills, but do they follow through?

Competency means being able to utilize skills to achieve positive outcomes. Soft skills (also known as “power skills”) bring about satisfactory results when applied to situations that require, for example, conflict resolution. 

According to NACE, the top four competencies employers look for in candidates are:

• Critical thinking/problem solving 
• Teamwork/collaboration 
• Professionalism/work ethic 
• Oral/written communications
  
  

Candidates who are both skilled and highly competent will bring the most value to your organization—IF you identify exactly which skills and competencies are needed for your organization, department, hiring teams and even particular project at-hand. 

Case in point: Real data, real outcomes.
For example, for an Enterprise client, Crosschq Data Labs recently uncovered fascinating correlations between skills, competencies and job performance that has impacted their entire workflow. 

Before they found Crosschq, the organization had self-identified 23 different skills and competencies that they believed were key requirements of a successful sales person in their org. They were using this list to make new hires.

Crosschq uncovered two important issues with their framework.

First, as is a fairly common occurrence in organizations, these skills and competencies were derived not from data, but instead inferred from individual experiences, “gut feel”, or antiquated, unconnected systems. With no formal tools or structure to accurately tie results to these S&Cs (much less with any statistical significance), the resulting list was at best, mere guesses. 

Second, their resulting procedure was both overly complex and extremely difficult to act on correctly. It was nearly impossible to reliably and consistently source and vet talent based on such a long list of attributes.  

With Crosschq’s help, the client was able to connect each of those 23 data points with true performance data around quota attainment. As a result, they were able to narrow down the list by 65% and prioritize the top 10 S&Cs that actually mattered. 

Crosschq helped narrow down the client's list
to the top 10 S&Cs that actually mattered.

In this instance, the benefits were immediate. By simplifying the profile of their top performers, the client was able to instantly pivot their process: more accurately target job requisitions, sourcing, assessments and interviews ensuring a better match and increasing the likelihood of overall success.  

It’s exactly this type of outcomes-focused data specific to your organization, goals and teams, that can be utilized to build an ideal profile for hiring, in this case, a stellar sales team. Imagine if every sales hire was a success and every sales employee met or exceeded their quota on a consistent basis?

Successful Skills (and Competencies) Hiring: Base It on Outcomes

What is skills-based hiring?
Many companies have the misconception that skill-based hiring or skills-based recruitment is solely a matter of assigning skills to a role, then checking off boxes with each candidate.

Josh Bersin penned an excellent guide to building a skills-based organization that highlights the flaws in current “skills-based hiring” methodology. He points out that hiring for the wrong skills can be detrimental, and identifying the real skill sets needed is complicated but critical. 

A complete shift in procedure.
Making the shift to skills-based hiring and workforce planning is more complex (and more company-specific) than most organizations realize. What problems is your company experiencing when it comes to performance-based metrics, and how can your hiring methods change to address those issues?

Bersin highlighted one case in which American Express was hiring for customer service skills in their sales and service department, but results weren’t meeting expectations. When it was suggested that Amex consider their customers to be guests rather than clients, and the company started hiring for hospitality skills first, outcomes improved dramatically.

The hiring focus at Amex was narrowed and refined to attract candidates with experience in hospitality spaces, like Ritz-Carlton. The shift in recruitment to hire for competencies in guest satisfaction over customer satisfaction yielded the desired results.

The only constant is change.
Hiring from a skills and competencies approach can’t be static—it has to be dynamic. Skills gaps don’t stay the same, so the required skills for any position within an organization must be continually reevaluated to ensure the gaps are getting filled. 

Gartner notes that only 20% of employees have the skills
needed for both their current career and their future career.

These things evolve. They’re different based upon what the company is, they’re different based upon the time and place for the company. Leaders have to ask: “What’s the state of the market for our company?” 

There’s so much nuance, and the core challenge in succeeding at building a skills-based organization is that the process has to be both company specific and time specific— aligning which attributes yield the best performers is something that your hiring engine must continually be learning over time.

The days of a single, static skills and competencies model are behind us. New technologies, the availability of data, machine-learning and AI enable us to constantly learn and evolve our models to better predict and develop top performers. 

