Brief Guide: Competency Management

In a world of rapid change and competition, being able to adapt and innovate is key for businesses. Underpinning this ability to adapt is one big concept: competency management. Understanding competency management can help you tackle the brain drain of your skilled employees and adapting to the rapid changes in skills brought about by automation and artificial intelligence.

This article will get to the heart of competency management, its parts, benefits and practical how to’s. Whether you’re a business leader, HR professional or just interested in the topic, this quick read will give you the lowdown on how competency management can transform your organization.

What is Competency Management?

Competency management is the process of identifying, tracking and optimizing the skills, knowledge and behaviours that employees need to perform their roles effectively. It involves aligning individual competencies with the organization’s objectives to ensure that staff are prepared to meet current and future needs. Competency management aligns individual competencies with business objectives to ensure employees possess the necessary skills to meet organizational goals.

Competencies can be defined as the combination of skills, knowledge, attitudes and behaviours that enable an individual to perform a task or role successfully. Competencies can be technical (e.g. the ability to analyse data), functional (e.g. project management skills) or behavioural (e.g. effective communication and teamwork). Behavioral competencies are required for various HR processes including recruitment, talent management, training and performance appraisal. Communication skills, as one of the most important competencies, improve the efficiency and effectiveness of an organization.

By focusing on competencies, organizations can:

• Identify skill and knowledge gaps.
• Develop targeted training programmes.
• Ensure that employees are in positions that match their strengths.
• Plan for future workforce needs and succession.

Core Components

Competency frameworks define the skills and behaviours for each job role in the organization. Competency management involves:

1. Competency Model

A competency model is a framework that outlines the competencies required for each role in the organization. A competency model will usually include:

• Core Competencies: These are the skills and behaviours that are required across the whole organization, such as adaptability or problem solving.
• Role Specific Competencies: These are specific to the job function, such as coding skills for software developers or negotiation skills for sales people.
• Leadership Competencies: These are the skills required for management and leadership, such as strategic thinking and decision making.

2. Competency Assessments

Competency assessments involve evaluating employees’ current competencies to identify strengths and areas for improvement. Methods for competency assessment include:

• Self-assessments.
• Peer reviews.
• Manager evaluations.
• Skills tests and simulations.

3. Development Plans

Once gaps are identified, development plans are created to address them, focused on developing competencies in HR and L&D strategies. These plans will often include a combination of training, mentoring, on-the-job learning and formal education.

4. Competency Mapping

Competency mapping is the process of developing a competency management process to link individual competencies to organisational objectives. This ensures the workforce is able to achieve short term goals and long term strategic plans.

5. Technology Integration

Modern competency management uses technology, such as HR software or Learning Management Systems (LMS) to track competencies, assess performance and provide training resources.

How to Implement Competency management

It can seem daunting to implement competency management but a systematic approach will make it easier. Here’s how:

• Define Organizational Goals: Start by understanding your organization’s strategic objectives. What are your short term and long term goals? Competency management should be linked to these goals so it’s relevant and effective.
• Develop a Competency Framework: Develop a competency framework is key when creating a framework that’s tailored to your organization’s needs. Involve key stakeholders including HR, managers and employees to ensure the framework is comprehensive and practical.
• Assess Current Competencies: Tracking and validating employee skills is critical to ensure regulatory compliance and operational safety. Assessing employees’ skills ensures they meet the requirements of their role and align to organisational goals. Organisational skills are important when assessing to evaluate employees’ current competencies. Use a combination of methods to get a full picture of strengths and gaps.
• Development Plans: Based on the assessment results create development plans for individuals and teams. Mix of learning methods to suit different learning styles.
• Technology: Use technology to simplify competency tracking and training delivery. HR software and LMS platforms can provide valuable data and insights to inform decisions.
• Monitor and Review: Competency management is an ongoing process. Monitor progress, update the competency framework as needed and review development initiatives.

Benefits

Competency management benefits organisations, employees and customers. Here are the top ones:

• Better Performance: Matching employee skills to job requirements means organisations can get the best out of their workforce. Employees will perform better in their role and be more productive.
• Employee Engagement: Competency management helps employees know their strengths and areas for development. Clear development paths and opportunities to upskill means employees have purpose and motivation.
• Succession Planning: With a clear view of the skills required for key roles, organizations can identify and prepare future leaders. No more surprises when a role becomes vacant and no disruption to business.
• Organizational Agility: Competency management allows organizations to respond to changing market demands by quickly identifying and filling skill gaps. Especially important in fast changing industries.
• Recruitment and Retention: By defining the competencies for each role, organizations can simplify their recruitment process and select the best candidate. And offer clear development opportunities to improve employee retention.

Challenges

While the benefits are clear, there are issues:

• Resistance to Change: Employees and managers may not want to change processes or systems.
• Time and Resource: Building and implementing a competency management system takes time and resource.
• Measuring Complexity: Measuring competencies, especially behavioural ones, is subjective and difficult.
• Keeping Frameworks Relevant: As industries change, frameworks need to be updated to reflect new skills and knowledge.

To overcome these issues you need strong leadership, clear communication and a commitment to continuous improvement.

Conclusion

Competency management is more than an HR project; it’s a strategic way to build a capable and agile workforce. For organizations that invest time and effort, competency management brings huge benefits. From better performance and engagement to better agility and succession planning the benefits touch every level of the business. By focusing on the skills and knowledge needed to achieve business goals competency management will help your business succeed in a fast changing and competitive world.