insight February 2008

Competency Management:
Creating a high-performance and adaptive workforce
Maura Pallera, Global Research Analyst, mpallera@salary.com

Bottom Line A well implemented Competency Management Program aligns individual and business goals resulting
in a more engaged, adaptive, and successful workforce.

Subjects Competency Management, Competency Model Components, Benefits of Program, Implementation

Executive Summary
Increasingly, organizations look to raise the bar for performance, accelerate the Frequently, competency
development of leaders and ensure employees can implement new work processes
initiatives fail because
and become drivers of continuous innovation and change. Organizations need a
way to clarify new standards and expectations, better align individual behavior and time to implementation
business strategies, and help employees take charge of their own development. The is too long. An organi-
successful development and implementation of a Competency Management Program zation needs to see
allows organizations to achieve these objectives.
tangible results to
remain invested in an
The Role of Competency Management
Competency Management is a systematic approach to align individual performance
initiative.
to business strategy and goals. This process allows an organization to develop core
Rapid implementation
and functional competencies to compete now and in the future. Competencies are
at the center of an effective talent management initiative. They enable employers to of a competency
focus workforce planning on critical initiatives such as: training and development, management program
career pathing, skills inventory and assessment, succession planning, performance yields tangible
management, recruiting, risk analysis, resource allocation, and compensation.
benefits sooner: 5-10%
Four essential components to rapidly integrate a Competency Program are: increase in hiring
•  A solid Framework to allow consistency and maintainability successful candidates,
across the enterprise. 15-20% increase in
retention, 15-25%
•  Access to proven Data Models to reduce time to adoption and
increase in morale
shorten development cycle.
and 20% increase in
•  A documented Methodology that leverages best practices goal completion by
to support flexible, adaptable Processes that streamline individuals and teams.*
implementation; and
* Statistics Provided by:
•  People : Those who provide the internal organizational
knowledge and those who provide the competency management
expertise and objective, external perspectives gained from
working with other companies.

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 insight February 2008

Salary.com Research
A study conducted by Salary.com research reveals that employees become more engaged when organizations adhere to certain
values that include career development, participative management, and an organizational focus on customer satisfaction.
Employees are likely to stay with an employer that seeks to improve relationships between managers and employees through
meaningful performance assessment, development planning, career planning, coaching and mentoring.
In general, employees are attracted to employers who:

•  Offer challenging work, incentives, recognition, rewards, promotion opportunity,

and developmental learning.

•  Instill trust in company leadership, especially as it articulates the mission, vision,

and objective of the company.

•  Foster thriving relationships with supervisors and co-workers through coaching,

mentoring, collaboration and spirit of cooperation.

•  Enable employees to see how they contribute to their employer’s success.

Competency Model
A Competency Model includes the data and the associated methods and processes that support a competency management
initiative. It provides a comprehensive and objective view of the jobs and competencies in the organization. The competency
model helps to drive performance by linking jobs, competencies and learning resources.

The data consists of four major components:

•  Jobs (job title, functional title, role or position) describe the major responsibilities The ITG Model
where incumbents spend the majority of their effort. Related jobs are grouped into Job Families (68)
job families based on function or expertise. Function or expertise
Bands for employees, management
•  Competencies are a combination of skill, knowledge and ability that manifests itself and executives

in observable behavior of an individual who is successful at a given activity. Each

competency consists of proficiency levels which define the type of expertise called
for in a particular competency in a given job. The ITG model uses a four level scale, Jobs (900)
Job descriptions
each with four to six behavioral descriptors (anchors) unique to that competency.
Job profiles
The proficiency levels are: Job responsibilities

•  Level 1: Basic understanding

JoB PRoFILES
•  Level 2: Working experience

•  Level 3: Extensive experience Competencies (1,200+)

Business - 28
•  Level 4: Subject matter depth and breadth Functional - 1,125
Individual - 25
•  Job Family Profiles are the result of assigning relevant competencies to jobs setting Managerial - 22
a proficiency level benchmark for each competency within each job role. It is the
job profile that can be used to clearly communicate those success criteria to the
employees.
Learning References (3,600+)
•  Learning references are a wide array of references to activities, books, websites, Books
Professional organizations
organizations, etc. that can help an employee develop proficiency in a given
Publications
competency. For example, ITG’s models provide five to fifteen references for each Websites
competency.

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 insight February 2008

The Salary.com Competency Group offers the ITG Competency database for specific jobs within industry verticals.
Skills, behaviors and proficiency levels required to excel in a given role are provided for all jobs.

Benefits of a Competency Management Program

A Competency Management Program provides benefits for the company as a whole while delivering specific benefits to
Managers, Individuals, Human Resources, and Training Managers.

