7 Mistakes to Avoid in Competency Management

Posted by Joe Ellis, President & CEO of TEDS, Inc.

May 29, 2014 2:21:00 PM

Although organizations commit to using competencies to strategically manage their businesses, I’ve seen certain problems that crop up in their implementation; to ensure competency success, organizations must steer clear of the following mistakes.

competency management

1. Organizations implement a competency inventory, but do not create a governance board.

When organizations share their competencies, they create efficiency. To reach the maximum benefit of shared competencies, organizations need a streamlined development and management process through a representative governance group, which develops and maintains a common language to establish enterprise-wide standards. The organization needs an integrated approach for the initial and all future work.

2. Organizations create their inventory and then stop.

Organizations sometimes think the definition of the competency inventory is a one-time incident and do not plan for the maintenance and upkeep of the competencies. The entire competency life cycle must be accounted for; the best way to accomplish that is to integrate it in as a natural part of the business process.

3. Organizations define their competencies too finitely without focusing on Return on Investment (ROI).

One of the fallacies in the late 1990s was that academia, analysts, and businesses wanted to apply competencies to too great a level to the point creating “turning on light switches” within inventories. Such a detailed classification structure creates an unsustainable, complicated, maintenance nightmare, but even more than that, the ROI for those skills that everyone has is too low. Organizations need to focus their competency definitions on determining what workers need to know and perform that to deliver ROI. A reasonable guiding principle for creating competency definitions is assuming whether or not most people have certain base competencies that do not need to be measured and not including those that offer little value in tracking or measuring.

4. Organizations don’t really have competencies.

Sometimes organizations think they have something close enough to a competency inventory—like job profiles—that they think they can continue to function. However, if they don’t have competencies truly defined, they may continue to stay in business, but they’re sub-optimizing their ability to succeed. Other times, an organization may have a competency—like data structures, but they are not organized or simplified with a common definition across the entire organization to enable it to compare across the organizations workforce.

In both cases, the organizations are doing themselves a disservice. Taking the time to create competency definition compresses time in the near-future and long run. By creating a competency inventory, organizations actually reduce the amount of data it takes to determine if the workforce meets the need because the organization can go to one central location for the answer instead of having to pull data and information from all sorts of departments and divisions. Without a competency inventory, organizations cannot perform skills gap analysis; instead, they approximate answers based on faulty data. Guessing is not the behavior of a successful organization; getting to the right answer quickly is a trait of a winning organization.

5. Organizations allow workers to self-profess competencies, but do not validate that knowledge or skill.

After implementing a competency inventory, organizations should take care of how to associate their workforce with the competencies. At one company I consulted with, a person in Human Resources had coded in a language years ago and self-professed proficiency in that competency; unfortunately, she wasn’t proficient in actually coding in the language because she hadn’t used that skill in years and was thus no longer up-to-date. The company found that 30% of the skills they were tracking had no value because of this. The company plans to address this problem by implementing a self assessment in association with self-profession of competencies to enable a manager to see that a worker has claimed the competency and the manager can update the worker’s competency record, if appropriate.

6. Organizations do not integrate competency maintenance into their business practice.

Competencies must be managed throughout their life cycle. Organizations must integrate not only the definition into the business process, but also the assignment of competencies. Workers must be associated with competencies in which they hold proficiency and they must be assigned new or revised competencies to keep their skills fresh.

7.  Organizations do not link competencies with learning.

By maximizing the benefits of competencies with linked trainings, your organization ensures that new workers gain specialized knowledge and skills, and veteran employees will be retrained as required. Full integration of competencies and learnings maximizes benefits.

Competency Management