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THE COMPETENCY ROMANCE3 - MAKING COMPETENCIES WORK Frank O’CONNOR RAP Consulting email@example.com and Leanne MARKUS Performance Group International; Centranum
MAKING COMPETENCIES WORKMany organisations have put substantial time andmoney into the use of competencies andcompetency frameworks♥The usual aggravations appear Organisations are too busy operating to get everyone involved The benefits are hard to measure or evaluate Weak distinction between the standards of work and worker Competencies focus on knowledge skill and ability♥Worse, the individual competencies used in many organisations have little direct connection to the purpose of the enterprise, so they don’t impact consistently on organisational results How do we get greater organisational leverage from these competency things?
HOW CAN WE GET GREATER ORGANISATIONAL LEVERAGE?We see organisational effectiveness when:1. Core competence matches people’s capabilities2. Goals flow from organisation to individual – and back3. Results expected are specified and understood4. Participants and their contributions are supported consistently
1 CORE COMPETENCE MATCHES PEOPLE’S CAPABILITIESCompetent organisations use their people’scapabilities, to:♥Gain competitive advantage, with customers, funders or suppliers♥Improve key aspects of performance, compared to others
A CORE COMPETENCE IS SOMETHING THAT AN ORGANISATION CAN DO WELL♥It provides customer benefits They want or need the product or service♥It is hard for competitors to imitate Others are less ready, willing or able to provide♥It can be applied widely to many products and markets A range of customer needs can be met using the competence Hamel and Prahalad (1990)♥A core competence includes the collective knowledge of people and the organisational procedures that shape the way employees interact to produce something particular♥Core competences are fundamental to the organisation
COMPETENT PEOPLE CONTRIBUTE TO CORE COMPETENCIESA core competence can take various forms, eg:♥technical / subject matter know how♥a reliable process♥close relationships with customers and suppliers Mascarenhas et al. 1998It may also include less tangible attributes, eg:♥innovative product development♥a work culture of high employee dedication Some say outsource activities that are not part of core competenceCore competence is more than individuals’ traits♥"aggregates of capabilities, where synergy is created that has sustainable value and broad applicability" Gallon, Stillman, and Coates (1995)
KNOWLEDGE AND SKILLS BOUND TO PRODUCTION PROCESSES♥"a core competence is a combination of complementary skills and knowledge bases embedded in a group or team that results in the ability to execute one or more critical processes to a world class standard." Coyne, Hall, and Clifford (1997)The skills or knowledge must be complementary tothe processes – taken together, they make itpossible to provide a superior product♥“a core competence differentiates not only between firms but also inside a firm it differentiates amongst several competencies. In other words, a core competency guides a firm recombining its competencies in response to demands from the environment” Galunic and Rodan (1998)
WHAT IS YOUR CORE COMPETENCE?When most products are modifications of a basictechnology, your people must make these well♥Combining skills, knowledge, equipment and processes♥Working to higher standards of consistency or reliabilityTake Black and Decker offerings to three markets: s♥Home workshops drills, circular saws, sanders, routers, polishers, screwdrivers♥Home cleaning and maintenance dust busters, etc♥Kitchen appliances can openers, food processors, blenders, bread makers, fans What is their core competence?
EXERCISE: MAKING A STANDARD PROCESS INTO A CORE COMPETENCE?A process which uses common methods andpeople with basic training cannot be regarded as acore competence♥Skills or resources that are standardized or easily available do not enable an organisation to achieve a competitive advantage♥Specialised equipment and training applied to such a process might generate a differentiating advantage over rivalsSome organisations, such as in the public sector,do not compete for customers, but they do competefor skilled staff How could the recruitment process be revisited to compete better?
2 GOALS FLOW FROM ORGANISATION TO INDIVIDUAL – AND BACKAligned goals get better results at lower cost♥Cascade from organisational goals to individual workplans♥Set standards of work in terms of output delivered to customerUntil they learn not to, people naturally reviewachievement♥Accept intentions are good, but measure the essential results♥Support individual work standards with unit goals
VIEW FROM THE TOP: THE BRITISH COUNCIL’S INTRODUCTION“The purpose of the British Council is to buildmutually beneficial relationships between people inthe UK and other countries and to increaseappreciation of the UK’s ideas and achievements”♥“Everything we do must contribute to one or more of the following outcomes: Improved perception of the UK in other countries Greater mutual understanding between the UK and other countries Stronger ties between the UK and other countries”♥“The work of every British Council member of staff contributes in some way to the achievement of these outcomes, and it is therefore important that we all have a clear understanding of what our role is and what is expected of us.”
