Competency Based HRM: A Strategic Resource for Competency Mapping, Assessment and Development Centres [9th reprint ed.] 0070528047, 9780070528048

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Competency Based HRM: A Strategic Resource for Competency Mapping, Assessment and Development Centres [9th reprint ed.]
 0070528047, 9780070528048

Table of contents :
Half Title
Title Page
Copyright
Preface
Acknowledgement
Contents
Chapter 1: Building Competencies for Organizational Future
Chapter 2: The Competency Development Process
Chapter 3: Understanding the Competency Management System
Chapter 4: Competency Drives Transformational HRM Strategies
Chapter 5: Mapping Business Competencies to People Competencies
Chapter 6: Assessment Centres
Chapter 7: Training Assessors in an Assessment Centre
Chapter 8: Competency Based Selection Process
Chapter 9: Competency Based Interview Strategies
Chapter 10: Assessment Group Discussions and Testing Techniques
Chapter 11: Experiencing the Competency Management Process in Organizations
Chapter 12: Competency Based Performance Management System
Chapter 13: Competency Driven Careers
Chapter 14: Competency Linked Competitive Remuneration
Chapter 15: Development Centers and Managerial Evaluations
Chapter 16: Competency Driven Culture: Driving Businesses to Lead and Manage Change
Index

Citation preview

COMPETENCY BASED HUMAN RESOURCE MANAGEMENT A STRATEGIC RESOURCE FOR COMPETENCY MAPPING DEVELOPMENT CENTRES

ASSESSMENT AND

COMPETENCY BASED HUMAN RESOURCE MANAGEMENT A STRATEGIC RESOURCE FOR COMPETENCY MAPPING

ASSESSMENT AND

DEVELOPMENT CENTRES

GANESH SHERMON UNIV CANADA BUSINESS SCHOOL

Tata McGraw-H Hill Publishing Company Limited NEW DELHI

McGraw-Hill Offices New Delhi New York St Louis San Francisco Auckland Bogotá Caracas Kuala Lumpur Lisbon London Madrid Mexico City Milan Montreal San Juan Santiago Singapore Sydney Tokyo Toronto

Tata McGraw-H Hill Hill Companies A Division of The McGraw-H

Tata McGraw-Hill © 2004, Tata McGraw-Hill Publishing Company Limited No part of this publication can be reproduced in any form or by any means, without the prior written permission of the publishers. This edition can be exported from India only by the publishers, Tata McGraw-Hill Publishing Company Limited ISBN 0-07-052804-7 Published by Tata McGraw-Hill Publishing Company Limited, 7 West Patel Nagar, New Delhi 110 008, typeset in Garamond at Emboss, 9, ISEC Main Road, 3rd ‘A’ Cross, Nagarabhavi, Bangalore 560 072. Cover Design: Mesmerizers, Bangalore

The McGraw-Hill Companies

Preface Businesses and managing businesses has and will always be complex. There is no denying the need to perform through a combination of utilizing predictive or forecasting tools, techniques and methods, yet without trivializing the need to sustain and drive a motivated high performing work force. The need to understand and map competencies arises in this context. As we seek to understand what makes people and consequently organizations perform we without compunction now ask for whether people bring in capabilities on to their roles and how best do they fit into jobs that make stretching demands. Nevertheless such a demand is often placed only on individuals who have demonstrated staying power to cope with changing perspectives in performance management. This book on competencies came up in such a context. As we saw through our two decade experience in business organizations spanning across several industry segments, from manufacturing to financial services to professional services and their varying interventions in deploying methods to understand and build capabilities, the need to write and pull together some terrific work done in the last 25 years by academics, consultants and business professionals was felt. This book connects competencies, business and people, with that of the human resources functioning and people challenges in an organizational context. The book is wide in its detail as it covers very many aspects of competency mapping processes, work plans, connecting competencies to HR processes and establishes in detail as assessment and development center. It also provides a large number of tools and techniques, illustrations and cases to help the reader see it as a working manual while developing and implementing a Competency Based Human Resource Management Base. The first three chapters deal with the need to understand and build competencies for the future. These chapters deal with business competence, people competency, the linking pin, the competency development process and the competency management system. They have a wide coverage and are consciously intended to bring in details of the system to help the reader get familiar with the work done in this area comprehensively. They deal with strategic emphasis from a capability perspective; the company's need to sustain in a competitive environment, the need to understand and absorb the learning's of core competence and establishes a context for competency mapping. It deals with the key issue of differences and inevitability of connecting core competence and people competency. In each of the three chapters there is a continuing emphasis on performance, behaviors and capability building as the cornerstones for organizational success. At the micro level these chapters also cover enabling and critical competencies, technical and managerial competencies and in a great detail establishes a detailed work plan in developing an organization wide competency model. These three

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Preface

chapters conclude with evaluating what is an appropriate approach for competency development, what frameworks are applicable, including those available, for deployment. Chapters 4 and 5 sets the context for the second purpose of the book, namely, the relevance of connecting core business competencies with that of people competencies and enabling organizations to drive its human resource goals through a competency based HRM process. This chapter help the reader appreciate the need to transform organizations using a competency platform and an HR base (using people as the key enabler of change) and covers a range of issues that deal with core competence, appreciation of business goals and how do they influence the need for effective business behaviors by role players. More importantly these chapters established the inevitability of leadership to drive transformation as they deploy a competency-based organization through strategic thrust in favor of customers, markets, internal processes, information management and people interventions. These chapters include the four main Human Resource challenges, namely, managing talent, managing performance,, managing change and managing knowledge and provides what needs to be concurrently addressed while developing competency frameworks. From an competency based HRM organization perspective this book deals with selections, performance management, career management, remuneration and training. Chapters 6 and 7 make it a focused discussion on an Assessment Center in order to help the reader delve into aspects pertaining to the mapping process. It covers a wide range of issues and concepts that pertain to the developing a mapping pattern, including, the center schedules, assessment center tools and techniques, proficiency levels, role profiles, competency dictionary, behavioral dimensions etc. Finally the chapters provides a perspective on identifying appropriate methods to train assessors on selecting tools that help measuring proficiency levels. The annexure contains several techniques, sample templates included in basket experiences and the reader is encouraged to experience one of those hands on. Chapters 8, 9 and 10 deal with competency based selection, interviewing, team working and testing approaches. The purpose of these set of chapters is to help the reader gain a deep and a hand on experience of how does one make competencies a relevant part of recruiting talent, both from the external and internal source pool. It includes providing appropriate instrument and templates to help conduct interviews, manage group processes and a detailed discussion on interviewing styles, methods, pitfalls and the typical styles used by interviewers while performing a competency based selections and the likely issues they would confront. The detailing in these chapters would help the reader appreciate the importance of using as assessment center or an appropriate test while recruiting. Chapters 11 and 12 deals with establishing basic management processes while enabling a competency based HRM processes and in particular focuses on Competency based performance management and has elaborately covered definitions and deeper understanding of

Preface

Competency based performance processes, establishing key performance indicators, forced ranking issues and integrating it with other sub processes in the performance management area including mentoring, coaching and counseling. The chapter deals with linking business strategy, mission to the goals and tasks that are deployed to enable performance. It provides a framework to understand the capability building cycle and the critical success factors in implementing a competency based performance management system. Aspects pertaining to establishing KRA's, benchmarks, and behavioral definitions as they impact performance and a comprehensive comparison of types of appraisals when compared to a competency based performance management system. Chapter 13 provides an appreciation of work done in the area of competency based careers and includes a note on understanding behaviors and the need to connect business processes with career assessment and planning activities. It explains an appropriate model for competency based career management and enables an understanding of transformational and transactional competencies. It provides for designing a path for career progression and illustrates how behaviors determine career successes. The chapter concludes with an overview of a multi rater feedback or a 360-degree feedback mechanism. Chapter 14 deals with competency based remuneration system, which covers the need to commence with making pay competitive and linked to performance before an attempt is made to connect it up with competencies. It presupposes that the reward mechanisms have a combination of the need to reward results and reward capabilities that make results happen. It also demonstrates the need to focus on specific competencies that helps build individual performance and concurrently the need to identify appropriate reward system intervention for each of the competency initiative. Chapter 15 deals with an appreciation of competency driven training, the use of a Development Center and indeed on how does it differ from that of an assessment center. It also provides working documents including tools and templates on establishing individual development plan, enabling a coaching schedule and the method to build a gap analysis profile for assesses. Finally chapter 16 concludes with the need to understand the cultural context before embarking upon a competency based HRM process that tends to cut across the organizational edifice, change management challenges and the need for organizational preparedness. In summary this book has attempted to bring together a combination of business drivers for a competency based organization, the need to integrate it with HR processes and the task of establishing and managing a series of Assessment and Development Centers. Of great relevance to the readers would be to concurrently refer to our reference list and as well cover works of L.M. Spencer, David McClelland, R S Mansfield, studies by Mcber and company,

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Arthur Andersen LLP and D A Kolb. Of significance in our research and learning's for this book has been the world class work done in the area of competency building by organizations such as Citigroup NA, Unilever, GE, HSBC, Lalbhai, KPMG, Andersen, Pepsi, Bell Canada, ITC, J & J, Syngenta, AT&T, Pfizer etc. The leaders of these institutions have indeed demonstrated the true and dynamic linkages between their business strategies, core competence and driving competency based HR processes. It is also recommended that the readers administer for themselves where possible the self tests and address issues raised on each of the HR sub processes as they embark upon the awesome task of transformation; indeed transforming into a Competency Based Business Organization.

GANESH SHERMON

Acknowledgement The author takes this opportunity to thank some critical folks who helped make this book happen. Patience, tolerance and perserverance through my wife, Kavita Shermon, some high level inspiration and questioning from my son. Anavir Shermon and life long motivation through my dad and mother. Of great significance to my work has been the dedicated commitment from Tata McGraw-Hill and in particular the editors who consistently studied the manuscript. Thank you to all of you indeed. I dedicate this book to my father, who is no more, but would have been happy to see this day.

Contents Preface v Acknowledgement ix Chapter 1: � Building Competencies for Organizational Future

1

Chapter 2: � The Competency Development Process

45

Chapter 3: � Understanding the Competency Management System

73

Chapter 4: � Competency Drives Transformational HRM Strategies

91

Chapter 5: � Mapping Business Competencies to People Competencies

119

Chapter 6: � Assessment Centres

143

Chapter 7: � Training Assessors in an Assessment Centre

189

Chapter 8: � Competency Based Selection Process

205

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Chapter 9: � Competency Based Interview Strategies

233

Chapter 10: � Assessment Group Discussions and Testing Techniques

291

Chapter 11: � Experiencing the Competency Management Process in Organizations

319

Chapter 12: � Competency Based Performance Management System

359

Chapter 13: � Competency Driven Careers

421

Chapter 14: Competency Linked Competitive Remuneration

449

Chapter 15: � Development Centers and Managerial Evaluations

477

Chapter 16: � Competency Driven Culture: Driving Businesses to Lead and Manage Change Index 533

513

Chapter

1

Building Competencies for Organizational Future

THE STRATEGIC EMPHASIS Strategic initiatives have come to be reckoned now than ever before, and in a form that is impacting at the operational level. People are now impacted by every strategic decision and no longer employees at the operational level claim to be insulated from the impact of deploying strategy. But ironically, business managers have become too preoccupied with their competitors for existing markets, rather than seeking to create new markets, where they can occupy the competitive advantage simply by being the first ones to get there. The future is largely unexplored. The management focuses has been mainly on restructuring and reengineering. Any company that succeeds at restructuring and re-engineering, but fails to create the markets for future will find itself in a treadmill, trying to be ahead of the steadily declining margins and profits of yesterday's businesses. They find themselves confronted with "organizational transformation" which includes downsizing, overhead reduction, employee empowerment, and process re-design and portfolio rationalization. These accomplishments alone cannot ensure the journey to a successful future. Even process re-engineering and advantage building efforts are more about improvising rather than competing in today’s market. Competition for the future is competition of opportunity share rather than market share. It is the competition to maximize the arena of sharing future opportunities. Competition for the future is not product versus product or business versus business, but the company versus company—inter-firm competition. Capable organizations and those that possess inherent strengths that are core and exceptionable in nature are likely to have an edge over the others. This is true for several reasons: �

Future opportunities are unlikely to fit neatly within the existing SBU boundaries; it must be a corporate responsibility.

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The competencies needed to access the new opportunity arena may well be spread across a number of business units and it is up to the corporation to bring these competencies together at the appropriate time within the organization.



The investment and the time frame required to build new competencies which are necessary to access tomorrow's market, may well tax the resources and the patience of a single business unit.

At the same time, to succeed, there is a need to bring together and harmonize widely disparate technologies, varying capabilities, diversity in work roles, demands on the job, stretched out standards, changing processes and to conclude ‘alliances with stakeholders and partners of complementary businesses.’ In fact, this would also mean the need to co-opt the potential rivals and to access the widest possible array of distribution channels, meaning that competition, is as much a battle between competing and often overlapping coalitions and between individual firms. At a different level, namely, the macro environment level, the business scenario has undergone a change. This brings CEO's together to help resolve their inward focus and look at their differential rate of returns within their business financial performance. While at one level there are trends to be seen and evaluated, at another level, customers have also not bypassed their desire to seek new ways to be serviced and indulged. To the customers, the options are many. Let us look at some economic disintermediation. Refer to Fig. 1.1.

When Does a Company Need to go Perpetual? �

A conceptual framework is needed for the performance measurement and management system. Every organization, regardless of the type, needs a clear and cohesive performance measurement framework that is understood by all the levels of the organization and that supports objectives and the collection of results.



Effective internal and external communications are the keys to successful performance measurement. Effective communication with the employees, process owners, customers, and stakeholders is vital to the successful development and deployment of performance measurement and management systems.



Accountability for results must be clearly assigned and well understood. High-performance organizations clearly identify, what it takes to determine success and make sure that all managers and employees understand, what they are responsible for, in achieving organizational goals.

Building Competencies for Organizational Future

The dynamic business environment has resulted in newer imperatives for customers TRENDS • End of sops—businesses to take ownership for performance— No subsidy • Regulation—introduction and reinvention, converging industries and regulatory mechanisms • Globalization impact • Increased sensitivity to shareholder value—EVA • Discovery of demand side and competition • Emergence of new models and businesses for growth • Need to look at technology and communication infrastructure beyond quick fixes • Emergence of the IT services and IT-enabled services proposition

C U S T O M E R I M P E R A T I V E S

• Focus on value-based management and strategy realization • Need to identify and realize growth opportunities • Increased operational efficiency and effectiveness with technology support • Focus on capability building • On/Offshore delivery from/to 3rd world economies

Figure: 1.1 Changing economic scenario.



