There is a lot of advice available to help HR professionals conduct competency development, but there is less guidance on how to ensure this investment provides real strategic value to your business, through careful alignment with the longer term goals of your business. Such strategic alignment requires HR and their functional colleagues to get clear on questions such as ‘why does our strategy need competency development?’, ‘to whose performance do we want to apply this development?’, and ‘how do we want to use these competencies?’ This article is intended to help you answer these questions, and in so doing, strengthen the link between what your people are doing on the ground, the business results you need today, and the successful execution of your business’s strategy tomorrow.
Over a twenty-year period, we’ve experienced a myriad of approaches to how competencies are used for development, from the early days when detail and differentiation were king and 27 competencies were described by job level, to more recent times when ‘less is more’ if a business wants to retain a certain amount of agility. But of course, we live in an age of AND not OR, where customers and consumers demand lower prices AND higher service levels; more flexibility AND a fast response; a personalized approach AND easy to deal with. These demands require our employees to handle a higher level of complexity, where they need to apply both focus and flexibility. And to achieve the appropriate balance of focus and flexibility within your business, we recommend turning the three questions we ask at the beginning of this article, into three strategic choices.
Strategic Choice 1: What changes are needed to drive your business and execute your strategy?
This choice is about understanding the true nature of the changes your business needs to make to both drive performance now AND execute the longer term strategy. So, answering the question ‘why?’ you want to invest in competency development in the first place. Performance improvement and strategy execution are all about change. What is the nature of the change that needs to take place? Is it increased production capacity? Is it a broad cultural change across the whole business? Is it the turnaround of a whole business’ performance? Is it a targeted transformation of your sales force? Is it an integration of your supply chain? Is it the start-up of a new technology or product segment?
The answers to these questions will provide the strategic scope and goals for your competency focus. For example, a broad cultural change may be best supported with generic core competencies that apply to all employees. This allows for close alignment to vision, values and mission, and can provide broad, rapid and consistent impact. Whereas the transformation of a sales force may be better supported with functional competencies which can accommodate focused, specific and often technical elements, and can be easier to integrate with a bonus scheme.