•  The Company can align the workforce with the corporate strategy, goals, and objectives. By establishing a
clear and consistent framework, the organization can create a fluid process for the movement of employees
across functions of the organization. Risk management is aided by the ability to analyze where there may be
a shortfall of skills in critical business areas.

•  Managers are able to clearly and consistently articulate job expectations to their staff. The common
language created via a competency management program allows for more objective discussion between
managers and individuals regarding development, performance, succession planning and other talent
management functions. The job profiles that are created can be used to create a targeted recruiting
process, resulting in hiring the right people with the skills needed.

•  Individual employees are able to determine what competencies are needed to be successful, not only in
their current jobs, but in future career moves. Development plans are enriched with information which is
generated from identifying knowledge gaps. Individuals’ strengths are also highlighted during the process,
perhaps qualifying them for higher profile project work. Self-directed employees can take advantage of the
learning references that are associated with each competency.

•  Human Resources and Training Managers can align learning and development efforts with employee,
team and organizational needs. Training professionals can facilitate self-directed learning for employees
and create “What if…” scenarios for curriculum development.

Implementation, Process and Methodology

When looking to implement a competency management program it is important to establish a strong management process.
This allows the implementation to move along rapidly and avoid pitfalls that can derail focus. Look for a well-documented
methodology that outlines flexible, repeatable processes, and documents multiple approaches depending on goals and
objectives.

Phase I Phase II Phase III Phase IV Phase V

Project Results
Model Staff
Planning & Analysis & Maintenance
Customization Assessments
Definition Actions

· Communications · Steering Committee · Individual · Organization-wide · Annual updates

campaign
· Working groups Assessments reports
· Continuous support
· Define roles and · Client version of · Individual gaps & · Strategy for
responsibilities development plans managing risk
model
· Software evaluation

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 insight February 2008

The best practices implementation methodology consists of five steps:

•  Project planning and definition entails identifying the project scope and objectives, developing a project
plan, and developing a communication strategy. Project team roles and responsibilities are determined and,
if necessary, talent management software to house the model is evaluated and selected.

•  Model Customization is achieved by working with the project teams and subject matter experts to select
competencies from the model that are strategic to the organization. A top-down approach is typically used,
with a steering group being formed to identify the core competencies needed by the company. Managers
and individual contributors are led through a process to help them quickly and efficiently select the
competencies for each job and assign proficiency levels.

•  Staff Assessments focuses on collecting information on the skills and proficiency levels of the employees.
Individual gaps are identified and development plans are prepared. This phase offers unparalleled
opportunity for communication between manager and employee.

•  Results Analysis and Actions focuses on analyzing individual and aggregate data, identifying critical gaps
and strengths and implementing strategies for closing the gaps and exploiting the strengths.

•  Maintenance begins when the first skills inventory is completed and continues for as long as the
information is needed in the organization. It focuses on upkeep of the competency data, jobs, profiles,
learning resources and assessments.

It is at this point we see the competencies put in place, aligned with other talent management efforts.

The Project Management process is critical to the success of a Competency Management Initiative. Essential elements consist
of a dedicated team, commitment from decision makers, and a focus on solid, short term deliverables to assure momentum,
interest, and funding. Be aware that there are always other projects in the organization that will be vying for the same pool of
energy, human resources and money.

Recommendations
The time investment and cost of implementation can be significantly reduced by establishing and enforcing a scalable
framework and leveraging existing information and expertise. It is critical to drive the project toward short-term deliverables,
and engage employees at all levels. Be prepared for pockets of resistance and manage that component of the process by
establishing an effective, consistent communications campaign. Take time to find out what is meaningful to individuals. Use
facilitated workshops to gather information and create a shared sense of purpose and excitement.

Following these recommendations will ensure:

•  Shortened implementation time.

•  Reduced costs.

•  Reduced project risk.

•  Tangible results quicker.

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 insight February 2008

Salary.com Competency Group

Job-competency data and related management services
ITG and Schoonover, a strategic business unit and division of Salary.com, focus on enterprise-wide competency-based human
capital management, design, modeling and implementation. Our staff includes developers and consultants with over 20 years of
experience working with competency data.

ITG and Schoonover’s partnerships offer the flexibility to choose the software platform that meets your needs. Our customer
base of over 300 companies includes a wide range of industries and company sizes. Contact us to preview any ITG competency
models for corporate enterprise, insurance, banking, information technology, healthcare administration, retail, customer
relationship management, manufacturing and corporate leadership.

To learn more, visit www.itgcompetencymodels.com or contact Stefan Evers at severs@salary.com

In addition to supporting your competency based talent management initiatives, Salary.com provides a complete offering of
on-demand compensation and performance management solutions helping HR professionals successfully administer pay-for-
performance programs. Compensation meets inspiration when you build your workforce with Salary.com.

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