Performance measurement systems must provide intelligence for decision makers, and not just to compile data. Performance measures should be limited to those that relate to strategic organizational goals and objectives, and that which provide timely, relevant, and concise information for use by decision makers at all levels to assess progress toward achieving predetermined goals. These measures should produce information on the efficiency, with which resources are transformed into goods and services, on how well results compare to a program's intended purpose, and on the effectiveness of organizational activities and operations, in terms of their specific contribution to the program's objectives.



Compensation rewards, and recognition should be linked to performance measurements. Performance evaluations and rewards, need to be tied to specific measures of success, by linking financial and non-financial incentives directly to such a

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performance. Such a linkage, sends a clear and unambiguous message to the organization as to what is important. �

Performance measurement systems should be positive, not punitive. The most successful performance measurement systems are not “gotcha” systems, but learning systems that help the organization identify what works—and what does not—so as to continue with and improve on what is working and repair or replace what is not working.



The results and progress toward program commitments, should be openly shared with employees, customers, and stakeholders. Performance measurement systems information, should be openly and widely shared with an organization’s employees, customers, stakeholders, vendors and suppliers.



To combine all the above, competency based interventions comes into perspective.



In fact the company goes perpetual when it has its value realization effectively organized through the new business models and utilization of assets. Take a look at Figures 1.2 and 1.3. Value is being created in a fundamentally… NEW way…by NEW assets • The new assets are traditionally thought to be intangible and not measurable • The market is rewarding companies based on what type of assets they leverage • Business design reflects how a company assembles tangible and intangible assets • Therefore, a company’s asset portfolio is its key determinant of economic success • Companies must adjust their asset portfolios to alter risk and reward • New digital tools are necessary to adjust asset portfolios based on market signals • Emphasis on People and their value is significant • Knowledge economy is weightless

Figure: 1.2 Business value is being created in fundamentally new ways.

Building Competencies for Organizational Future



Unique Assets : No other firm has exactly the same set of knowledge, skills, abilities, innovations, codified knowledge, patents, trade marks, , copyrights and trade secrets. They are unique and difficult to duplicate and may require considerable time and resource to do so. Refer to Fig. 1.4.



Differentiable Assets: Includes assets such as manufacturing, di stribution which while similar are different in some ways from those of competitors. They differ in size, shape, complexity, production rate and cost structure. Complementary business assets (innovations) are important to knowledge firms for generating and maintaining profits.



Generic Assets: Includes those not differentiable, such as cash, fixed assets, fixed capital and tangible assets. All of the assets are found in a balance sheet.

Figure: 1.3 Unique assets driven by competencies need to be leveraged.

The need to identify and build upon competencies are needed now ‘more so because of given loss of value in generic and differentiable assets and various organizations devising ways to dominate in the unique asset category.

STRUCTURED VERSUS UNSTRUCTURED ARENAS

FOR

STRATEGIC

COMPETENCY PLANNING The two most important ways, in which competition for the future is different from competition for the present, are: �

It often takes place in unstructured arenas, where the rules of competition have yet to be written.



A different way of thinking about the strategy and the senior management.



It has a unique way in which it assembles its portfolio of assets incurring risk but managing it for realization of value.



And finally, attaches value to capabilities in realizing strategy.

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A case in point: IBM-Lotus Corporation IBM • Conservative , Well structured company • Established as one of the most successful corporations • Strength in technology and mainframe systems • Legendary for bureaucracy and analysis paralysis

Lotus Corporation • Entrepreneurial company • Highly competitive environment • Culture of developing great software

July 5, 1995 …...IBM made a hostile takeover bid at a price of USD 3.5 billion (14 times Lotus' book value)

• Strong corporate knowledge • GroupWare technology Dominating player

The Prize at Stake • • •

Stake in the future of enterprise computing A product which delivered on the productivity promise to customers Challenge to Microsoft’s dominance

IBM was really after ... • Lotus Knowledge • Ray Ozzie the brain behind a procedure called "replication” which made machines telepathic • Men who could confidently say 'I KNOW’

… IBM nurtured the existing Lotus culture, recreated the dream factor–Notes is still the leader in GroupWare

Figure: 1.4 A case in point would be the acquisition of Lotus by IBM Corporation. Some industries are better structured than others. It means that the rule of competition is more structured and clear-cut, product concepts are better defined, industrial boundaries are more stable, technology changes more predictable and the customer needs precisely measurable. Unpredictable and turbulent change can happen in any industry today and new opportunity arenas, like genetic engineering, is almost universally unstructured. Hence, the problem for any company intent on getting to the future first is that there is a map of the apt and not the future. Besides this, deregulation, globalization, fundamental breakthrough in science and the strategic importance of information technology, are blurring boundaries in a variety of industries. To handle all of these obstacles, would mean that a proper competency planning activ-ity needs to be executed. Traditional planning seeks to position the firm optimally within the existing structure by identifying which segment, channels, price points, sell-

Building Competencies for Organizational Future

ing propositions and value chain configurations will yield the highest profits. If the goal is competing for the future, then we need a different view of the strategy that addresses more than the problem of getting to the future. Strategic competency management has now evolved to the point, by which its primary value is to help organizations to operate successfully in a dynamic and complex environment provided they have the capabilities to do so. To be competitive in a dynamic environment, corporations need to be less bureaucratic and more flexible. In stable environments, such as those that have existed in the past, a competitive competence strategy, which simply involves defining a competitive position, understanding competencies that drive strategy and then defending it, was the norm for effective management. Because it takes very little time for one product or technology to replace another, companies are finding that there is a need for reinventing their capabilities concurrently without having a competitive advantage over a sustainable time frame. Corporations must develop strategic flexibility and an ability to shift from one dominant competence to another. Consequently, strategic flexibility demands a long-term commitment to the development and nurturing of critical resources. It also demands that the company become a learning organization skilled at creating, acquiring, and transferring knowledge and at modifying its behaviour to reflect new knowledge and insights. Learning organizations could avoid stable stagnation through continuous self-examination and experimentation. People at all levels, not just top management, need to be involved in competence management that involves understanding internal and external capabilities that are intrinsic and extrinsic while concurrently scanning the environment for critical information, suggesting changes in strategies and programs to take advantage of environmental shifts, and working with others to continuously improve working methods, procedures and evaluation techniques. At XEROX, for example, all employees have been trained in small group activities and problem solving techniques. They are expected to use these techniques at all meetings and at all levels, with no topic being off-limits.

Scanning of the internal and external environment—mapping core competencies Corporate scanning of the environment should include an analysis of all the relevant elements in the environment. These analysis take the form of individual reports, competency gap analysis, written by various people in different parts of the firm. These and other reports are then summarized and transmitted, up the corporate hierarchy for top management to use in strategic decision-making. If a new development is reported regarding a particular product category, top management may then send memos to people throughout the organization to watch for and report on developments in related product areas. The various reports resulting from these scanning efforts, when boiled down to their essential, act as a detailed list of external strategic factors.

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Identification of external strategic factors that influence competencies One way to identify and analyze the developments in the external environment is to use the issues priority matrix as follows: �

To identify a number of likely trends that are emerging in the societal and task environment. These are strategic environmental issues and pertain to those important trends that, if they happen, will determine what various industries will look like.



To assess the probability of these trends actually occurring.



To attempt to ascertain the likely impact of each of these trends of these corporations.

Corporate strategy derives from competencies Corporate strategy is primarily about the choice of direction based on its competencies for the firm as a whole. This is true whether the firm is a small, or a single product company, or a large multinational corporation. In a large multi-business company, however, corporate strategy is also about managing various product lines and business units for its maximum value. In this instance, corporate headquarters must play the role of organizational “parent”, which means it must deal with various product and business unit “children”. Even though each product line or business unit has its own competitive or co-operative strategy that it uses to obtain its own competitive advantage in the marketplace, the corporation must coordinate these different business strategies so that the corporation as a whole succeeds as a “family”. Corporate strategy, therefore, includes decisions, regarding the flow of financial and other resources through a company’s product lines and business units but is constructed on the basis of assembling together capabilities required to deliver value. Through a series of co-ordinating devices, a company transfers its skills and capabilities, developed in the unit to other units that need such resources. In this way, it attempts to obtain synergies among numerous product lines and business units so that the corporate whole is greater than the sum of its individual business parts. All corporations, from the smallest company, offering one product in only one industry, to the largest conglomerate operating in many industries in many products must, at one time or another, consider one or more of these issues. This includes critically the need to build corporate capability bank to transfer knowledge, know how and “how have we done here” before templates.

Directional strategy for building upon competencies Just as every product or business unit must follow a business strategy to improve its competitive position, every corporation must decide its orientation towards growth by asking the

Building Competencies for Organizational Future

following questions: �

Is it aligned with our core competence?



Should we expand, cut back, or continue our operations unchanged?



Should we concentrate our activities within our current industry or should we diversify into other industries?



If we want to grow and expand, should we do so through internal development or through external acquisitions, mergers, or joint ventures?



Are our people’s capabilities in sync with the competencies and core strategies of the organization?

A corporation’s directional strategy is composed of four general orientations towards growth (sometimes called grand strategies): �

Growth strategy, which expands the company’s activities.



Stability strategies that make no change to the company’s current activities.



Retrenchment or restructuring strategies that reduce the company’s level of activities.



And finally, the value realization strategy that tends to assemble and disassemble various parts of the asset portfolio to experiment with new lines and ways of doing business.

Effective learning and performance management systems must have some methods of determining the individuals’ needs, providing learners with access to appropriate training and development activities, and evaluating individuals’ performance and growth. Individuals should be able to identify their needs easily, locate and participate in appropriate development activities, and feel confident that their progress will not go unnoticed. Competencies and their measurement provide the mechanism for achieving these goals. Let us address these issues through the use of a template given below: Element of strategic thinking Be strategic about your competence definitions



Things to think about Your action plan Keep it simple. Strategic competence needs to be a template for decision-making.

Define your core competence



People need to have some knowledge of do’s and don’ts of the strategies involved in their organization.

(Contd.)

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Have a competitive edge (i.e., be very good at something)



Design and adapt your strategy crafting process and competence building measures to suit your specific situation.



Be better at providing a product/ service than your existing competitors (e.g., at GE, Jack Welch insists on being in the top two, or dropping a product line).·



In which product(s)/service(s) competence definitions will you excel? In what ways will your organization have a competitedge with its product(s)/service(s)?



Think 'outside the box'



� �

Think of your organization from the point of view of others





Evolve your strategy, articulate your core competence



We know that this phrase has been badly overworked. Nonetheless, managers are often so engrossed in the demands of their roles and profession, and so immersed in a given way of thinking, that their knowledge is limited to only their work in their organization. Seek many opinions and perspectives.· Read and consult people outside your industry, organization and area of expertize. Talk to and understand the perspective of your customers, suppliers, employees and other stakeholders. Learn about competitors, their directions and their core competencies. Senior management can elucidate a 'strategic framework' which gives others ample opportunity for 'strategic improvising.'

(Contd.)

Building Competencies for Organizational Future





Have everyone in your organization think strategically







Align systems to support your strategy. Make it relevant to competence





WHAT

IS A

Define strategic core competencies that you believe drives your organization. Build measures to evaluate periodically whether such competencies are adding value or are just being utilized and discarded and rebuilt when needed. Don't isolate strategic thinking with senior managers or in strategic planning group. Have all business and staff units clarify their strategies. Be a role model and challenge others to think strategically as you do. Your organizational systems are perfectly aligned to achieve your current results. In many ways the hardest part of strategy implementation is rejigging your systems to support the new strategy. Enable systems that interact with one another and which can draw together capabilities in such a way that they are learnable and transferable.

COMPETENCY?

A competency is an underlying characteristic of a person, which enables him to deliver superior performance in a given job, role or a situation as explained in Fig. 1.5. This characteristic may be called an “attribute bundle“, consisting of knowledge, skills, traits, social role, self-image and motive. The “underlying characteristic”, manifests itself in the form of behaviour, which helps identification and measurement of the competency.

CONTEXT

FOR

COMPETENCY

“Competency” has two relevant meanings—The first, addresses the ability of an individual to perform effectively in a job-relevant area. The second, is a definition of what is required

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People have and acquire COMPETENCIES

We apply these in the form of BEHAVIOUR

(Actions, thoughts, feelings)

Our behavior produces OUTPUTS

(Product and services)

How this is done yields R ESULTS

Figure: 1.5 Defining competencies in terms of behaviours, outputs and results. of an individual, for effective performance. These two are closely related but distinct. The second meaning, involves defining what is important to be successful in a job, while the first deals with the degree to which an individual does, what is important for a job. Defining job competencies is useful in assisting individuals develop their competencies for that job. This book uses the second meaning—a competency is a clearly stated definition of a performance area related to success in a job or role. Building on this definition, a competency model is a grouping of individual competencies, which describes all, or most of the requirements for job, function, or organizational success as seen in Fig. 1.5. A common set of criteria for all human resource activities, has been established with the help of competencies. This provides an opportunity to agree to a common language for describing the effectiveness of an organization. This opportunity to achieve a high level of consistency when assessing performance is for selection or for appraisal, needs to be assessed. And what can be known needs to be identified in a mapping exercise. There are many definitions of competencies. Fundamentally there are two main propositions in regard to competencies. The first one deals with a description of the task of job outputs.

Building Competencies for Organizational Future

Organizations like the management charter initiative, defines competency as the ability of a manager to perform to the given standards required in any employment. The second definition of competency deals with the descriptions of an individual’s behaviour. These have evolved from the word of researchers and consultants who are specializing in managerial effectiveness. Many definitions of behavioural competency are variations on the following definition. A job competency is an underlying characteristic of a person’s behaviour, which results in an effective display of superior performance in a job. (KLEMP, 1980). Variations typically expand on what the characteristics may be, including those people competencies with an underlying characteristic of a person together, with their motive in behavioural disposition. At any rate it is still an aspect of one’s self-image of social role, or in fact the body of knowledge which a person uses in order to perform a task, or a role in an organizational circumstance or otherwise. This demonstrates that, competencies made up of many things, including motive straight skills and read definitely, get to see a concrete evidence of these activities, in the way that people behave and act in a particular situation. Competencies that are determined are driven by behaviour and is observed on those, that are differentiated from some effective or superior performance driven by skills, capabilities, motives, behavioural skills and differentiates the inferior performers, who were unable to deploy their effective behaviour in a given situation. Apart from what we have seen, in regard to motives and skills, it has been increasingly proven, that values also influence the individuals’ behaviour.

