How to Develop a Comprehensive Competency Framework

A company’s success is affected by numerous criteria, but one of the most crucial ones is having the right talent with the right competencies.

Competencies are the integrated knowledge, skills, judgment, and attributes people need to perform a specific job effectively. By defining a set of competencies for each role in your business, you can communicate to your employees which behaviors the organization values and needs to achieve its objectives.

The question is how do you define these sets of skills, behaviors, and attitudes that employees need to perform their roles effectively? How do you know they’re qualified enough for the job? In other words, how do you know what to measure?

To accurately evaluate and clearly define competencies within their organizations, HR leaders need to develop a comprehensive competency framework.

Why a Competency Framework?

There are several reasons this practice can come in handy. Specifically, it helps to: 

• Identify and recruit new staff more efficiently  
• Select candidates for the openings from the internal talent pool 
• Detect skill gaps   
• Customize training and professional development plans 
• Assess performance more accurately and regularly
• Level up succession planning
  

A well-made competency framework also comes with a bunch of benefits, helping HR leaders achieve tangible results such as:

• Translate business strategies into concrete behaviors expected from employees 
• Set specific and clear expectations regarding the performance of specific employees or teams and departments 
• Align the company’s strategy with specific future skills, competencies, and talents this company needs to embrace to implement its strategy
  

Role-based competencies that are specific, clear, and easy to understand and implement help HR leaders make more informed talent management decisions.

Another thing that makes a competency framework an effective instrument is employee involvement. Specifically, it encourages employees to collaborate on career development, builds trust within the organization, and increases engagement and efficiency.

5 Steps for Developing a Comprehensive Competency Framework

Competency framework formats can range widely — from a generic list of universal competencies applied to all employees (e.g., digital literacy, foreign languages knowledge, teamwork) or a more complex system of skills related to specific jobs and seniority levels. (The latter kind of framework helps organization build a more future-ready approach focused on specific skills profiles.) No matter the format, though, here are five steps for developing a competency framework from the ground up.

1. Outline principles for your competency framework

Before rolling up your sleeves and getting to work on your competency model, start with the basics and create guiding principles for your framework. This should include:

• Employee input: HR teams can use labor market data and internal talent inventories to research most aspects of certain roles, but why not also go to the source — the person doing the job? This can provide more granular details for your framework while also engaging employees in the process.
• Communication: New HR initiatives and practices can sometimes raise concerns — especially when they involve performance reviews. Let your employees know why you’re developing a competency model and how it will be built and used. The more transparent your organization is, the smoother the implementation will be.
• Use relevant competencies: Include only competencies related to specific roles your organization . If you include irrelevant competencies, people will probably have difficulty relating to the framework.
  

2. Define your future competency model

With your guiding principles in place, it's time to define the purpose and scope of your competency framework.

Is your organization focused on recruiting top talent? Or fine-tuning learning and development (L&D) programs? Does your team need visibility into skill gaps and future workforce needs?

Make your purpose very specific and align it with business goals to secure buy-in from within the organization. Then start thinking about what information the framework will 1313need, such as: 

• Core competencies that typically apply to all the roles (e.g., digital skills, soft skills) 
• Competencies related to specific jobs 
• Technical competencies that outline required technical expertise, skill, and knowledge (e.g., hands-on software tools, technologies, or job-specific platforms) 
• Leadership competencies that define leadership performance

3. Build the project team and gather critical data

In addition to gathering input from business leadership, managers, recruiters, L&D directors, and employees about competencies, it's also vital to understand what's showing up in the labor market, too.

This diversity will provide a more holistic view of competencies — from skills essential for hiring the right-matching candidates to critical knowledge needed for current and future business needs.

A few ways to gather these critical internal and external insights on key competencies might include:

• Observation of how people are performing their work. This is especially relevant for manual labor roles, including manufacturing, operating with machinery, designing engineering drafts, etc.
• An interview involving your project team. Whether it's a group conversation or individual interviews, your main goal is to get as many valuable insights into what’s needed for each role’s success as possible.
• A survey that will help you perform a thorough job analysis.
• Labor market intelligence and workforce analysis solutions that will help HR teams track the latest trends — including new and growing skills — and identify gaps among your own talent.

‍4. Start drafting your competency framework

Once you’ve collected the data, it’s time to start putting your competency model together. Here are a few best practices to consider:

• Make sure your competencies are measurable and, if necessary, specific to seniority levels (junior, middle, senior, and expert, for example). If taking this approach, also clearly define seniority levels to ensure transparency and consistency across the organization. 
• Limit the number of competencies per role to 20 or so and group them into clusters. You can split your competencies into hard and soft skills groups or use a more detailed and job-specific approach to create subgroups.
• Name competencies clearly (e.g., problem-solving, teamwork, active listening) so there's no ambiguity.
• When a draft is ready, test the framework and gather feedback to ensure competencies are relevant and crucial for effective work performance in specific roles.

5. Roll out your framework to the organization

As you roll out the finalized competency framework, remember the principle of communication mentioned earlier in this post. To help get buy-in from members of staff at all levels of the organization, it’s important to explain to them why the framework was developed and how you’d like it to be used.  

Here are some tips on implementing the framework:  

• Make the framework convenient and straightforward to use
• Double-check it’s linked to business objectives  
• Suggest rewards for competencies and align this with the company’s policies  
• Make sure the company can provide relevant coaching and training to help employees upgrade their competencies
• Continually refine and update the framework as technology and skills change
  

By defining crucial skills and competencies for each role, you can help your organization future-proof the workforce, prepare for future challenges, and support your employees in their aspirations to grow and develop within the company.