What Is a Competency Model? +Benefits, Examples (2023)
What makes an effective employee? This is a tricky question, and the answer varies depending on the position. At face value, knowing who to hire is tough and first appearances don’t always hold up.
One tool that successful HR teams use to determine the necessary skills and competencies required to fill and maintain a specific role is called a competency model.
What Is a Competency?
The simple definition of competence is the state of “having requisite or adequate ability or qualities.” For any business, ensuring that team members have the required abilities and qualities for their assigned roles is crucial to success.
It is common practice for businesses to define specific areas of competence that ensure success in certain circumstances or roles. These are known as “competencies.” Typically, competency comes in the form of a specific, observable, and measurable knowledge set, skill, ability, or other characteristics (KSAO). Common competencies are qualities like decision making, team-leading, critical thinking, and clear communication.
The use of this term has roots in law and clinical psychology, where it is used in relation to mental and living capacities. It was later adopted by trade and vocational professionals as a tool for defining KSAOs for specific jobs.
Competency vs skill
Skill is similar to competence in their broad definition: the ability to use knowledge effectively or to execute learned physical tasks. In practice, skills are smaller-scale abilities that can be learned quickly through training or practice.
Alternatively, competency can be thought of as the overarching compilation of requisite skills, knowledge, or abilities.
Competency vs capability
Capability is another term that often gets confused with competency. Capability refers to the potential an employee has to acquire a KSAO or competency. A capability is certainly beneficial because it can turn into a competency with the necessary guidance and training.
Competency, on the other hand, refers specifically to the proficiency a team member already possesses which equips them for success in their position. Competencies are the qualities that make someone an expert in their role or field.
What Is a Competency Model?
Once competencies are defined, they are aggregated into a framework used by businesses to define the KSAO requirements for success in a given role. Competency models define what success looks like for a given role and is useful for recruitment and hiring as well as L&D efforts and performance assessments.
The Elements of a Competency Model
An effective competency model includes several components.
First, it spells out designated competencies with clear descriptions. It also includes useful examples of relevant activities and behaviors associated with competencies so HR teams know exactly what they’re looking for.
Furthermore, including a visual component like a flow chart to represent the model is also helpful.
Benefits of Competency Modeling
There are many benefits of competency modeling. While compiling these models for each role at your company might at first seem repetitive, there will be a fair amount of overlap across roles.
In the end, this process will help ensure that HR truly understands the ins and outs of every single position and the value of each employee at your company.
1. Draft high-quality job descriptions
Nobody likes to have their time wasted. 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 right candidates submit applications and that prospective employees aren’t met with any surprises when they reach the interview stage.
2. Promote communication and understanding across the organization
Developing robust competency models helps ensure that team members understand what their colleagues do every day, 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.
3. Pinpoint L&D needs for more effective training
4. 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 in relation to changing environments and industry developments.
5. Promote self-sufficiency among team members
When employees understand their expectations, they have the tools they need to take charge of their success within the company. This also makes them aware of the competencies necessary for growing into new roles within the organization.
6. Ensure consistency for performance evaluations
Having set competencies gives managers and team members a common vocabulary when carrying out performance evaluations. This makes the entire process much easier to navigate.
7. Build a well-oiled talent retention plan
How To Develop Effective Competency Models
There’s a lot that goes into developing effective competency models, and a lot of the process will be determined by the needs of your individual business. Having a clear plan for the development of your model can help smooth out this journey and increase the overall benefits as a result.
Before beginning, it’s important to ask several questions to define the purpose of your company’s competency model. For example, who will be using the model and what will it be used for? What types of goals do you have for this plan? Do you need different models for individual jobs, for managers, or for the company as a whole?
The answers to these questions will guide the development of your competency model
1. Gather information
Once you’ve answered the questions above and determined the type of framework, or frameworks you’ll need for your model, the research and development of the plan can begin.
HR teams don’t necessarily have intimate knowledge of each position or initiative in the company, so gathering that information is crucial. Use questionnaires, one-on-one interviews, and conduct outside research to get a clear idea of the proficiencies needed for each role.
Then, interview top employees and management teams to get their take on the most critical competencies. You can also establish competencies for individual roles based on the competencies of managers and top-performing employees.
If there are still gaps to be filled in, reach out to industry experts and look at models of other companies to round things out.
2. Develop a preliminary framework
Use the information you gather to identify themes and patterns in competencies across departments, projects, and levels of management, and then group that information into content areas.
For each area, pinpoint the most consistently important competencies, and begin building out the framework. Come up with definitions of these competencies and provide examples to demonstrate how these competencies show up in day-to-day work situations.
3. Solicit feedback
Once you’ve got a framework, seek feedback from subject matter experts, internal stakeholders, and the employees to whom it applies. Run it back by executives and managers to align the framework with company values and performance trajectories, and find out what the involved parties and leadership team members view as essential.
Make sure you’re conscious of potential biases in your data – what are the backgrounds, demographics, and experience levels of your interviewees?
4. Refine the model
With that feedback, you can return to your framework to add and remove competencies as necessary. The list shouldn’t be too long or wordy, or the people who end up using it will be overwhelmed, rendering it less effective. This process is all about determining the competencies that are absolutely necessary and making them crystal clear.
5. Validate the model
Finally, take the model for a test run to validate its efficacy. Bring the list back to those stakeholders, executives, and managers to make sure all parties are on board to ensure success.
From there, you can return to step four for further refinement or put your model into action.
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’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.
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.
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Competency models have emerged as valuable tools employed by HR and L&D departments to define skill and knowledge requirements for specific job roles, assess competencies and performances, and create learning and development strategies for employees to succeed.
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