COMPETENCE MANAGEMENT—IS THERE AN EMERGING SPACE TO DEMONSTRATE A PARADIGM SHIFT IN PERFORMANCE? There are a wide range of definitions for performance objective, performance goal, performance measure, performance measurement, and performance management. To frame the dialogue and to move forward with a common baseline, certain key concepts, need to be clearly defined and understood, such as: �

Competency objective: This is a critical success factor, in achieving the organization’s mission, vision and strategy, which if not achieved, would result in a significant decrease in customer satisfaction, system performance, employee satisfaction or retention, or effective financial management.



Goal orientation: A target level of activity expressed as a tangible measure, against which actual achievement measured behaviourally can be compared.



Criterion measure: A quantitative or qualitative characterization of performance.

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Demonstrated measurement: A process of assessing progress toward achieving predetermined goals, including information on the efficiency with which resources are transformed into goods and services (outputs), the quality of those outputs, (how well they are delivered to clients and the extent to which clients are satisfied) and outcomes (the results of a program activity compared to its intended purpose), and the effectiveness of government operations in terms of their specific contributions to program objectives.



Competency management: The use of competency measurement information to effect a positive change in organizational culture, systems and processes, by helping to set agreed-upon performance goals, allocating and prioritizing resources, informing managers to either confirm or change the current policy or program directions to meet those goals, and sharing results of performance in pursuing those goals.



Output measure: A calculation or recording of activity or effort that can be expressed in a quantitative or qualitative manner.



Outcome measure: An assessment of the results of a program, compared to its intended purpose.

Objectives of competencies and competency mapping for people This is a competency era. It is beyond doubt that it is beneficial and cost effective, to have competent people to occupy higher-level positions. Competency refers to the intellectual, managerial, social and emotional competency. Many organizations in India and abroad are channeling their efforts to mapping competencies and implementing assessment and development centres. The need of the hour as indicated by many organizations, is to design and implement low cost assessment and development centres specially designed to meet the requirements of developing economies like ours. Normally the purpose of analyzing training needs, is to uncover the gap that exists between the present competency of the enterprise and the competency needed to reach strategic goals in the future. A determining factor for what problems may arise, is the choice of level of precision or how complex a concept of competency one uses. For instance, the imminent drive of an enterprise in Germany was only a question of learning the German language skills. It is easy to ascertain the number of years taken to learn German, but it is difficult to identify skills and attitudes that may be crucial, for the result of acquisition of negotiations with German businesses. From the point of view of methodology, there is a substantial difference between: �

A systematic mapping through interviews with the employees of the enterprise,



By means of an external consultant (facts collected) and

Building Competencies for Organizational Future



A controlled development processes where the employees co-operate on the issue of competency in relation to the strategy of the enterprise (process method).

The results and problems will depend, both on the choice of method and on how it is used by: �

Creating a competency based culture in the organization.



Identifying and building competencies of individuals as efficient and effective managers.



To ensure that right people are identified and placed in the right jobs and employee potential is identified, developed and utilized fully.



To help uplift the competencies of critical groups of managers, by providing them insights into their competencies and developmental opportunities.

Historical approaches to competency mapping Competency mapping identifies an individual’s strengths, weaknesses in order to help them better understand themselves and to show them where career development efforts need to be directed. Competency mapping is a process of identifying key competencies for an organization and/or a job and incorporating those competencies throughout the various processes (i.e. job evaluation, training, recruitment) of the organization. To ensure we are both on the same page, we would define a competency as a behaviour (i.e. communication, leadership) rather than a skill or ability. Competencies are derived from specific job families within the organization and are often grouped around categories, such as strategy, relationships, innovation, leadership, risk-taking, decision-making, emotional intelligence, etc. Mapping competencies to stand-up and learning curricula, is the work of Human Resource or Corporate Learning and Development professionals within the organizations.

“Job Evaluation” based competency mapping include the following steps: �

Conduct a job analysis by asking incumbents to complete a Role Profile Questionnaire. This can be provided for incumbents to complete, or you can conduct a one-onone interviews using the RPQ as a guide. The primary goal, is to gather from incumbents what they feel are the key behaviours necessary, to perform their respective jobs.



Using the results of the job analysis, you are ready to develop a competency based job description. This was developed after carefully analyzing the input from the represented group of incumbents and converting it to standard competencies.

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With a competency based job description, you are on your way to begin mapping the competencies throughout your human resources processes. The competencies of the respective job description become your factors for assessment on the performance evaluation. Using competencies will guide you to perform more objective evaluations based on displayed or hidden behaviours.



By taking the competency mapping one step further, you can use the results of your evaluation, to identify in what competency individuals need additional development or training. This will help you focus your training needs on the goals of the position and company and help your employees develop, toward the ultimate success of the organization.

Competency mapping is an important resource in this environment, and is an adjunct to knowledge management and learning organizational initiatives. “Role Profiling” or job analysis tools, help companies to extract knowledge of core competency requirements from internal experts, and allows the company to have any number of job expert raters to contribute ratings on a standard competency scale for any job title or position. The “Experts Panels” might be VPs of Sales, for example, and doing ratings for outside sales professional jobs under their supervision. The accumulated ratings, are transformed into a composite template defining the ideal competency set for that position. Employees or job applicants, then complete a self-report version and their results are “mapped” against the template. Skills or competency gaps are thus identified and inform training decisions. Another kind of competency mapping tool is the 360° multi-rater feedback. Such surveys allow employees to rate themselves on global competencies and specific behaviours. Predefined groups of supervisors, peers, direct reports, or customers who perform ratings of persons on the same items, with the resulting report providing a detailed analysis of self-other gaps in perceived competency behaviours. Again, this measurement data is ideal for the construction of individualized learning paths. It can also be performed in a follow-up fashion to assess the progress. At a more macro level, “organizational surveys” are invaluable, in helping managers chart the organizational-level values and competencies and areas, which are in need of improvement. A well-managed survey can provide managements with otherwise inaccessible knowledge, about how their employees and other stakeholders view the company, and to assist in pinpointing the areas of the company (including geographical, divisional, or job class priorities) in need of particular learning interventions. Some studies approach mapping by focusing on high performing employees—those who get the best results. Working backwards from the results, to study attempts to see how the

Building Competencies for Organizational Future

behaviour of these employees differs from their less-proficient colleagues. Finally, they seek to identify the competencies that explain these behavioural differences. This approach uses the, “repertory grid system” and the “behavioural event interview”, to identify the competencies. The advantage of this method is that they place the worker/ employee in the middle of the data collection. Rather than gathering hypothesis from experts, both approaches emphasize on “real” behaviour of “real” people. But these have their own limitations, as competencies required for the job may not be identified, that both the “super star” and “average” employees may possess. And secondly, the behavioural event interview relies on the identification of a “ socially recognized” superstar. Other approaches begin with a “Rank Order” list of competencies that the employees (and experts) are asked to rank according to importance. The list is shortened to include only the most relevant ones.

CONTEMPORARY APPROACHES TO ASSESSMENT Contemporary approaches to the assessment of individuals' learning and of workplace performance have been influenced by two essentially countervailing philosophies. The first is the competence movement and the second the concept of continuing (professional) development, now increasingly being called lifelong learning. The key differences between them relates to the locus of control, responsibility and accountability around what it is considered important to know (or for some, what knowledge is), and what it is considered important to be able to apply effectively in the workplace. This of course raises the corrival question: effective for whom? Abstract generalizations around these issues become problematic and perhaps the easiest way of illustrating the debate is by caricaturing an organizational philosophy and management structure in which these different approaches might seem desirable in a very hierarchical organization. For example, in a biscuit factory, where role demarcation is very tight, it might choose to take a competency approach to staff development. A 'flatter' organization such as a small public relations agency, or an owner/manager organization; as a GP practice, might embrace its continuous development with a high degree of responsibility for learning and for keeping up to date with current techniques research. Part of the controversy includes different perceptions and conflicts of interest around notion of standards, both of education and training provision and of work. Recent research shows the presence of some of the current methods involved. They include: 1. “Complete Personality Typology” deals with identifying various personality type sets that have been demonstrated as those essential for effective performance and are then tested through a combination of a battery of psychometric tests and simulation exercises.

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2. “Job Suitability Analysis” is another technique being used to help understand work preference inclination of the assessee and to judge their current disposition for placement in varying type of jobs. It provides the assessors data on both type of jobs and suitability for jobs at a mental and personal comfort levels of the assessee. In general, assessment technique judging criteria includes the following: 3. Classification: The goal of assessment here is to produce an accurate and objective measurement of the job dimensions presumed to underlie job performance. The assessment activities must enable the candidate to demonstrate some of the competencies. 4. Performance Media: Exercises here should comprise of a mix of performance media and can be but not limited to: Written (assessor judges the standard by reviewing what has been written), computer based (Multiple choice questions), spoken (individually to the assessors or to other group members) and behavioural (assessment based on live performance). 5. Performance Assessment: In the UK, the 1997 Dealing Report had made a clear case for the establishment of a coherent national framework of qualification at every level, congruent with the National Curriculum in schools and with National Vocational Qualifications in the workplace. There was vociferous opposition to these developments in many quarters, with an alternative case being made for peer review and rich and diverse mix of provision and approaches. At the heart of the controversy, different perceptions of the nature and value of learning and conflicts of interests and issues such as freedom, responsibility and independence on the one hand and standards and accountability on the other. When the assessment is related to certificate and accredited qualification or local versus place performance criteria, there are perennial dilemmas associated with any assess; process. These include: �

The assessor as advocate for the person being assessed.



Anxiety about the implications of failure.



Leniency or strictness in the application of criteria.



Interpretations of criteria.



Rigid adherence to 'objective' criteria undermining the creativity and originality.

Building Competencies for Organizational Future



The assessor as a gatekeeper for entry into a professional body or academic commonality.



Consistency between assessors.



Consistency of assessment over a period of time.



Consistency of assessment in different locations and between different cohorts.



The impact of the environment and context of assessment – the notion of the ‘COMP’ workplace'; or competent workplace.



The 'halo' effect of the previous performance of the assessed person or of their “P” position in the profession or organization.



The ownership of learning and of assessment.

These and other associated concerns have led to various assessment approaches designed to overcome the worst defects. None of these ultimately remains unchangeable. 6. Formative and Summarize Assessment: Concerns about the role of assessment either in enhancing or inhibiting learning has led to a distinction between formative and summative assessment. The former offers feedback to the learner while their program or period of learning is still taking place so that they can act on and improve their performance. The latter marks the arrival (or not) at a specific stage or level of teaching, which the learner is deemed to have reached. At its simplest, formative assessment would include the assessor's detailed and overall comments on a piece of written work that the learner can use to either improve that piece or the next one. An example of a summative assessment would be the grade given for the final piece of work, or the percentage achieved in an exam. 7. Norm Referencing and Criteria Referencing: Norm referencing entails the comparing and contrasting of standards reached by any one group of students being assessed during the same period which is sometimes called as benchmarking. Consistency is apparently achieved by organizing results around clusters of grades or percentages, e.g. a certain percentage of grades A passes. It is criticized for not taking into account different levels of ability and the achievement between groups. Criteria-referenced assessment aims at the production of set criteria to which assessors are meant to adhere, offering greater consistency within and between groups. In practice even when these are conscientiously used, it is claimed that benchmarking is

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still in operation and that assessors according to their educational background, personal experience and preferences subconsciously weight criteria. The other problem with criteria is that over time, knowledge in and across disciplines grows and criteria may need to be constantly updated to account for this, thus undermining any claims for consistency or universal standards. 8. Self- and peer-assessment: Arguments in favour of self-assessment are made on two main counts: �

The first is that self-assessment approaches encourage individual responsibility and commitment to learning to a much higher degree. Hence learning is deeper, richer and more relevant for the individual.



The second relates to who can judge what learning has taken place and how authority is invested in them. Is it through positional power only, within the assessing organization; or through their external credibility or is it through their actual knowledge and understanding of the learner or 'body of knowledge' in the subject being assessed.

Obvious criticisms of self-assessment include the degree to which learners will be too harsh or too soft on themselves in relation to their own perception of the standard required. AI problematic can be the learners' ability to locate their achieved understanding within a much broader spectrum of knowledge. Peer-assessment helps to deal with some of these dilemmas by the moderating effect of several different perspectives will bring to that of the individual. This can also be of some benefit where ownership of and motivation for learning are vested within a group of learners, as the focus group in the case study above, especially when the learners also share the status in relation to the process and the task of assessment. However, other factors influencing group dynamics, including power games and 'trade-off' can create equally different problems for fair and equitable assessment processes.

The Difference between Competence and Competency Fundamentally, we need to understand that there is a difference between competence and competency and the impact it has on an individual at the personal competency level, an organizational situation or at a position level. Competence and competencies tend to differ in certain basic ways. An ability based on a work task for a job outputs, is referred to as a competence. The ability based on behaviour, tends to be referred to as a competency.

Building Competencies for Organizational Future

Organizations present competencies in many ways. In some situations, these competencies in fact, reflect the form of what is called as a competency cluster. In a competency cluster, behavioural indicators, are the basic building blocks and form the fundamental framework, which determines competencies in their definitions, in a particular situation. Behavioural indicators, are examples of behaviour, which is observed when someone demonstrates competency. In most cases, there are several examples of effective competencies. Each competency demonstrates the recollection of related behavioural indicators and their organizing, to what our motorists depend, on the scope of framework, which otherwise can be called as a competency dictionary. Competencies are differentiated through basic standards or benchmarks (sometime also called as levels) and those with levels and those without levels. A simple framework that covers these chances are roles that have very similar demands on the job or adored behaviour may have a single list of indicators within each competency and an overall sense of framework may not be present on state multiple levels on benchmarks. But then there are situations when a job may demand a multiple level of standards or benchmarks and this framework also covers a wide range of jobs with different degrees of demands including beer will indicators, within each competency that could be divided into separate lists all levels. This enables a range within a competency, to be described under one competency, heading as both which is acceptable and are necessary to the competency framework in a wide range of applications that cover a multiple jobs or roles. Competencies based levelling are to split the behavioural indicators into groups and are labeled usually numerically and the more complex behaviour to the higher level that is assigned to that particular level. Another method of levelling is, by the expected performance of a older job. This form of levelling is usually used, only where the framework relates to a single competency, or a particular role. In some situations, these indicate that it has been differentiated, as the shown competencies are outstanding competency, or at times negative demonstrations of a competency. In order to make competency communication effective, on what is understood as a behavioural description of a competency is usually described in a particular way. The competency title is usually very short and distinguishes it from other competencies while being descriptive and easy to number when it is explained in a behavioural sense. In addition to the competency title, many frameworks include competency descriptions. There are two main approaches to competency descriptions—the first approaches to produce a summary of the behaviour that are contained within the competency. When a competency summarizes a single list, the behaviour is the spectacle approach, tends to be very effective in a job situation, when people and peers need to understand the job the role demands. The second approach is to provide a rational for the competency, in place of a summary and includes a description of wider competencies that are important to the organization. This is best used, where competency frameworks contain all the levels of behaviour because in these cases it is difficult to produce a summary, that would cover all roles in the organization and adopted behaviours of job incumbent or role player within the competency.

