Competencies are used by more organizations than any other talent management tool, yet for many HR professionals, there are still so many unanswered questions about what they are and how they can be used to drive organizational success.
In this blog post, we have rounded up some of the top questions about competencies and provided straightforward answers to help you understand the role competencies play in the talent lifecycle.
A competency is an HR tool that describes the knowledge, skills, and abilities required to perform a job requirement successfully.
A well-constructed competency describes these dimensions in detail and translates them into observable behaviors so that employees, managers, and HR teams can all agree on what success looks like on the job.
How do competencies differ from skills?
Competencies are more multidimensional than skills. In fact, skills make up just one of three dimensions of a competency. Every competency includes the skills, knowledge, and aptitudes needed to perform a specific job requirement:
Knowledge is a practical understanding of the concepts or models involved in performing a job requirement.
Skills are the application of knowledge to a job requirement through training or experiences.
Aptitudes are natural abilities that may not have required studying, training, or experience.
Competencies are the most widely used approach to talent management -based management in the world, and one that delivers measurable results. The business case for competencies is clear. Organizations with fully developed competency management programs not only enjoy better employee engagement, but also enhanced business success, including increased revenue, customer retention, customer satisfaction, and market penetration.
A competency model (also called a competency profile) is a group of competencies required for successful performance in a specific role.
The most useful competency profiles describe the competency at a specific proficiency level, from basic to intermediate to advanced.
A competency profile must meet three basic criteria:
A competency architecture provides a set of rules to help HR professionals build consistent, interrelated competency profiles for every role in the organization. These rules guide the selection of competencies and specific proficiency levels for each role.
Common elements of a competency architecture may include core competencies, job family competencies, technical competencies, and general (or universal) competencies.
By applying a consistent logic to the selection of competencies across all organizational roles, the organization can see more clearly how the requirements for different roles overlap and interrelate. This, in turn, can help employees to explore new internal career paths and enable managers and HR to identify candidates for internal promotion.
Core competencies help your organization to achieve its business goals, vision and mandate. Because they are "core" to the organization's success, they are always applied to every role across the organization.
General competencies (also called "universal" competencies) define various abilities, motivations, and traits that are applicable to a wide range of roles within the organization. Examples of universal competencies include "adaptability" or "attention to detail." Universal competencies are similar to “soft skills” that people in very different disciplines may need. For example, the same “adaptability” competency may be required for success in marketing, accounting, and IT.
Technical competencies define the specialized knowledge, skills, and aptitudes that are only needed to perform effectively in a specific role, such as "digital marketing," or "civil engineering." Unlike universal competencies, which can be relevant to a wide range of roles in different departments, disciplines, or industries, technical competencies tend to be relevant only to a specific domain. A role in data analytics, for example, may require a competency in “data mining” that would not be required for any other role in the organization. Similarly, a role in law enforcement may require a specific competency in “interviewing victims and witnesses”—a competency that would be applicable to very few roles outside of policing.
Leadership competencies translate the behaviors and attitudes of successful, transformational leaders into defined, measurable traits that inspire individual and team success, and drive performance and results. Leadership competencies are generally applied to roles at the leadership level of the organization. Examples of leadership competencies include "inspiring others, "leading change," and "embracing diversity."
Every competency includes a collection of behavioral indicators. Each behavioral indicator provides a clear description of an observable behavior that a successful employee will demonstrate on the job.
For example, for the "client focus" competency, the behavioral indicators might include:
For multi-level competencies, each level of the competency, from basic to intermediate to advanced will have its own cluster of behavioral indicators. This enables employees, managers, and HR professionals to identify what each progressive level of proficiency for that competency looks like.
While single-level competencies provide a general statement Multi-level competencies include behavioral indicators that identify levels of proficiency against the competency on a progressive scale, from basic to advanced performance.
This structure not only provides more detail and accuracy, it enables HR professionals, managers, and workers to visualize the steps they need to take to gain greater proficiency in specific areas. The level of detail that a multi-level competency provides gives everyone in the organization a shared language to guide discussions about performance and greater accuracy when talking about specific workplace behaviors and expectations.
Competency-based management is an HR approach that uses competencies to drive the entire talent lifecycle, including hiring, assessment, development, and retention.
The process begins with developing a competency architecture for your organization. This is usually developed with help from a consulting services or by using specialized competency technology. With the architecture in place, competency profiles (or models) can be created for every role in the organization, and these profiles become the foundation for talent management.
Because multi-level competencies provide a higher level of detail to define what successful performance in a specific role looks like, they help to clarify role requirements—both for the organization and the role applicant. This helps to ensure greater alignment between the pool of applicants and the role requirements, as applicants can self-select, and the organization can screen applicants more accurately.
There are two ways in which competencies can be incorporated into the recruitment process:
The competency profile can be added to the job ad so that job seekers have access to this information and can determine whether they meet those requirements.
Managers can assess employees—or employees can self-assess—against their ability to perform their current role using the behavioral indicators included in the role's competency profile. The employee can also be assessed against the behavioral indicators for other roles to determine their readiness to take on future roles.
Development resources, including online courses, books and articles, on-the-job activities, and mentorships, can be linked to specific behavioral indicators. This gives managers and employees access to development opportunities that are highly targeted and directly relevant to the role requirements. Whether employees need to improve performance for an existing role or acquire new competencies or proficiency levels ahead of a promotion or lateral move, they can easily and intuitively create a development plan that aligns with their goals.
Career pathing enables employees to explore new roles within the organization and helps the organization identify and develop internal talent in ways that align with business goals.
When competencies are used to define every role, it's much easier to support career pathing activities. Using self-assessments, 180s, or 360s, employees, managers, and HR teams alike can compare the data against the requirements for any role in the organization to see the gaps and areas of alignment. This information, in turn, can be used to create a development plan to prepare employees for their next career goal, whether it supports a vertical or lateral move.
Competency technology integrates competency content with artificial intelligence and big-data capabilities to streamline the creation of competency architecture and competency profiles. Competency technology may also competency-based management processes, including assessment, recruitment, development, and career pathing.
Because the development of competency architecture has historically been a complex, specialist activity requiring a significant investment of time and effort, using competency technology significantly shortens the timeframes on launching a competency initiative and helps the organization see ROI sooner.
Continue the learning by exploring HRSG's Resource Hub, which includes curated tools, best practices, and information about competency-based management. For more formal learning opportunities, consider registering up for online training and certification through the Competency Academy.