Hiring has never been as tough as now for employers. Job roles are changing, the digital era requires new skill sets and one cannot just make a call about the direction the company might take. So what do hiring managers do? Some go by credentials while recruiting. Others swear by competencies.

Competency-based hiring is not new. Several companies have a list of competencies – both position-specific and organisational – that they look for when they hire. For some companies integrity may be the top competency. For others it may be interpersonal skills, and so on.

But Volvo Eicher Commercial Vehicles (VECV), the joint venture between the Volvo group and Eicher Motors, decided to overhaul its approach to competencies.

“All organisations have competencies in some form or other. We wanted to be different. Instead of doing the usual leadership, communication, relationship management type of competencies, we thought of coming up with a list that would stick in the minds of our people,” says Kinjal Choudhary, senior vice-president & CHRO, VECV.

After deliberations the list of eight competencies it drew up was Scientist, Introspector, Executor, Collaborator, Owner, Strategist, Magician and Innovator. The idea was to make the names catchy so that they would stick in people’s minds. “It was not an HR initiative alone but the entire leadership was involved in drawing up the list,” says Choudhary.

Though the names sounded fascinating, people did not understand what they meant. So then the company had to undertake a massive communication exercise to translate what these meant. That a Magician denoted someone who could draw clarity from ambiguity and do seemingly impossible tasks. A Scientist was a curious person who would keep asking questions.

To explain it simply, it took clips from movies, sports and advertisements. For example, for Owner, a person who assumes accountability for overall results, it showed clips from the movie Guru , and how he follows through his passion despite criticism and discouragement.

But then when it was time to use these competencies in hiring, the company faced another challenge. How would the eight competencies work across levels? “The competency of ‘Owner’ at CXO levels will be different from that at an entry level. You could not apply the same definitions for a shop floor person and an SVP (senior vice president),” points out Choudhary.

To resolve this, the company came up with varying definitions for different levels. It also created a huge question bank to draw out candidates’ competencies.

In competency-based interviews, questions are specific, with the intention of drawing out anecdotes. “The functional interviews tells you what the candidate has done. In a competency interview, you get a view of how the task was done,” explains Choudhary.

For instance, you might ask “How did you take a strategic view of GST implementation in your company?”

These are specific instance-based questions where the candidate cannot fudge. Second, it tells us the behaviour of the person at work, and you can match it with the desired behaviours, he says.

Also, the questions are designed in a way to bring out the individual contribution vs team effort. Right now, VECV is in the midst of training all its hiring managers.

“People are more comfortable doing functional interviews than competency-based interviews. So this is an entrenched kind of change process,” admits Choudhary.

But it’s not just for hiring that VECV has introduced the competencies. The idea is to use it across the employee life cycle in the firm. “We want people to use this in everyday work,” says Choudhary.

Even before it was introduced for hiring, VECV began using competencies it in its performance appraisals.

“We had our mid-year appraisal, basis the competencies. Typically people talk about attitudes and so on. But we made sure everybody got a 360-degree feedback basis the competencies,” says Choudhary.

VECV plans to use the competencies to decide on promotions. “We are preparing the ground for that.” It will also be used for career growth and development within the organisation, he says.

So what’s the ROI of a competency-based approach? Is the pay-off worth it?

“The ROI is you get a better culture fit. During hiring, a functional interview will only tell you whether the person has domain knowledge. But in a competency-based interview, you can gauge the behaviours that will fit within the organisation,” answers Choudary.

What are the possible challenges in implementation? “One of the pitfalls of competency-based evaluation is people go by flash-in-the-pan situations,” he says. If somebody fails at something, they are labelled as not good at executing. But competencies have to be mapped over a longer period of time. “Competencies are manifested behaviours at the workplace over a period of time, explains Choudhary.

That may be so – but doesn’t the competency approach add too much complexity? After all, VECV has had to spend 4,500 man hours of training to make each and every one of its 2,137 employees understand the eight competencies. And implementation is a nightmare.

“Competency becomes critical when you focus on culture,” defends Choudhary. And today culture is very important when we are facing tectonic changes, he says. For instance, commercial vehicles industry will soon be hit hard when electric vehicles replace diesel or when self-driving vehicles come into play.

“We will not be able to survive unless our people demonstrate certain behaviours,” argues Choudhary.

That, in fact, was one of the raisons d’être of introducing this approach. It’s still early days – but VECV’s experiment and how it tides through the coming changes could be a case study.

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