1. THE COMPETENCY ROMANCE
3 - MAKING COMPETENCIES WORK
Frank O’CONNOR
RAP Consulting
franko@rap.net.nz
and
Leanne MARKUS
Performance Group International; Centranum

2. MAKING COMPETENCIES WORK
Many organisations have put substantial time and
money into the use of competencies and
competency frameworks
♥The usual aggravations appear
Organisations are too busy operating to get everyone involved
The benefits are hard to measure or evaluate
Weak distinction between the standards of work and worker
Competencies focus on knowledge skill and ability
♥Worse, the individual competencies used in many organisations
have little direct connection to the purpose of the enterprise, so
they don’t impact consistently on organisational results
How do we get greater organisational
leverage from these competency things?

3. HOW CAN WE GET GREATER
ORGANISATIONAL LEVERAGE?
We see organisational
effectiveness when:
1. Core competence matches
people’s capabilities
2. Goals flow from organisation
to individual – and back
3. Results expected are specified
and understood
4. Participants and their
contributions are supported
consistently

4. 1 CORE COMPETENCE MATCHES
PEOPLE’S CAPABILITIES
Competent organisations use their people’s
capabilities, to:
♥Gain competitive advantage, with customers, funders or
suppliers
♥Improve key aspects of performance, compared to others

5. A CORE COMPETENCE IS SOMETHING
THAT AN ORGANISATION CAN DO WELL
♥It provides customer benefits
They want or need the product or service
♥It is hard for competitors to imitate
Others are less ready, willing or able to provide
♥It can be applied widely to many products and markets
A range of customer needs can be met using the competence
Hamel and Prahalad (1990)
♥A core competence includes the collective knowledge of people
and the organisational procedures that shape the way
employees interact to produce something particular
♥Core competences are fundamental to the organisation

6. COMPETENT PEOPLE CONTRIBUTE TO
CORE COMPETENCIES
A core competence can take various forms, eg:
♥technical / subject matter know how
♥a reliable process
♥close relationships with customers and suppliers
Mascarenhas et al. 1998
It may also include less tangible attributes, eg:
♥innovative product development
♥a work culture of high employee dedication
Some say outsource activities that are not part of core competence
Core competence is more than individuals’ traits
♥"aggregates of capabilities, where synergy is created that has
sustainable value and broad applicability"
Gallon, Stillman, and Coates (1995)

7. KNOWLEDGE AND SKILLS BOUND TO
PRODUCTION PROCESSES
♥"a core competence is a combination of complementary skills
and knowledge bases embedded in a group or team that results
in the ability to execute one or more critical processes to a world
class standard."
Coyne, Hall, and Clifford (1997)
The skills or knowledge must be complementary to
the processes – taken together, they make it
possible to provide a superior product
♥“a core competence differentiates not only between firms but
also inside a firm it differentiates amongst several competencies.
In other words, a core competency guides a firm recombining its
competencies in response to demands from the environment”
Galunic and Rodan (1998)

8. WHAT IS YOUR CORE COMPETENCE?
When most products are modifications of a basic
technology, your people must make these well
♥Combining skills, knowledge, equipment and processes
♥Working to higher standards of consistency or reliability
Take Black and Decker' offerings to three markets:
s
♥Home workshops
drills, circular saws, sanders, routers, polishers, screwdrivers
♥Home cleaning and maintenance
dust busters, etc
♥Kitchen appliances
can openers, food processors, blenders, bread makers, fans
What is their core competence?

9. EXERCISE: MAKING A STANDARD
PROCESS INTO A CORE COMPETENCE?
A process which uses common methods and
people with basic training cannot be regarded as a
core competence
♥Skills or resources that are standardized or easily available do
not enable an organisation to achieve a competitive advantage
♥Specialised equipment and training applied to such a process
might generate a differentiating advantage over rivals
Some organisations, such as in the public sector,
do not compete for customers, but they do compete
for skilled staff
How could the recruitment process be
revisited to compete better?

10. 2 GOALS FLOW FROM
ORGANISATION TO INDIVIDUAL
– AND BACK
Aligned goals get better results at lower cost
♥Cascade from organisational goals to individual workplans
♥Set standards of work in terms of output delivered to customer
Until they learn not to, people naturally review
achievement
♥Accept intentions are good, but measure the essential results
♥Support individual work standards with unit goals

11. VIEW FROM THE TOP:
THE BRITISH COUNCIL’S INTRODUCTION
“The purpose of the British Council is to build
mutually beneficial relationships between people in
the UK and other countries and to increase
appreciation of the UK’s ideas and achievements”
♥“Everything we do must contribute to one or more of the
following outcomes:
Improved perception of the UK in other countries
Greater mutual understanding between the UK and other countries
Stronger ties between the UK and other countries”
♥“The work of every British Council member of staff contributes in
some way to the achievement of these outcomes, and it is
therefore important that we all have a clear understanding of
what our role is and what is expected of us.”

