What is a competency framework?

Companies often use a competency framework to figure out what skills are needed within the company. The structure makes it clear what skills are needed for each job, like problem-solving, strategic awareness, or logical thinking, whether the person is working in a small team or for the whole organization.

It’s about what behaviors (and technical skills, if needed) someone must have in order to do their job correctly and efficiently. This is called competency. People may already be competent, or they can become more competent through training and learning.

In the past, HR managers have tried to tell the difference between ability and competencies because they are not the same thing. Competence is more interested in effort and input (the behaviors that lead to competent performance), while impact and output (what people need to do to do a job) are more important to competency. In recent years, there has been a push to make a framework that knows both are needed for a business to do well and for a candidate to do well, so the terms have become more interchangeable.

A competency framework sets out what the candidate’s competencies should be in order for the team/business to achieve success. Understanding what skills are required and knowing which competencies can be developed is key to long term business success.

When done correctly, a competency framework can improve performance and provide clarity for each individual role requirement. In turn, this will help provide a clear link between individual and organisational performance. One of the big takeaways from a competency framework is that one should work on a business-to-business requirement and that flexibility is as important as creating an overly prescriptive and non-inclusive framework.

What is a competency framework used for?

A competency framework is used to help employees understand what’s expected of them in their job role and drive what are considered the most important elements of success within the organisation. Done correctly, a competency framework helps employees, managers and the organisation as a whole.

How does it help employees?

Employees get a description of their job role and in particular, what’s required for excellency. Outlining expectations and providing guidance on personal growth, a competency framework, in short, helps the employee understand what’s expected of them and how they can improve.

The framework should give more information about the organisation, their role and responsibilities and how their job impacts the bottom line. From retaining talent to increasing internal mobility, a competency framework should highlight what matters in the role and the organisation for the employee.

Finally, competency frameworks allow employees to have a level of transparency when it comes to assessments. This helps the manager assess the employee based on the criteria of the role, the benchmark requirements and removes any bias from the assessment.

How does it help the managers?

A competency framework helps managers to standardise employee assessments by creating a basic benchmarking tool per job role.

This is, of course, an advantage in creating assessments that are fair but more importantly, this takes the stress off the manager in developing talent by themselves, bringing in the HR teams and wider organisation to develop employees.

How does it help the organisation?

A competency framework can also help organisations bring better data to top-level management. Having a standardised assessment tool helps develop a clear understanding for senior managers where the existing talent lies within the organisation.

Developing internal talent and increasing employee internal mobility has become a focus for businesses in recent years. It helps maintain key members of staff within the workplace, drive down recruitment costs but, importantly, helps organisations understand what other talents are needed within the organisation to succeed.

How to develop an effective competency framework

Skills and competencies are the starting point for creating a competency framework. The design should be carefully created to include only measurable components with a restricted number of competencies so as to not overwhelm the candidate selection or assessment process.

What should be included?

A competency framework needs to work on a level of detail that’s effective for both the organisation and the employee. If you create one that’s too broad it will fail to provide an overview that’s adequate for assessments and for the employee to live up to. If, on the other hand, it’s too detailed, a competency framework becomes overly bureaucratic, time consuming and renders the process lacking in credibility.

Skills and competencies are being assessed in a competency framework. Skills describe the learned ability to complete a task. Competency better describes how to best utilise skills in order to complete a task.

When it comes to skills, you’ are talking about something that an employee has, even when they leave the company. Being able to assess these as part of the framework is essential because they will always have them.

Hard Skills

These are skills that are attained through education or training. Every job has them, and they are primarily technical – but are not limited to technical industries. Examples include, data analysis, documentation and coding ability.

Soft Skills

Soft skills are personal characteristics that are developed away from the workplace but shape how you act on the job. These have taken years to develop and can be measured through different individual assessments if required. Examples of soft skills include interpersonal skills, problem solving and leadership skills.

A mixture of hard and soft skills should be part of a competency framework. However, to make a competency framework complete, the framework must also assess competency. Competency is the ability to apply a combination of skills, knowledge and experience to perform on-the-job tasks successfully.

