Competency Management

  1. The SMR Perspective

Competency and competence differ in their meanings. Therefore, before moving on to discussing competency management and its implications on organisational and individual performance, we need to resolve this issue Which term do we use in this book and what do we mean by it?

The confusion and the SMR response

With an understanding of the terms such as competency, competence, core competency, and role competence, we at SMR use the following terms and meanings as given here:

Competent: A person is said to be competent when his or her level of competence (suitability/ability) is recognised and verified by a community of practitioners.

Competency: Refers to overt (visible) characteristics like knowledge and skills and underlying (hidden) characteristics such as attitudes, motives, traits, self-concept, and values that drive performance to pre-determined standards.

The purpose of defining these terms is to adopt a practical approach rather than engage in a theoretical debate. This stand enables us to either focus on threshold competencies (knowledge and skills) or the underlying characteristics causally related to superior performance, depending on the organisational needs and culture

Levels of competency

Competencies relate to various levels in the organisation:

  • Organisational level
  • Positional level
  • Individual level

Types of competency

Further to our definition of competencies, SMR follows the following classification:

  1. Core competencies: They correspond to the organisational level. We follow the same definition as the one provided by Hamel and Prahlad.
  2. Functional competencies: They describe the work tasks and outputs, i.e., knowledge and skills needed to perform a job. They correspond to positional level.
  3. Behavioural competencies: They refer to the underlying characteristics needed to perform a job and correspond to the individual level.
  4. Role competencies: They correspond to the positional level and refer to the roles performed by team contributors


  1. SMR’s six steps in implementing competency projects
a.     Commencement

This stage involves getting ready to implement the project. Gaining management commitment, developing the scope document, and installing any software that may be required to drive the project are the critical steps to be carried out here. The project office and the project team with all the resources are set up. The project team is trained on selling competency management to the organisation. Existing data is imported from current systems.

b.    Development

This stage involves competency profiling resulting in the creation of competency dictionary, position profiles, and competency matrix. Each of these stages are validated by management, before the project moves on to the next stage.

c.     Pilot

The competency project is simulated in a small department. The results are presented to top management. The goal is to identify any difficulties that may arise in a full scale implementation.

d.    Roll out

This stage involves rolling out the project through the entire company.

e.     Linking to applications

This stage involves using linking the competency project to HR applications.

f.      Conclusion

At this stage, the project team conducts system testing of the software, prepares all the relevant documentation before concluding the project and handing it over to the project champion. The project team is disbanded and competency management becomes integrated with the organisational system.


An organisation maybe defined as a group of people working in a structured and collaborative way to achieve goals that maybe profit or nonprofit oriented. Depending on the organisational objectives, the structure may vary: functional, divisional, matrix, teams, circles and networks.

The structure determines how an organisation operates and how work is carried out. The structure allows the expressed allocation of responsibilities for different functions and processes to different entities such as individual, unit, department and division. An organisation structure is a formal layout of hierarchies of positions and grouping of employees.

The purpose of a competency framework is to ensure the goals of an organisation are achieved efficiently and effectively. The right job person fit should be in place. When people are competent, they should perform.

SMR’s PAGE™ Framework is the driving force behind competency models built when implementing competency based people development systems. Typically, a competency model is abstract in nature. SMR’s PAGE™ Framework converts the model from its abstract state to a practical state which can be used in day to day life.

In other words, the model is a blueprint and the framework is about the bricks and steel (not just bricks and mortar) which gives life to the blueprint. Both are equally important for a successful design.

– Position, Person, Programme and Performance

– Assessment

– Gaps (Competency Gaps)

– Evaluation


3. SMR Page Framework™


Every organisation is a hierarchy of positions; each position is expected to perform a set of duties. To successfully carry out these duties, certain competencies are required. When we list down all the competencies required by the position and assign Required Competency Levels (RCL) we derive Position Competency Profile.

The RCL is a numeric value assigned to the competency and indicates the level to which the competency is to be performed. The RCL may be defined between 1 to 5 depending on the requirements of the organisation structure. Each position should result in a position profile.

Sample of Position Competency Profile:

Position: Manager, Operations
Competency Required Competency Level (RCL)
Problem Solving 3
Planning Orientation 4
Decision Quality 4



Positions are assigned to employees (the person holding the position) based on the formal layout of hierarchies of positions and grouping of employees. Everyone has a required position competency profile.


Once we have the competency requirements of the position and person identified, the next step is to conduct a competency assessment. There are different techniques of assessments practiced such as reviews, interviews, observations, tests (RIOT). The technique used is decided after consideration of organisational factors.

Each employee (person) is rated on how well they demonstrate the competencies required by the position. The resulting competency assessment of each person is known as a person competency profile. The Person Competency Profile details the Current Competency Level (CCL)of the person.

The CCL is a numeric value assigned to the competency and indicates the level to which the competency is to be performed. The CCL may be defined between 1 to 5 depending on the requirements of the organisation structure which should be in line with RCL.

