The thing with competencies is that they have no direct value. Remember that we said competencies are only the ability, the potential to perform well in a certain situation. So what is the value of a promise to do something well? Ultimately the value comes from how you actually perform, not your ability to. The promise needs to materialize for the value creation to occur. But there is a direct link between your ability and your actual performance, so there is some value for the competences on their own too. Actually, you as a competent person are two links away from the value. First the competence needs a context where it can turn into performance, and secondly you must capture the value of the performance.
The first hurdle you must take is that you need the proper context to excel in your competency domain. It is often said that great leaders are the product of their time. Presidents and other world leaders that stood out have been shaped by the times they lived in. Often a crisis enabled them to put their leadership potential into greatness. Or not. What would Abraham Lincoln have been without the context of the civil war? Would Martin Luther King have been an ordinary preacher when born 50 years later? On a less dramatic note it is safe to say that none of our competences can materialize into valuable action without the proper context. If you are good at flying a plane, you better be employed by an airline. If you are good at war strategy your competence will be most valuable in times of war. If you are a doctor, you need to encounter ill people to practice your competences. If you are good at accounting, you need to find firms in need of your services. Sounds logical, but if you don't have access to the proper context to bring your competences or talents into action, you will not see any value of them.
The second hurdle to tackle is to capture the value of your performance. Sometimes it is taken for granted that the one creating the value is also the one getting the value. That is a false assumption. Value creation and value capturing are two different things. Some companies have been great inventors, but were bad at capturing the value of their inventions, so other companies have grown through the roof with those ideas. Xerox is said to have laid the basics for modern computer interfaces, but it was Apple that captured its value in the first place, and later Microsoft. Being able to capture the value of your performance depends on the strength you have at the negotiation table of your 'value chain'. There are a lot of actors involved bringing a service to the market. If you write a book for example, it is custom to get 10% of the revenue as an author, the rest goes to the other parts in the value chain such as retailers and publishers. If you are an artist, you will pay a fee to your agent, you don't capture the entire value. What if the performance is a joint effort by a team of competent people, who gets what share of the value?
Ultimately the value the 'fool' is willing to pay for your competencies will be determined by the trust there is that 1) the competences (abilities to perform) will translate into actions (performance) and 2) that those can be made to money. Usually that 'fool' is an employer like a firm that has figured out how to capture the value of your actions. So that leaves the trust in your potential to materialize. That's why it is so very important to prove your competencies. The trust in proven competences that include proof of knowledge (learning), proof of previous experience (doing), and proof of reputation (sharing) is high, whereas the trust you have in vague, undocumented promises is much smaller. The value the 'fool' will pay obviously also depends on the perceived value of the performed activity. Not all activities are equally valuable.
The indirect link between competence and value also explains why employers have no direct benefit in developing your competencies. They only have an interest in what you DO on the work floor and for your customers, as that is what will ensure income for the company. When there is a trusted, proven link to educating employees in certain domains and performance in valuable activities, the employer will have a benefit in developing its workforce. So don't blame employers for not investing in your development unless it has a proven link to your (future) performance. It's just common sense.
Key point: Competencies have only indirect value, the real value is in what you DO, not in what you are ABLE to do. You as a competent person are two steps away from value. First your competence needs a context to materialize into performance. Secondly, you need to be able to capture a fair share of that value for yourself.
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