"Talent Management" continues to be a key challenge for procurement and supply chain groups. Like in a game of poker, nearly every procurement leader has been dealt a "hand" of employees with which they must play the game. Usually the hand cannot be altered by trading out cards. So...sophisticated managers are seeking to improve the capabilities of their employee groups.
But how can procurement leaders properly determine the competency levels of their team members (and their own skills too)? Skill assessments are a proven method to benchmark personnel capabilities, developmental opportunities, and training needs.
This article will discuss Three Types of Skill Assessments in use today:
Type 1 - Self Assessment Survey: This method of assessment is the most widely-used, and also the least accurate. In a self-assessment survey, a procurement or materials management employee is asked to rank their perceived expertise on each competency on some type of scale (1 to 10, etc.). For anyone who took Statistics 101 in college, the deficiency of this method is obvious...it is highly-subjective and lacks statistical viability.
Prior to hiring Strategic Procurement Solutions to build a professional development strategy and train their 120+ supply chain employees, a large company paid one of the largest Global SCM Consultancies to run a skills assessment evaluation for their organization. $35,000 (USD) later, the report was delivered and the company's management was furious. The consulting firm had merely sent an Excel spreadsheet to each employee which listed 32 "competencies" and asked the persons to rate their skill on a "1 to 6" scale with 1 being "Inexperienced", 3 being "Average", and 6 being "Highly Experienced". Of course, accompanying the consulting firm's report results were all sorts of bar charts and proposals for additional consulting services. But the company's CPO delayed payment for the analysis, and told the consultancy to provide something with "more than one data point". The consulting firm's answer? They sent a blank spreadsheet to each employee's direct manager and asked them to complete the survey. The final report thus contained two subjective data points for each employee's results...something which would be unacceptable to our professor in Statistics 101...
Type 2 - Behavioral Assessment: Relatively new in the field of skills assessments is a different type of questionnaire which asks employees about their workplace behavior in order to try and identify developmental needs. This type of survey has been used for decades in production management, but during the last half-decade is being modified by some training firms to try and measure workforce competency. The results are debatable.
An actual example from an online assessment tool fostered by a popular trade association asked participants, "In the last 12 months, how many times have you led a reverse auction valued at more than $100,000?" Possible answers were "None", "1 to 3", "5 to 8", and ">9".
The problem with any behavioral assessment is that it MUST be highly-customized to each position description which is being tested. It is also notoriously unreliable. Consider the sample question above being asked of a procurement employee who once had been the leader in a strategic sourcing role, but a year ago was asked to lead a project running all of a global company's materials management operations. Even though the person might be an expert at running reverse auctions, the wording of the question would make it look like they have little or no expertise in that competency area.
Perhaps not by accident, a properly-administered behavioral assessment must be customized at significant expense to the organization. Otherwise (probably also not accidentally), the resulting reports will indicate employee training needs which may not be real. Hmmm...might make one think the testing organization was trying to sell their own training services...
Type 3 - Knowledge Based Skills Diagnostic: The most-scientific type of assessment is one which actually measures a supply management professional's understanding of key competencies. This style of assessment does not utilize subjective inputs, but rather tests the understanding an employee has of "best practice" techniques related to certain competencies.
This style of assessment is a Knowledge-Based Skills Diagnostic. Similar in style to the questions in a professional certification exam, this measures how much the person actually knows....not what they think they know.
More than a decade ago, this assessment approach is the one Strategic Procurement Solutions chose to emulate in our Online Supply Management Skills Diagnostic™. Building upon methodology used by several leading organizational development firms, we developed a list of 24 competencies needed by today's supply chain leaders. These range from core SCM skills like Sourcing Strategy Development, Negotiations, and Supplier Management to soft skills like Customer Service, Relationship Management, Time Management, etc.
Our secure online testing tool contains pools of questions related to each competency. About half of each question pool can be answered by a procurement professional having solid understanding of practices associated with the competency. A third of the questions require advanced understanding. And one of the questions requires expert knowledge to answer right. Thus, our tool can accurately measure the knowledge possessed by all levels of SCM employees.
The strength of a knowledge-based assessment is that it can accurately measure how much a supply management professional "knows" about key areas of supply chain performance. From that accurate data, our firm customizes a commentary to the person's actual job description. Thus, we can tell a person who holds a Sourcing job role but scores 72% on Negotiations that additional training will be helpful. But that particular score would negligibly-impact an employee who works in Inventory Management so it would not be identified as a growth opportunity.
The only weakness of this third type of assessment is that it only measures knowledge/understanding. It does not evaluate actual job performance (that is why companies and governmental groups give employees job performance reviews). But a knowledge-based diagnostic can definitely tell us what training opportunities exist for any employee. For example, if the Sourcing professional in the previous paragraph was a good "seat of the pants" negotiator, their lower score on Negotiations indicates that they could be a great negotiator by understanding more leading techniques for planning, staging, and conducting a winning supplier interaction.
Mark McCormack once wrote in his bestselling book, What They Don't Teach You At Harvard Business School, "Today I believe in the importance of training more than the importance of hiring..."
Skills assessments are the first step in assessing a team in order to identify developmental opportunities. Otherwise you may be playing poker without knowing which cards are in your hand...!
Our knowledge-based Online Supply Management Skills Diagnostic™ can be easily set up by Strategic Procurement Solutions for any organization's personnel. This skills assessment is also a standard part of our 360o Supply Management Efficiency Review™. Information can be requested at Info@StrategicProcurementSolutions.com
