Saturday, May 30, 2015

Why credentialing is so important

By Steven M. Worth, President at Plexus Consulting Group, LLC

The concept of credentialing has been growing strongly—particularly since the late 1980s when the signatory countries of the Uruguay Round Multilateral Trade Agreement stipulated for the first time that global standards should be developed by competent authorities (i.e., organizations made up of reputable professionals with no political or nationalistic agendas) using inclusive and transparent processes as defined by the International Organization on Standardization (the Geneva-based ISO). The Uruguay Round signatories observed that the lack of such standards encourages discord about what constitutes a safe product or a competent professional and that this discord has been a barrier to trade (otherwise known as a non-tariff trade barrier).

This international treaty mandate has been passed on to each of the signatory countries (well over a hundred—including the United States) where it has been incorporated into national regulations. These regulations stipulate that the national government must not be involved itself in the creation of these standards, but that the appropriate regulatory agencies may work with and encourage nonprofit trade associations and professional societies to do so. This has the potential to vastly empower nonprofit organizations that represent industry sectors and professions of all kinds.

In order to link all these national standards making initiatives together, each nation should designate an agency or agencies to coordinate their nation’s work with the ISO so to create more uniform global standards for all products and services that are traded commercially across national borders. For the US these agencies are the American National Standards Institute (ANSI) and the Institute for Credentialing Excellence (ICE—formerly known as NOCA). ANSI and ICE recognize and endorse the work of standards making organizations that do their work in an appropriate manner.

What is credentialing:

There are several categories of credentialing. Terms are often used loosely and because of that they cause confusion, but it is important to know the difference. The following definitions follow ISO guidelines:

Certification—certifications are bestowed on individuals who have proven they have mastered a certain level of competency that defines an activity or profession. When such a credential is required by a state or national governmental entity it is called a license. In such cases licenses are required before a person can practice their profession such as doctors and lawyers. Certifications and licenses are usually valid for a certain time limit before they must be renewed. Renewal ensures that person has kept up their knowledge of the latest changes in the field and have maintained their competency. Competency is demonstrated through independently developed and administered tests and/or field experience.

Accreditation—organizations are accredited—so schools are frequently accredited. Accreditation establishes that organizations have met certain minimum standards. Where accreditation is required under state law it is also called a “license to operate”—so hospitals and restaurants and other establishments open to the public are licensed. Accreditation is demonstrated through independently conducted audits that verify the organization meets minimum defined standards and is renewable.

Certificates and badges—these are credentials that indicate a person participated in a certain program or activity but they do not necessarily demonstrate competency or mastery of the subject. There is no test involved, but such certificates or badges are valued because they demonstrate to others that a person has in fact taken the time to try to improve their skills—and this is important, particularly to employers who may have paid the inscription costs!

Why is credentialing important to associations:

1) Credentialing starts by defining the body of knowledge and/or performance standards that represent competency in a certain profession or activity. The organization that is the first to do this for a sector or profession has by definition credibility and status as a pre-eminent authority in its field.

2) It also creates several non-dues revenues streams from:

  • The production and sale of texts and learning tools of various kinds
  • Courses and the teaching and/or coaching fees associated with them—both online and in person
  • Testing fees
  • Continuing education requirement and retesting
  • Franchising fees, should the association wish to set up licensing agreements with other educational organizations for delivering their coaching, education, training, and testing programs

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