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A competency is an underlying characteristic of an individual, which is causally related to a criterion referenced as effective and/or superior performance in a job or a situation. Underlying characteristic, means the competency is a fairly deep assessment of a person's personality and can predict the behaviour in a wide variety of situations and job tasks. Causally related means, that the competency causes or predicts the behaviour and performance. The criterion referenced means, that the competency actually predicts the poor performance as measured on a specific criterion of standard. Competencies underlying the characteristics of people and also indicate ways of behaviour thinking generalized across situations and their endurance for a reasonably long period of time. There are five types of competency characteristics. Example: Motive. The things, a person consistently thinks about during the behavioural action. A motive drives directly and selects the behaviour towards the goals. Physical characteristics and their consistent responses to situations of information drive the description process. Emotional self-control and initiative, are more complex consistent responses to situations, as some people don't blow up at others and to act about and to be on the call of duty to sort problems in distress. The straight competencies are characteristic of successful managers. Motives and competencies are intrinsic or parents of self-starting master traits, which predict what people will do on their jobs on a long term without supervision. As the competitive environment becomes more complex and variegated, so is the need for greater genetic variety, a broader range of managerial beliefs and a greater repertoire of managerial actions that grows apace. Any firm that hopes to survive, must create within itself, a reasonable proportion of the genetic variety, to be found in the industry at large. To change bits of genetic coding, the company can leave a bit of play in administrative procedures, be reluctant to use the lessons of the past to train the employees for the future, or it may mean a greater willingness to hire and promote individuals who aren’t like us. Creating a “learning organization” is only half the solution. It is important to create an “unlearning” organization. There is an important message for challengers in such an organization. To be a challenger once, it is enough to challenge the orthodoxy’s of the incumbents; to be a challenger twice:, a firm must be capable of challenging its own orthodoxy. So it has to reinvent its core strategies. It must preconceive its definition of the market place, redraw the boundaries of the firm, redefine its value propositions and rethink its most fundamental assumptions, about how to compete. A firm’s stake in the past is economic, as well as emotional. For a successful firm, the definition of served market, the value proposition put forward to customers; the margin and the value added structure and the supporting administrative systems constitute a profit engine. The threat to the firms profit engine, may come from the improvement made by a competitor to a particular component of the engine. The best way to ensure, that one is not at risk from

Building Competencies for Organizational Future

more imaginative competitors, is to be the first to conceive of an alternate value delivery mechanism. And also to be the first to cannibalize one’s own products and services and the first to get to the future, even when the future undermines past success. Today, the efficacy of designing organizations around mere job structures, is being challenged. Although this approach has dominated the field of organizational behaviour and human resource management for decades, a number of forces have converged, to suggest that a competency-based approach is more successful. In the global competitive environment which organizations face, the competency based approach and the capabilities that individuals need to acquire and develop should be the major focus. As jobs become more knowledge-and service-focused, organizations need to be more adaptable and to compete on the basis of their core competencies and skills (PRAHALAD and HAMEL, 1990). One of the major consequences of the new performance, demands that organizations face and the idea of organizational capabilities as a basis for competition, concerns the role of individuals. It directly affects the kind and amount of value that they are expected to add. Instead of their simply being parts of a large bureaucratic organization where they may do the same thing (job) as other individuals, they become a key competitive asset (DOYLE, 1990). In essence, their knowledge, skills, capabilities and learning become an important part of the organization’s ability to compete and are at the heart of an organization’s adaptability and ability to learn (SENGE, 1990).

NEED

FOR

COMPETENCY FRAMEWORKS

If a leading-edge organization seeks to create an efficient and effective competency management system, what would they typically cover? Let us look at their priority list: �

Translate agency vision into clear measurable outcomes that define success and that are shared throughout the agency and with customers and stakeholders.



Provide a tool for assessing, managing and improving the overall health and success of business systems.



Continue to shift from prescriptive, audit and compliance-based oversight, to an ongoing, forward-looking strategic partnership, involving agency headquarters and field components.



Identify core capabilities in the business and in the individual to help connect work with behaviour, consequently influencing the performance and results.

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Include measures of quality, cost, speed, customer service and employee alignment, motivation and skills to provide an in-depth, predictive performance management system; and



Replace existing assessment models with a consistent approach to competency management.



Implement efficiently.



Undertake pilots as necessary.



Go for the kill once acceptance is gained for across the board execution.

Essentially Competency Frameworks includes the following: �

The Competency Development Cycle—Core Competence, Strategic analysis, Vision and Value orientation work, Organizational Structural Implications.



Technical, enabling and managerial competencies.



Role profiles.



Competency definitions, clusters, Meta and sub-set competencies.



Proficiency levels and benchmarking.



Competency Dictionary.



Employee Band Matrix



Assessment Set.



Assessment Worksheets for assessment, including templates.



Conducting the Assessment Centre.



Assessment data.



Conducting the Development Centre.



Individual Development Plans.



Organizational Development Plans.

Building Competencies for Organizational Future



Short Term Plans.



Long Term Plans.



Managerial Centre, where applicable.

This has been explained below through a three level (Level 1 to 3) presentation of the competency framework process. For competency framework to be effective it should be understood and should be in a position to be applied in varying situations that an incumbent is placed while performing a job. Increasingly certain basic quality standards for competency frameworks have been established. They are as follows: �

Is related to the job role.



Clear and easy to understand.



The framework will be relevant and affect all staff.



Takes account of expected changes.



Has a specific behaviour indicator.



Can be applied to many situations.



Has been benchmarked against specific standards.

As described above, models or frameworks of competency that are based on the behaviour of high performers can provide clear guidelines for many employees as a next step of action because of their concrete nature. Moreover, incorporating the previously abstract standards defining capability (judgement, inventiveness, leadership, etc.) in the competency model enabled managers to more concretely convey corporate strategies to employees. At the same time, modeling the characteristics and strong points of high performers' behaviour thus enabled the management to formulate guidelines for their employees' development, helping to raise overall capabilities. In fact, there are examples of success where a new assessment system based on competency was introduced, and because of this, more and more company employees began to examine their actions from a viewpoint in which they asked themselves, 'Will this lead to a good result or not?' and as a result this led to an improvement in the employees' attitudes and changes in their behaviour. Having articulated the strategy of the firm in the earlier part of this chapter, it is important to provide a brief appreciation of the key elements of the competency mapping process and demonstrate its linear linkages to the strategy of the firm. This can be classified into 3 levels

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Organizational Values Core Strategy

Org Structure

Critical Success

Mapping Band Matrix Concept Admin of Process Style Style Skills Band A Band B Band C Band D Band E

Competency dictionary Competency name: Description: Behavioral indicators: Level rating scale:

Long Term Career Plan

Personal Development Plans Assessment Set (Say, Bands IV, V and VI only) E.g. CEO, CHRO, COO, CFO, CTO, CKO

HR Strategy

Short Term Development Plan

Finance–- VP, GM, Executives - VP, GM Marketing Sales – National Head Assessment Worksheets for Assessment Set Director- Marketing Profile: Competencies: Desired Rating:

Assessment data (individual and summarised)

Assessment technique Assessment Center, 360 degree Feedback, In depth Testing etc Material, e.g. In-basket Simulations exercises Team Interview Discussions

Figure: 1.6 The Key Elements of a Competency Model.

as seen in Figure 1.6 (above), with each of the levels denoting an aspect of the mapping process and its overall linkages.

Level 1 – Framework: �

Organizational vision, aspiration, foresight and business landscape in which the business operates.



Articulation of a strategy, core competence, the delineation of the business plan, defining critical success factors, key performance indicators.



Creating a competency dictionary in sync with core competence of the firm.



Defining the HR strategy and its influence on the core strategy of the firm.

Building Competencies for Organizational Future

Level 2 – Framework: �

Organizational Structure and architecture, including roles, responsibilities.



Defining employee bands, role maps, job clusters, defining variation in levels.



Determining the Assessment Set.



Assessment worksheets for individuals including templates, key areas to be covered, mega and sub competency differentiation.

Level 3 – Framework: �

Short term initiative in terms of Individual development plans.



Long term initiative in terms of Individual development plans.



Integrated Individual development plans.



Assessment Data (Individual and Summarized).



Assessment technique (Methods, tools, formats, expert panels, etc).

LIMITATIONS AND

LEARNING FROM COMPETENCY FRAMEWORKS

However, the following four questions emerge: �

The question of specifying a certain model: Is it really possible to specify a single model of a competency or might there be other patterns?



The question from the standpoint of cultivating human resources: Isn't it too difficult to fortify the weak points of individuals no matter how well you present a model of competency?



The question of the reproducibility of results: The model is a pattern of past success. Can one really generate reproducible results by continuing to act in the same way?



The question of restricting behaviour: If anything, doesn't it rather discourage individuality, encouraging the entire workforce to adopt the same behaviours and attitudes and act in the same way, and as a result cause the whole organization to become unicellular, weakening its flexibility to deal with change?

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The Behavioural dimension in competency mapping McClelland Model and its understanding of Human Behaviour The McClelland Model brings to bear the fundamentals of how motives and behaviours can be classified to determine the need to map competencies and behaviours. MCCLELLAND (1976), the leading researcher on self-concept, has studied human behaviour for many years and has theorized that people are motivated by three basic needs—achievements, affiliation and power. He has further asserted that, though all of us possess all three needs, we possess them in varying degrees—one person's highest priority need may be achievement, whereas another person's may be affiliation or power. The following paragraphs present a brief description of each need and the ways in which a high degree of each, translates into behaviour in an organizational setting.

1. Achievement People with a high need for achievement do enjoy challenging work, but they also want to ensure that they will succeed. Tasks that present so great a risk that success is improbable, do not interest or motivate them. Consequently, they tend to set conservative goals. Achievers plan ahead to avoid any serious problems in their undertakings, but the planning function itself, is not a source of motivation for them. They enjoy tasks for which they are personally responsible for the outcomes and with which they can be closely associated with the resulting success. They are quite concerned with meeting appropriate deadlines and experience great anxiety about any project, until it has been completed successfully. In addition, they require frequent reinforcement consisting of "hard" data such as sales figures, standards, and so forth.

2. Affiliation People with a high need for an affiliation, direct their energies toward the establishment and maintenance of effective working relationships with others. It is the need for affiliation, which prompts people to examine the "human" side of decisions, which are made within organizations. When this need supersedes that for achievement or power, the concern for receiving approval from and being liked by peers, supervisors and subordinates becomes a critical factor in decision-making and implementation. Just as achievers focus on deadlines and the objective aspects of decisions, people whose highest priority need is affiliation, focus on the interrelationships that exist among those who are to be affected by the implementation of decisions. As group members, they try to maintain harmony and mutual respect among members, while the group undertakes its function or objective.

Building Competencies for Organizational Future

3. Power "Power", in terms of McClelland's model can be seen as the ability to overcome resistance in achieving an objective or goal (PFEFFER, 1981). People with a high need for power, are usually quite fluent, because they enjoy arguing and conforming conflict, and so speaking skills are important to them. In an organizational setting, they tend to prefer an autocratic decision-making ("I make the decision, you implement it"), and they tend to see situations as win/lose ("I win, you lose"). Their highest-priority need is power and are frequently political realists, who can evaluate situations in light of their political implications and determine a course of action, on the basis of the outcome of their evaluations. When combined with a low need for affiliation, a high need for power may lead an individual to consider people, as means to an end and the value of establishing and maintaining satisfactory relationships in the organization may be lost.

4. Self-concept A person's attitudes, values or self-image formulates itself into self-concept. A person's values or respondent or reactive motives that predict what she will do in the short-term add-in situations where others are in charge. They are people who value being in management but do not intrinsically like or spontaneously think about influencing others at the motive level and often attain management positions but then fail. Knowledge is processed and analyzed information of a person isn’t specific in content areas. Knowledge is a complex competency. Scores on knowledge tests often fail to predict the performance because they fail to measure knowledge and skills in the ways they are actually used on the job. Firstly, many knowledge tests measure rote memory, when what is really important is the ability to find information. Memory of specific facts is less important, than knowing which facts exist, that are relevant to a specific problem and where to find them when needed. Secondly, knowledge tests are respondent. They measure the taker’s ability to choose, which of the several options, is right for the respondents but not whether a person can act on the basis of knowledge.

5. The Skill The ability to perform certain physical or mental tasks, consistently, accurately and when displayed in meaningful ways and behaviourally turns into a competency. Mental or cognitive skill competencies include, analytic thinking, posting knowledge and data

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determining cost in effect organizing data, plans and conceptual thinking by which we mean recognizing patterns in a complex data. The tripod level of a competency, has practical implications for human resource planning. As knowledge and skill competencies tend to be visible and relatively surfaced characteristics of people. Self-concept traits and motive competencies are more hidden and deeper and central to a personality. Surface knowledge and skill competencies are relatively easy to develop and training is the most effective way to secure the employee’s attitudes including their abilities. Selfconcept competencies lies somewhere in between. Attitudes and values, such as selfconfidence in other words, seeing oneself as a manager instead of a technical or a professional, can be changed by training psychotherapy and all positive developments, to experiences albeit with more time and difficulty. This is less time consuming and a cheaper method of mapping competencies, though this may mean running the risk of missing crucial that can be obtained by actual observation.