CASCADE FROM GOALS TO PLANS Organisational Organisational Obligations Obligations & Goals & Goals Met Priorities, requirements & results Results Achieved for Customers Unit Plans Annual tasks/activities, Products and Services outputs, outcomes and Delivered achievement indicators Individual Work Plans Core Work Done Individual tasks/activities, outputs and achievement indicatorsEXPECTED STANDARDS Individual of skill, style & Effort knowledge required forsatisfactory achievement SUPPORT at specific work depends on style & content of work
SUPPORT: THE LITMUS TESTWhat are the [three] key goals this organisation hasthis year?♥What are the core processes that will deliver these goals?♥What are the key actions carried out by your department to support these processes?♥What do we have to do to be and stay competent at these actions? People can do this – when they have to!
SUPPORT: OBSERVABLE COMPETENCIESA child calls “Hey Dad! Come and watch me do ….”,to give evidence of competence♥Start with the same sentence, say with “Teamwork” What would you see from “understands and supports diversity” ? What does “cooperation” look like?Results-based competencies go further:♥“Hey Dad! Come and watch me increase sales by doing ….” How do these affect overall achievement of goals? Thanks to Carol Barnett, who taught me this People learn to do this – when they want to!
SUPPORT: REAL DISTINCTIONS IN OUTPUT STANDARD – AND CONSEQUENCES Support Junior Intermediate Senior ACTING TO ACHIEVE RESULTS I got my work I worked with I planned for, I decided how we done on time and others to plan for monitored and balanced work in the right way, and achieve evaluated the within my area, so so other people results that results achieved in we achieved the can get on with contribute to my area of planned their contribution achievements accountability, contribution to to our goals outside my work correcting where it our KRAs in the group fell short best way for staff and clients WORKING TOGETHER I worked with I planned, did and I led and developed I led the actions of other people in evaluated work staff in our and groups that work and beyond my done with other client with other group — I fitted in people, so all organizations to organizations to with everyone else work used the get work done achieve shared so we achieved right information together to the goals using good results and achieved the right standard and separate together right results timing, with resources and problems resolved knowledge efficiently and effectively
EXERCISE: RESULTS OR INPUTS♥Identifying and developing abilities and potential using job-relevant tests, learning processes and other exercises in selection, development and career counselling♥Influencing the motivation of staff designing payment and reward systems, and advising on health and safety issues♥Assessing achievement, in and around the job designing goal setting and appraisal systems for groups or individuals, advising on stress management, and in designing machines and computer systems that are easy to use♥Designing effective organisations advising on the best type of management systems, identifying effective human resources strategies, and designing jobs to fit peoples skills If we looked at the output of a year’s work, what would we see?
3 RESULTS EXPECTED ARE SPECIFIED AND UNDERSTOODResults are delivered better when they are specifiedbetterConsistent standards are critical, for individualsand organisationsFeedback on fit of work done to end use savesmoney and time
HOW CAN INDIVIDUAL COMPETENCIES BE USED AS AN ACHIEVEMENT LEVER?If organisations are to achieve useful productivityleverage from “competency” initiatives, there mustbe a direct relationship to organisationalachievement through the development of suchorganisational capabilities♥Personnel show these capabilities as individual competencies, which vary with scope and type of work♥One challenge is to integrate these input competencies in a way that fits with overall outcome objectives
BOC: CORE COMPETENCIES PUT SIMPLY“ACTS cultural pillars underpin everything we do at BOC; the way we behave, theway we speak, the things we praise, the things we reward, the people we hire, thepeople we promote, the procedures we implement. “The ACTS Cultural pillars are: Accountability Collaboration Transparency Stretch People know We maximise We believe that We continuously what they are our achievements visible problems push the accountable for as a group, can be solved and boundaries and are not as individuals that informed of performance empowered people make better to deliver decisions Add GAS and you have their core business
EXERCISE: SPECIFYING RESULTS EXPECTED“… concerned with the organisation and planninginvolved in systematic … assessment, evaluationand problem solving with individuals, groups,organisations, and the community”♥“Be able to demonstrate: Problem definition Collection and analysis of data relevant to the problem Interpretation of data within a relevant conceptual framework Determination of strategies supported by the best available evidence Implementation of ongoing evaluation”♥“… gathering information; defining and specifying the problem; generating hypotheses; tool / method selection and use” What does this competency produce?
4 PARTICIPANTS AND THEIR CONTRIBUTIONS ARE SUPPORTED CONSISTENTLYSupported participants make better contributions♥Most people want to do work ‘well enough’, once they know how match support delivery to style & content of work done♥Courage and preparation enable ‘difficult conversations’Individual and workgroup performance must have♥Feedback on achievement against plans Specific, measurable, achievable, realistic and time-bound results♥Conformance with standards on how things will be done expectations matching achievement
CONSISTENCY: WHAT I SAY WHAT I MEAN I hate what you just told meThank you for the feedback. and I disagree with you. I am not happy with yourI am offering you a performance so I’m movingdevelopmental opportunity. you somewhere else.I have confidence in you. I have concerns and doubts about your ability but I want to make you feel good.It’s a very interesting idea. I really want to express my indifference or objection.
