The Surge of Competency-based Hiring Navigating the Shiftby Murali Santhanam, CHRO

We are living in an era marked by shifting competency demands. The evolving digital landscape is resulting in an unprecedented demand for competent tech workers across business sectors. This demand for a competent talent pool is growing by the day. While this is a good trend, it brings with it its own challenges. Most organizations struggle to deal with this transformation due to prevalent talent shortages. To exacerbate the matter, the competent talent pool supply has not kept pace with the growing competency demand as the academic and industry domains evolve unevenly.

A shortage of in-demand competencies in the talent pool market can have far-reaching implications for organizations regardless of sectors and job roles. The talent shortage is a global phenomenon, and India is no exception. Recent industry studies and reports have highlighted this. For instance, according to a recent study by Nasscom, India has a tech talent demand-supply gap of 21.1% (even though this number is lowest globally among top tech locations, such as the US and China). This supply gap for digital tech talent is expected to increase by 3.5X or more by 2026. As a response, several organizations in India have started adopting competency competency-based hiring in an effort to meet their ever-changing technology advances.

Besides leveraging competency-based hiring practices, what other strategies can organizations adopt to tackle this talent shortage and strengthen their talent pool? This article explores some of those strategies.

As more and more processes are getting digitalized and automated, organizations are increasingly relying on digital technologies and are looking for candidates who have the competencies required to navigate this new demand. As a result, new roles are emerging. These roles are not always part of the academic syllabi; in addition to an unchanged curriculum, several such competencies are acquired outside of the job and through other informal learning avenues. Given this context, focusing only on candidates’ formal qualifications instead of valuing the actual competency sets they need to bring to the table may screen out potentially qualified candidates who might have gained valuable competencies and experience through non-traditional methods.

Today, competencies are gaining increasing importance during hiring, leading to a steady surge in competency-based hiring. For instance, a recent LinkedIn study shows that when recruiters are looking for candidates on LinkedIn, they are 25% more likely to search by competency filters than they were three years ago. Also, they are 50% more likely to search by competencies than by number of years of experience.

In the face of talent pool shortages, the importance of adopting various hiring strategies cannot be overstated. To build agile, adaptable, and tech-savvy teams, implementing a multifaceted hiring approach is imperative. Depending upon specific needs, organizations can choose from various avenues such as competency-based hiring, apprenticeships, internships, upskilling and reskilling, boot camps, and sponsored training, among others, as alternatives.

Competency-based hiring

Competency-based hiring is a recruitment approach where a candidate’s competencies are prioritized over the candidate’s education, experience, or resume. This approach is useful when focusing on specific competencies, as some roles are competency-intensive. One of the biggest advantages of this approach is that it facilitates competency-based tests, role-specific assignments, and work samples, helping organizations to assess the talent objectively and greatly reducing the chances of mis-hires.

Competency-based hiring can be implemented during the job posting process by simply standardizing the competencies required and at a specific proficiency level. While publishing job postings, not mentioning formal education as a mandatory requirement for certain job profiles can potentially increase the talent pool and attract more right-fit candidates. Also, specifying a combination of technical and behavioral competencies in the requirement can ensure an even higher likelihood of hiring the right candidates.

Competency-based hiring can expand the possibilities for organizations, enhancing their capability to deliver quality services. Equally, it can help job seekers gain access to new employment opportunities and build career paths, helping them overcome barriers to entry.

Apprenticeships

Apprenticeships are longer-term programs designed in collaboration with industry stakeholders. They involve a structured combination of on-the-job training and classroom instruction or technical training that is directly aligned with the needs of employers. Apprenticeship programs are crucial in addressing talent shortages and promoting inclusivity, benefiting employers and individuals.

Apprenticeships can also foster collaboration between educational institutions and industry partners. It helps to bridge the gap between academia and industry, addressing competency shortages more effectively.

Internships

Internships are pivotal in nurturing emerging talent and preparing the student community for the workforce. By offering students and recent graduates hands-on experience, organizations can identify and attract promising individuals. Internship programs act as a talent incubator, bridging the gap between academic knowledge and practical application.

Re-skilling and Up-skilling

In a way, Re-skilling and Upskilling endeavors are strategic investments. Reskilling involves training employees in entirely new competencies while upskilling hones and enhances existing proficiency levels. By empowering current employees with evolving capabilities, organizations can fill immediate competency gaps and cultivate a culture of continuous learning, adaptability, and loyalty.

Boot Camps

Boot camps are intensive, short-term training programs designed to equip individuals with specific competencies. These immersive experiences offer rapid competency acquisition, making boot camps an agile solution for addressing immediate competency shortages. Organizations leveraging boot camps tap into a pool of individuals ready to contribute with newfound expertise.

Sponsored Training

Sponsored training programs involve organizations partnering with educational institutions or training providers to sponsor the development of specific competencies. By investing in sponsored training, companies proactively shape the competencies of future talent, ensuring a pipeline of relevant, contextual, and qualified talent pool.

Conclusion

Adopting a multifaceted approach becomes imperative as organizations navigate the complexities of talent shortages. Competency-based hiring ensures precision in recruitment; Reskilling and upskilling help invest in internal growth; apprenticeships help build a competent workforce; internships cultivate future leaders; boot camps offer rapid competency infusion, and sponsored training builds future expertise. Embracing this diversity of hiring strategies is not just necessary; it is a strategic imperative for organizations looking to thrive in the competitive landscape and position themselves as agile, adaptive, and resilient entities.