Human resource management competencies

Key Findings of a Recent Survey

Just under half of the respondents state their organisations have a competency system. Almost another quarter say their organisation is planning to adopt this approach.

The most popular reason for adopting a competency approach is to use it as a training and development tool - over half of the respondents state this. Significantly, over a third stated a desire for a more systematic human resource management function as the reason, and a further one in three view a competency approach as useful to support a change in organisational culture.

The survey reveals that the three key areas of a manager's performance are team working, people management and communication - almost three quarters of respondents state their organisation had a competency covering these areas.

The major benefit of a competency approach, according to our data, is the shift towards the individual taking responsibility for their own development through continuous learning - 62% state this. Other benefits are that a competency approach focuses on continuous development, it defines explicit standards, and concentrates on outcomes.

The main drawback of a competency approach is that it is time consuming - 67% of respondents state this. Respondents also claim that it is difficult to convey the concept, as well as stating that managers feel threatened by the approach.

Case Studies

The six organisations profiled in available case studies have all implemented a competency approach, using several different methods, and all tend to use them for a variety of purposes. However, several best practice features were identified by all of them.

Each organisation has tried to make their scheme as simple as possible in order to ensure its success. Linking the competencies to the overall business strategy was seen as vital to their success and the success of the business.

All the case studies saw the competencies as providing explicit standards and guidance to staff about what the organisation required of them. This has the advantage of helping to motivate staff and showing them how they can progress through the organisation.

Consultancy

The need for organisations to gain the edge on their competitors has made it essential for managers to be able to measure the performance of their staff and identify improvement measures. A competency approach aims to do just this by identifying the competencies required to do a job. From this real development needs can be assessed, and measurable performance improvements can then be evaluated.

However, the mistake that organisations can make when adopting a competency approach is to see it as just a training initiative, and divorce the competencies from other areas of the business. Organisations must identify competencies that have a direct link to the business values. They must also involve the people who they are asking to live up to the competencies when defining them in the first place. Initially managers can feel nervous about a competency approach, but with support and training this should be short-lived.

A competency approach also shifts the responsibility for a person's development onto that individual. The person now has to demonstrate their value for money. They can no longer depend on enjoying the security of a job for life. However, in our opinion this is not necessarily a bad thing; hopefully it means that they can enjoy the security of their own resources and competence.

The conclusion is that British industry is crying out for a competency approach. Reviewing a manager's performance in the past has too often been an act of faith, while a competencies approach provides a mechanism to more accurately review performance.

What are Competencies?

"A competency is the set of behaviour patterns that the incumbent needs to bring to a position in order to perform its tasks and functions with competence" Boam and Sparrow. The key point however is that being competent means performing to professional or occupational standards.

Why Competencies?

The prime business case for the development and use of competencies is to improve the profitability of the business. This is achieved by maintaining a competitive edge through ensuring the right people, in the right jobs, doing the right things, in a superior way. Other benefits include:-

Improved individual performance: working with a competency approach allows employees to be very clear about the standard of work that is expected of them.
Business alignment of the human resource strategy: by providing HR systems which focus on standards of performance identified to improve individuals and the business. There is also increased potential to spell out standards of performance to line managers, as well as providing a common language for desired business performance.
Recruitment: When organisations are clear about the competencies they require, then prospective employees - and internal candidates - can identify where they match them. This encourages focused applications. Also it enables the selection of staff to be linked more clearly to the business needs.

Organisational Culture

If an organisation needs a major culture change then the introduction of competencies can be a key factor in effecting change. The main benefit of this approach is that it enables the organisation to firstly identify the success factors they want to gain and then determine the sort of competencies their staff will need to achieve their success. Organising a strategic plan around individuals and agreed standards rather than structure and jobs represents a different paradigm and as such requires new systems. The explicitness of the competencies then provides a sense of purpose and a focal point for cultural change.

To adopt a competency approach without integrating it into the overall strategy of the organisation will dilute most of its effectiveness.

Setting up a Competency System

In order for the competencies to have real benefit they must be integrated into the overall business strategy. Organisations need to identify what kind of organisation they want to be and then define the competencies they need in order to achieve this.

Key areas to pay attention to:

Involve staff: it is vital to involve staff from the beginning - avoid trying to make it a "secret" approach. Have focus groups to identify competencies, and then make sure that you canvass as many views as possible.
Define the right competencies - make sure they are not just an amalgam of different competencies. It is very useful to involve an outside consultant, not necessarily to design the competencies, but to help identify and tailor the competencies to the specific organisation.

It can be useful to separate the competencies into three categories. Technical - the specific skills required; functional - the processes that form the role, for example, running a meeting, coaching staff and finally behavioural - this looks at "how" a person does their job - the behaviours they display. The behavioural competencies require the most attention. It is far more difficult to change behaviour and deal with the underlying values and motives than to help people to learn the technical skills and processes.

Future orientated: Make sure the competencies are not retrospective. An organisation needs to identify the competencies required for their future success. However, avoid the danger of including ill-defined desirable organisational characteristics which have no measurable impact on superior performance.
Benchmark against other organisations: When designing a competency scheme, it can be very useful to consider how other organisations have approached it. Also the Management Charter Initiative (MCI) provides a generic list of competencies, put together through a thorough consultation process with managers across the UK. It can be useful to view the MCI generic competencies as a benchmark when forming your own set.

Measuring Competencies

Having defined the standards of competence required, it is useful to produce a scale or range of levels to match job profiles against. Once people become familiar with the approach it becomes easier to identify what they need to do to progress.

Each competency must be clearly defined so that managers know what standards are required of them. However the scale system should embrace a development approach, with people moving from an adequate performance - just doing the job -to a superior performance.

Managing Competencies

When implementing a competency programme keep in mind the following:-

Involve managers from the start, and continue to get feedback from them as to how the approach is working.
Make sure that people understand the competencies - otherwise this could lead to frustration and confusion.
Don't keep the competencies a secret - make sure all staff are aware of the competency standards.
Make sure the standards are fair and don't prejudice any sectors of staff.

Use of Competencies

The competency approach is particularly useful in the following areas:-

Change management: by identifying the behaviours required for improvement and establishing a mechanism for driving through change.
Succession management: the competence approach gives clear information on individuals and their potential.
Performance management: the competencies provide clear and specific information on performance with criteria for reward focused on key competencies.
Selection and recruitment: the competencies provide a framework for identifying the standards required for superior performance. This means that the interviewing process can be more objective and have key, measurable standards to judge candidates against.
Development: competencies enable development and training to be focused on specific needs. Inappropriate nominations for development can then be reduced. Self-development is encouraged because the competencies identify explicit learning and development gaps.
Human resource planning: again the competencies should improve HR planning, as the core competencies allow for a better managed workforce profile.
Appraisal the competencies provide a constructive basis for any appraisal system, mainly because they provide measurable outcomes, and also help to clearly identify training and development needs. As all competencies should tie into the overall business strategy they help the appraisal to focus the individuals on their vital role in the overall success of the business.

Evaluating Competencies

If the competencies have been evolved as part of the overall business strategy, then the best way to evaluate their effectiveness is by linking them to the business results. Ultimately an organisation would expect to see match between the improved performance and the increased business success.

Another way to monitor the effectiveness of the competencies is through an employee opinion survey. The results of a survey, after a competency approach is established, should show an improvement in staff opinion, particularly in the area of leadership, management style and culture.

It is important to review the competencies regularly. Just as business is not static so also some competencies will mature and die; just as parts of the business do. Others will emerge as markets and services change. They are definitely not "tablets of stone". Reviewing their relevance will ensure their continued vitality.