HR Summit and Expo Africa 2015 - Seminar Presentation by Brent Herman, Lead Consultant, Hay Group...

Developing and implementing a competency framework

Session Code: HRSA09

“Starting the Journey”- Developing a Behavioural Competency Model in Organisations

Brent Herman

Lead Consultant- Hay Group South Africa

STARTING THE JOURNEYDeveloping a Competency Model

18 SEPTEMBER, 2015

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1. WHAT ARE COMPETENCIES?

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BEST BOSS / WORST BOSS

Answer the following questions for each boss:

How did you feel when you worked for that boss? How did you perform when you worked for that boss?

How long did you work for that boss? What were the business results?

__________________________________ _________________________________________________________________________ _________________________________________________________________________ _________________________________________________________________________ _______________________________________

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HOW WE DEFINE A “COMPETENCY”

A relatively enduring characteristic of a person

Displayed more often and more consistently by outstanding performers

In a given role, job, situation or culture

To get outstanding, strategic results

What it is about you, that makes you great at your job?

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THE ICEBERG MODEL OF COMPETENCIES

Social Role

Values

TraitsMotive

SkillKnowledge

The image one projects to others (“outer-self”) e.g. manager, teacher

Recurrent thoughtthat drive behaviour

Behavioural demonstration of expertise

Information that a personhas in a particular area

A general disposition to behave in a certain way

A person’s beliefs and things that are important to them

Self Image

A person’s view of themselves or sense of worth e.g. technical expert

Technical Expertise: Easier to see, measure and develop

Behavioural Competencies: More difficult to see, measure and develop Characteristics that lead to

longer-termsuccess

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SOME COMPETENCIES BECOME MORE IMPORTANT AS JOB COMPLEXITY INCREASES

Natural tendencies and traits For example:

- Tenacity- Initiative

- Interpersonal sensitivity- Self confidence

Task-related knowledge and skills For example:

- Knowledge of electronics, company products- Market awareness, labor relations, law,- Skill in active listening, negotiating

REL

ATIV

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JOB COMPLEXITY

High

HighLow

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2. HOW DO COMPETENCIES LINK TO OTHER HR DELIVERABLES?

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COMPETENCIES – NOT IN A SILO

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COMPETENCY APPLICATIONS

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EXECUTIVE TURNOVER RATES AND COSTS BY TRADITIONAL AND COMPETENCY-BASED HIRING SYSTEMS

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N=35 N=32Total sample

N=17 N=2Total sample

100%

0%

60%

80%

40%

$4.5

$3.5

$0.5

$1.5

$2.5

Competency based hiring improves retention of executives

The dollar value of improved retention of executives

Key: Traditional Competency based

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COMPETENCIES AND LEADERSHIP DEVELOPMENT

Job CompetencyRequirements

LeadershipStyle

OrganisationalClimate

Our Framework for Development: The Four Circle Model

provides a proven framework & language for analysing and addressing individual & team performance development opportunities

• Growth in Organisation Revenue

• Increase in Effectiveness

• Attainment of Broader Strategic Objectives

70%30%

INDIVIDUALCOMPETENCE Motives Values Behaviours

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PERFORMANCE BELL CURVE

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PERFORMANCE BELL CURVE

What will you pay for?

What will the balance be?

What will you pay for?Role

Performance Competencies

What will you pay for?

RolePerformance

Competencies

RolePerformance

Competencies

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3. COMPETENCY MODELLING – HOW DO YOU GO ABOUT IT?

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COMMON DATA SOURCES FOR COMPETENCY MODELSObservation: Watching outstanding and average performers, seeing what they do, using this to input to a model. Most suitable for front line jobs which are relatively simple (e.g., bank branch manager, retail sales person, call centre manager).

Behavioural event interviewing: Interviewing outstanding and average performers to understand how they do what they do. Closest thing to observation, more practical for senior executives with jobs which are too complex to simply observe.

Subject matter expert / stakeholder interviewing: Interviews to understand what SMEs and senior leaders believe are the critical behaviours for the role. Often misses critical competencies, but helps to articulate organisational expectations and aspirations.

Customer interviews: Interviews with internal or external customers of a function / role, to understand customers’ needs and impact of competencies on customer satisfaction.

