Column: By Alex Borg, regional director, CILT
Companies are increasingly focusing on human capital as a competitive advantage in a rapidly changing environment. To achieve business success, companies are expecting their employees to perform at higher levels, to be more customer-responsive, more process-oriented, more involved in shared leadership, and more responsible for creating the knowledge that adds value to an organisation’s distinguishing capabilities. Adjusting to these challenges has profound implications for human capital management.
In particular, human resource professionals are now charged with developing and sustaining methods for: predicting, in advance, superior performing talent; aligning individual and team behavior with an organisation’s vision and strategy; integrating performance development systems; distributing "just in time" learning and development opportunities; building and retaining intellectual capital.
In order to accomplish any of these objectives, HR professionals must be able to help their companies identify and define required employee competencies. It is now a leading strategy to apply and integrate competencies in all major HR areas, including recruitment, selection, assessment, development, appraisal, and rewards.
When embarking on the path of selecting and defining competencies, an organisation needs to pause for an introspective review. Linking competencies to its purpose, goals, and values are key in order to positively affect a company’s direction and bottom line.
Competencies can be linked to both the hard and soft aspects of business. Mission/Vision form the basis of determining an organisation’s strategic direction and its values. Core competencies should link to objectives, and strategic performance. They should be linked to the organisation’s practices and ultimately to its values. Consistent and supportive infrastructure is the key to institutionalising both sets of competencies across the organisation.
A great organisational culture doesn’t necessarily mean great results. Likewise, total focus on the quantitative goals whilst forgetting people, isn’t a great formula for long-term success either. Organisations that seek balance seem to have resilience over the long term. In his book “Good to Great”, Jim Collins and his team demonstrated that companies that focus on five areas become far more successful than their competition. Three of these areas fall in the arena of performance competencies and the other two into the category of core competencies.
Will competencies be another disappointment for human resource professionals or actually provide a positive impact on the strategic direction and success of an organisation? The answer will be directly linked to how competencies are created, defined, and integrated into an organisation’s systems, processes and culture.
What is competency? The word is tossed about very liberally and means different things to different people. For an organisation, competency can be defined as the technical capability that differentiates that organisation from the competition. On an individual level, competency can be defined as related knowledge, skills, and abilities that influence job performance.
Competencies can be categorised into one of four groups: organisation based, individual based, technical and behavioral.
Will newly defined competencies be relegated to a binder in a bookcase like so many mission statements are relegated to a wall poster in the front lobby? Or will they become an integrated part of a company’s culture? The answer to that question lies in how competencies are embedded into the organisation’s systems, particularly the human resource systems and processes. Stephen R. Covey emphasises that “you can’t talk your way out of problems you behave yourself into.” Defining and applying behavioral competencies can take an organisation to a new level of performance.