The Competency and Emotional Intelligence 2003/4 survey found that 95 per cent of respondents used behavioural competencies and 66 per cent used technical competencies. It was noted that because the latter deal with specific activities and tasks they inevitably result in different sets of competencies for groups of related roles, functions or activities. The top four uses of competencies were:
1. Performance management – 89 per cent.
2. Training and development – 85 per cent.
3. Selection – 85 per cent.
4. Recruitment – 81 per cent.
Only 35 per cent of organizations link competencies to reward. The ways in which these competencies are used are described below.
Performance management
Competencies in performance management are used to ensure that performance reviews do not simply focus on outcomes but also consider the behavioural aspects of how the work is carried out that determine those outcomes. Performance reviews conducted on this basis are used to inform personal improvement and development plans and other learning and development initiatives.
As noted by Competency and Emotional Intelligence (2003/4): ‘Increasingly, employers are extending their performance management systems to assess not only objectives but also qualitative aspects of the job.’ The alternative approaches are: 1) the assessment has to be made by reference to the whole set of core competencies in the framework; or 2) the manager and the individual carry out a joint assessment of the latter’s performance and agree on the competencies to be assessed, selecting those most relevant to the role. The joint assessments may be guided by examples known as ‘behavioural indicators’ of how the competency may be demonstrated in the employee’s day-to-day work and in some cases the assessment is linked to defined levels of competency (see Chapter 33 for further details of how this process works).
Learning and development
Role profiles, which are either generic (covering a range of similar jobs) or individual (role-specific), can include statements of the technical competencies required. These can be used as the basis for assessing the levels of competency achieved by individuals and so identifying their learning and development needs.
Career family grade structures (see Chapter 46) can define the competencies required at each level in a career family. These definitions provide a career map showing the competencies people need to develop in order to progress their career.
Competencies are also used in development centres (see Chapter 40), which help participants build up their understanding of the competencies they require now and in the future so that they can plan their own self-directed learning programmes.
Recruitment and selection
The language of competencies is used in many organizations as a basis for the person specification, which is set out under competency headings as developed through role analysis. The competencies defined for a role are used as the framework for recruitment and selection.
A competencies approach can help to identify which selection techniques such as psychological testing are most likely to produce useful evidence. It provides the information required to conduct a structured interview in which questions can focus on particular competency areas to establish the extent to which candidates meet the specification as set out in competency terms.
In assessment centres, competency frameworks are used to define the competency dimensions that distinguish high performance. This indicates what exercises or simulations are required and the assessment processes that should be used.
Reward management
In the 1990s, when the competency movement came to the fore, the notion of linking pay to competencies – competency-related pay – emerged. But it has never taken off; only 8 per cent of the respondents to the e-reward 2004 survey of contingent pay used it. However, more recently, the concept of contribution-related pay has emerged, which provides for people to be rewarded according to both the results they achieve and their level of competence, and the e-reward 2004 survey established that 33 per cent of respondents had introduced it.
Another application of competencies in reward management is that of career family grade and pay structures.
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