Not sure what the difference is between skills and competencies? We highlight the key differences, plus show you how you can improve both in the workplace.

Understanding the difference between skills and competencies is an important, particularly when considering performance management and learning and development. 

While they are sometimes used interchangeably, it’s important to distinguish the differences and understand how to use them correctly. 

Especially when 58% of respondents in a McKinsey survey stated that closing the skills gap at their company has become a priority.

Done right, you can see huge growth in employee performance, employee happiness and ultimately, business success. 

But what exactly is the difference between the two? 

In this blog, we’ll go through: 

• What are skills?
• Types of skills
• What are competencies? 
• Types of competencies
• Skills vs competencies
• How to develop skills and competencies

Let’s get started. 

What are skills?

Skills are strengths or abilities that individuals gain through experience or ones they develop as part of their lives. 

In the workplace, skills are important for a few reasons: 

• Skills can help you find the right talent for roles
• Skills allow you to define expectations in a job role and to define success 
• Skills can be selected for development

There are lots of skills that make up good employees and those skills will vary company to company, role to role and so on. 

Types of skills

There are thought to be two main types of skills; hard skills and soft skills. Here are the differences between the two as well as a few examples: 

Hard skills

Hard skills are technical abilities that form the base requirement for a professional to perform their role. 

This could be skills in particular tools or equipment, or it could be specialised knowledge that’s pertinent to their job or industry. 

For example, a software engineer would need hard skills around coding programmes and languages. A marketer meanwhile, wouldn’t have much use for that hard skill. 

Some examples of hard skills include: 

• Server maintenance
• Coding languages
• Marketing analytics
• Graphic design
• Database management
• Video editing
• Infection prevention

Soft skills 

Soft skills refer to nontechnical skills that individuals have. They’re not industry or even job-specific. 

They can be developed in school, the workplace, and can even just come from personality or upbringing. 

For example, soft skills like communication, creativity and organisation are all soft skills. While hard skills are helpful for technical ability, often soft skills are also necessary in order to activate successful working. 

Let’s look at a use case. 

Jenny is an office worker that supports a wider team with administrative tasks. She has hard skills including Microsoft Office. But her soft skills are what help her stay efficient. She is organised, motivated and really strong at prioritisation. 

Here some examples of common soft skills: 

• Adaptability
• Problem-solving
• Critical thinking
• Teamwork
• Organisation
• Creativity
• Communication

What are competencies? 

A competency is more than just a skill, it’s also knowledge and ability. It’s also a mix of behaviours and attitudes. Some people allude that soft skills are competencies, but it’s more detailed than that. 

Soft and hard skills come together alongside attitudes to create competency. You might have set skills in a particular coding software, but that doesn’t mean you will be a good developer. 

Of course, this is where it gets complicated. 

Competencies are much more sophisticated than skills. And for that reason, it can be harder to track them and more importantly, harder to develop them as it’s much more nuanced. 

Types of competencies

Competencies typically come in one of three categories; behavioural (or life skill), functional (or technical), and professional competencies. 

Let’s look at each in more detail: 

Behavioural competencies

Behavioural, or life skill, competencies are ones that people use to manage daily needs. They include wide range of abilities such as cooking and budgeting, as well as things like communication. 

Developing strong behavioural competencies allows people to build good daily habits that contribute to well-being. 

Behavioural competencies are important because they often make up the innate and subconscious of individuals. 

Functional competencies

Functional competencies, otherwise known as technical competencies, are ones that employees need to do their job. 

That could include skills like specific computer software knowledge, analytical ability or editing. 

When people are applying for roles, these are often quite easy competencies to show proficiency is as they’ll have years of experience, or practical knowledge. 

Professional competencies 

These are the skills that allow employees to succeed. That’s going above and beyond their role and excelling in their job. 

These are more general, but it’s usually a mastering of a number of skills that come together to help them perform well and advance in the workplace. 

For example, a salesperson needs communication skills and knowledge of a CRM to be able to perform their job, but they also need networking skills in order to excel. 

Skills vs competencies

Skills are generally easier to develop as they’re much more specific and will have better routes to advancement. 

Competencies make up knowledge, skills and ability, some of which can’t be improved or takes a long time to improve. 

Organisations may not have the resources to support development of certain aspects of competencies, meaning that their employees are always on the backfoot. 

How to develop skills and competencies

Developing skills and competencies can take a bit of time and organisation, but it’s not impossible. 

Ideally, you would have a platform to support this challenge. 

That’s where we come in. 

Competency or skill tracking, is available in both Totara Learn and Totara Perform. If you only have one, rather than both, then there will be some limitation to its use. 

But, with Totara at play, you can use competencies to map skills to people, and then map competencies to various forms of achievement, including courses, other competencies and manual ratings.

You can also set up achievement paths to decide how competencies are achieved. 

For example, a user could be automatically given the ‘Competent with supervision’ based on their assignment to the competency for holding a certain position – as you might assume this level of competency is a requirement for even being hired in that position. 

They may then have to complete courses or other competencies to achieve the ‘Competent’ rating with an optional ‘Highly competent’ rating available to be manually given by their manager.

Having this visibility around competencies allows for greater transparency when it comes to understanding where you’re at in your business and what steps you need to take in order to progress and develop. 

See how we could support you to integrate Totara into your LMS by booking a demo with our team.