Competencies drive performance and business outcomes. However, HR often struggles to provide talent recruitment support because it lacks an understanding of the required competencies for specific roles and career levels.
Competency models provide a strategy framework for aligning existing employee competencies with skill gaps and business needs. 95% of C-suite executives say that competency models are critical to overall organizational performance.
In this article, we’ll define competency model frameworks, explain how they drive business outcomes, discuss elements of competency models, and provide examples from leading HR organizations.
What Is a Competency Model?
A competency model is a framework that defines the specific skills, behaviors, and knowledge required for employees to succeed in their roles within an organization. It outlines both the technical and behavioral competencies necessary to perform a job effectively, guiding areas such as recruitment, performance evaluations, training, and employee development.
Competency models are tailored to reflect the unique needs and goals of a company and are used to align employee performance with the organization’s broader workforce management strategic objectives, ensuring a consistent standard of excellence across its employees.
Key Elements of a Competency Model
Here are the most important elements of a competency model:
Core competencies
Core competencies are the foundational skills and behaviors that are essential for all employees within an organization, regardless of their specific role or department. These competencies reflect the company’s values, culture, and overall business strategy, and are crucial for ensuring that all employees align with the organization’s goals.
Examples of core competencies include:
- Communication: The ability to convey information clearly and effectively to different audiences.
- Adaptability: The capacity to adapt to change and challenges in the workplace with a positive attitude.
- Customer Focus: A commitment to understanding and meeting the needs of both internal and external customers.
Functional and technical competencies
Functional skills and technical competencies are specific to particular organizational roles, departments, or functions. These competencies reflect the technical knowledge, skills, and abilities required to perform specific tasks effectively.
Examples of functional and technical competencies include:
- Project Management: Skills in planning, executing, and overseeing projects to meet specific objectives for a project manager or team leader.
- Data Analysis: The ability to gather, interpret, and utilize data to inform decisions and solve problems for data-driven companies.
- Software Proficiency: Knowledge and skills in using specific software applications relevant to the role (e.g., CRM tools, programming languages).
Behavioral competencies
Behavioral competencies refer to interpersonal skills and personal attributes that influence how employees interact with others and manage their own work behavior. These competencies are crucial for fostering effective communication, collaboration, and leadership in the workplace.
Examples of behavioral competencies include:
- Emotional Intelligence: The ability to recognize, understand, and manage one’s emotions and the emotions of others.
- Teamwork: Effectively working and collaborating with others to achieve common goals.
- Accountability: Taking responsibility for one’s actions and delivering on commitments.
Leadership competencies
Leadership competencies focus on the skills and behaviors necessary for employees in management or leadership roles. These competencies include strategic thinking, decision-making, and the ability to inspire and guide teams toward achieving organizational objectives.
Examples of leadership competencies include:
- Strategic Thinking: The ability to envision the big picture and create long-term plans to meet organizational goals.
- Decision-Making: Making informed and effective choices, even in complex or uncertain situations.
- Coaching and Mentoring: Guiding and developing team members to help them grow and reach their full potential.
Types of Competency Models
While the overall goal of building a competency model is to define success for a given role, a few different types of competencies may be used within your models.
Here are the main types of competencies included in most competency models.
1. Job competency model
A job competency model defines the specific skills, knowledge, and behaviors required for success in a particular role within an organization. This model is tailored to the responsibilities and tasks of an individual job position and ensures that employees have the necessary competencies to perform their duties effectively.
Example: The job competency model for a sales representative might include competencies such as sales skills, customer relationship management, negotiation, and product knowledge.
Purpose: This model helps organizations hire the right candidates, develop targeted training programs, and conduct performance evaluations for specific roles.
2. Organizational competency model
An organizational competency model outlines the core competencies that are important for all employees, regardless of their specific role or department. These competencies align with the organization’s overall culture, mission, and strategic objectives.
Example: Competencies such as teamwork, communication, and alignment with company values are included in an organizational competency model.
Purpose: It fosters a unified organizational culture and ensures that all employees, no matter their role, contribute to the company’s broader goals.
3. Functional competency model
A functional competency model focuses on the competencies required within a specific function or department. It emphasizes the technical knowledge and specialized skills needed to perform effectively in a particular area of the business.
Example: In an IT department, functional competencies might include software development, cybersecurity, or network management.
Purpose: This model ensures that employees within a particular department have the functional and technical skills necessary for their roles and contributes to the overall effectiveness of that department.
4. Leadership competency model
A leadership competency model focuses on the competencies required for employees in managerial or leadership roles. It emphasizes the abilities needed to lead teams, make strategic decisions, and drive organizational success.
Example: Leadership competencies may include strategic thinking, decision-making, emotional intelligence, and team management.
Purpose: This model is crucial for developing current and future leaders within the organization, ensuring they possess the necessary skills to guide their teams and make impactful decisions.
Related Resources
How to Develop an Effective Competency Model
will be determined by the needs of your individual business and its objectives. Having a clear plan for developing your competency model can help smooth out this journey and increase the overall benefits. Here’s how you can go about developing your competency model.
- Identify business goals and objectives – Start by aligning the competency model with the organization’s strategic goals and objectives. This ensures that the competencies you define will directly contribute to the company’s success.
- Analyze job roles and functions – Conduct a thorough analysis of the different job roles within the organization to understand the specific tasks, responsibilities, and skills required for each. This step ensures that the competency model is tailored to the real needs of the roles within the organization.
- Define and categorize competencies – Once you’ve analyzed the roles, define the competencies for each job. Group them into categories such as core competencies, functional competencies, and leadership competencies. For example, core competencies (e.g., teamwork) might apply to all employees, while functional competencies (e.g., financial analysis) apply only to those in specific departments.
