Resources How-to's The basics of competency management


The basics of competency management

What is a competency?

Competencies are also called: behaviors, skills, values, performance dimensions or performance standards. Where goals or objectives describe "what" you want an employee to accomplish, competencies describe "how" you want them accomplished. As such, cultivating and managing competencies is an important way to foster employee and organizational high performance. They're also a key way to define and strengthen your organizational culture and to strengthen your competitive differentiators.

How do you create a competency framework or model?

You create a competency framework or model for your organization and for each position in your organization by identifying the key abilities required to improve performance and achieve success.

When choosing core or organizational competencies, identify the abilities that:

  • embody or represent your organizational culture
  • are required for success or leadership in your industry
  • support your organization's strategic goals
  • set your organization apart from the competition

For example, you might select competencies like innovation, creativity, technical expertise, quality, customer focus, or safety, as your core organizational competencies.

In general, it's best to identify the 4-6 most important core competencies for your organization. A larger number of competencies will be difficult to cultivate and will dilute your efforts.

Then, for each competency, create:

  • a short description
  • examples of the behavior to provide clarity
  • descriptions of the levels of mastery
  • suggested learning activities to help develop increased mastery

There are lots of off-the-shelf competency libraries available to help you with this exercise. You can use the competencies and definitions included as is, modify them to suit your own industry, culture and requirements, or create your own specific library of competencies from scratch.

Once you've identified your core competencies, you can repeat the exercise for each role or area in the organization.

When choosing job-specific competencies, identify the abilities that are required for success and high performance in the job.

Some organizations also choose to identify a set of leadership competencies that they want embodied by all levels of their management team.

Again, try to keep the number of competencies you identify for each job reasonable and manageable. Keep their definitions specific but general enough that they can be consistently applied to all jobs that require them. For example, you don't want to have more than one competency that describes how to answer the phone and interact with customers, even though multiple employees will demonstrate this competency in different ways and in different degrees in their day-to-day work.

The competencies in your framework or model should remain relatively constant over time. But you should periodically revisit your list and definitions to ensure they still reflect your needs and support your strategy; this is especially important if your organization or industry experience a major shift that impacts your competitive landscape.

Now what do you do with your competency library or framework?

Cultivate them in your organization - at all levels. Here are some suggestions for how to do that:

  • Communicate your competencies to all employees. You can: make a competency handbook available to all employees, post the list and definitions of your competencies on your Intranet, include competencies in your employee handbook, post some or all of them in a lunchroom, discuss them in your employee newsletter, etc.
  • Include core and job-specific competencies in job descriptions so every employee knows what is expected of them.
  • Include core and job-specific competencies in job requisitions so you hire people who already demonstrate these competencies.
  • Include core and job specific competencies in performance appraisal forms so managers assess every employee's demonstration of them and put development plans in place where performance gaps exist.
  • Make sure you reward employees based on their demonstration of competencies as well as their achievement of goals.
  • Ensure your learning organization has a variety of learning paths and learning activities to help develop the competencies in your framework. Map your learning activities to the specific competencies they help develop. This competency mapping guides managers and employees in their selections.
  • Make your core competencies a part of your organization's "vocabulary" and ensure they're included or referenced in employee communication, corporate presentations, etc.

Your competency model and the specific competencies you assign to each job provide a blueprint for your managers and employees, so they develop the skills they need to succeed as individuals and the skills your organization needs to excel in its market. By identifying, defining and cultivating core, leadership and job specific skills or competencies, you create strong culture, foster high performance and align your workforce.

Read how others have cultivated competencies in their organizations

At CarVal Investors, they developed a more meaningful competency framework and language, specific to roles within the organization. Now their competencies resonate with employees and are being used to build individual and organizational strength.

The Teachers Mutual Bank incorporated a series of competencies into each employee job description, which are linked to an appraisal form. Employees now have full-circle visibility into their role and performance within an integrated system.

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