Behaviour is what business competency is all about Why do people act the way they do? We often ask ourselves this question. Because consequences support this behaviour. In a business environment many behaviours occur daily. Some of those behaviours affect business directly (positive as well as negative) while others are socially needed. By understanding what drives human behaviour, we can create the conditions necessary to encourage desired behaviour. The ABC-model is an instrument which helps you understand the forces that drives human behaviour and applies these principles to instruments like a reward system, an organizational change, projects and so on. You can gain perspectives on why people act as they do and discover the patterns of consequences and antecedents that are associated with different behaviours.

1. Antecedents prompt you to act An antecedent (sometimes referred to as an activator) is something that occurs before a certain behaviour. This can be anything from a directive to the effect of the working environment. Antecedents appear both in everyday life and at the workplace. Even the Internet itself operates on the function of antecedents. The fact that you are here on this homepage is already a consequence of an antecedent. Everything that prompts you to act in a certain way (like asking you to click the button), could be called an antecedent. Now you understand that the Internet can be seen as one

Building Competencies for Organizational Future

big function of the model. A funny looking button inspires you to push it, an interesting item on a homepage make you click the link, a good looking homepage prompts you to give it the attention it deserves. An antecedent is an important part of the model to get a certain behaviour started; it prompts you to take action. In the world of business, these would include policies, goals, directives, announcements, training programs, procedures, vision statements, and so forth. All of these 'set the stage' for a work-behaviour or performance to take place, but they do not guarantee that it will occur. Managers are also frequent users of antecedents, telling people what to do, figuring out what to tell them to do, or figuring out what to do because people didn't do what they were expected to do. They even spend approximately 80% of their time using the A of the ABC, neglecting the B and the C (DANIELS 1989).

2. Behaviour, how to manage it.... Behaviour is the centre of our universe. We behave in such manner that we feel is comfortable or just necessary. In business, moneymaking is the key goal. In order to reach this goal many actions must take place. We have to push buttons, write reports, have long meetings, put candy bars in a box and place an order by a supplier. Whatever we do or what ever has to be done, certain patterns of behaviour are involved. Imagine for a moment that an alien spacecraft is hovering over your place of work. Then imagine that it 'freezes' all your employees like statues. Machines continue to run, but people do not. The telephone rings, but no one listens. How long will it be before your business is affected negatively? The same situation is possible when a snowstorm hits your town and all roads are closed for five days (THOMAS B. WILSON). Without behaviour, no production can effectively be conducted meaningfully. The same can be said about the safety in the workplace, attendance and punctuality, quality and improving health in the workplace. Behaviour is the keyword. Because in business there are so many behaviours going on, it is important to pinpoint those behaviours, which directly affect the outcome of your business (process). Those behaviours must support the goal and mission of the firm. The process of pinpointing behaviour is a process done by the manager in co-operation with the employee. Helpful questions are: �

Which actions have to take place to become a excellent employee?



What shows the difference between a productive and a less productive employee?

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One more thing can be said about behaviour: it is observable. You can see someone push a button or move the mouse. Because it is observable, you can correct it, count it, appraise it and therefore manage it. The ABC-model gives you one important instrument, which helps you to manage behavioural consequences.

3. Results vs. behaviour In business’, managers mostly focus on results instead of behaviours; they manage results. But there is a big difference between these two. Behaviours are part of the throughput of a process while results are output. Therefore managing results is not always as effective as it might seem. Take for example a new employee who has to learn a lot about how to repair a bicycle. While doing his work he tries to fix the problems he encountered to the best of this knowledge. The bicycles seem to be in perfect state when they reach the end of the assembly line. The employee gets a friendly pat on his back for finishing the job. Everything seemed to be OK. Except that the supervisor did not observe that the new employee used his tools the wrong way and some different screws were used; which resulted in extra costs and time and a bad condition of the tools.

4. Positive reinforcement, what happens to us We discussed that antecedents prompt you to act in a certain way. Explaining that behaviour is an important part of business followed this. The third item of the model is consequence. Consequences are a powerful instrument for managers to use. They are also an instrument, which is not used as frequently as it should be or is used in a wrong way. When a manager demonstrates what the worker needs to do, an antecedent strategy is being used (it's an instruction which prompts the employee to a specific behaviour). But when the worker is praised for the correct performance of the task, a consequence strategy is applied. The figure below illustrates the different types of consequences. The term reinforcement refers to the increasing likelihood that the behaviour will be performed, or the intensity with which it is performed.

5. Behavioural Consequences Positive reinforcement. This is a consequence that increases the possibility that (pinpointed) behaviour will occur more frequently in the future. We can only speak of positive reinforcement when the rate or frequency of the behaviour changes in a positive

Building Competencies for Organizational Future

way. For example: praise, a bonus, 'just giving attention', a job rotation and working on a project, could be positive reinforcements. But remember different strokes for different folks. Individuals have preferences. Some people prefer a pat on the back accompanied by the words: “you did a fine job," or "the way you handled that customer was really excellent". While it reinforces others just by an approving look or even a cynical remark. Negative reinforcement. This consequence also increases the likelihood that the behaviour occurs again. In contrast to positive reinforcement, frequently people behave in a certain way because they have to, not because they want to. They act to avoid a negative consequence, for example, being punished or getting fired by the boss. In issues like safety rules, negative reinforcement can be effective. Nevertheless, negative consequences are in general less desirable than positive ones. Still, management frequently uses them. Punishment. When being punished the person gets something he/she doesn’t want. Punishment leads to fear and will stop the behaviour being continued. Being chewed out after launching an idea regarding on how to optimize the business process, can inadvertently stop this behaviour (to launch a new idea). Remember: different strokes for different folks; behaviour must stop or decrease to be considered as a punishment. Extinction. In a meeting, you try to bring forward a new idea, but you fail repeatedly to draw attention of the members present there. Ignoring involves withholding social reinforcement and results in the extinction of behaviour. This situation occurs frequently in business when, for example, productive behaviour is ignored. Many performance problems may be created, not by what we do, but by what we don't do (DANIELS, 1989). This in short, is the way consequences work. A good understanding of these principles can be very profitable for competency mapping in an organization. These principles can be used not only for managing behaviour but also when developing a reward systems or conducting a performance appraisal.

TYPES

OF

COMPETENCY DEFINITIONS

Competencies can be defined in a variety of ways, but most definitions are either Direct Statement definitions or Key Element definitions.

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A Direct Statement definition consists of a single sentence, paragraph, or brief descriptor, that conveys the meaning of the competency (Fig. 1.9). The level of detail in the definition can range from one or two words, to a lengthy paragraph. Typically, each statement is rated, and the individual competency ratings or an overall performance result for an individual is used to target learning needs or evaluate performance. These models can be quite simple, which has practical advantages, but they can also suffer from a lack of clarity, especially if the definition is very brief. A balance must be struck between, the size and detail of the definition, and the number of competencies used, and covering every important aspect of a job role. In writing detailed and comprehensive definitions, an organization also risks losing the ability to target discreet development needs effectively. For example, “Strategic Decision Making” can be a complex competency, with a number of distinct aspects. If all of its aspects are combined in a single statement, an individual’s rating is an average of his or her abilities in all of these areas. This is fine for an overall evaluation of “Strategic Decision Making,” but does not focus the individual’s attention on specific aspects of the competency in which he or she needs the most development. On the other hand, statement definitions are effective, when they focus on skills that must be learned as a consistent whole. Many technical skills fall into this category (for example, “can arm a Sidewinder missile”). With such a competency, one must know all the steps in the process. To evaluate an individual on each step—separate from observing whether he or she can perform the entire operation—becomes more work than it is worth. The detailed evaluation is made on the job or in a coaching sessions and its evaluation in a written competency is superfluous.

Principles behind writing definitions �

Definitions should indicate the difference between technical, enabling and managerial competency.



The competency should be initially described for its conceptual meaning.



It should cover the basic application of that concept to the job role.



It should state the expectation from the role player.



Such an expectation should be stated in behavioural terms.



It should involve action verbs, that indicates the need to act upon the competency to realize its value to a job.



It should form a sub-set of the meta competency and demonstrate relevance to the meta competency under which it is being defined.

Building Competencies for Organizational Future



The behaviour should be implemented in a job role situation.



The sub competency should flow, through logically from one to another.



Definitions should not be another reproduction of the job descriptions. It is essential that competency, distinguish the behaviours necessary to achieve tasks or perform roles as against defining roles themselves.



Competency definitions should stand the test of scrutiny in achieving a common understanding of each of the definitions.



It is best-written keeping skill levels, benchmarks proficiency and standards in perspective to enable fundamental differentiation from one level to another.

For example:

Meta competency: Account Management Orchestrating resources to drive category and SBU sales/profit with individual customers by identifying opportunities/goals and developing/implementing plans. Eg. Figs. 1.7–1.8.

Meta competency Meta competency helps achieve the following: �

Defines core competency at the level of roles.



Enables creation of subset competencies that can have a logical connection to the core competency.



Provides for brevity and ease of understanding at the senior management level when reviewing or evaluating competencies across the organizational levels, job families.



Facilitates individual communication to be at both conceptual level and at the eye for detail level when required or necessary.



Predominantly used while defining proficiency levels when comparing across benchmarked jobs, peer incumbents and at senior management positions.



Useful when there is no need to drill it further into sub set competencies.



Meta competency has to be defined at a strategic level with adequate scope for its drill down.

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Skill Level 1.

Demonstrate basic Account management techniques.

• Identify who the customer is. • Describe SBU priorities. • Describe basic roles and accountabilities. • Effectively make professional sales calls. • Describe basic differences in customers’ strategies (e.g., hard discount vs. full service grocery). 2.

Use Account management process to communicate benefits to customers.

• Explain profitability and profit impact on channels and packages. • Identify and blend customer needs with SBU objectives. • Articulate benefit of marketing initiatives and strategy. • Explain account’s role and importance in the channel. • Explain account’s strategy, especially relating to soft drinks. • Explain account structure and decision-making process. • Make sales presentations that demonstrate benefits to customers and secure implementation of business programs.

Figure: 1.7 Meta competency and Account Management at different Skill Levels.



In situations where the need is to simplify the competency to its very basic level meta competency approach is not desirable.



Meta competency mapping without recourse to sub set competency for untrained competency mapping professional is not recommended given serious possibility of errors in defining proficiency levels.



Also necessary that critical and relevant players under meta competency for what it is intended and that all are on the same page with reference to its meaning and definition.



When in doubt meta competency mapping should be followed by a clarification seeking session.

Defining Meta and Sub Set Competency �

Each of the Meta competencies should be defined verbally to extract its true and commonly understood meaning.

Building Competencies for Organizational Future

Competency Measure: Meta and Sub Competency Proficiency Levels Incumbent Role Profile Strategic Mindset Conceptual and Analytical Thinking Systemic Thinking Environment Scanning and Trend Analysis Networking and Management Articulation Demonstration Information Business Relationships Sensitivity and Empathy Bonding Adaptability Problem Solving Defining Right Trouble Shooter Proactive Builder Personal Habits Firm Drives Personal Examples Action Focused Leadership and Influence Proactively Changes Demonstrate bias for action Builds Consensus Group Process Motivating team members Building teams Recognizes accomplishments

CEO 5.0

COO 4.0 5 4 4

5.0

RM 1 3.0 4 3 4

4.0 5 4 3

4.0

4.0 3 4 3

3.0 5 3 4

4.0

3.0

4.0

4.0

4.0

4.0

3.0

4 3 3 4.0

4 3 2 5

4 3 4

3 3 4

3 3 4

5 4 4 4

3 2 3

4 3 4

5 3 4 5.0

4 3 3

3 3 3

4 4 4 5.0

3 3 2

4 3 3 4

2 4 5

4 4 3

Figure: 1.8 Meta competency at the desired proficiency levels varying across different levels.



These statements need to be defined with a behavioural perspective without losing the purpose behind the act.



Each of the meta competency should have at least 2 or 3 sub set competencies to help capture the overall meaning behind the meta competency.



Defining each competency would mean falling back of the competency dictionary and standard definitions behind each of the competency.

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Defining Meta and Sub Set Competencies Sl. No. 1

Competency

Definitions

Strategic Mindset Diagnoses, collects and analyses information. Looks for links and develops new constructs. Intellectually manages complexity and ambiguity. Shows interest in perspectives of others and can comSystemic Thinking bine and contrast different disciplines. Understands own part in the total and sees the whole picture. Environment Scanning and Trend Analysis Looks ahead, predicts and forecasts. Prepares, plans, recognizes, and acts in advance of obstacles. Reads the environment.

a

Conceptual & Analytical Thinking

b c

2

Networking & Relationship Matrix a

Written-Understanding, Absorbing & Communicating

b

Verbal/ Non-Verbal

c

Information Management

3

Absorbs information through reading bulletins, manuals, trade press, etc. Presents information through proposals, reprints, letters. Communicates to others via telephone and face-toface, one-to-one and in meetings, and through presentations and demonstrations. Can track down sources of information. Knows who to contact. Keeps the appropriate people informed. Acts as a liaison between others.

Problem Solving a

Problem identification Resource Mobilization

b

Monitoring/ Coordinating/ Trouble Shooting

c

Understanding Customer Requests, match to products, resource constraints

Anticipates difficulties and spots opportunities. Makes plans for self and others. Identifies potential resources. Alerts management to issues to forestall problems. Monitors progress, follows up, coordinates work done by self and others. Orchestrates. Initiates action to correct deviations from plan. Understands business of the customer and own organization. Identifies customer requirements. Matches these to available products and service. Recognizes resource and cost constraints.

Figure: 1.9 Redefining Meta and Sub Competency. �

It is important not to redefine each of the competency as it is colloquially understood by the participating members.



Validating the definitions would help cross correct for inadvertent insertions of words or meaning not intended or necessary or has a tendency to distort the original meaning.

Building Competencies for Organizational Future

Each definition should be stated behaviourally with appropriate verbs to demonstrate action while performing that competency by a role incumbent.



Causal flow models can be used to do criterion referencing assessment analysis. Criterion references are critical to a definition of competence. A characteristic is not a competency unless that predicts something meaningful in the real world. A characteristic that makes no difference in performance is not a competency and should evaluate people’s criterion most frequently and should use in competency studies that are superior performance and more effective. Competencies tend to get categorized into two categories and these can be defined as, those that are threshold and differentiating according to the job performance criterion they predict. There are essential characteristics of the show competencies, usually in the form of knowledge on basic skills, such as the ability to read that everyone in ajar needs to be minimally effective but that does not distinguish superior from average performers.

