Trends & Smart Practices in Competency Modeling

Two preconditions of a world class talent platform that drives superior outcomes for all stakeholders:
a talent mindset pervading the organization and an integrated and effective talent framework
TALENT MINDSET
  • Talent processes are taken as serious as any other business process
  • Line managers own and drive people processes and are fully accountable for talent outcomes

Enterprise perspective

  • Talent is shared across the enterprise instead of just managed within individual business units
  • Top management clearly promotes the interests of the enterprise

Purpose, performance and principles

  • Organizations need to be purpose-driven, performance-oriented, and principles-led in order to achieve superior productivity and growth, fueled by a positive organizational climate and high engagement
TALENT FRAMEWORK
  • Consistent definitions, language and tools
  • High connectivity of all talent and performance processes

Simplicity and transparency

  • Simple, intuitive processes and self-serviceable systems secure high acceptance and application
  • Both, simplicity and transparency drive management accountability

Balancing the tensions

  • Between individual performance and collaboration/ collective performance
  • Between exploit (today) and explore (tomorrow)
  • Between internal employees (with open-ended contracts) and agile workers

Use competencies to develop a practical “theory” of effective job performance tailored to your organization
ANALYZING
COMPETENCY INFORMATION
  • Consider organizational context (e.g. digital transformation, restructuring)
  • Link competency model to the organization’s mission, vision, values, and business strategy
  • Identify the competencies which are most critical for success in different contexts
  • Consider global relevance and cultural nuances
  • Design future-oriented success profiles
  • Classify competencies into threshold competencies, specific differentiators, and key development areas

ORGANIZING
COMPETENCY INFORMATION
  • Define the anatomy/structure of the competency (model)
  • Consider hybrid career models and define levels of proficiency on competencies
  • Define target areas for success profiles (role-specific, functional area-specific, job level-specific, company-wide)
  • Define a proper level of granularity (number of competencies and amount of detail, e.g., 10 core plus 5-15 job-specific)
  • Leverage competency libraries as only a starting point and tailor the labels , definitions, and proficiency levels to your particular needs

USING
COMPETENCY INFORMATION
  • Use organizational language and organizational development techniques to ensure acceptance and use
  • Use competencies to develop and align HR systems (hiring, appraisal, promotion, succession planning, learning & development, compensation)
  • Use information technology to enhance the usability of competency models
  • Raise rater reliability: train and evaluate them
  • Determine how you will measure your results
  • Revisit and refresh the competency model over time

Use competencies to develop and align your HR systems

HIRE NEW EMPLOYEES

by using assessments and other selection procedures that measure the competencies. The fact that models often attempt to distinguish the characteristics of top performing employees from average employees makes them especially useful for selection. For example, executive succession programs are commonly guided by competency models in most organizations today.

TRAIN EMPLOYEES

by creating courses aimed at the development of certain competencies. For example, executive development and coaching programs often have a competency model foundation. Likewise, many 360 surveys used for development are based on competency models.

EVALUATE THE PERFORMANCE

of employees by structuring the appraisal instrument around the competencies. Models that depict levels of proficiency for each competency are especially useful for appraisal.

PROMOTE EMPLOYEES

by using the competencies to establish promotion criteria. Models that depict job grade or pay levels for each competency are especially useful for promotion.

DEVELOP EMPLOYEE CAREERS

by using the competency models to support career and succession planning, to guide the choice of job assignments and make other career choices. Again, models that define job grade levels are especially useful for this purpose.

MANAGE EMPLOYEE INFORMATION

by using the competency models to record and archive employee skill, training, and job experience information.

COMPENSATE EMPLOYEES

by using the competency model to structure pay differences between jobs or to evaluate employees for pay increases. The link to business objectives and performance levels facilitate the use of competency models for pay purposes.

MANAGE RETENTION OF CRITICAL SKILLS

and reduction-in-force activities through the identification and measurement of competencies tied to current and future organizational objectives.

SUPPORT ORGANIZATIONAL CHANGE EFFORTS

by developing broad systematic support of future-oriented competencies. The ability to train, assess, select, promote, and reward employees in alignment to a desired future state can help speed organizations through transition.

Further reading: Campion M. A., Fink A. A., Ruggeberg B. J., Carr L., Phillips G. M., Odman R. A.: Doing competencies well: Best practices in competency modeling; in Personnel Psychology, 2011, 64, 225-262

Major Challenges in Competency Modeling

  • BEST OF BREED
  • CULTURAL TRANSFERABILITY
  • REASONABLE COMPLEXITY
  • LINK TO PERFORMANCE

  • top-down approach to define strategic direction and future requirements
  • bottom-up approach to ensure buy-in, validity and practical relevance

  • ensure a global common understanding
  • explore to what degree the cultural differences affect the construction of meaning by people situated in different cultures
  • blend the competency model with their understandings from their professional practice in their country

  • depending on how many competencies are needed to accurately predict high performance
  • depending on how you intend to use the model (considering its fundamental importance, from recruiting to succession planning)
  • depending on the model structure (e.g., serving multiple career paths, different job families, and different job levels)

  • Link competency model to performance evaluation and communicate a practical “theory” of effective job performance
  • the business objective linkage of competency models is critical to the interest and commitment of senior management
  • the most effective proficiency anchors will have a clear linkage or alignment to organizational goals
  • they usually include a description of
    • the process: how effective performance occurs as well as
    • the content: what is effective performance
  • aligning competencies to organizational goals may result in competencies that are complex or multidimensional – however, this additional complexity is intended to enhance the usefulness of the model
  • such competencies are provocative and promote thought and discussion about effective job performance
  • avoid a hodgepodge of competencies and an ill-defined concept with no clear meaning/impact

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