12. CASCADE FROM GOALS TO PLANS
Organisational Organisational Obligations
Obligations & Goals & Goals Met
Priorities, requirements & results
Results Achieved for
Customers
Unit Plans
Annual tasks/activities, Products and Services
outputs, outcomes and Delivered
achievement indicators
Individual Work Plans Core Work Done
Individual tasks/activities,
outputs and achievement
indicators
EXPECTED STANDARDS Individual
of skill, style & Effort
knowledge required for
satisfactory achievement SUPPORT
at specific work depends on style &
content of work

13. SUPPORT: THE LITMUS TEST
What are the [three] key goals this organisation has
this year?
♥What are the core processes that will deliver these goals?
♥What are the key actions carried out by your department to
support these processes?
♥What do we have to do to be and stay competent at these
actions?
People can do this – when they have to!

14. SUPPORT: OBSERVABLE COMPETENCIES
A child calls “Hey Dad! Come and watch me do ….”,
to give evidence of competence
♥Start with the same sentence, say with “Teamwork”
What would you see from “understands and supports diversity” ?
What does “cooperation” look like?
Results-based competencies go further:
♥“Hey Dad! Come and watch me increase sales by doing ….”
How do these affect overall achievement of goals?
Thanks to Carol Barnett, who taught me this
People learn to do this – when they want to!

15. SUPPORT: REAL DISTINCTIONS IN OUTPUT
STANDARD – AND CONSEQUENCES
Support Junior Intermediate Senior
ACTING TO ACHIEVE RESULTS
I got my work I worked with I planned for, I decided how we
done on time and others to plan for monitored and balanced work
in the right way, and achieve evaluated the within my area, so
so other people results that results achieved in we achieved the
can get on with contribute to my area of planned
their contribution achievements accountability, contribution to
to our goals outside my work correcting where it our KRAs in the
group fell short best way for staff
and clients
WORKING TOGETHER
I worked with I planned, did and I led and developed I led the actions of
other people in evaluated work staff in our and groups that work
and beyond my done with other client with other
group — I fitted in people, so all organizations to organizations to
with everyone else work used the get work done achieve shared
so we achieved right information together to the goals using
good results and achieved the right standard and separate
together right results timing, with resources and
problems resolved knowledge
efficiently and
effectively

16. EXERCISE: RESULTS OR INPUTS
♥Identifying and developing abilities and potential
using job-relevant tests, learning processes and other exercises in
selection, development and career counselling
♥Influencing the motivation of staff
designing payment and reward systems, and advising on health and
safety issues
♥Assessing achievement, in and around the job
designing goal setting and appraisal systems for groups or
individuals, advising on stress management, and in designing
machines and computer systems that are easy to use
♥Designing effective organisations
advising on the best type of management systems, identifying
effective human resources strategies, and designing jobs to fit
peoples' skills
If we looked at the output of a year’s work,
what would we see?

17. 3 RESULTS EXPECTED ARE
SPECIFIED AND UNDERSTOOD
Results are delivered better when they are specified
better
Consistent standards are critical, for individuals
and organisations
Feedback on fit of work done to end use saves
money and time

18. HOW CAN INDIVIDUAL COMPETENCIES BE
USED AS AN ACHIEVEMENT LEVER?
If organisations are to achieve useful productivity
leverage from “competency” initiatives, there must
be a direct relationship to organisational
achievement through the development of such
organisational capabilities
♥Personnel show these capabilities as individual competencies,
which vary with scope and type of work
♥One challenge is to integrate these input competencies in a way
that fits with overall outcome objectives

19. BOC: CORE COMPETENCIES PUT SIMPLY
“ACTS cultural pillars underpin everything we do at BOC; the way we behave, the
way we speak, the things we praise, the things we reward, the people we hire, the
people we promote, the procedures we implement. “The ACTS Cultural pillars are:
Accountability Collaboration Transparency Stretch
People know We maximise We believe that We continuously
what they are our achievements visible problems push the
accountable for as a group, can be solved and boundaries
and are not as individuals that informed of performance
empowered people make better
to deliver decisions
Add GAS and you have their core business

20. EXERCISE: SPECIFYING RESULTS
EXPECTED
“… concerned with the organisation and planning
involved in systematic … assessment, evaluation
and problem solving with individuals, groups,
organisations, and the community”
♥“Be able to demonstrate:
Problem definition
Collection and analysis of data relevant to the problem
Interpretation of data within a relevant conceptual framework
Determination of strategies supported by the best available evidence
Implementation of ongoing evaluation”
♥“… gathering information; defining and specifying the problem;
generating hypotheses; tool / method selection and use”
What does this competency produce?

21. 4 PARTICIPANTS AND THEIR
CONTRIBUTIONS ARE SUPPORTED
CONSISTENTLY
Supported participants make better contributions
♥Most people want to do work ‘well enough’, once they know how
match support delivery to style & content of work done
♥Courage and preparation enable ‘difficult conversations’
Individual and workgroup performance must have
♥Feedback on achievement against plans
Specific, measurable, achievable, realistic and time-bound results
♥Conformance with standards on how things will be done
expectations matching achievement

22. CONSISTENCY:
WHAT I SAY WHAT I MEAN
I hate what you just told me
Thank you for the feedback. and I disagree with you.
I am not happy with your
I am offering you a performance so I’m moving
developmental opportunity. you somewhere else.
I have confidence in you. I have concerns and doubts
about your ability but I want
to make you feel good.
It’s a very interesting idea.
I really want to express my
indifference or objection.