- Engage stakeholders – Involve key stakeholders such as department heads, HR professionals, and managers in the development process. Their input ensures that the competencies are relevant to the needs of their teams and align with business goals.
- Solicit feedback – After developing an initial version of the competency model, gather feedback from a broader group, including employees who will be using the model. Employee input can help refine the model and ensure that it is practical and realistic.
- Refine the model – Based on the feedback received, make adjustments to the competency model. This may involve clarifying competencies, modifying proficiency levels, or expanding competency categories.
- Validate the model – Test the competency model with a pilot group of employees or apply it in a limited capacity to assess its effectiveness. Ensure the model aligns with business goals and drives desired employee behaviors. Validation confirms that the model works as intended and is helping the organization achieve its strategic objectives.
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Benefits of a Competency Model
Here are some of the most significant benefits of a competency model.
- Draft high-quality job descriptions – Research and information generated through the development of competency models enable HR teams to craft descriptive, straightforward, and accurate job descriptions. This ensures that the suitable candidates submit applications and that prospective employees aren’t met with any surprises when they reach the interview stage.
- Promote communication and understanding – Developing robust competency models helps team members understand what their colleagues do daily and what they’re especially great at! This can improve communication across lines of business and give team members the vocabulary they need to talk to one another about their roles.
- Pinpoint L&D needs for more effective training – Understanding the competency needs for each position lets HR professionals identify skill gaps in learning development for their teams. This helps ensure that companies invest in the right kinds of learning and development (L&D) and save valuable time, energy, and money in the long run.
- Align business goals and strategies to set performance trajectories – Understanding key competencies for each role in the company also helps management set realistic and attainable goals (SMART goals) and determine trajectories with changing environments and industry developments.
- Promote self-sufficiency among team members: When employees understand their expectations, they have the tools to take charge of their success within the company. This also makes them aware of the competencies necessary for growing into new organizational roles.
- Ensure consistency for performance evaluations: Having set competencies gives managers and team members a common vocabulary when conducting performance evaluations, making the entire process much easier to navigate.
- Build a well-oiled talent retention plan: Competency models can be integrated into employee retention plans to ensure that team members have what they need to succeed. This improves employee experience and helps guide team members through their employee life cycle, reducing the likelihood of turnover and increasing retention.
Examples of Corporate Competency Models
Competency models can be as varied as the companies that use them, and not every business makes their models available to the public. Here are several corporate competency models that have proven to be incredibly successful in their respective industries.
IBM
IBM’s Data Science Skills Competency Model outlines the necessary skills and competencies required for success in roles related to data science, machine learning, and AI.
Because data science is a growing field that requires many skills across the disciplines of statistics and computer science, as well as the field the business falls into, there has been a lack of consistency in job requirements. This model is organized into seven areas across these disciplines and spells out the outcomes, assessment criteria, and evidence types for each competency.
The Data Science Skills Competency Model
Deloitte
Deloitte’s competency model is geared toward identifying broad competencies necessary in today’s age of automation. This model demonstrates the need for new competencies in the digital age, as a response to the enormous changes that automation has brought in terms of jobs both destroyed and created.
The document outlines the problems thought to be posed by automation and the changes in broad competencies in the Swiss labor market between 1990 and 2013. It divides up crucial competencies for Swiss employees into subcategories, notes the shifts in their importance, and predicts the competencies that will become most necessary in the future.
Society for Human Resources Management (SHRM)
The SHRM Full Competency Model defines necessary proficiencies for HR professionals at any level of their career. This model focuses on nine key competencies which are broken down into full definitions, sub-competencies, behaviors, and proficiency standards, and then further broken down by professional career levels.
Association for Talent Development (ATD)
The ATD Competency Model is designed for guiding talent development practitioners to succeed in their careers. In this model, ATD defines key foundational competencies and areas of expertise and offers educational programs, certifications, and learning plans to provide professionals and the companies they work for with the skill-building knowledge needed for success in their field.
The ATD Competency Model™ Talent Development Redefined
Challenges in Implementing a Competency Model
Here are a few challenges to look for while implementing the competency model.
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Resistance to change – One of the most common challenges when implementing a competency model is employee and management resistance to change. Employees may feel threatened by new standards of evaluation or fear that they lack the competencies required. Managers might resist the additional work involved in integrating and maintaining the model.
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Maintaining flexibility – A competency model must remain flexible to adapt to change in terms of business needs, market demands, and evolving job roles. However, it can be challenging to strike a balance between creating a structured model and maintaining enough flexibility for adjustments.
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Ensuring fairness – Implementing a competency model must ensure fairness and consistency in how employees are assessed. A poorly designed model may lead to bias or unfair evaluations, where some employees are judged on competencies that aren’t relevant to their specific roles.
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Keeping the model updated – One of the biggest challenges with competency models is keeping them current. As technologies, industries, and market conditions evolve, so do the skills and competencies needed. Failure to update the model can lead to an outdated framework that doesn’t reflect current job requirements.
Training Clicks Better With Whatfix
Implementing a competency model is a powerful way to drive employee growth, improve performance, and align workforce skills with organizational goals. To maximize the ROI of such employee development initiatives, integrate a digital adoption platform like Whatfix.
WhatfixDAP provides interactive, in-app guidance and training directly within your enterprise software and applications, ensuring employees acquire the competencies they need while performing their tasks. Additionally, user analytics offer valuable insights into employee progress, helping you modify and update employee development programs and track competency mastery. With Whatfix, you can enhance the effectiveness of your competency model, ensuring continuous learning, improved employee performance, and strategic business growth.
To learn more about Whatfix, schedule a free demo with us today!