Obtaining a qualifications is a significant milestone for many people.  But how does a qualification impact the employer?

Maxumise finds that qualifications are, at best, a guide and not a meaningful measure of an organisations’ capability needs.  Moreover, it does not indicate the capacity of the employee to contribute.  We find that a focus on qualifications can, in fact, be a hindrance to innovation, progression and organisational development especially with the current academic approach to learning and development.

The UK Office for National Statistics (ONS) Labour Force Survey, reported by the Guardian, found that around 15% (1 in 6) of workers are over-educated for their jobs while 13.9% are under-educated i.e. having a lower than average education level for their occupation.  The survey therefore concludes that 28.9% of the UK workforce are in “jobs not suited to their skill level”.  It was also found that the younger employees fall into the “over-educated group” while the 50 to 64 year olds made up the majority of the under educated.  The question is, would we have got a different result if we were looking at the competence of the people against the organisations requirements rather than qualification?

While we have no problem with the report findings, we question the relevance of qualification as a meaningful measure of an organisations’ capability needs.  In fact we would go further to say that qualification can be a hindrance to making real change in organisations as the tendency is to retain traditional “jobs” rather than define new and innovative positions around stakeholder needs.  The blinkered traditional “qualification” approach may be a significant contributor to the productivity issues in the UK and other countries like Australia as we are still teaching to old out dated organisational needs.  It is also worth noting that recently Scottish employers found a “mismatch” between their requirements and the “skills” of the employees according to the Institute for Public Policy Research (IPPR) and firm Burning Glass Technologies database.

Modern organisational design can define the capacity needs of the organisation in outcome terms and their corresponding competency and complexity levels.  Qualification can, at best, provide an indicative level of competence needed by the organisation.  It is not a reliable predictor of the competence of the individual.  Developing competency profiles to define the positions in the structure (contributing elements) should be independent of qualification and allow more flexibility, efficiency and innovation in the design.  In an outcome based competency approach to position design it is not unusual to find positions are combined or restructured, providing the best outcome for the stakeholders involved e.g. the business, customer and employees.

To give a simple example; an organisation that sold and serviced F&B equipment to the hospitality industry had  Equipment Salesperson and an Equipment Technicians each with the F&B Manager as their primary customer stakeholder.  When the outcomes needed by the F&B Manager were properly defined, it was found that a combined Sales Technician position would best serve the purpose of the clients.  This change improved the company results, lowered costs and most importantly made the position more interesting and fulfilling for the employees appointed to this new position.  Over the following 2 to 3 years the position was further expanded to provide quality and cleanliness services in bacterial swab testing and laboratory sampling.  What qualification was relevant in this case? Maybe sales, laboratory technician or equipment technician?  Qualification may have been a guide but the bottom line was “best fit against the competencies required” and “potential to develop where competency gaps existed”.  This was a win-win situation.

In assessing existing employees and managers Maxumise finds gaps against the designed position in about 75% of the assessments.  These competency gaps vary from quite low where development is feasible, to significant gaps where development may not be a feasible short or even long term option.  After conducting an assessment we often hear statements like “but they have an MBA” or “they were our best operations person so we promoted them into a management position”.  We hear many similar stories at the trade or technical levels where a great technical person may struggle to deal with customers, especially where they need to assess the situation and/or communicate needs.  A qualified technician may be capable of responding to instructions, but may not possess problem solving capacity and hence the capacity to work independently, if that is what is needed.

There seems to be a reluctance by organisations to use the methodology and tools that have been around for more than 20 years to develop outcome and competency based position descriptions; positions descriptions that are quantifiable and provide a universal size and value against a particular market.  .  This approach also includes the quantitative match of employees or applicants against the positions and the determination of both gap and potential.  Organisations that employ staff without assessing the competence against the organisation’s current and future competency based position description will probably be employing the wrong person.  They will certainly not have the quantitative information to be able to include a short and long term development plan in the letter of offer.  This quantification of the human assets will also allow the HR Asset value to be put on the balance sheet, although currently only as a BS note, but that is sufficient to use as a key performance measure.

Certain universities and organisations have talked about using competencies as a University score or measure to determine the starting and finishing level of the competencies expected from an MBA or other program.  Students assessed with higher existing levels of competence could enter a development program at a higher level and potentially develop further than a student entering with a lower level of competence and/or potential.  Actual assessments of MBA graduates have demonstrated that the void between the academic qualification, and the competence level can be enormous.  In the mid 1990’s Kellogg introduced a competency driven academic system where development progressed up a continuum and qualifications such as certificate, diploma etc. were identified as “size” points along this continuum.  This continuum was determined by the competency sizing and evaluation (a modern version of what we used to know as “job” evaluation) and could be reached via many paths depending where employees were or wanted to be in the current and future structures.  In the Kellogg situation the competency value was used to drive the qualification and not the reverse.  This kept the Sydney plant competitive for a further 20 years.

The potential to increase the productivity of an organisation and a country through appropriate competence is enormous and we believe higher than the ONS report suggests.  This can be achieved if:

  1. Organisations commence with a clear 3 to 5 year strategic perspective that enables the design of current and future structures reflecting the best outcome for all the key stakeholders;
  2. The elements of the structure are designed, then we determine the competence match of the current employees and recruits against these ideal position designs in the structures – current and future;
  3. Competency development of employees is focussed on the current and future needs of the positions designed for the organisation; development through multiple channels including internal development as well as academic learning opportunities;
  4. Organisations reward employees for their true and on-going contribution to the organisation in their particular position now and as the position grows.  .

Maxumise believes academic institutions have a choice. They can work with the organisations and associations to develop flexible programs around the competency needs of those organisation or, remain isolated and continue with the rigid academic qualification structure, a “ tail wagging the dog” situation which contributes to lack of progress and productivity improvements.

The competency assessments of employees, applicants and graduates also highlight the inequities in salary often generated by perceived “qualification value” rather than reality of “contribution value”.  This would also seem to align with the younger generations over qualification and higher earnings. While Maxumise agrees there are serious productivity issues, we cannot agree with the academic assertion quoted in the Guardian article that qualification can be directly aligned to productivity in the UK, especially where it is clear that the qualification system is part of the cause of the current poor productivity levels.

Max Underhill

Maxumise Consulting Pty Ltd

Tel: +61 (0)407998516

Email: info@maxumise.com