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Applying Core Competencies to Selection Interviews

Perry Alter and Blake Lowry

Introduction
Core competencies are now commonplace in large companies. They are the skills, behaviors, and knowledge that create competitive business advantage and distinguish high from average performance. Often, companies go to great lengths to behaviorally define the five to 10 competencies they want all employees to demonstrate as they do their jobs. By using core competencies to clarify desired performance for employees, organizations focus employees toward the most critical business priorities.

But, are organizations doing enough to ensure their strategic competencies are supported by their employee systems? By selecting employees who are already strong in the organization’s core competencies, organizations can effectively weave the competencies into their ongoing daily performance. However, despite investing resources to develop these strategy-based competencies, many organizations do not take the important next step of aligning their selection systems with them. This amounts to substantial missed opportunities.

Why should a company apply its core competencies to selection interviews?
Hiring, at least partially on the presence of core competencies, helps bring those competencies into the company. The benefits of doing this can be substantial, but tough to measure. Suppose you need people to make fast decisions so you can be responsive to customers. Selecting people who are decisive should provide more sustained results than just telling people to make decisions more quickly. What is the dollar return of such selection? It depends on the value of a retained customer.

Let’s look at this in more depth. You can build systems that facilitate certain competencies, you can train for certain competencies, and you can certainly hire them in. Suppose innovation is one of your core competencies, and you are trying to make innovative behavior more prevalent in the company. You can build a system that rewards new ideas. Or, you can train people to question processes.

Or, you can ask job applicants for examples of times when they’ve demonstrated innovation. For example, “Describe a time when you solved a problem innovatively. How did you do it?” Make high ratings in innovation a criterion for employment. If you don’t interview for the competency, you are treating it as a wild card in your new hires (the caretakers of your company’s future, we might add).

Or, you can build systems, train, and hire for it. Any effort to enhance a competency’s prevalence in a company would probably be more potent if the people in the mix are predisposed to doing it in the first place. For example, a teamwork initiative would likely be more effective if all new employees came in with teamwork skills.

Certainly, telling interviewers what to look for increases the chance that they will look for it! If you don’t, you are letting the interviewers hire based on their own perceptions and agenda, all with good intentions, rather than the agenda you are trying to instill. One recent study (Posthuma, Morgeson, & Campion, 2002) pointed out the possibility that “the interviewer may select an applicant similar to the interviewer, but not necessarily one that fits the job or the organization. (p.8)”

What would such an approach look like?
Ideally, the company would create one or two fixed questions for each core competency. All interviews would ask these questions. Alternatively, the company could create four to six questions for each competency and allow the interviewers to choose which one or two are most appropriate for the job. The interviewer could also edit the questions to more directly reflect the job. He or she would still have to cover each core competency.

Another approach is for the company to analyze which core competencies are most difficult to train and then interview for those. If there are six core competencies and two of them are readily trainable, you might interview for the other four.

Jill Stem, VP and GM of Lee Hecht Harrison’s Memphis office, has been using this approach since 1985, in several different positions. She has typically used a bank of competencies, with each competency having a number of behavior-based questions associated with it. Stem says that they, “had job experts determine what the competencies were, and chose the appropriate questions based on those competencies...We’d use two to three questions per competency per job.” Then they edited the questions to ensure that they reflected the jobs in that organization.

Research has repeatedly shown that behavioral questions are good ways to assess competencies (See, for example, Green, Alter, & Carr, 1993). For instance, “Describe a time when you went out of your way to help a co-worker. What did you do?” Some people have the time and skills to create such questions in-house. Others might prefer to have a consultant do it.

In addition, it is helpful to give interviewers guidelines to evaluate answers. For example, knowing to ask about action-orientation is only useful if you know how to discern a good answer from a bad one. This is easiest if the company has already behaviorally defined the core competencies in the first place, since the target behaviors are clearer. (See Campion, Palmer, and Campion, 1997, pp. 675-678, for a concise review of different types of rating guidelines.)

Stem says that her companies have used evaluation guides unique to each question also present with the original bank of questions. She adds, “We liked to refer back to the wording of the competencies. It helped us to focus on...the specific content.” The more articulately the competencies are worded, the more helpful they can be as hiring criteria.

Bridging the gap to the future
One critical application for core competencies is as a medium for delivering the organization to a desired future state. For example, several years ago, the energy industry began its deregulation. This put companies in a position where meeting customer needs became not only a matter of pride but also of competitive survival. By hiring for the competency of customer focus, companies move more quickly toward being a customer-focused organization. This will provide a competitive edge over companies who don’t.

