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Competency Based Culture

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Last Updated on November 2, 2022 / HR Strategy

Question:

What do I need to think about when creating a competency based performance management system?

Answer:

As with any type of new program being introduced to your employees a lot of planning needs to go into creating a performance management system.

  • Start with a clear idea of the business challenge or problem you need to address.  What is the business impact in terms of lost revenue, staff retention, performance and productivity, culture, and decision making.
  • Identify what is working well and what needs improvement. You’ll want to keep what’s working and change what isn’t. Articulating your company’s strengths will help identify competencies needed to measure performance.
  • Keep a separate to-do list of other areas that may come up as you create your plan. It’s not unusual to flush some of these things out as you dive deep and you can then make choices about what to work on when.
  • Revisit the company’s mission, vision and purpose to provide a refresher on why the company exists.
  • Review the annual business plan with the goals and determine whether or not you have the talent to deliver the results needed.
  • There can be many options and opinions when creating desired competencies. Try to involve HR – someone with experience in performance management, talent management and/or strategic planning to help guide the process. Be sure to describe behaviors and results. It might be helpful to ask:
    • Who are the existing employees demonstrating the kind of top performance needed to deliver business goals?
    • What does a top performer look like?
  • Identify competencies that span all positions in a company – it sets a common standard and helps create a company culture that drives performance and results.
  • Drill down under each competency to identify specific behavior for performance standards.
  • Define the spectrum of performance from the ‘top’ (exceeding expectations) through the ‘bottom’ (needing improvement). Typically a 3 point or 5 point range is used.
  • Determine the frequency of performance reviews with every employee having at a minimum an annual review. Ideally, real-time feedback is given as it occurs, with more formal checkpoints occurring via monthly or quarterly meetings with their direct manager.
  • Involve a select group of employees to give input on the competencies before finalizing. They may provide additional insights and facilitate quicker adaptation of the new system.

By following the suggestions above you will be well on your way to creating a solid performance management system.

HR Strategy isn’t always about planning for the future. Sometimes it means responding to current issues and making sure they fit with the mission, vision or goals of the company. Dealing with a company’s culture can be a touchy subject – especially when you tie that to performance management. Strategic HR can help you with a variety of issues related to culture. Visit our HR Strategy page to learn more about how Strategic HR can help you meet your goals.