Knock, Knock. Who's There? Competencies and Performance Management. Trick or Treat?

Every year about this time I run into HR practitioners who just don't know what to do with the competency portion of their performance management program. 

It's as if they had gone to the door of their favorite neighbor with their Halloween candy bag open, only to see the neighbor dropping unwrapped candy in. Great handfuls of brightly colored gumdrops and M & Ms. Our trick or treaters may not be able to throw the candy away if they are going to act neighborly but with eyes bulging and jaws dropped, they are a bit horrified of their alternatives.

Back in the office -- objectives and goals, no problem. Write effective SMART objectives, clear rating definitions, train managers how to apply the ratings and most HR practitioners are happy in their everyday Superman or Superwoman cape. But throw competencies into the mix, and entirely different personalities emerge. Many turn into Peter Parker/Spiderman, whose self doubt abounds and whose questions keep coming.

Are competencies entirely separate from objectives or are they connected? What do I do when most performance plans show that employees don't write good competency examples -- or any at all? Can we really rate every employee on each competency? Or if we don't rate them, what do we do? Why do we have competencies when our managers just don't know what to say about them and skip over this section of the form?

Competencies have been used to describe preferred behaviors for decades, but they began to creep into HR practices around 20 years ago. It was a convergence of a number of factors, with these two at the top. Research began to demonstrate how adults develop over their career, anchoring the developmental stages in discrete behaviors. In addition, insight into business strategy and operations clarified that how employees worked and built relationships with customers differentiated competing companies as much as their products did.

So what are those competencies doing on the performance appraisal form? In a broad strategic sense, they are another way of defining your culture, defining "how we work together in this company". In a practical sense, they facilitate achievement of objectives. In terms of levels of responsibility, they can be used to describe the difference in behavior between job levels in a career path.

For example, competencies can help employees understand that if they are promoted to a Team Leader, their Communication efforts have become more of a priority than when they were individual contributors. And, because their Communication behaviors are more of a priority, the Team Leaders' achievement of objectives can be directly impacted for better or worse by their effectiveness in the Communication competency.

Should the Team Leader be paying equal attention to all of the competencies on their performance plan? Probably not. That's where planning comes in -- the manager would help the Team Leader zero in on competencies like Communication that will be critical to achievement of his or her objectives. Just as important, the manager would also identify the competencies that will be less influential to success, so the Team Leader can understand how to put his or her best foot forward and not be distracted.

Conversationally, we can probably agree that HOW we go about our work matters as much as our WHAT we achieve. Competencies give us words so we can talk about our work practices . . . that is, how we go about our work. Competencies can make it clear to employees that behavior matters and can influence their own results as well as the company's.

Competencies can be tricky, but they really are treats that can be savored like a fresh box of Junior Mints. If this is not happening yet in your neighborhood, it's definitely time to make a change and check out the payoff. It's worth doing the work to understand the role that competencies play and build greater effectiveness in their use before Halloween 2011 rolls around.

Margaret O'Hanlon is founder and principal of re:Think Consulting.  She has decades of experience teaming up with clients to ensure great Human Resource ideas deliver valuable business results.  Margaret brings deep expertise in total rewards communication to the dialog at the Café; before founding re:Think Consulting, she was a Principal in Total Rewards Communications with Towers Perrin.  Margaret earned her M.S. and Ed.S. in Instructional Technology at Indiana University.  Creative writing is one of her outside passions, along with Masters Swimming.

Comments

[E James (Jim) Brennan]

Have you seen any really new or innovative changes in the competency arena since Schuster-Zingheim's last research study published 3Q09? http://schuster-zingheim.com/Competencies_Replacing_Jobs_as_the_Compensation-HR_Foundation.pdf finds that some have replaced the term "performance management" with "competency management."

[Margaret]

Hi Jim. Just noticed that the reply I posted back in October didn't take. Great observation but I would wonder if the world splits between big companies with lots of experience and understanding of competencies and other companies who have implemented them without understanding them. The research may indicate that those who undertook competency work for a business reason have evolved in their understanding and applications, while those who introduced them without understanding their application continue to flounder a bit. Many of my clients are in the second camp, I find, which is such a shame because competencies can do so much for a persons' understanding of improved productivity and career development.