Existing competency models in the organisation: Often useful context, and can help avoid re-inventing the wheel and creating more change than is necessary.

Competency model benchmarks: Gathering and analysing competency models from other relevant organisations to ensure nothing is ‘missing’ from above data gathering.

Role / strategy benchmarks: Gathering and analysing competencies demonstrated by executives in similar roles or delivering same strategic initiatives, to ensure nothing is ‘missing’ from above data gathering.

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COMPETENCY MODEL DATA COLLECTION METHODSRelationship between methods and validity of results

Benchmarking

Generic model

Heavy duty research-based model (35+ BEI’s)

Full-scale BEI-based model (20+ BEI’s)

Hybrid model (5-15 BEI’s)

Expert panel and benchmarking and strategic interviewing

Expert panel

INVE

STM

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T $$

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CRITICALITY / PRECISION AND VALIDITY OF RESULTS

Key: [ ]TargetTipping point /

algorithmROI

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OUR RESEARCH METHODS COMBINEBIG PICTURE AND DETAILS; NUMBERS AND TEXT

Big Picture / Strategy / Concepts

Details / Behavior / Analysis

Qua

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RIGOR OF ANALYSIS

Not coded because anassertion

Not coded because can’ttell who “we” is - and it’s an assertion

Coded because 1st person, past tense, and specific words said

Straight Talk

1. Uses “tact” or says things in an indirect way.2. Gives individuals honest assessments.3. Publicly gives one’s team an honest viewpoint.4. Makes differences of opinion stunningly clear in a noncontentious manner.

Coded for “Straight Talk” Level 3

Exec:

Exec:

Int:Exec:

I structured X into a profitable business unit and theseguys all grew. We gave them responsibility to createtheir own destiny...I called the meeting. I said, “Today, the purpose of this meeting for the next two days is I want you to sober up.The party is over. I’m going to take you through the real data of how much money you have and haven’t made.”That’s what you said?Yeah, a quote. “The party is over. You’vebeen telling yourselves you’re great...Today you are going to see the real numbers, the numbers as wesee them.”

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COMPETENCY MODEL BUILDING PROCESS

Define and agree purpose

Steps Purpose (HR

tool, capability building, culture change, etc)

Ownership and governance (HR, Line, Functional head)

End users (Top 250, Finance function, High potentials, etc)

Define/agree methodology aligned to purpose

StepsData sources:

Executive Interviews

Behavioural Event Interviews

Expert Panels Previous

Models & Values Statements

External Benchmarking

Implement methodology and build model

Steps Gather data

Build the model by clustering the competencies into themes, and with defined levels

Assign target levels to different roles / categories

Validate and rollout

Steps Approval of

models by the Executive Team

Communication to all Employees

Possible training on management (specially if it will be included in the PM system)

Implement competencies

Steps Implement in

the HR systems that will support the acquisition and development of competencies:

- Performance,- Recruitment,- Development,- etc.

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ALIGNING THE PURPOSE OF THE MODEL TO THE OWNERSHIP OF THE MODEL

Driven by HR with Line support

Driven by Line with HR support

Transformational Change

(e.g. Building Strategic Capability, Step

Change in Performance)

Fails to deliverHR cannot gain the traction required to drive real change without the Line taking the lead

Succeeds in driving change……when (and only when) the Line and HR work

together to embed the behaviours through communications, development programmes, succession planning, selection, performance

management, etc

HR Architecture (eg, Competencies to

be slotted into role descriptions, development

programmes, etc)

Succeeds in providing best practice HR support to the business…

…when (and only when) HR then embeds the competencies into HR processes

Poor use of resourcesBecause line leadership is not necessary if the purpose is simply to provide HR architecture

PURPOSE

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KEY CRITERIA THAT ANY EFFECTIVE METHODOLOGY SHOULD MEET

Why it matters How to ensure success To ensure you’re focusing people in the

right places, its critical to ensure you identify the competencies that will drive the strategy..

Use internal best practice and role models within DBSA to shape the competencies – this

ensures they reflect the reality of how work gets done in DBSA.

To ensure people can develop the new competencies, you need to ensure they understand what the competencies mean for them in their roles, and how they connect to their daily lives.

