The difference between skills and competencies

“Skilled” vs. “competent”

Which one do you want to be? These two terms are at the core of learning and development. In the race to close skill gaps in organizations, understanding what these terms mean — and their implications — is critical. How can you differentiate between skills and competencies, and how can modern learning solutions build up the most skilled and competent workforce possible? Let’s dive in...

What are competencies?

Competencies are broader attributes that account for effective performance. They bring together knowledge, behaviors, and attitudes along with skills. Consider competencies as the "big picture" qualities or the “umbrella abilities” enabling someone to be successful in a general role or situation.

For example, a competency like "strategic thinking" can be broken down into foresight, analytic reasoning, decision-making, and many other unique skillsets. Since competencies are linked with organizational values and long-term results, they become vital in aligning the growth of individuals with the goals of the business.

However, competencies are typically more abstract and harder to measure compared to skills. They require contextual understanding and are developed over time through experience and deliberate practice.

What are skills?

A skill is a concrete, measurable capability that people can learn and develop. It is the tool or instrument employees apply to do something effectively. When compared to competencies, skills are more specific and concrete, making them easily measurable.

Let's return to our previous example of the competency of "strategic thinking,". Application of market analysis, competitive benchmarking, and financial modeling might be relevant skills that fall under the umbrella of "strategic thinking". Skills are actionable, task-oriented, and sometimes can be developed more quickly through focused training efforts.

In the chart below, you can see how the skills column is more trackable and concrete, compared to the competency column.

As companies undergo rapid technological change, identifying and developing the most critical skills is the competitive advantage. Companies can become adaptable by focusing on an approach that prioritizes trackable skills.

This isn’t to say competencies don’t matter. They do. However, organizations sometimes find them too broad to measure and improve upon year after year.

Skill vs. competency: where both make a difference

Still, the relationship between the two — skills and competencies — is interdependent. Competencies describe the macro ability, while skills allow you to master specific actions and activities that help you succeed at your job.

Take "collaboration" as an example. It's about active listening, conflict resolution, and how teams communicate. While competencies provide a kind of roadmap for what success should look like, it is through skills that people are able to carry out their vision.

From competency models to skills-based strategies: The corporate learning shift

Traditionally, competency and general knowledge have formed the backbone of corporate learning. These frameworks outline the role-specific expectations and, many times, tie in development initiatives to the organizational values. However, they tend to be static and hard to measure, which makes development less concrete. This is the impetus for a shift from role or competency based talent strategies to skills-based talent strategies in recent years.

Blending the two through immersive learning

A great way to develop both overall competencies and track specific skills is through immersive learning. Immersive learning platforms and simulations allow employees to enhance their understanding of a topic through real-time, scenario-based learning.

They not only can be coached and tested on their competence of a subject, but they can actually practice specific skills in a safe environment that help them do their job better in the future.

The future of work

The new era of corporate work is shifting towards skill-based learning and development. By focusing on this, and measuring it carefully, organizations can build up a strong, independent, and adaptable workforce.

Use tools like immersive simulations to apply this in action at your company, and learn more about skill-based learning here.