For Performance Effectiveness “Knowing is not enough; we must apply. Willing is not enough we must do.” - GoetheFor IPM Sri Lanka N.H.R.Course Facilitator: Rahila Narejo PRIVATE LIMITEDJune 21, 2007 www.narejohr.com
Learning Objectives• Define Competency and recognize its fit within all HR practices.• Experience building a competency map as part of a panel of subject matter experts.• Use a competency dictionary to define strategic and functional competencies.• Overview the competency mapping process.
Training Norms • Participate!• Mobile phones OFF! • REWARDS• Be on TIME
Brief History: A Precursor of Competency Modeling• 1950’s: John Flanagan – 1954 established Critical Incidents Technique as a precursor to the key methodology used in rigorous competency studies – significant behavioral events that distinguish between average and superior performers. – It is Flanagan’s critical incidents technique that sixteen years later inspires David McClelland to discover and develop the term of “competency”.
Brief History: The Concept of Competency• 1970’s: “Testing for Competence Rather than Intelligence” (McClelland, 1973) – Competency: “an underlying characteristic of a person which enables them to deliver superior performance in a given job, role, or situation.” • Not biased • Can be learned and developed over time • Implication: If competencies are made visible and training is accessible, individuals can understand and develop the required level of performance.
Brief History: Competency Modeling Matures• 1980’s: “Certain characteristics or abilities of the person enable him or her to demonstrate the appropriate specific actions.” (Boyatzis, Richard E. The Competent Manager: A Model for Effective Performance. New York: Wiley, 1982, p. 12). – the first empirically-based and fully-researched book on competency model developments – specific behavior and clearly defined performance outcomes – like Flanagan, stressed importance of systematic analysis in collecting and analyzing examples of the actual performance of individuals doing the work – behavioral event interview (BEI)
TODAY! 34 years after the first competency model, more than half of the Fortune 500companies are using competency modeling.
Competencies are INPUTS They consist of clusters ofknowledge, skills, and personal attributes that AFFECT anindividual’s ability to PERFORM.
Competencies DistinguishExemplary Performers from Average Performers
Components of Competency1. Skill • capabilities acquired through practice.2. Knowledge • understanding acquired through learning.3. Personal attributes • inherent characteristics which are brought to the job4. Behavior • The observable demonstration of some competency, skill, knowledge and personal attributes attributed to excellent performance.
Figure 1. Competency Components Competency: Uses an understanding of market pricing dynamicsCompetencies: to develop pricing modelsPosition a new productintroduction so that it is Knowledge:clearly differentiated inthe market Understand market pricing dynamics Skills Knowledge Skill: Set up new Product introduction Competencies project Personal Motives Competency: Meets all commitments in a timely manner Personal Motives: Achievement – wants to do an excellent job.
Competency Flow Model Personal Attributes/Motives Knowledge Skills Competency Observable Behaviors Job PERFORMANCECompetencies are to performance what DNA is to people.
Type of Competency1. Employee Core Competency2. Managerial Competency3. Technical/Functional Competency4. Personal Attribute
Job Description vs. Competency Model• Job description looks at what. what • elements of the jobs and defines the job into sequences of tasks necessary to perform the job• Competency model focuses on how. how • studies the people who do the job well (STARs), and defines the job in terms of the characteristics and behaviors of these people.
Competency Model• A set of competencies necessary for successful performance in a particular job or job family.• Driven by organization’s strategy.
Competency Model Framework Vision & Mission Core capabilities Stakeholder requirements Market realities BUSINESS STRATEGY Competency Requirements Success Factors Skill Behaviors Knowledge Attributes Competency Model
The Competency Continuum“One-Size “Full Model” Fits-All Model” e.g. e.g. group, competencies core family or role down to the job level for all competencies Personal Abilities/ Knowledge Attributes Skills
A DIAGNOSTIC MODEL TO DEFINE COMPETENCIESExisting Behavior Targeted Behavior CUSTOMER FOCUS "Sold to" Consulted with Adversary Partner COMMUNICATION Top-down Multidirectional Limited sharing Extensive sharing People "told" People "involved," listened to p LEADERSHIP Command and control Inspire goal achievement Manage and supervise Coach and role model "Do what I say" "Follow my example" Unilateral action Decisive consensus
SAMPLE CORE IDEOLOGIES OF SELECTED COMPANIESAmerican Express Co.: customer service, reliability, initiativeThe Boeing Co.: leading edge, pioneers; challenges and risks; product safety andquality; integrity and ethics; aeronauticsCiticorp: expansionism; being out front (best, innovative); autonomy andentrepreneurship; meritocracy; aggressiveness and self-confidenceGeneral Electric Co.: technology and innovation, balance among stakeholders,responsibility and opportunity, honesty and integrityHewlett Packard Co.: technical contribution, respect and opportunity for HP people,contribution and responsibility, affordable quality, profit and growthProcter & Gamble Co.: product excellence, self-improvement, honesty and fairness,respect for individual3M Corp.: innovation, integrity, initiative and personal growth, tolerance for honestmistakes, product quality and reliability, problem solvingWal-Mart Stores Inc.: value to customers; buck conventional wisdom; partnership withemployees; passion, commitment, enthusiasm; run lean; pursue high goalsWalt Disney Co.: no cynicism; consistency and detail; creativity, dreams, imagination;"magic"; "bring happiness" and "American values"
SHARED COMPETENCIES IDENTIFIED IN A 10-COMPANY SAMPLE FrequencyCompetency of UseCustomer Focus 8Communication 7Team orientation 6Technical expertise 6Results orientation 6Leadership 6Adaptability 5Innovation 5
Design Decision1. Context2. Level of Orientation3. Level of Complexity4. Linked to Strategy5. Company Specific6. Flexible7. Future Oriented
Design Decision1. Context• ‘What does a superior performer look like in a specific setting?’• effective competencies are linked to a particular organizational target or goal.• the design of models may be geared toward: – the total organization (e.g., core competencies or values) – an entire function (e.g., finance, human resources) – a specific role (e.g., HR generalist) – a specific job (e.g., compensation analyst)
Design Decision2. Level of Orientation• Will the model reflect future or current job requirements.
