Competent employees are the main resource of any organization in acquiring a competitive advantage. Land, buildings or materials do not yield company productivity, rather, it is ‘people capital’ that runs a business and produces value from existing resources. HayGroup (2004) point out that an organization’s best source of competitive advantage lies with its employees. Strategies, business models, products and services can all be copied by competitors, but talented and competent employees represent a sustainable source of differentiation. The demand for effective and competent employees continuously increases in both public and private organizations because a dynamic global marketplace and increasing foreign competition has compelled organizations to become more effective and flexible in response to the rapidly changing environment. As a result, this is a suitable time to assess human resource management (HRM) practices that can augment organizational performance in public sector organizations (Gould-Williams, 2003). Organizations try to increase their capabilities by investing more in training and
management development and Ichniowski et al. (1996) state that HRM practices have a
greater effect on organizational performance than on individual performance. Moreover,
human resource development encourages competency development by forming opportunities within the organization for employees to develop their competencies for both their own benefit and the benefit of others (Rao, 2000a; Rodrigues & Chincholkar, 2005). The competency-based approach has become integral in HRM during the last thirty years and, currently, different organizations, businesses and public services use competency models to better integrate global trends and business strategies with their human capital resources. Competency encompasses the knowledge, skills, abilities, traits and behaviors
that allow an individual to perform a task within a specific function or job. In accordance with this approach, competencies are used as the basis for human resource management.