Focus on outcomes. 
To meet these needs, many tools have surfaced in an attempt to harness the power of skills and competency-based hiring. However, there is a key differentiator amongst these tools when it comes to true performance prediction. 

Many platforms are simply “inferring” which skills will lead to success and are not using actual data to back up those assumptions. This can be particularly dangerous (and downright silly when you think about it) considering business environments are constantly changing, which of course means the requirements to survive in those environments are changing as well.

Take sales teams as an example: Outcomes for new sales hires and promotions are typically tied to quota attainment. But the skills and competencies needed for quota success can change overnight. 

For example, pre-pandemic many successful sales people used in-person meetings and networking to close deals. But the game changed very quickly when those social, in-person opportunities to meet up were shut down by Covid. Lunches, dinners and other in-person entertaining were all replaced with zoom calls, digital prospecting, on-camera lunch-and-learns or other remote meetups. All those selling techniques required a new and different set of core skills and competencies for success. 

What were the skills and competencies of the sales teams who successfully navigated that change? Were those employees more able to be agile, pivot and creatively problem-solve? Did they possess the ability to self-motivate even when isolated remotely, or communicate better via any medium (not just in-person)? 

This is just one example where the ability to tie outcomes data back to hiring (and promoting) decisions in a real-time environment is what separated the organizations who failed as a result of the impact of the pandemic, and those who survived or even thrived – learning whom to hire, move and promote to build a future-proof, quota-attaining sales team.

Without an outcome-based learning model connecting the dots of performance, it’s easy to get stuck with the wrong hires. Tools, like Crosschq’s Talent Intelligence platform, need to be able to deliver information and insights that connect the current situation with the best skills and competencies to succeed for specific outcomes. 

Feed the learning feedback loop. 
With the ability to use technology to constantly track the impact of employee skills and competencies in different situations, and evolve using those ongoing insights, the organization will be able to build a powerful engine for making better and better hiring decisions. 

Through listening surveys, HRIS data, performance reviews, and more, connections can be made that the employee was in fact a great hire who is thriving, growing and succeeding in hitting desired outcomes, and via this feedback loop the model can be updated to recognize that this is now the profile for an ideal candidate. 

Even better, this feedback loop can inform not only your hiring practices, but also onboarding, L&D, internal mobility, and more.

Internal mobility: Seek out the right S&Cs
The same method applies to analyzing the current workforce and making the right promotion decisions. When done well, internal mobility–moving employees (vertically and laterally) to positions where they will further grow and succeed–can increase both retention and engagement, improving performance and productivity, saving the company time and money. 

Analyzing whom to move, where and when is not a new challenge for HR, however. Attempting to predict which employee will perform best in a new role has traditionally been done matching the job description to an employee’s work history, with sometimes disappointing results.

But organizations are well aware of the limits to this approach. 

95% of companies stated that skills are more important
than job titles when promoting employees.
Aptitude Research 2023 HR Tech Mid-Year Trends Report

According to Aptitude Research, 95% of companies stated that skills are more important than job titles when promoting employees. If you’re not utilizing skills and competencies for internal mobility decisions, it’s time to make this critical pivot. 

Rather than focus on the job titles or job specific skills (a job-first model), do a deep dive on the critical competencies of the individual employees (a people-focused approach). By mapping those competencies to the needs of the company, team, project or even leadership goals, and creating strategic moves to support those functions, the employees will be more likely to thrive both in the current situation and farther into the future.

Aptitude’s report shows that, “high-performing companies (defined as companies with above average retention, employee experience, and quality of hire metrics) that prioritize a skills-based approach have a better understanding of the skills they need for today and are more proactive with reskilling and upskilling for the future.”

The Benefits of Skill- and Competency-Based Hiring

When you hire for what a candidate can bring to the role, and how they can make their work drive value, you are hiring for skills and competencies. The benefits to this approach are many and there are multiple layers to how it will affect your organization and outcomes. 

Nowhere is this more important than at leadership level. However, according to Brandon Hall Group, 31% of organizations have yet to define the essential leadership competencies requisite for leaders at all levels to achieve business goals.

