The document discusses competency-based human resource management. It defines competencies as clusters of knowledge, skills, and attributes that enable superior job performance. The key benefits of competency-based HR include aligning HR processes through a common language, establishing clear performance expectations, and facilitating employee development. Recruitment, performance management, training, development, and compensation can all be designed based on an organization's competency model. The document provides an overview of developing a competency catalogue and applying competencies across the HR cycle.

1. For Performance Effectiveness
“Knowing is not enough; we must apply.
Willing is not enough we must do.”
- Goethe
For IPM Sri Lanka N.H.R.
Course Facilitator: Rahila Narejo PRIVATE LIMITED
June 21, 2007 www.narejohr.com

2. 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.

3. Training Norms
• Participate!
• Mobile phones OFF!
• REWARDS
• Be on TIME

4. Brief Historical &
Theoretical Background

5. 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”.

6. 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.

7. 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)

8. TODAY!
34 years after the first
competency model, more than
half of the Fortune 500
companies are using competency
modeling.

9. Concepts of Competency

10. Competencies are
INPUTS
They consist of clusters of
knowledge, skills, and personal
attributes that AFFECT an
individual’s ability to PERFORM.

11. Competencies
Distinguish
Exemplary Performers
from
Average Performers

12. Components of
Competency
1. Skill
• capabilities acquired through practice.
2. Knowledge
• understanding acquired through learning.
3. Personal attributes
• inherent characteristics which are brought to the job
4. Behavior
• The observable demonstration of some competency,
skill, knowledge and personal attributes attributed to
excellent performance.

13. Figure 1. Competency Components
Competency:
Uses an understanding of
market pricing dynamics
Competencies: to develop pricing models
Position a new product
introduction so that it is
Knowledge:
clearly differentiated in
the 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.

14. Competency Flow Model
Personal
Attributes/Motives
Knowledge
Skills
Competency
Observable Behaviors
Job PERFORMANCE
Competencies are to performance what DNA is to people.

15. Type of Competency
1. Employee Core Competency
2. Managerial Competency
3. Technical/Functional Competency
4. Personal Attribute

16. 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.

17. What is a
Competency Model?

18. Competency Model
• A set of competencies necessary for
successful performance in a
particular job or job family.
• Driven by organization’s strategy.

19. Competency Model Framework
Vision & Mission
Core capabilities
Stakeholder requirements
Market realities
BUSINESS STRATEGY
Competency Requirements
Success Factors Skill
Behaviors Knowledge
Attributes
Competency Model

20. 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

21. A DIAGNOSTIC MODEL TO DEFINE
COMPETENCIES
Existing 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

23. SAMPLE CORE IDEOLOGIES OF SELECTED COMPANIES
American Express Co.: customer service, reliability, initiative
The Boeing Co.: leading edge, pioneers; challenges and risks; product safety and
quality; integrity and ethics; aeronautics
Citicorp: expansionism; being out front (best, innovative); autonomy and
entrepreneurship; meritocracy; aggressiveness and self-confidence
General Electric Co.: technology and innovation, balance among stakeholders,
responsibility and opportunity, honesty and integrity
Hewlett Packard Co.: technical contribution, respect and opportunity for HP people,
contribution and responsibility, affordable quality, profit and growth
Procter & Gamble Co.: product excellence, self-improvement, honesty and fairness,
respect for individual
3M Corp.: innovation, integrity, initiative and personal growth, tolerance for honest
mistakes, product quality and reliability, problem solving
Wal-Mart Stores Inc.: value to customers; buck conventional wisdom; partnership with
employees; passion, commitment, enthusiasm; run lean; pursue high goals
Walt Disney Co.: no cynicism; consistency and detail; creativity, dreams, imagination;
"magic"; "bring happiness" and "American values"

24. SHARED COMPETENCIES
IDENTIFIED IN A 10-COMPANY
SAMPLE
Frequency
Competency of Use
Customer Focus 8
Communication 7
Team orientation 6
Technical expertise 6
Results orientation 6
Leadership 6
Adaptability 5
Innovation 5

25. Design Decision
1. Context
2. Level of Orientation
3. Level of Complexity
4. Linked to Strategy
5. Company Specific
6. Flexible
7. Future Oriented

26. Design Decision
1. 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)

27. Design Decision
2. Level of Orientation
• Will the model reflect future or current
job requirements.

28. Design Decision
3. 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.

29. Design Decision
4. The model should be linked to strategy
• Effective competency models support and contribute
to the company's and the function's 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.

30. Design Decision
5. The model should be company-specific
• Unlike many job descriptions, competency
models are not easily transferable.
• Competencies are determined by the
company's unique characteristics:
– Culture
– Strategy
– Size
– industry

31. Design Decision
6. 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.

32. Design Decision
7. 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 model's shelf life
• Ensures employees have enough time to
understand and to develop.

33. Firm Core Competence and
Employee Core Competencies
FIRM 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…

34. 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

35. Developing a
Competency Catalogue

36. Stages of Competency Catalogue
Development
Stage 1
Stage 1 Stage 2
Stage 2 Stage 3
Stage 3 Stage 4
Stage 4
Conducting
Conducting Identifying
Identifying Developing
Developing Developing
Developing
Competency
Competency Competency
Competency Competency
Competency Competency
Competency
Workshop
Workshop Components
Components Catalogue
Catalogue Profile
Profile

37. Stage 1
Stage 1
Conducting
Conducting
Competency
Competency
Workshop
Workshop
• introduce the concept of competency
• deciding the scope of competency
project

38. Stage 2
Stage 2
Identifying
Identifying
Competency
Competency
Components
Components
Stage 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 strategy
Stage 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

39. 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

40. Stage 3
Stage 3
Developing
Developing
Competency
Competency
Catalogue
Catalogue
• 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

41. Stage 4:
Stage 4:
Developing
Developing
Competency
Competency
Profile
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.

42. “They don’t actually do anything. I just like the way
they make me feel.”

43. What Competency-Based
Management does, in
contrast, is connect these
pulleys and levers - to
connect our various HR
processes.

44. Alignment of HR Systems
Recruitment & Selection
Training & Competency Performance
Development Model management
Compensation

45. 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

46. 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.

47. “… First, we compose a profile on your personal
habits, traits, basic attitude and job skills. Then we try
to match you with a supervisor who wouldn’t be
affected by it …”

48. 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

49. CBPM SCALE
0 - Cannot Rate - Insufficient information to assess
1 - Introductory - Little or no knowledge/proficiency.
Rarely demonstrates. Needs significant development.
2 - Basic - Basic knowledge/proficiency. Sometimes
demonstrates. May need development.
3 - Proficient - Knowledgeable/proficient. Usually
demonstrates. Little development required.
4 - Very Proficient - In-depth knowledge/proficiency.
Demonstrates most of the time. No development required.
5 - Mastery - Expert knowledge/proficiency.

50. 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

51. 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.

52. Competency based
Compensation
• Provides an incentive for employees
to grow and enhance their abilities.

53. Closing
• Review
• Evaluations
• Thank You!