Why Competencies Matter – Integrating Talent Management Practices

Building Competencies for Results

Competency building remains a high strategic initiative for many organizations. Though companies may be using the same approaches to learning and skill development they’ve used in the past, new data suggests that organizations now focus on a different set of competencies and different groups of employees to develop.

According to a January, 2015 McKinsey report entitled, Building Capabilities for Performance, “On one hand, executives still believe leadership skills contribute most to their companies’ business performance…yet functional capabilities now rank second, replacing sector-specific capabilities in our earlier survey. Among specific functional capabilities, executives most often identify skills in strategy, operations, and marketing and sales as the most important to business performance.

“Organizations have also shifted the focus of their spending on capability building. 33% of respondents now rank frontline employees first as the group with the most resources for learning and skill development (up from 22 percent in 2010), followed by senior and executive leaders as a spending priority.”

Regardless of how an organization reaches its competency model or its approach to learning, it will be difficult to maintain credibility with line managers and employees unless the competencies can be demonstrated to be clearly linked to getting the results the organization desires.

Integrate Talent Management Practices With Competencies

As we’ve discussed in previous blogs, competencies are an integral part of any talent management strategy. They provide a structured model that can be used to integrate talent management practices throughout the organization. With competencies appropriately defined, you can tie the entire life cycle of the employee together and align recruiting, performance management, training and development and reward practices to build and reinforce key valued behaviors.

Employees in many organizations can feel pulled in multiple directions when talent management practices reinforce and demand competing priorities. If employees and their managers are responding to “mixed signals” about what is important within the organization their capability in producing a recognizable and distinct results is diminished. Providing consistency helps everyone understand what is important to succeed, and provides a common language throughout the organization.

Talent management systems provide a number of key components for sending a consistent message to the organization about what really matters. One of these is recruiting and selection which, when linked to the organization’s competency model, can assist with effectively evaluating candidates for hire or promotion on the basis of their alignment with the critical competencies linked to producing the organization’s desired results.

A second is talent planning and development. The organization can leverage its competency model if it evaluates the current capabilities of its workforce against competencies and uses the results for talent planning as well as to guide investment in training and development activities that will help close critical competency gaps.

A third key talent management component is the organization’s performance planning and management system. This system needs to be tightly connected to the organization’s competency model and can help enhance performance particularly if each of the competencies in the model were selected in the first place because of their strong linkage to a particular result or result-category. In the performance planning process it then simply becomes a matter of linking a particular individual’s key performance results (“the what”) to the particular competencies (“the how”) that he/she needs to demonstrate to successfully deliver.

The final key talent management system component relates to how the organization ties rewards to the demonstration of competencies. An organization’s willingness to “put its money where its mouth is” sends a strong signal to its employees that competencies are taken seriously and really matter. For example, an organization might sweeten the incentive pay-out to individuals who not only meet their results targets but do so in a way that is consistent with its competency expectations.

Jackie Messersmith is President and CEO of Talent Management LLC. Talent Management is the developer and distributor of Talent Snapshot®, an integrated, competency-based, “in the cloud” talent management solution. Jackie can be reached at 513-528-9700 or jackie@talentmanagementllc.com.

Talent Snapshot® – Talent Management Made Simple. www.talentsnapshot.com