Four Reasons Why Every Business Needs a Competency Model
In the 1970’s David McClelland, a renowned Harvard professor and an expert in motivation and achievement, directed research to explore the ingredients of superb job performance and in 1973 published “Testing for Competence Rather than Intelligence“. In this paper “he proposed that a set of specific competencies distinguished the most successful from those who were merely good enough to keep their jobs.”
Since then many organizations have attempted to hire, promote and train employees based on competencies. What many have failed to do however is identify and differentiate the skills and behaviors that are proven predictors of success. Too often, managers are enamored with intelligence, education, charisma, and personality only to discover too late that many top candidates can barely swim when they were expected to walk-on-water.
In an article in the Financial Times (October 12, 1994), Richard Donkin and McClelland analyzed what differentiated superior performers from those who missed and barely met expectations. They concluded that “value-adding” qualities in an individual are not totally related with academic achievement. They indicated that, from a cost effectiveness stand-point, it Is better to hire for core motivation and trait characteristics and develop knowledge and skills. Chris Dyson, a colleague of McClelland explained, “you can teach a turkey to climb a tree, but it is easier to hire a squirrel.”
While more and more organizations begin to imbed competency modeling into their performance management infrastructure, an October 28, 2003 Wall Street Journal story reported that several businesses are requiring SAT scores to screen and qualify candidates. How absurd. The SAT is designed to predict performance in the first year of college, and that’s it. Moreover, SAT results are typically at least five years old when an examinee enters the job market, so even if the scores were relevant to a professional position, they would be outdated by the time a person applies for that job.
Academics and consultants as far back as the 1920s have attempted to identify key competencies. They have relied heavily on past behavior as a predictor of future performance. McClelland expanded the practice of competency modeling to include the abilities, skills, behaviors and personal characteristics that impacted individual experiences and how superior performers perceived critical events.
In 1972 he wrote, “if you want to test who will be a good policeman, go find out what a policeman does. Follow him around. Make a list of his activities and sample from that list in screening applicants.”
Revealed through the practice of competency modeling are four benefits that help organizations manage costs and maximize individual productivity:
- You hire only people with the potential to success.
- You target training, development and coaching resources to improving those skills and behaviors that have the greatest top-line/bottom line impact on results.
- You develop an employee evaluation system that encourages ongoing feedback.
- You link individual rewards for productivity and performance improvement to corporate profitability.
As the economy begins to turn the corner, employees will begin to churn again, just like the late 1990s. It is time to inventory your talent and implement plans for retention and replacement.