Rational Persuasion

Conceptual Thinking

Behavioural Indicators

Behavioural Indicators





Understands how own tasks relate to the wider framework.



Makes connections between facts and events, that are not readily obvious.

• •

Develops models and sees the “big picture”.



Fits information to mental models and frameworks.



Relates different pieces of information and recognizes trends.



Identifies the key factor(s) in a complex problem.



Associates seemingly unrelated information in order to analyze a situation.



Forms a general impression about a group or organization, from the way people behave within that group or organization.



Relates the implications of events and trends, in the external environment to the work unit or organization

• • • • • • •

Draws on reason and logic, in making a case. Uses cost benefit arguments in order to influence. Presents arguments, based on factual information. Demonstrates that a course of action, is of mutual interest. Points out how a course of action, is/is not effectively related to the expressed interests of the other party. Relates suggested solutions, to the needs of the listener. Refers others to source data, when debating contentious issues. Focuses on the problem, rather than the person in a debate.

Compares present data and events, with previously defined frameworks.

Figure: 1.10 Behavioural Indicators for Rational Persuasion and Conceptual Thinking.

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Types of competencies Technical Competencies related to a specific area of expertise such as an industry, process, technological package or functional area as a knowledge or skill (e.g., knowledge of safety regulation & international compliance codes, Order Management, upstream-downstream integration skills, hedging expertise to reduce risks in the oil market, etc.) These competencies are generally acquired through some form of training (i.e., course work, formal education) which may be accompanied by some type of certification

Non-Technical Competencies often considered “soft skills”—usually abilities and personal attributes (e.g., Risk Taking, Flexibility, passion for organisation, patience, commitment, etc.) These competencies generally are not specific to an industry, process, technological package or functional area.

Figure: 1.11 Types of competencies—Technical and Non-technical. A threshold competency for a salesperson is knowledge of the product and ability to fill out invoices. The differentiating competencies are factors to distinguish superior from average performers. For example, achievement orientation expressed in a person is setting goals higher than those required by the organization is a competency that differentiates superior from the average salespeople. �

Working well with others—improving one’s own work and that of others, by building, using and maintaining effective, interpersonal relationships.



Serving the customer—working effectively with the customer to meet customers and one’s own business goals.

Key elements in the competency definitions An organizational competency principle must have its roots firmly in the vision, mission and strategy of the enterprise. This determines the relevance of a competency in relation to values, core competency, directional strategy, and developmental intervention, required building upon the organizational core competence through a people competency mapping process. Technical competency forms the foundational skills and capabilities in relation to doing

Building Competencies for Organizational Future

“Intent” Personal Characteristics Motive Trait Self-Concept Knowledge Achievement Motivation

“ Doing Better” • Competition With standards of excellence. • Unique Accomplishments

“Action” Behaviour

“Outcome” Job Performance

Skill Example: Achievement Motivation Goal Setting, Personal Responsibility, Use of Feedback

Continous Improvement Quality, Productivity, Sales, Earning

Calculated Risk Taking

Innovation

New Products, Service and Process

Figure: 1.12 Achievement Motivation and its Outcome. one’s job effectively. It would mean knowledge and process capability, which demonstrates levels of proficiency, as determined by the proficiency level in a particular job. Technical competencies (Industry, Process, Function and Technology) are specific to each job family, industry expertise to start with and each job role as we move forward. Enabling competencies drive performance orientation through managerial capabilities that help in formulating people management skills, leading and problem solving and analytic as appropriate. Refer Figs. 1.11, 1.13, 1.14 and 1.15. The key elements definition uses a paragraph or brief descriptor in combination with additional descriptors, or key elements, that further detail the important aspects of successful performance in the competency. The number of key elements typically varies from two to seven, and each key element can be rated. The overall rating for a competency is determined by averaging the ratings of the key elements, or by setting minimum thresh hold scores for each key element that, if met, result in a rating of “competent” for the competency. As with the Direct Statement approach, unless the competency is defined carefully, the Key Elements approach can result in competency models that are unclear or too large to be practical. Each key element must also be clearly defined in the context of the competency to which it belongs. For

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Organizational Building Personal Effectiveness

Logical Analysis

Technical Application

Problem Solving

Commercial Management

Work Ethos

Conceptual

Self Assuredness

Articulation Ability Team Focus

g s tin ie ra enc teg et In mp Co

Decision Making

Flexibility

Interpersonal

Personal

Open and Transparent

Collaborative Effectiveness

Trusting Integrity

Managerial Ability Leadership Ability Personal Ability

Sets an example Risk taking Motivation

Figure: 1.13 Two examples of competencies defined using the Direct Statement approach. example, a key element that focuses on seeking information to understand an issue fully could be part of a number of competencies, such as Customer Service, Troubleshooting, and Coaching. In each instance the key element must be defined in such a way that clearly links it to the competency, so that it is evaluated and addressed in the relevant context, not as a generalization across different competencies. This model has the great advantage of providing individuals, with more detailed feedback. Each key element rating can be examined, and only those areas in which development is needed, become targets for improvement. In addition, many effective key-element definitions focus the paragraph part of the definition, on what an individual must accomplish (for example, “achieve work goals in an efficient manner”) and focus the key elements on how to accomplish the competency (Fig. 1.12). For Example: Working efficiently achieving work goals in an efficient manner. �

Keeps information and materials organized and easily accessible; and has on hand what is required for a given situation.

Building Competencies for Organizational Future

Technical Competencies defined in Five Categories Industry

Process

• • • • • • • • • • • • • • •

• Logistics • Transportation • Inventory • Research • Career • Management • Financial Management • Human Resources • New Product Development • Order Management • Sales and Marketing • Supply Chain • HR • Payroll

• • • •

Aerospace & Defence Agri Business Beverages Biology Consumer Products Electronics Entertainment Energy Foods Financial Services Healthcare Insurance Life Sciences Manufacturing Media Pharmaceuticals Retail Technology Telecommunications Utilities

Technology • IT Strategy • ERP Implementation • ERP program • IS Plan

• Baan • Oracle

Function • Legal • Accounting • Human Resources • Finance • Sales • Marketing • Brand Management • Product development • Client service • Treasury • Financial • Management • Information Services • Tax • Internal Audit • Research & Development • BusinessDevelopment

Lead Business Processes • Vision • Values • Mission • Strategy • Critical Success Factors • Core Competence • Competitive analysis • Environmental scan • Benchmarking • Learning Goals • System Dynamics • Social Responsibility • Objectives • Goals • Key Performance Measures • Milestones • Targets • Human Capital Indices • Intellectual Capital Indices

Figure: 1.14 The Four Categories of Technical Competencies.



Uses appropriate resources to supplement own efforts and maximize the quality and efficiency of the work performed (e.g., use of functional specialists, use of technology, outsourcing or delegating of tasks).



Uses knowledge of informal relationships and political sensitivities within the organization to effectively implement decisions, request resources, or resolve issues.



Establishes and sticks to priorities to ensure that critical deadlines are met; and avoids being sidetracked by less critical tasks or other activities; and also manages time effectively.

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Business Competencies

Values & Strategy Enabling Competencies Technical Competencies

Managerial Competencies Applicable to building institutions Organisational Vision, Values, Strategy What are the organisational values we stand for? What are the organisational core competencies reflected in the strategy? What are the organisational core competencies we want to build/develop as part of our strategy? What are the defined core competencies?

Business Competencies Applicable to commercial orientation This includes core capabilities essential for addressing the business value chain including defining products, markets, technology, targeting the market, delivering services and maintaining customer relationships

Technical competencies

Enabling competencies

Specific to Role • Education, certification, and technical certification can be used as baseline markers of knowledge and technical skills • Specific technical skill requirements particular to individual jobs must be detailed in job profiles • Technical skills are typically more important differentiators at lower levels in the organization

Applicable to Environment • Enabling competencies (leadership, team orientation, etc) support a competency-based culture and portability (jobs and people) within the organisation • Enabling competencies are typically better differentiators at mid to higher levels in the organization

Figure: 1.15 An Organization’s Competency Model using a Key Elements Approach. �

Collects information in a structured and organized manner; using a systematic approach to ensure comprehensive collection of information.

Chapter

2

The Competency Development Process The three stages in the development process involve, data gathering, data analysis and validation. The work involves understanding and appreciation of job roles, identifying major categories of skills, and defining high-level competencies that may be required. The next stage involves reviewing the list of probable competencies, constructing appropriate definitions for the competency sets, assigned at proficiency levels. This is followed by validating the content and knowledge gained, while the mapping process has been in progress, to reinforce levels and intensity of proficiency, in particular critical or mega competency and to redefine competency where required. The competency development processes are now quite well known and industries have begun to show considerable interest in the field. Unfortunately, there a few guidelines for practitioners who wish to apply these concepts in their natural setting. This shows the need for practitioners to continue to be focused on how can competencies be translated into practice and what kind of competencies do managers want. This includes what type of the developmental activities is most appropriate to a manager in the industry, and who has faced business pressure on the time and resources. The issue of relating managers to organizations and their performance concerns addresses the competency development process. This is fundamental because of a belief in one simple basic premise. That any effective system for competency development must increase the manager's capacity and willingness to take control over, and be responsible for events and influence actions particularly for himself and also afford learning. This brings us to the next question of how can we reinforce competency building or capability analysis activity of an individual with that of a group of activities that can be articulated in a business context. Competency development could consider a context, and activities that the managers receive in time to reflect on past experiences and experiment, with learning and training for those of their own development and application of their learning. It is important to consider the benefits for companies in promoting competency development. The process and practice of people, managers and individuals to the development contributes towards their appreciation of the climate of participation, which is being increased in the industry and the

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Competency Based HRM

Stages in Developing an Organization Wide Competency Model Stage 1 Data Gathering and Preparation

Stage 2 Data Analysis

Stage 3 Validation

Study identified jobs

Review list of probable competencies

Identify major categories of skills

Construct competency definitions

Reinforce proficiency of critical competencies

Assign proficiency levels

Refine competency definitions, if necessary

Identify probable competencies Estimated elapsed time

Estimated elapsed time

Content validation session

Estimated elapsed time

Figure: 2.1 The Three Stages in developing an Organization Wide Competency Model. participants and increases the commitment of individuals who see that they do have some responsibility and control over their destiny. Once established in the company, the need for competency development philosophy, enables organizations to keep up with the dynamics of a change as it affects the organizations and individuals in them, because managers are encouraged to think about their change and its improvement. And in many situations to the development, selections and succession planning that are made easier, and are brought into sharper focus by discussions that take place with various individuals concerning their strengths and weaknesses, expectations and ambitions, preferences and learning and development experiences, while they are being assessed for their competencies.

Stage 1: Data Gathering and Preparation—Fig. 2.2 Stage 1: Study Identified jobs This stage deals with the start up to a competency development process involving data gathering and preparation for an intervention. It deals essentially with the following: �

Identify an exhaustive set of job families in the organization. E.g. Accounting, Brand Management, Production Management, Engineering and Maintenance, Treasury, Cash Management.

The Competency Development Process

Stage 1 Data Gathering and Preparation

Study identified jobs

Identify major categories of skills Identify probable competencies

Estimated elapsed time

Figure: 2.2 Stage 1: Data Gathering and Preparation. �

Obtain Role data in regard to such identified job families (See Template below).



Identify job roles within each job families. E.g. Production Manager, Works Engineer, Maintenance Mechanic, Stores in Charge, Product Manager, Sales Force Trainer, Benefits Administrator.



Obtain Role data in regard to each of the jobs (See template on Role Profile).



Review the job roles for its clarity in regard to Job Purpose, Objectives, Key responsibilities, and critical success factors.



Review for inadequacies, if any, and improve upon the Role Profile form, to prepare it to be reviewed for competency mapping requirement.



Conduct a peer review exercise from one role incumbent to another.

Stage 1: Identify major categories of skills �

Each job has its minimum skill requirements, to establish proficiency levels of the incumbents, to perform their roles effectively.

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Competency Based HRM

Job Roles Template:

Role Profile ROLE DETAILS Global, Regional, Country:

Profit Centre/Department/Function:

Country Reports to:

Location:

Role Title:

Current Job Holder:

PRIMARY PURPOSE AND OVERALL OBJECTIVE OF THE JOB: Briefly describe the overall purpose of the job, why does it exist and what are the major results expected from this job. CONTEXT OF THE JOB: How does your job impact and contribute to the overall business? If possible, define the measurable impact of the job; e.g. revenue responsibilities, number of subordinates, peers, operating budget, salary budget, order-processed etc. ORGANIZATIONAL STRUCTURE: Define the organizational structure, two levels above and two levels below, including all peer roles and identify your position. Identify corporate or matrix relationships, where applicable. MAIN RESPONSIBILITIES: List the responsibilities in enough detail to explain what activities are performed in the specific area of responsibility, how they are completed and whom you depend on to complete the same. List responsibilities in order of priority and designate a percentage of time spent on each responsibility. These should total approximately 100% First area of responsibility: % Time: Second area of responsibility: % Time: Third area of responsibility: % Time: 25% Fourth Area of responsibility: % Time: 20%

The Competency Development Process

Fifth area of responsibility: % Time: 10% Organizational valúes Level: Senior Management Managerial Non-Managerial

Work ethics

Other dimensions which are critical for the role:



Determine skills required to perform a job effectively. Figure 2.3.



Assign weights to each of the skills on a 5 point scale, to establish relative importance.



Map the skills on an inter job family comparable basis, to enable correlated understanding of the use of each skill in a job context.



Enable each job family and jobs within those job families to gain consistency in skills that have been stated as required to perform a job.



These skill requirements are determined on a functional and managerial basis and demonstrate capabilities that would enable a role incumbent to perform his or her job. For example: Budgeting skills, transaction processing skill or problem solving skills. It is when a role incumbent that it becomes a competency applies these skills behaviourally.

Organization's skill matrix:

Technical Skills:

People Skills:

Motivation:

Hire

Train

Organizational Tools

Test (not usual) Interviews

This is the company

Intell. Property Facilities

Training (not usual)

Office systems

Interview–usually look for match to your own Sometimes in an interview. (Again, not usual)

Conventional Managetment skills

Carrots and sticks

Figure: 2.3 The Skill Matrix of an Organization.

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Competency Based HRM



Consequently, every job has its set of critical or major skills and a set of supplementary skills. Alternatively, supplementary skills could be a sub-set of the major skill and would be essential to make the role incumbent performing the major skill. For example, problem solving could be a critical skill and fact finding information gathering could be supplementary skills. Similarly for budgeting skills, planning and forecasting could be supplementary skills.