Sample of Position & Person Competency Profile:

Position: Manager, Operations
Competency Required Competency Level (RCL) Current Competency Level (CCL)
Problem Solving 3 3
Planning Orientation 4 3
Decision Quality 4 4



Now we have the Position Competency Profiles and Employee Competency Profiles, the next step would be to identify the Competency Gaps. SMR’s PAGE™ Framework provides a structure to identify the competency gaps: With the competency gaps for individual employees, departments and divisions, we will be able to conduct a Training Needs Analysis (TNA) effectively.

Sample of Position & Person Competency Profile with Competency Gap

Position: Manager, Operations
Competency Required Competency Level (RCL) Current Competency Level (CCL) GAP (RCL – CCL)
Problem Solving 3 3 0
Planning Orientation 4 3 1
Decision Quality 4 3 1



The identified competency gaps need to be closed with development interventions to improve competency levels and achieve organisational goals. There are various interventions, which could be used to close gaps. Each development intervention is detailed as a programme competency profile.

A programme competency profile details the competencies addressed by the development intervention. The competency level to which it is addressed is known as Programme Competency Level (PCL). Evaluation is an important component when addressing competency gaps. A person’s mere attendance at a programme does not indicate competency achievement. There needs to be evidence that the competency gap identified has been closed with the development intervention.


On completion of the development programmes, participants are evaluated to determine competency gains from the programme. The increased competency levels and performance improvements maybe used to evaluate the return on investment.


SMR’s PAGE™ Frameworkis consciously built with development of people in mind rather than punishing them for poor performance resulting from incompetence. Thus, the continuous application and development of SMR’s PAGE™ Framework results in improved individual performance. Individual performance should be translated into organisational performance. The link between competency and performance must be established. In the event, if it is not evident, other non-competency gaps needs to be explored.


4. Tips on competency Management

Why Competency Management?

The purpose of implementing a competency management framework is to gain a competitive edge in a competitive world. Work has to be restructured in different ways to meet the present and future challenges. Competent human capital ensures organisational competitiveness and prosperity.

What is Competence?

Competence has generally been referred to as being job related with a focus on skills acquisition. The VET movement has been largely focused on competence. The competence focus was on developing vocational competencies that were transferable between jobs, occupations or roles. The goal of this approach is to ensure threshold performance or minimum standards are being met by the job incumbent.

What is Competency?

A competency is an underlying characteristic of an individual that is causally related to criterion referenced effective and or effective performance in a job or situation.

Competency is more person related with a focus on the underlying characteristics that are fairly deep and enduring and part of the person’s personality. It is expected to predict behaviour in a variety of job tasks and situations.

Causally means there is a correlation to performance. The five types of characteristics are Motives, Traits, Self Concept, Knowledge and Skills.

What are the essential elements?

The essential elements were defined as follows:

Competencies (knowledge, Skills, attitudes) to be demonstrated by the learner,
Criteria to be employed in assessing competencies
Assessment of the learners competency 

What are the drivers for the Competence movement?

Six drivers have fuelled the VET field in Europe according to a study conducted by European Centre for the Development of Vocational Training, 2009:

The speed of change in technology, processes and demographic changes such as the entry of the young workforce,

The traditional form of education that was supply driven was being replaced by demand driven models where the focus is on output

Competence and Competency

While competence is more job related and has a vocational training emphasis, competency is more person related.
Competence focuses on threshold competences that ensure a person is able to meet the minimum standards; competency focusses on differentiating competencies that differentiate superior and poor performance. Boyatzis attempted to marry the two by including skills and knowledge within underlying characteristics.

How do you develop a competency model?

A six step model is recommended even though the depth and time taken to develop a comprehensive model would depend on the scope of the project.

The steps are:

  1. Establish the performance criteria.
  2. Identify people for the criterion samples to differentiate performance.
  3. Collect data through behavioral event interviews (BEIs) or other assessment methods.
  4. Analyze data and define the competencies.
  5. Validate the model.
  6. Design applications.

What are the drivers for Competency Management

Performance is the central driver within a competency based system. When the people hired and the right learning opportunities implemented fit with the organisational needs, organisations are able to achieve their performance goals.

Costs savings can be huge. Wastage incurred due to poor hiring and development can be substantial.

Each of them varies on the time taken to complete the assessments, costs, quality (validity and reliability) and administrative convenience.

The acronym RIOT is a good guide for use in Competency Assessments.

  • Reviews
  • Interviews
  • Observations
  • Tests

How do we manage the complexity of competency management implementation in a cost effective way?

Implementing Competency Management in an organisation is a complex exercise. There are no short cuts. It involves extensive investment of time, resources and money. Ultimately, the data obtained from the exercise must lead to productive decision making about people.

While organisations aim to use enterprise resource systems such as SAP and Oracle, there are many specific competency applications such as HRDPower which are more specific for competency and talent management.