There are several competencies that employers can use as part of the framework to identify and assess including:

• Core competencies – this helps support the businesses values and missions. This will apply to all jobs in the organisation.
• Common competencies – this will relate to specific roles/jobs within the organisation. For example, the core competencies required in management roles would be different to a graduate starter. They would include strategic awareness, team leadership or how they manage performance.
• Job specific competencies – this is usually related to technical expertise that’ is required for a specific role. Essentially, this is assessing the depth and breadth of that skill and knowledge. For example, software engineers will be versed in different program languages – how many different languages and systems and how long they’ve utilised them would be easier to assess.
• Leadership competencies – this is understanding if the employee has the skills and behaviours that contribute to performing as a leader or identifying if the employee has the skills to potentially become one. One of the key areas of global business development in recent years has been about creating leadership opportunities internally. Understanding which leadership competencies are specific to the company’s culture will help guide the framework and tailor it to provide a wider company advantage over time.
• ‘Meta’ competencies – these are competencies that relate to high-potential individuals where their competencies would be required in the future. This is when organisations are looking for something very specific in the next five to ten years and typically to fulfill senior management posts.

When frameworks are being used to assess competencies they should help to recognise how an individual can develop and grow and not just look at past behaviour.

Every framework should also be mindful of who the audience is and the organisation itself. Fundamentally, the framework has to reflect the organisation and not some generic business. There will be cultural values that need understanding and communicating and assessments should be based on criteria that are fair and balanced.

Finally, one of the key elements of any framework should be simplicity. In both ease of use and structure, the framework should reflect a standard that is not too complicated, long or detailed. This will make participants weary of it and render it meaningless.

How to assess your competency framework

Developing a competency framework takes time and effort. You’re trying to assess your team’s competency and skills gap and provide a framework that standardises assessing employees. Once you’ve rolled out the framework though, you need to know if it’s working effectively.

Hold 1 to 1 meetings

One of the easiest ways to assess if the framework is working is to have a regular 1 to 1 meeting with the business HR representative. They should have been involved in the development of the framework and can implement any specific plans/actions that will tailor the framework to the core message and beliefs of the business.

Make sure HR teams understand the framework

Of course, knowing that the HR teams understand the framework that’s been created is a must. Do they understand why it has been implemented? Do they understand how it’s meant to work? If line managers contact them because it’s too difficult and they don’t know how to answer, the process fails.

Get regular feedback from stakeholders

Question the respondents, the managers, the HR team that are all involved in the process of carrying out the competency framework. Ask things like, “how’s it working for you?”, “what changes have come about from this?”, “what more would you like to see from the framework?” The greater the depth of the feedback, the more you’ll gather a general sense of how it’s working and what can be improved.

Understand it takes time

To implement such a large change in framework takes time. Your assessment should be ongoing and you should start to see changes in how the teams are developing after identifying skill gaps or shortages. Know how to measure the success either through feedback or data such as staff retention or business targets being hit. All of these things combined show the level of success in achieving your competency framework goals.

What are the pros and cons of using a competency framework?

When developing any framework, understanding why you’ are doing it in the first place is essential. But what are the advantages and disadvantages of a competency framework? Here are some of the pros and cons.

Advantages of using a competency framework

• Employees will understand what’ is expected of them to perform their jobs as required behaviour is well-defined from the outset.
• Greater transparency from an assessment standpoint, making it fairer and open to all employees in the organisation.
• Being able to measure and standardise processes will have company wide benefits such as identifying leadership potential amongst a group of employees.
• There is a clearer distinction between individuals performing and organisational achievements.
• Employees who are performing will stand out more in assessments and can be rewarded.
• A well thought out framework will identify potential future competencies, advancing the strategic advantages of the business.

Disadvantages of using a competency framework

• They can be considered to focus too much on the past and not keeping up with rapidly changing environments.
• Can be hard to understand and use.
• It focuses too much on creating employees who are alike rather than praising individuality in roles.
• Can be considered to fail on delivering improvements in performance.

Fundamentally, competency frameworks, like any other framework will have pros and cons. Importantly, competency frameworks are there to assess skills and competencies, giving the employee and the business a platform that is fair, equal and transparent for all the parties involved when it comes to assessments and developing talent.

Employers could focus on competency- based learning to address skill and competency gaps and back their framework assessments with other key assessment tools to help in developing staff and growing leadership within the organisation.