Identification of such skill sets, would establish a boundary, within which competencies should be defined. Effectively, competencies tend to be articulated from within the defined or pre determined skill sets.



Skills could be in some role profiles called as abilities, attributes etc. Differentiate those and delineate skills.

Stage 1: Identify Probable Competencies �

List the skills and evaluate which of them needs to be emphasized behaviourally.



Evaluate the relative important scores that have been given to each skill or skill sets.



Add or to eliminate skills that appear to over lap and may cause conceptual confusion for a role incumbent when it has to be manifested behaviourally.



Clarify additional skills and the reason for placing those skills in relation to a particular job.



Relook at a role profile, now in particular, at the Role expectation section and evaluate whether adequate skills have been defined to enable the role incumbent, to fulfill such expectations.



Evaluate, if any competencies have already been mentioned. To study whether they have a behavioural dimension or only a skill without a behavioural expectation that has been inappropriately been stated as a competency.



Having identified the skills required for a particular role, possible competencies that are critical for that role profile to be listed. This provides a framework within which competencies definitions, assessment sets and other band matrix issues are resolved.



Probable competency analysis would enable the evaluator to determine, whether all the required skills have been listed and defined. This acts as a checkpoint.

The Competency Development Process

Stage 2 Data Analysis

Review list of probable competencies Construct competency definitions Assign proficiency levels Estimated elapsed time

Figure: 2.4 Stage 2: Data Analysis.

Stage 2: Data Analysis Stage 2: Review and finalize list of competencies �

Probable competencies that are identified from the last stage, is now reviewed to check for any internal consistency, validity versus other jobs, exhaustiveness of competencies to fulfill the job objectives and purposes.



The competencies are now finalized for each job role. The finalization has several processes:—namely, top management meetings, focus groups, position evaluation matching with role demands, demands and constraints analysis for each job incumbent, benchmarking with similar jobs in the industry, desired set of competencies that are futuristic etc.



Identify and list Meta competencies.



Have it agreed with the management teams.



Perform workshops to communicate.



Each role profile in turn would now have a detailed set Meta and sub competencies.

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Job Family

Works Manager

Competency 1

Problem Solving

Competency 2

Conflict Management

Competency 3

Quality Management

Sales Manager Sales Force Management Channel Administration Data Gathering

Production Manager

Treasurer

Conflict Management

Forecasting

Decision Making

Issue Management

Problem Solving

Data Gathering

Figure: 2.5 Different Competency Levels and their Role Profiles.

Stage 2: Construct competency definitions �

Each competency is placed in an individual and multiple boxes with both job family and competencies listed. An appropriate matching process is conducted to identify where similar competencies tend to be necessary. It is important to define the skill requirements for each of the said competency in each of the levels. It is likely that the skill emphasis may differ from one job to another, although it is for the same competency. Figure 2.5.



Each of the competencies are now defined in the context of the role profile.



Utilize the competency dictionary where required to ensure internal consistency.

Stage 2: Assign Proficiency Levels �

This is a long and an arduous process involving the top management, focus groups with sample role profile holders or incumbents, benchmark information on proficiency levels articulated by other comparable organization.



Mandate an iterative process to compare and cross-examine on definitions, proficiency levels and map for consistency. This is to prevent an ambitious definition for a lower level of proficiency requirement or a simple behavioural expectation where a higher level of proficiency is expected.



Define what proficiency means to the organization, and what use would it be put to within the organization.



Define levels and differentiate between appraisal ranking and proficiency levels. A higher level of proficiency is not a necessary condition for each of the competency.

The Competency Development Process

N

No basis.

1

Exposed—Has some knowledge but little or no practical experience.

2

Development—Has some practical experience and can apply with supervision.

3

Proficient—Has substantial knowledge and can apply it without supervision.

4

Mastery—Has extensive knowledge, can apply it well in complex situations and can supervise others.

5

Expert—Is recognized thoughtleader whose contributions influence knowledge in this area.

Proficiency Levels

Figure: 2.6 Defining and Assigning Proficiency Levels. �

The work also involves defining proficiency levels, as it would become applicable to that particular organization. See Figs. 2.6 and 2.7.



Defining statements for each of the competency and the sub competency as illustrated above.

For Example: �

COMMUNICATION

The ability to communicate is simple in theory, but is not always easy to achieve. This is because few people have had any formal communication training. For a receptive communication environment to exist, it must receive full support and be a top priority within the workplace and endorsed by the management. Whether one-on-one, on the telephone, or in a group setting, the staff must be open and willing to really listen to one another. This same philosophy for communication success must carry over into their relationship, with the customer, in order to provide quality service and to ensure effective communication—the driving force that keeps a business running efficiently. �

Anyone can speak—only a select few can really communicate.

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Core and Professional Competencies

1. Managing Change

1.1

2.2

1

Overcomes change barriers and identifies change enablers to support, initiate, or advocate organizational change

Indentifies and communicates implications of organizational change 1.1.1 Recognizes the interrelationships of people, processes, and technology as they are impacted by change

Helps self and others navigate change 1.2.1 Seeks to understand changes being proposed and the impact of those changes or our business. 1.2.2 Recognizes resistance to change and assists in developing strategies to address resistance 2. Managing Selling Fosters and manages value-added relationRelationships ships with clients 2.1

2.2

Executives Assistant Manager Sr. Manager Vice President and Directors

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1

2

3 4 5

1

2

3 4 5

2

3

4 4 5

2

1

2

1

2

3 4 5

Practice development 1 2.1.1 Demonstrates understanding of the range of the firm's capabilities 2.1.2 Facilities and maintains relationships with clients, and across different firm teams and service categories 2.1.3 Builds network of personal and business contacts to market the firm and to identify potential clients and recruits 2.1.4 Determines how the firm can share and exploit new trends om one's market 2.1.5 Applies knowledg of competitors to articulate one's competitive advantage 1 2.1.6 Identifies and acts on opportunities to generate business

3

4 5 5

2

4 5 5

Client service 2.2.1 Indentifies and manages client expectations 2.2.2 Addresses client's concerns and issues in a swift and decisive manner 2.2.3 Identifies, investigates, and anticipates client needs 2.2.4 Applies knowledge of the client's business environment to offer business solutions that exceed client expectations 2.2.5 Ensures appropriate firm resources are introduced to help clients address issues 2.2.6 Seeks and communicates ways to improve client satisfaction

Figure: 2.7 Core and Professional Competencies—Modified from Arthur Andersen.

The Competency Development Process

Stage 3 Validation

Content validation session

Reinforce proficiency of critical competencies Refine competency definitions, if necessary Estimated elapsed time

Figure: 2.8 Stage 3: Data Validation. �

Active listening—respond respectfully to all communication styles.



Nonverbal communication—body language mirrors your verbal language.



Speak, so people will listen—improve your platform excellence.



Overcome daily communication barriers—improve working relationships.

Stage 3: Validation (Fig. 2.8) Stage 3: Content Validation Session �

Bring together an appropriate focus group consisting of top management, cross section of managers and typical role profile holders. Validate the findings from Stages 1 and 2 particularly in regard to the skills identified and, competencies profiled.



Conduct a validation exercise to check for ease of understanding, implementation possibility, time and the process involved to roll it out through the enterprise.



Define milestones for such an implementation work.



Tabulate the learning process.

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Evaluate whether the exercise has generated adequate data and information to progress with the competency definition and proficiency mapping exercise.



Reestablish the business case for implementing a competency development work process.



Run pilot workshops wherever necessary.

Stage 3: Reinforce proficiency levels of critical competencies �

At this stage, proficiency analysis and validation is essential to be conducted through similar cross management focus groups. This exercise, may cause a considerable consternation, as there is likely to be a misunderstanding that proficiency levels in turn demonstrate the position value, or a job value as is understood in a Position Evaluation exercise. Lower benchmarks may mean lower value of job, which could be an apprehension with role profile holders.



Illustrate with examples how proficiency levels have been articulated, valued and how they would be used. It should be remembered that eventually proficiency levels have to be measured in an Assessment Centre meant to assess Assesses. A meaningful usage of proficiency levels would enable an effective way to assess.



Handle insecurities and threat perceptions in the usage of proficiency levels.



Run pilot workshops where necessary.

Stage 3: Refine, Redefine competency definitions, if necessary �

Focus upon the competency definitions in the light of details obtained through the validation exercise. Refine them to absorb errors of commission or omission including those that deal inappropriate language, inaccurate conceptual clarity, lack of understanding, conveying an unintended meaning etc.



Apply principles of effective writing skills in a simple way, with brevity and to meaningfully capture the fundamental meaning and intended application of a competency, to a job.



Freeze upon the definitions.



Conduct a top management workshop and finalize the definitions.



Run a Pilot focus group, if necessary.

The Competency Development Process

DETAILING THE

IMPACT OF A COMPETENCY DEVELOPMENT PROCESSES

The acceptance, of the major decisions pertaining to competencies, is likely to be effective as a result of a participative approach in developing the competency model for an organization. And the individuals and the organizations that have contributed towards evaluating their own achievements readily accept it. In fact, development of activities is probably the most cost-effective way in which organizations can develop its human resources to produce positive results in an economic way. Competency development activities, tend to identify individual and group developmental needs and problems including issues of concern and the members need to help each other to identify solutions, select the resources necessary to achieve success in such problem solving situations. The resources selected may be internal or external to the groups, and assess and monitor how effective they are achieving the individual and group close, in a typical competency centre. There are simple benefits than people act has experienced while proceeding with a competency development centre. The sharing of experiences and abilities, between people who have different experiences, backgrounds, status, futures and ambitions tend to bring together their whole some experience and thus only contribute towards their personal development. In fact, groups dealing with real developmental problems and issues could generate real solutions to them, as encounters one competency of another and pass routine types of tests and simulation exercises. There are several individual and group activities that are adaptable to the contingencies, affecting different individuals in different parts to the organization who have to perform their roles in doing their jobs. In order to operate effectively with other complex social systems that make up an organization, the managers need not only be able to relate successfully to individuals within a group or between the groups but also to develop competencies influencing the wider social processes that run through organizations. In order to help understand the competencies and skills that are essential to help the mapping process happen and effectively, it can be classi-fied into five specific skills. Personal skills are concerned with personal awareness and deals with personal knowledge, self-awareness of one’s own competencies and own behaviours, deployment of skills, needs, wants, drives, triggers, appreciation, biases and gaps in his behaviour. 1. Interpersonal competencies impact Interpersonal competencies consist of the whole range of skills, needed to interact effectively with another person or persons. This is an additional skill and includes critical capabilities

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and skills as listening, feedback, reflecting on ideas to build its implementation through people processes and giving and receiving feedback while going through the communication process. But skills form into the category that comprises additional skills and individual needs in order to work effectively within a group. Appreciation and an understanding of the effect of the group or behaviour and crude awareness of process issues and interactions with other groups add to the effectiveness of work roles and workgroup norms. This, in fact, includes decision-making and leadership skills and Inter–group skills, which form an additional content of the effect of the interaction between two or more groups. Competencies in this area include awareness of self-defensive mechanisms, personal norms, values, believes and conventions between groups and their effects on behaviour. In fact many of these are imported daily as artifacts of into group competition, which acts as a representative or delegate and consultancy skills.

2. Personal competencies impact Personal competencies, are associated with the needs or demands placed by other manager as an individual. For the purpose of understanding, we have to choose and subdivide these personal goals into task goals developer goals and status goals that can be relevantly connected with the car but at the mapping process. Personal cupboard is related goals are objectives that define the data scope of the responsibilities Dr JA demands on the individual. Personal task competencies are objectives that define the data scope of the responsibilities. They have task requirements for which the individual has a personal responsibility. These objectives may be clear and concrete or relatively unclear and abstract. They may be set up after discussion with his immediate superior or may be impressed unilaterally by the superior or in other ways, by the nature of the technology of the production or external influences on the organization. Depending upon the nature of these influences, the individual may have figured a lesser opportunity to influence the nature of a job, in terms of the objectives as long as there is clarity in terms of competencies. Personnel development competencies are goals and tasks that the individual sets for himself in order to increase the range of debt of the skills and abilities. These goals can be achieved by gaining support from the organization through competency training or a new or large organization with the demand for different sets of skills to those, which the individual currently employs. Personal status goals and competencies are concerned with the individuals standing or for one ranking the organization. They will include, not only the promotion to higher levels of authority the organization post achievement of these competencies, but also the benefits, that accrue to the individual with increasing status.

The Competency Development Process

3. Team competencies impact Team competencies are those that are concerned with the needs of self with that of the world group of which the individual is a part. These are competencies that have been agreed with the other members of the team, and are seen as being of benefit to the team as a whole. Team competencies, are different in kind to the personal goals of the team members and do not represent a simple connection of their personal goals. One crucial difference that team competencies will reveal, is the extent of which there is an interdependence and synergy between the group members and extent of which it is an effective and a cohesive unit. A second crucial differences that they will tend to have is a feeling of collective responsibility, for the achievement of these goals. Team task competencies, are goals of task objectives which recognizable team for departments is required to achieve. While there may, or may not be a feeling of collective responsibility, for achievement of these objectives, in many cases the manager or supervisor of the team whose effectiveness is touched by the achievement of team, task goals and consequently the competencies are deployed in achievement of such goals. The rain which these team task the goals as it will depend partly on the relationship is the manager who has whittled members but also the raid which interfaces between the other teams or more senior management groups. Usually the team task goals require a successful integration, of the individual member’s personal task goals these capabilities and competencies and mapping them to that of the team capabilities and congruence in the goals that have to be achieved together. Usually, the team task, requires a successful integration of individual members personal task goals. However in situations where there is a scope for creativity and flexibility in establishing personal task is that a subset of the competencies then there “I” factor, working relationships between the members of the group output, may be different in volume or quality than what could be achieved by a simple integration of the personal tasks. Team development competencies are goals that the members might agree in order to change some aspect of the team functioning. This could mean changes in the nature of the job, such as changes in production technology on working practices that makes the job easier to do or the deployment of competencies which are much more effective. Equally, it might mean extension or change in the quality a range of products that the group is required to produce, as an output, for the group is doing some interesting and challenging work. Alternatively, it might mean changes in the way in which the team members relate to one another. Further it could be sometimes set aside when the team members can review the interpersonal processors do many problems and carry out some activity to chain the dons a pact observation that in the group and at the same time keeping in perspective the deployment of the competencies in their group behaviour.

