Examining the role of key competences in firm performance

Abstract

Purpose Industry 4.0 processes brought dramatic changes in skills and competences needed at the firm level. The purpose of this paper is: to identify and quantify key competences required for workers with economics-and-business background; to evaluate development level of those competences among the currently employed workforce; to investigate degree of match between required and currently developed competences; and finally to assess how this (mis)match translates to firm performance. Design/methodology/approach This research is based on primary data, collected through questionnaires, and secondary data of firms’ financial and structural characteristics. Key competences were estimated using factor analysis and were then used as covariates in explaining differences in firms’ performance in both static and dynamic production function specifications using standard regression model, Heckman selection model and Arellano–Bond estimation. Findings Results show that mismatches in competences basic algebra; collectedness, conflict resolution and presentation; and motivation and organization are all negatively associated in explaining the variation of firm performance, with motivation and organization having the most significant effect. Originality/value This paper focuses on competence mismatch by including both sides of the labor market (employers and employees) in the analysis. This paper offers: a theoretical structure for understanding and investigating existing competence mismatches; a step-by-step industry-driven method for deriving key required competences, including an initial exploratory phase (combination of literature review, exploratory interviews and pilot study) followed by a descriptive and implementation phases (design, implementation and analysis of nationally representative survey); and finally, analysis phase (associating competence mismatches to firm performance).

Impact of artificial intelligence on employees working in industry 4.0 led organizations

“…The fourth industrial revolution (I4.0) has brought about a paradigm shift, in business processes. It however calls for upskilling and integration of human resources with operations (Bag et al , 2020a, b; Škrinjarić and Domadenik, 2019). This idea was introduced at the Hannover Fair (2011) and thereafter it was officially recognized as a strategic initiative by Germany (2013), symbolizing industry pioneers bringing about a revolution in the manufacturing sector.…”

The emotional and social side of analytics professionals: an exploratory study of the behavioral profile of data scientists and data analysts

“…Organizations are progressively embracing a data-driven culture that puts big data technologies and their related analytic methods at the center of their work (Ciarli et al, 2020;Davenport and Harris, 2017;Gandomi and Haider, 2015;Lorenz et al, 2015;Singh et al, 2021;Skrinjari c and Domadenik, 2020;Vidgen et al, 2017). While investments in big data technologies are becoming of paramount importance, it is at least as important to build a team of data science professionals who can use these technologies effectively and who possess the set of competencies needed to acquire, organize, process and present data effectively (Davenport and Patil, 2012).…”

Analyzing the impact of stock options on talent retention and knowledge product generativity at knowledge intensive firms

“…Knowledge worker retention may have an impact on company performance through value creation and profit maximization (Škrinjarić and Domadenik, 2020). Firms may develop unique value by employing knowledge workers that set them apart from their competitors' market dominance and may achieve profit maximization (Xie et al.…”