This is part one of a two part series on building competency models by Edward J. Cripe. The second post can be found here.
Job competency models describe what superior performers actually do on a job that produces superior results. Armed with this information, selection, retention, training, succession planning, and performance management systems can be integrated and designed to attract, develop, and retain top performers.
Superior performance that produces superior results means higher sales, productivity, and profits. And everything can be measured. Which explains why many organizations have embraced competency-based talent management. It has provided human resource departments with an opportunity to demonstrate to line management that HR is able to “add value” that improves organizational performance.
However, there are several factors to consider before attempting to develop and implement a competency framework for talent management – factors that can make or break your best efforts.
1. Accept or modify the terminology and educate the users.
The language that consultants use to describe competency systems is often confusing, misleading, and filled with jargon. It starts with the definition of competencies.
A competency is a “skill, knowledge, motive, attitude, or personal characteristic that causes or predicts outstanding performance.” Most standard dictionaries, however, define competence and competency as sufficient or average performance as in “competent to stand trial.” With the opposite side of “competent” being “incompetent,” the image that competency systems may raise for some people is that of incompetence, an implication that people are incompetent until receiving the benefit of competency modeling.
In truth, one of the purposes of competency technology is to help competent people become more competent – in areas where increased competence will produce superior performance. Each of us has strengths and areas where we can improve. Competency modeling just does a better job of identifying the specific competencies that drive superior performance and assessing the degree to which individuals have demonstrated those competencies. Once employees understand the concept and the purpose of competency modeling, they usually accept it
A competency model does a better job of conveying the idea of superior performance because the word model means “something to be copied or imitated”. A job competency model, therefore, is a “blueprint” for all current and prospective job-holders to copy, that includes a list of competencies that are required for superior performance. Competencies required for average performance, those required to just survive in a job, can also be spelled out in a job model.
Don’t expect everyone to immediately understand and appreciate the significance of competency modeling. Some may feel threatened by it. Go slow and educate people at the beginning and as you progress.
2. Think in terms of measurable payoffs.
The key question to ask yourself and others in your organization is: “what is superior performance worth?” This is easier to answer for some jobs than others, but there is an answer for every job. It first requires clarity about performance measures.
Since sales jobs have fairly clear measures, let’s look at a sales job to illustrate the point. If the average annual sales for all sales people were $3.0 million and the top sales people averaged $6.7 million in annual sales, superior performance would be worth $3.7 million in sales per sales person. Now translate this into the bell-shaped curve that depicts the distribution of performance ratings in many organizations. If you can increase the percentage of superior performers and move the curve to the right, you will add economic value. Each sales position that is filled by a superior performer will add $3.7 million of sales per year. (This is an actual example from a client organization.)
Line executives understand this kind of thinking, where they often do not understand other HR approaches that are seen as having little impact on the bottom line.
3. Start small or with a critical, highly-visible job?
The best way to demonstrate the payoffs of a competency approach is to start with a high impact job or one that is requiring attention, i.e. high turnover, impact on company’s sales, etc. Define the measurable outcomes of doing the model and specify the applications.
For example, if you want to do a model of a software developer position, include an application of a selection system and interview guide that will allow you to expand the candidate pool and select superior performing software developers. Other applications can be added, but you should start with at least one visible and measurable outcome for the model. If outcomes and applications are not built in, competency modeling may be perceived as a HR exercise without payoffs.
There is a natural tendency to want to start with a low risk, low visibility position.
But, another good place to start is with the top executive group. Getting that group to develop a model for their position increases buy-in. Top management may have already gone through a strategic planning exercise that included identifying their organization’s “core competencies”. Developing a model helps them understand the job competency process and align it to the company’s strategy. For example, if innovation is a desired core competency, then a “fostering innovation” competency may be included in most models in order to drive the kind of change needed. An executive model is also needed for a good succession planning system.
The last three considerations before building competency models can be found here.
Edward J. Cripe is President of Workitect, Inc., a consulting firm specializing in competency-based talent management and development. Ed has 40 years of experience in job competency modeling, HR, and talent management, including consultant positions with Hay/McBer and AchieveGlobal.