Design Decision3. Level of Complexity• The length of models and the degree of complexity and detail described in behavioral indicators.• Number one reason competency initiatives fail.• Provide a simple framework to users in a timely manner.• 80-20 rule – 20% of behaviors that drive 80% of excellent performance.
Design Decision4. The model should be linked to strategy• Effective competency models support and contribute to the companys and the functions strategy and goals.• For instance, if a goal of the company is to transcend functional barriers, the model needs to describe the behaviors that demonstrate that competency.• If goal is all employees communicate and work together effectively, the model should describe the behaviors that demonstrate that competency.
Design Decision5. The model should be company-specific• Unlike many job descriptions, competency models are not easily transferable.• Competencies are determined by the companys unique characteristics: – Culture – Strategy – Size – industry
Design Decision6. The developed model should be flexible• May use as performance management tool with enough detail to distinguish between employees at different levels of proficiency.• Yet flexible enough to accommodate differing approaches to success, simple enough to be easily understood, and readily adaptable to changing business environments.
Design Decision7. The model should be future-oriented• Forward-looking perspective stimulates organizational change.• Articulate how the job is evolving and will best be performed in the future.• Increases models shelf life• Ensures employees have enough time to understand and to develop.
Firm Core Competence and Employee Core CompetenciesFIRM EMPLOYEE• Strategic strength, the • McDonald (production essence of what makes and delivery speed) one firm competitive in its • all McDonald employees environment should generate – McDonald’s: production competencies that reflect and delivery speed. these core competencies. – Microsoft’s: user friendly software.• translated into…
Competencies – A Holistic Application• Help companies “raise the bar” for performance expectations• Help managers align subordinates’ behaviors with key organizational strategy• Each employee understands how to achieve expectations
Stage 1Stage 1ConductingConductingCompetencyCompetencyWorkshopWorkshop • introduce the concept of competency • deciding the scope of competency project
Stage 2Stage 2Identifying IdentifyingCompetency CompetencyComponents ComponentsStage 2a: Identifying Employee Core Competencies possessed by all employees regardless of their functions. Review business vision and strategy Identify Employee Core Competencies (behaviors) to achieve strategyStage 2b: Identifying Job Relevant Competencies Relevant to each existing function/job/role. Determine and understand the nature of the job/role/position to be analyzed. Conduct focus group discussion
What is the Secret to Success?• What characteristics most distinguish a star sales person from an average one?• Discuss and select 8 competencies of a star
Stage 3Stage 3DevelopingDevelopingCompetencyCompetencyCatalogueCatalogue • Conduct behavioral event interview to identify behavior indicators. • Define the competency with a description which includes the previously identified behavior indicators • Scale each identified behavior indicator from lower to higher levels of performance. • Validate and confirm the matrix of competency catalogue with key stakeholders
Stage 4:Stage 4:Developing DevelopingCompetency CompetencyProfile Profile • Define number of positions to be reviewed • Identify roles and responsibilities of each position (JD or JA) • Establish competency matrix: match the roles and responsibilities with the competencies • Analyze the weight of the roles and responsibilities as a basis to decide the level of proficiencies.
“They don’t actually do anything. I just like the waythey make me feel.”
What Competency-Based Management does, incontrast, is connect these pulleys and levers - toconnect our various HR processes.
Alignment of HR Systems Recruitment & Selection Training & Competency PerformanceDevelopment Model management Compensation
ADVANTAGES• Links HR activities through a common language• Reflects the values and mission of the organization• Establishes clear expectations - competencies are observable and measurable• Facilitates employee development• Streamlines HR activities
Competency Based Recruitment• Competency based interviews reduce the risk of hiring mistakes and increase the likelihood of identifying and selecting the right person for the right job.
“… First, we compose a profile on your personalhabits, traits, basic attitude and job skills. Then we tryto match you with a supervisor who wouldn’t beaffected by it …”
Competency based Performance Appraisal• Establishment of clear high performance standards• Collection and proper analysis of factual data against set standards• Conduct objective feedback meetings• Clear direction in regards to specific areas of improvement
CBPM SCALE0 - Cannot Rate - Insufficient information to assess1 - Introductory - Little or no knowledge/proficiency.Rarely demonstrates. Needs significant development.2 - Basic - Basic knowledge/proficiency. Sometimesdemonstrates. May need development.3 - Proficient - Knowledgeable/proficient. Usuallydemonstrates. Little development required.4 - Very Proficient - In-depth knowledge/proficiency.Demonstrates most of the time. No development required.5 - Mastery - Expert knowledge/proficiency.
Competency based Training• CB PM leads to effective identification of training needs• Identify/develop targeted training programs – focused training investment• Focused training enables improvement in specific and aligned technical and managerial competencies
Competency based Development• Gives individual the tools to take responsibility for their own development.• Gives line manager a tool to empower them to develop their people.
Competency based Compensation• Provides an incentive for employees to grow and enhance their abilities.