From job‐based to competency‐based organizations

Abstract The efficacy of designing organizations around job structures is challenged. Although this approach has dominated the fields of organizational behavior and human resource management for decades, a number of forces have converged to suggest that a competency‐based approach often is more appropriate. In the global competitive environment which large, complex organizations face, the competency‐based approach and the capabilities that individuals need to acquire and develop should be the major focus. Reward systems, career tracks, selection systems, and the structure of organizations need to change to focus on competencies. The challenges and opportunities for research, theory, and practice development that a change to a competency‐based approach raises are many and diverse. For example, new pay systems are needed, new selection systems are needed, indeed whole new concepts about what constitutes selection validity and career development are needed.