Picture your CEO announcing to the company: “We have more competitors than we did 10 years ago. The only way we can provide sustained competitive advantage will be to out-innovate our competition. Therefore, by 2007, I want us to double the number of service options that we have now, because our research shows that our competitors won’t be able to match that.”

One way to get to that future state would be to make “innovative problem solving” a hiring criterion for all (or most) new employees. Filter applicants by asking a question like the following: “Describe a time when you dealt with a common situation differently than others had, and you delivered superior results.” By only hiring applicants with a track record of innovation, you will continuously build a workforce predisposed to it.

Let’s clarify the implications here. First, the organization would become more innovatively inclined. Second, other innovation-oriented initiatives would likely be better executed than if new employees comprised a random mix of innovative vs. change-resistant people. Third, using that core competency as a hiring criterion might facilitate doubling of service options by 2005 instead of 2007.

Plus, people who enter the organization now will grow and take on new jobs, new responsibilities, and probably wider influence within the organization. The competencies they demonstrate today will become the norms and expectations of tomorrow. Again, innovation was just an example. The same could be said for customer focus, teamwork, flexibility, diversity, and many more.

Are there any reasons not to apply core competencies to selection interviews?
There are reasons why organizations might hesitate to apply core competencies to selection interviews, but these reasons pale compared to the benefits. For example:

Anything we can interview for, we can train for. The accuracy of this probably varies with the competency. Time management, valuing diversity, and open communication can probably be trained. Other competencies, like integrity or decisiveness, would be difficult or impossible to train. And even if they could be trained, wouldn’t hiring for it plus training for it be more potent?

We don’t have the skills to create these questions in-house. This is fair, as it is certainly an unusual professional skill. There are consultants who would provide this service, however. Certain consultants compose interview questions and rating guidelines to closely match companies’ chosen competencies, core or otherwise. These may be different from the consultants that helped define that organization’s competencies in the first place.

We don’t have enough time to interview for core competencies. Again, this is reasonable. If a company has eight core competencies and covered one or two questions about each in an interview, that would certainly add time to the interview process. The question then becomes whether this is too much to invest in the pursuit of bringing your core competencies to life across the organization.

The questions will leak out and become useless. It is probably fair to say that the questions can leak out into the pool of interview candidates; however, this makes them far from useless, for two reasons. First, if the company does have multiple questions per core competency, and chooses and edits on a job-by-job basis, then it would take a prohibitive amount of preparation to plan for all of them.

Second, at least in behavioral interviews, it is difficult to lie consistently. Certainly a little exaggerating could be woven in, but knowing the questions would only minimally help someone make up a persuasive series of lies that can withstand the probing of a well-conducted behavioral interview.

An in-depth example
Rich Products Corporation, headquartered in Buffalo, is a great example of how to do this correctly. Rich provides more than 2000 different food products to hotel chains, restaurant chains, in-store bakeries, and other food-service and bakery organizations, and does over $1.7 billion in sales annually.

Rich is focusing on branding itself as a “Mission World Class” organization. They have implemented a competency model as a way to communicate what’s important to them and to the culture they are trying to create. According to Brian Townson, Sr. VP and Chief Talent Officer for Rich, it “will help us define what success means in this company. It helps our associates understand what’s expected of them...You should focus on these for success. At the end of the day, our ultimate goal is to develop extraordinary people and provide them extraordinary opportunities.”

Townson adds this about their people plan: “Developing competencies...represents for me a core on which we can build many aspects of our people plan.” This includes several facets, selection among them. “If we are able to define the skills, behaviors, and attributes that are successful in this company...then it is a pretty logical step to use that as a basis for selection.”

They worked with a consultant to create a bank of questions for each core competency (and each leadership competency as well). For any interview, Townson tries to get at least one or two questions from each core competency, and distributes them in a logical way among the participating interviewers.

The questions in that bank are behavior-based, and each has a corresponding evaluation guide, which helps interviewers ask useful follow-up questions and determine the quality of answers. Then there are more generic evaluation guides as well. Plus, the interviewers received formal training in using the approach.

The competency-based selection effort is too new for success to be measurable yet, although Townson feels it is working. What kind of results is Rich expecting? For starters, a reduction in turnover. They estimate that a bad selection decision for a $50,000 position costs about $200,000. However, the initiative is only indirectly about the dollars. Says Townson, “We don’t see the need to do dollar things. This is about Mission World Class...It will bring in the return on investment.”

Conclusion
In closing, let’s just reiterate the rationale for selecting based on core competencies. Core competencies help an organization achieve its strategic goals. Hiring people strong in those competencies should further advance the organization towards those goals. What is the benefit of such selection? It’s whatever the benefits of achieving those strategic goals are.

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