ORGANISATIONS PERFORM AS WELL AS THEIR PEOPLE ALLOWThe best use of people requires firm expectations♥clear plans and how it’s to be done♥feedback on what’s done and needed♥Use the cascade / technology pairOnce people throughout the organisation …♥Understand what results are wanted♥Identify and develop skills needed♥Monitor and evaluate their own effectiveness … their organisation can deliver on its promises
EXERCISE: WHERE COMPETENCIES MOST AFFECT BUSINESS ACHIEVEMENT Strategy, Mission and Business ObjectivesOrganisation Structure Leadership & Communication Human Resources Strategy Management Processes Recognition Job Design & Information Systems & Rewards Appraisal & Recruitment Goal Setting & Placement ACHIEVEMENT ACHIEVEMENT DevelopmentWorkforce Succession Career Planning & TrainingPlanning Planning
GREATEST PRODUCTIVITY WITHA framework that makes it easy for people♥Assess and discuss their own performance and that of others in the context of the organisation’s obligations and goals Address individual training and development needs Identify trends in skill gaps across the organisation♥To get and use information about work planned and done Technology makes this practicableClear expectations♥People can’t do their jobs if they donknow what is expected t What’s measured? What’s in the job description? What matters?Useful feedback♥achievement improves with constructive and prompt feedback Most employees appreciate feedback on what has worked well and, given opportunity, will monitor and evaluate their own achievements
GREATEST BENEFITS COMEWhen competence is derived from the resultssought by the organisation♥meeting standards in the competencies is essential to acceptable achievement in the job and♥achievement in the job is essential to acceptable organisational achievementWhen competence is relevant and necessary♥to the actions of the worker♥for the success of the organisationWhen standards are clear and consistent♥plain distinctions are made between “not good enough” and “good enough” outputs♥also applies to intangibles such as relationships and reputations
TEST QUESTIONS FROM EXPERIENCE♥What are the organisational results expected? We need to know outputs & outcomes, not intentions or inputs♥What are we asking people to do differently? We need to describe it, see it and do it.♥How does the competency impact on these results? Consistent and direct leverage on organisational achievement♥What does “good enough” look like on the job? We need to see the organisation showing that these minimum standards matter♥Are staff showing that meeting the standards matters to them? We need to see and hear them demonstrate relevance in actions True Love or Hawthorne Effect?
SOME REFERENCES♥Galunic, D.C. and Rodan, S. (1998) "Resource recombinations in the firm: knowledge structures and the potential for Schumpeterian innovation". Strategic Management Journal vol 19. pp1193-1201.♥Hamel, G and Prahalad, C.K. (1990) "The core competence of the corporation", Harvard Business Review, vol. 68, no. 3, May- June 1990, pp 79-93.♥Levenson, A.R., Van der Stede, W.A. and Cohen, S.G. (2006) “Measuring the relationship between managerial competencies and performance”, Journal of Management, vol. 32, no. 3, June 2006, pp360-380♥Mascarenhas, B., Baveja, A., and Jamil, M. (1998) "Dynamics of core competencies in leading multinational companies", California Management Review, vol 40, no. 4, pp117-132.♥Schneider, W.E. (1997) "Aligning strategy, culture and leadership." In Neumann, J.E.; Kellner, K.; & Dawson-Shepherd, A. (Eds.), Developing Organisational Consultancy. London: Routledge
Hawthorne Effect 1924-1933 from Western Electric’s Hawthorne (Chicago) works "Parsons (1974) described it as: "Generalizing from the particular situation at Hawthorne, I would define the Hawthorne Effect as the confounding that occurs if experimenters fail to realize how the consequences of subjects performance affect what subjects do". Studies were done between 1924 and around 1933. Fritz J. Roethlisberger and William J. Dickson give a great amount of detail, but little interpretation. Elton Mayo of Harvard Business School gives a shorter account, including the interpretation which has been so influential: that it was feeling they were being closely attended to that caused the improvement in performance. Research was a series of studies on the productivity of workers manipulated various conditions (pay, light levels, rest breaks, etc.) but each change resulted on average over time in productivity rising, including, eventually, a return to the original conditions. This was true of each of the individual workers as well as of the group mean. The variables the experimenters manipulated were not the only nor dominant causes of productivity changes. One interpretation, mainly due to Mayo, was that the important effect here was the feeling of being studied: it is this that is now referred to as "the Hawthorne effect".