Focus on the fewest competencies that make the biggest difference – don’t try to describe every single skill required to execute the role.

Use examples and provide employees with guidance on how to develop the competencies, so they become real.

To ensure people embrace the new competencies and drive the change towards stronger decision support, it is critical that they are seen as credible.

Use a blend of internal best practice and role models, and external benchmarks, to shape the competencies, to avoid common pushback such as ‘We’re unique and different, so these competencies don’t apply to us.’

Regardless of purpose,

competencies must be:

Accurate

Understandable

Credible

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OPTIONS:

Some organisations have a history of building competency profiles on a role by role basis.

Many other organisations build models which can be applied to a range of roles.

This section will present different ways that organisations structure their competencies and competency models.

There is no ‘right way’; rather the key challenge is to find what will work best for the organisation, given its structure, operating model, strategy, and its history with competencies and how they’ve used them in the past.

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COMMON WAYS OF LEVELLING COMPETENCIES

‘Degree’ levels: This is where you have one set of behavioural indicators, and the assessor is asked to determine the degree to which the individual satisfies the criteria.

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COMMON WAYS OF LEVELLING COMPETENCIES‘Developmental’ levels: This is where you have a cluster of behaviours, some more sophisticated than others, which are levelled with the least sophisticated / easiest at the bottom, and most sophisticated / most difficult at the top.

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EXAMPLE OF HOW TO STRUCTURE COMPETENCY MODELS: CATERPILLAR

Individual Contributors

First Line / Middle / Senior

Managers

Senior Leaders

•Built this model first, and invested most in it.•Heavy emphasis on behavioural competencies.•Applies to all top 250, regardless of role.•Has flexibility built in through an empirically derived ‘algorithm’•Built this model second.•Started with Senior Leader model and adapted to make it appropriate for managers; where possible competencies are the same, to create clear ‘line of site’ when transitioning from manager to leader.

•This model was created independently of the senior leader and manager models.• This model was retrofitted to work more like the senior leader models.• Its primary application is via performance management.

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EXAMPLE OF HOW TO STRUCTURE COMPETENCY MODELS: IBM


First Line / Middle / Senior

Managers

Senior Leaders

IBM also has different models and different levels, and these models apply to people across different functions.

In addition, for mission critical roles and for mission critical functions, they have developed more specific competencies models.

• For the mission critical Sales function, we helped them build a specific sales competency model which stretched further down the organisation and included specific sales competencies which weren’t relevant for other functions and so hadn’t been included in the leadership model.• We also built a similar model for senior research scientists.• For the mission critical ‘Managing Director’ role, which looked after $1 billion dollar accounts with IBMs largest global clients, we built a specific model for that role, to help IBM select the right internal candidates for that role.

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EXAMPLE OF HOW TO STRUCTURE COMPETENCY MODELS: VODAFONE


Leaders

Vodafone has one integrated, very high level model, which applies to the entire organisation. Some behavioural indicators under each competency apply only to senior leaders, so there is some differentiation.

In addition, for every function they have a competency model, and a core set of 3 competencies which are relevant to every function.

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EXAMPLE

Cluster or “Theme” Managerial Roles Specialist Roles Operational Roles

Managing Others

Developing Others (4) Flexibility (4) Flexibility (3)

Empowerment (4) Teamwork & Cooperation (4) Teamwork & Cooperation (3)

Team Leadership (5) Customer Service (4) Customer Service (3)

Managing Self

Initiative (4) Initiative (3) Initiative (2)

Achievement Orientation (5) Achievement Orientation (4) Achievement Orientation (3)

Strategic Thinking (4) Conceptual Thinking (4) Analytical Thinking (3)

Concern for Order & Quality (3)

Managing the Organisation

Organisational Commitment (4) Organisational Commitment (3) Organisational Commitment (2)

Impact and Influence (4) Impact and Influence (3)

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Developing and implementing a competency framework

Session Code: HRSA09

HR Summit and Expo Africa 2015 - Seminar Presentation by Brent Herman, Lead Consultant, Hay Group...

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Transcript of HR Summit and Expo Africa 2015 - Seminar Presentation by Brent Herman, Lead Consultant, Hay Group...