A well designed skills and competencies hiring approach:

Increases overall productivity and Quality of Hire

Hiring the person who has the skills and competencies to get the job done (instead of the person who went to Harvard or worked at Google) increases overall productivity across the entire organization, optimizing quality of hire for better business outcomes and up-leveling existing teams to drive company performance.

Brings much needed equity to hiring

Shifting to hiring based on skills and competencies can allow you to do away with outdated recruitment and promotion processes that still include too much bias. Look for ways to automate and utilize AI and machine learning to eliminate bias across your hiring funnel.

Builds opportunities for talent 

When candidates and employees know exactly what skills they need to master in order to be eligible for promotion or other opportunities, there is fundamentally more transparency across hiring and promotion in your organization. 

Increases success for managers

When your manager is a good leader, and has team members who are fully equipped to do the job, their own task is easier. Even if the team hasn’t fully gelled yet, at least their leaders can know exactly what blind spots might exist to drive development.

Encourages diversity in the workforce

Hiring for skills and competencies naturally leads to a more diversified workforce, as it helps eliminate the tendency of recruiters, hiring managers, and interviewers to make decisions based on gut instinct and commonalities with candidates, such as going to the same school. This can support your DEIB initiatives.

Impacts the bottom line

When employees are hired (and promoted) for success based on outcome-focused skills and competencies, productivity and retention increase, saving recruiting costs, increasing employee efficiency and improving overall revenue.

Finding the Right Tools for Outcome-Based Hiring

When you can clearly tie skills and competencies to performance and productivity, you can make the case for shifting your hiring function to this approach and obtain C-suite buy-in. The key is how you collect and assess data related to specific candidate attributes. 

Currently, data is everywhere in the hiring process, but without a plan to identify, filter, segment, and analyze that data, it is overwhelming and at the same time, useless. You need tools that will turn your candidate data into a powerful decisioning machine, capable of tracking skills and competencies in the pre-hire process, and correlating them to post-hire outcomes.

Tools like Crosschq 360 offer automatic skills verification, supplying this necessary data across the talent lifecycle – from hiring to productivity to promotion – for competency-based hiring and effective internal mobility, making it possible to better correlate the skills of each individual with potential outcomes. 

Crosschq 360 provides
soft skills, attributes and competency verification

Crosschq 360 gathers real, actionable data on hard and soft skills, attributes, and types of competency displayed by each candidate, without bias, allowing hiring managers to make smarter, more confident hiring and promotion decisions.

Crosschq 360 combined with Quality of Hire Analytics allows any organization to customize their pre-hire process and leverage data the right way. 

Top talent can be identified near the top of the hiring funnel; for example, a projected top performer may be surfaced thanks to high ratings on 10 skills. Promoting talent is also easier when you can easily identify strong candidates ripe for internal mobility - a BDR ready to become an AE, for instance. 

With Crosschq, you can identify not only your top employees’ strengths, but their weaknesses, and act accordingly. (Surprise: this doesn’t mean forcing them to work on the things they are bad at but that don’t affect their overall performance. It means giving them room to hone and upskill their strengths, becoming even more productive and valuable.)

Crosschq’s Quality of Hire Analytics
helps correlate skills to outcomes

More importantly, Crosschq can be used to build that powerful feedback loop described above, connecting an employee’s skills and competencies to their success in the organization. 

By learning the ideal candidate profile (and how it varies by function, role, hiring manager, department and over time), hiring and promoting gets smarter and smarter as time goes on, improving hiring decisions based on skills and competency data that is tied to the desired outcomes. 

For example, if (and when) the company hires someone with a certain set of skills and competencies, a hire that perhaps may have been slightly different than what was expected to be the ideal hire, TA will be able to learn through these feedback tools whether those unique skills and competencies made a positive impact. 

Start Evaluating Skills, Competencies, and Attributes Today

The first step.
Crosschq 360 validates the key candidate quality indicators and attributes that drive your top hiring outcomes. You can aggregate data on applicant and human resource skills and competencies, and use our proprietary machine learning model to connect the dots and predict which candidates will excel in their roles. 

Leverage performance-based hiring learning systems, and develop an accurate competency assessment interview process. Confidently hire more quality candidates and give your talent team the competitive advantage in the fierce hiring market. Request a demonstration today.