We have diplomas, badges, certificates, endorsements, licenses, IDs, awards, and titles. Each of these communicate something to others. What gives credentials value? What makes them sought after or admired? Amid my exploration of past, present and emerging credentials, I’m still learning the answers to these questions. When I think I understand it, I find yet another type of credential or a new way of understanding how or why different stakeholders attach value to them. As it stands, however, I see three commons reasons why a credential is valued.
1. Social Currency
This is the dominant answer to what gives a credential value. Some credentials make you look good, but the extent to which you look good depends upon the value assigned to the credential by an audience. My first degree is from a Lutheran (faith-based) liberal arts college. That has significant social currency with some audiences, but it is seen as a lesser degree to others. My terminal degree is from a state University, which leads some to assign it high value while others see it as a second-rate credential. Similarly, there are some companies and firms that clearly value degrees from certain institutions more than others.
The social currency even trumps the competence of a person in some (perhaps most) cases. The assigned value is not necessarily based upon any objective facts about the diploma. It is perceived value and sometimes socially negotiated meaning around the credential. Nobel prizes are largely respected, but even such an award does not hold universal value. With some groups it is largely unknown and therefore a less valued social currency.
Social currency is complex, more complex that I first expected. I know an employer who is hesitant to consider hiring a person who graduated from the flagship state Universities or the liberal arts colleges. He explains that these schools train good generalists who know theory, but they can’t do the daily work that he needs completed. As a result, he is much more interested in people with more focused associates degrees who learned practical skills in the field. He is willing to pay top dollar to hire people who can do the work well, but is less interested in a generalist who will be dissatisfied with some of the more mundane tasks and will quite in 1-2 years. So, the person with an associate’s degree from a technical school has the more valued credential in such a context.
2. Mandate & Monopoly
Some credentials are established by authoritative individuals or institutions as mandatory for certain purposes. Without a driver’s license, it is illegal to drive a car. Without a medical license, you can’t legally practice medicine. As such, the license has value because it is established as the only means to a desired outcome, whether it is driving a car, practicing law or medicine, or checking out a library book. The credential is meant to represent that you met the established criteria established by the authoritative entity. If you lack the credential, you are denied access.
3. Practical Value / Perceived Competence or Quality
Still other credentials have value because they are closely connected to certain knowledge, skills or abilities. For example, a certified CPR credential is highly valued when someone needs CPR. Health care professions seek employees with very specific credentials because they represents readiness for a particular task. Even in less high-stakes situations, we see credentials as symbols of practical quality. We might want a certified massage therapist, even if there are no mandates by a community or state that practicing therapists have certifications. We assume that being certified means that you must be good (or qualified by some standard) at what you do. In fact, we even like our meat, eggs, and milk to have such credentials. The credential represents a quality standard that we value.
Sometimes the value of the credential is not as much for what other people think about it, but what it means for the person who holds the credential or very small group of people. My children went through swimming lessons where they earned certificates. Each certificate represented a level of skill from one to six. Level six is mean you are ready to swim independently, with less adult supervision. My children valued the credentials because each one represented their accomplishments and progress toward water independence. My wife and I valued them because they represented the readiness of our children to safely enjoy the water. We didn’t value them because of social currency or a mandate, but because that were closely connected to specific swimming skills.
There are plenty of other answers to the question about what gives a credential value, but these seem to be the three dominant ones. They become critical as we think about the growing discussions around alternate credentials, but they are also important as we look at changing views among different groups about existing credentials.