23. ORGANISATIONS PERFORM
AS WELL AS THEIR PEOPLE ALLOW
The best use of people requires firm expectations
♥clear plans and how it’s to be done
♥feedback on what’s done and needed
♥Use the cascade / technology pair
Once people throughout the organisation …
♥Understand what results are wanted
♥Identify and develop skills needed
♥Monitor and evaluate their own effectiveness
… their organisation can deliver on its
promises

24. EXERCISE: WHERE COMPETENCIES MOST
AFFECT BUSINESS ACHIEVEMENT
Strategy, Mission and Business Objectives
Organisation Structure Leadership & Communication Human Resources Strategy
Management Processes Recognition
Job Design & Information Systems & Rewards
Appraisal &
Recruitment Goal Setting
& Placement ACHIEVEMENT
ACHIEVEMENT
Development
Workforce Succession
Career Planning & Training
Planning Planning

25. GREATEST PRODUCTIVITY WITH
A framework that makes it easy for people
♥Assess and discuss their own performance and that of others in
the context of the organisation’s obligations and goals
Address individual training and development needs
Identify trends in skill gaps across the organisation
♥To get and use information about work planned and done
Technology makes this practicable
Clear expectations
♥People can’t do their jobs if they don'know what is expected
t
What’s measured? What’s in the job description? What matters?
Useful feedback
♥achievement improves with constructive and prompt feedback
Most employees appreciate feedback on what has worked well and,
given opportunity, will monitor and evaluate their own achievements

26. GREATEST BENEFITS COME
When competence is derived from the results
sought by the organisation
♥meeting standards in the competencies is essential to
acceptable achievement in the job and
♥achievement in the job is essential to acceptable organisational
achievement
When competence is relevant and necessary
♥to the actions of the worker
♥for the success of the organisation
When standards are clear and consistent
♥plain distinctions are made between “not good enough” and
“good enough” outputs
♥also applies to intangibles such as relationships and reputations

27. TEST QUESTIONS FROM EXPERIENCE
♥What are the organisational results expected?
We need to know outputs & outcomes, not intentions or inputs
♥What are we asking people to do differently?
We need to describe it, see it and do it.
♥How does the competency impact on these results?
Consistent and direct leverage on organisational achievement
♥What does “good enough” look like on the job?
We need to see the organisation showing that these minimum
standards matter
♥Are staff showing that meeting the standards matters to them?
We need to see and hear them demonstrate relevance in actions
True Love or Hawthorne Effect?

28. SOME REFERENCES
♥Galunic, D.C. and Rodan, S. (1998) "Resource recombinations
in the firm: knowledge structures and the potential for
Schumpeterian innovation". Strategic Management Journal vol
19. pp1193-1201.
♥Hamel, G and Prahalad, C.K. (1990) "The core competence of
the corporation", Harvard Business Review, vol. 68, no. 3, May-
June 1990, pp 79-93.
♥Levenson, A.R., Van der Stede, W.A. and Cohen, S.G. (2006)
“Measuring the relationship between managerial competencies
and performance”, Journal of Management, vol. 32, no. 3, June
2006, pp360-380
♥Mascarenhas, B., Baveja, A., and Jamil, M. (1998) "Dynamics of
core competencies in leading multinational companies",
California Management Review, vol 40, no. 4, pp117-132.
♥Schneider, W.E. (1997) "Aligning strategy, culture and
leadership." In Neumann, J.E.; Kellner, K.; & Dawson-Shepherd,
A. (Eds.), Developing Organisational Consultancy. London:
Routledge

29. YOUR CHOICE

30. Hawthorne Effect 1924-1933 from Western
Electric’s Hawthorne (Chicago) works
"Parsons (1974) described it as: "Generalizing from the particular
situation at Hawthorne, I would define the Hawthorne Effect as the
confounding that occurs if experimenters fail to realize how the
consequences of subjects' performance affect what subjects do".
Studies were done between 1924 and around 1933. Fritz J.
Roethlisberger and William J. Dickson give a great amount of detail,
but little interpretation. Elton Mayo of Harvard Business School gives
a shorter account, including the interpretation which has been so
influential: that it was feeling they were being closely attended to that
caused the improvement in performance.
Research was a series of studies on the productivity of workers
manipulated various conditions (pay, light levels, rest breaks, etc.)
but each change resulted on average over time in productivity rising,
including, eventually, a return to the original conditions. This was true
of each of the individual workers as well as of the group mean.
The variables the experimenters manipulated were not the only nor
dominant causes of productivity changes. One interpretation, mainly
due to Mayo, was that the important effect here was the feeling of
being studied: it is this that is now referred to as "the Hawthorne
effect".