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4. Organizational competencies impact Organizational competencies are seen to be of benefit to the organization and its employees as a whole. These are competencies that determine the continued existence and development of the organization, as it relates to your environment. Organizational competencies, are achieved either by increasing the organization’s internal efficiency in processing its throughput order and determining a successful strategy for survival in the changing environment of the organization. To extend the organization’s goals are clear that are agreed and salient to all employees and that the organization will have a relatively clear identity and an apparent sense of purpose. Again, these competencies can be divided into organizational task competencies and organizational development competencies. Organizational development competencies represent the goals of any program or change upon which the organization could embark. They could also include changes in methods of procedures so that the organization can adapt to developments in its environment or they could include a fundamental rethink about the organization’s mission, vision and values. Also included would be the goals of any change of program, that is designed to affect the climate or culture of the organization as a whole. Organizational skill, is the effort correlated to the competencies needed to deal with extra dimension added by the total organization. This could mean the effect of hierarchies and the functioning and technology of the organization. The set of competencies, includes the ability to deal with managers and subordinates in an inappropriate style to manage the balanced skills and capabilities and to react to change in the organization’s external and internal environment. In order to help the competency mapping process happen effectively, there is a need to integrate the personality and other personal, interpersonal and organizational goals and at the same time demonstrate the use of operative styles that are employed within the organization to ensure that these goals are accepted and achieved. Organizational task competencies represent a primary task or omission of an organization. They define the business which the organization as an ad in concrete terms are formally represented by the long-term corporate plan and budgeting forecasts for any particular actual year. In family, these plans are mediated by their functions which the employees bring to bear about the organization which the organization as in other businesses the impact. The sense of proper purpose will be determined, upon the attitudes that the employees and the management have about the organization and its products and customers and the effective utilization of competencies and are

The Competency Development Process

consequently manifested to an effective behaviour for the accomplishment of such organizational competencies or goals. For managers who were operated on the boundary of the team for organizations, interdepartmental or into organizational competencies would be included as a part of this definition. This is to suggest that, when managers act as a representative of the road department of organization, they should attend to set at the crucial goals and competencies that a representative of other departments or organization and be of mutual benefit to both parties. This alignment of competencies from one department to another is an effective tool for bringing about the alignment of individual competencies with that of the organizational competencies.

Styles that influence competency development processes Styles of influence, has an important role to play in understanding how does an individual influence what happens in the organization in order to get decisions or action that enable him to achieve the goals that is established for themselves by deploying their skills, capabilities and competencies. They were organizational styles because they are styles of behaviour that are discreet and internally consistent. Within each style, there is a set of skills, beliefs and values about how to influence the events that are characteristic of as a particular style. While some people tend to use one style predominantly, it is possible that people can be trained to use alternative styles and any specific, onto the sudden weapon program which is held to develop the participants abilities to use different styles depending upon the situation. The organization and the manager, deploys a style and prefers to manage and supervises since the latter, being the organization, identifies a way that a manager relates to his subordinates. Organizational style refers to the way in which an individual impacts the various decision-makings and influence processes across the organization and not just within his own department in order to offer wider relationships within the department. This would mean influence to behaviour to the latter relationships across all resisting boundaries into other departments and divisions of the organizations as well. Different styles of influence to the appropriate in different organizations or a different situations in the same organization as competencies tend to be deployed based on the role that is performed by the individual. For the purpose of this discussion for different styles that could be used in the wind competencies have been articulated. These deal with formal competencies and style political competencies and style whatever competencies and laissez-faire competencies and style. The former competencies, lie principally on the use of legitimate authority to influence events. This legitimate authority, may fall from hierarchy positions and the use of former power to

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direct and control the behaviour of others and these issues were the principal concern of traditional organizations and more recently have been the subject of comment by many authors. The other primary sources of legitimate authority flows from Law, rules, regulations, agreed procedures, processes that make demands upon and constrain the actions of employees. 1. The Formal Style Skillful use of formal style, will involve a good working knowledge, of the laws of the land, rules and regulations and aggregates the willingness to use former power of rooms to get what one wants. Increasingly, the use of former power has been managed where many management’s and organizational developments thinkers, developers and practitioners believe in order to map of the need for competency mapping with that of roles that are deployed by respective individual. The use of power is still a potent means to influence our original events provided those in word, recognize the use of former power as being legitimate. 2. The Political Style The political style of behaviour, relies principally on informal influences to get things done and has different but sometimes complimentary strategies. The first of these is the formation of alliances and usually those that all originally powerful groups or individuals accept and agreed and of mutual self-interest. These alliances will usually be covert but occasionally strong groups which will form an overt that they want to put them in an unchangeable position. The basis of the relationship within such an arrangement is usually proud negotiations, for the promotion and support of some goal or object and of mutual benefit of all parties. If an individual reasons to deploy negative behaviour so that it can benefit one’s own group, it is foolhardy and is detrimental to the opposite group as a behavioural disposition. Then the alliance might well be broken on the parties will tend to compete against rather than support each other’s activities. The second basis of the style of influence relies on the use of information. Information tends to be used in the strategic way. Withholding information, partially or completely, timing the use of information and selecting a proper retarded for information are calculated, to produce the decision that the individual desires. Distortions of information, including impression management, posturing propaganda rumour mongering under strategic use of lying are ways in which the quality of information is manipulated to have maximum effect on the target. 3. Open Style The open style of influence in behaviour, can generally be seen to be the style that organizational development specialists advocated. Essentially it offers an idea of the—individual

The Competency Development Process

being aware of him, as a person with feelings, attitudes, knowledge, skills and behavioural responses, being prepared to share this awareness of him, and behave in ways that are coherent. Organizations should create climates of trust andacceptance for the employees. But by its very nature an open approach also involves being prepared to express feelings of hostility, anger and confrontation and not just feelings of love and support. In dealing with the reality, it is hoped that a much more insightful understanding of the problems can be developed and that solutions to problems will be long-term, since they deal with fundamentals as supposed to peripheral issues. In a sense, the open style of behaviour can be seen as the opposite of a political style of behaviour, since it values reveals the use of standard issues.

4. The Laissez Faire Style The laissez faire behaviour is essentially a style of non-intervention in events when things are going well and according to plan. It is perhaps the most difficult style to get managers to consider, because it seems like an application of manageable responsibility. In fact it is fairly close to the principle of management by exception.

Application of competencies in the context of challenges, pitfalls, both in the area of HR system as well as in mapping, and need for consequent learning Competencies have received a wide range of application perspective, and several organizations have commenced using competencies in regard to performance, cultural change, training and development, recruitment and selection, career planning, succession planning, the skill development, role clarity, compensation, rewards, and an overall sense increasing the operational effectiveness. In recent times competencies are mostly been used for recruitment and selection, performance management, training and development and reward management. Competency Management System: Challenges �

Fear of measurement and new systems.



Lack of common definitions and terms.



Inconsistent or weak buy-in, and lack of understanding.



Visions and strategies that are poorly defined and understood, not actionable, and not linked to individual actions.



Treating budgeting as separate from strategy development.

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Measures that are set independently of the performance framework, or measures with no ownership.



No performance targets, or targets that are set too high or too low.



Little or no strategic feedback.



Lack of meaningful employee involvement.

Common pitfalls in implementing a competency based HR system 1. Measures that do not focus on strategy. A common problem is that an organization will adopt some new non-financial measures, but fail to align the measures adequately with strategy. “The biggest mistake that organizations make is thinking that the competency mapping is just about behaviours. Quite often they will develop a list of behavioural measures and believe they have a competency based performance management system. This, I believe, is dangerous.” For example, in one case a bank’s IT department had identified measures and benchmarks for being a world class IT department. According to those measures, they had done very well. How-ever, the measures used by the IT department were not tied in with the overall business strategy and therefore thus discouraged the IT department from meeting the strategic business needs. 2. Failure to communicate and educate. A scorecard is only effective if it is clearly understood throughout an organization. Frequently, scorecards will be developed at the executive level, but not communicated or cascaded down through an organization. Without effective communication throughout the organization, a competency based Human Resource System will not spur lasting change and performance improvement. 3. Measures tied to compensation too soon. It is generally a good idea to tie compensation to the competency based Human Resource System. However, several factors suggest it can be a mistake to do that too early in the lifecycle of the scorecard.

The Competency Development Process



Rarely is an initial competency based Human Resource System left unrefined. So, if an organization ties the compensation to measures that are not in fact driving desired behaviour, a powerful motivator has been instituted that will drive an unwise action.



Data may be incomplete or inaccurate, so measures may not be correct. If employees’ pay cheques are adversely impacted, serious morale problems and invalidation of the scorecard inevitably result.



It may take time to determine realistic targets, and penalizing people for failing to achieve an unreachable target will surely have a negative impact on morale and eventually profits.

4. No accountability Accountability and high visibility are needed to help drive change. This means that each measure, objective, data source, and initiative must have an owner. Without this level of detailed implementation, a perfectly constructed scorecard will not achieve success, because nobody will be held accountable for performance. 5. Employees not empowered While accountability may provide strong motivation for improving performance, employees must also have the authority, responsibility and tools necessary to impact relevant measures. Otherwise they will resist involvement and ownership. Resources must be made available, and initiatives funded, to achieve success. Employees are likely to need new information tools to help them understand the drivers of measures for which they are responsible so they can take action. These tools can include systems for analysis and early warning indicators, exception reports and collaboration. 6. Too many initiatives Large, decentralized organizations usually find that crossover and duplication among initiatives can be identified. Cross-matching scorecard objectives with current and planned initiatives can be an important way to focus and align a company. This method will identify cases where the objectives are supported inappropriately. Rather than relying on budgeting for strategic funding, this process eliminates waste, speeds scorecard implementation, and helps an organization to prioritize their initiatives to better support their strategy. Many corporations have been taken up in the boom and adopted competency into their evaluation systems. From a human resources point of view, it might have been effective to model

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competency in order to make two things, namely 'improved fairness in evaluating performance and awarding compensation' and 'giving impetus to the changing of employee attitudes with the introduction of competency,' compatible. In doing this, however, aren't they too caught up in the idea of introducing competency only in order to reflect it in compensation? (Or, is it possible that in trying to raise their sense of satisfaction to such a degree that, even when the model has been refined again and again in response to each organization and workgroup, there still remain those that don't fit the model, and so HR managers find themselves in a quagmire of continually segmenting and elaborating the competency model? Isn't it time we consider ways on how to utilize competency from viewpoints other than that of the human resources admin-istration? The quality standards expect that competency frameworks should be unambiguous, using simple language, which is easy to implement structure with a logical framework that connects one competency to another. The language used in the framework has to be relevant to all the people to use and should have a combination of generic or specific indicators. This relevance has to cut across all roles and application of those roles in a being job situations. Considerable use can be made of a framework when they are relevant to roles in organization are department and this in turn would mean that competencies must describe in January can specific terms behaviour at that are essential for effective performance in all roles covered by the framework. Where competencies are developed for specific application or a role the same framework should be relevant to multiple tasks and roles in an organization. To enable a competency framework to remain relevant it should take into consideration changes in the organizational environment, introduction of new technology, and build on the vision of the future that the leaders are using to inform their decisions. In fact one of the main users for competencies is criterion assessment. This may be in the form of an assessment for selection and recruitment, performance management of succession planning. One of the main users for competencies is the structure or framework that will have a major influence on the ease and accuracy of assessments.

Common Pitfalls In Implementing a competency mapping system According to the Confederation of Norwegian Business and Industry the usual pitfalls about competency development are the following: �

Lack of internal rooting, management not involved, lack of resources.



Lack of information to and participation by employees.



Lack of co-ordination with other activities and routines.



The wrong time (demanning, production peaks, change of ownership, etc.).



Wrong use of tools (deficient user competency, unclear purpose, etc.).

The Competency Development Process



No consequence analysis (the path ahead, dealing with major changes, etc.).



Dependence on external consultants.

Mapping the results of the input is fairly easy. There are many systems that can do this and take the results from a questionnaire and plug it into the program, which then spits out a social network map showing "who chose whom" or a competency map of "who knows what". However, before an organization purchases such a system or hires a consultant offering these services, they should be aware of the potential pitfalls. Some of these are outlined below: Pitfall No. 1: Believing the Map is the Ultimate Goal Mapping is the easiest part of the process. The difficult parts are the audit (input) and analysis (output). These are the one’s most fraught with stumbling blocks and hidden dangers. Mapping may seem to be the output of the system. In truth the map is the middle part of the process and serves only as the beginning for analysis, the true output. It is a pitfall to view the map as the desired result. The map is nothing but a colossal waste of time and money without the proper analysis. However, proper analysis is impossible without asking the proper questions at the outset. This brings us to the second pitfall. Pitfall No. 2: No Purposeful Question Ask a stupid question and you will get a stupid answer. If you want a valuable result you must ask a question that will give you a valuable answer. The reason the question may be stupid is that a purpose or mission for the mapping project has not been defined. An organization should not map merely for the sake of having an organizational map. The map is not good in and of itself. It is only good if it can bring about positive change in the organization. The value of the map has been described as the 'reality' chart of an organization. The traditional organization chart shows you the prescribed method in which communication is to flow. The knowledge map can show you how the communication actually flows in other words it creates the chart of what is happening. Knowing how communication actually flows is of no greater value than the organization chart unless you want to measure how close the flow is to what is desirable and if it is not, to use it to design strategies to change it. Pitfall No. 3: Not Knowing Where You Are Going The pitfall is not having a mission. If you don't know where you are heading how will you know when you get there? Similarly when you wish to effectively measure reality

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you must have some idea of the ideal goal and must ask questions that will show whether this ideal goal is in fact close to the mark or far removed. Thus the mission must reach far beyond the map itself. The mission must be to create and sustain a knowledge flow that is more profitable to your organization. Then the map becomes a measure of how close to the ideal goal you already are in order to benchmark for future measures of how much change you have been able to effect. If you are already there, that is, your organization is already rich beyond your wildest dreams your mission might be to measure the current 'ideal' knowledge flow. Then in the future when the bottom line is not so rosy, you will be able to measure against the benchmark to see where the problems are occurring and use this to try to re-create the ideal. However, until we know this perfection we must try to imagine what would be better. Pitfall No. 4: Not Ensuring Both Reliability and Validity In fact, most ordinary people are not sure what these are and what difference they make when gathering data. Not only must the question have a purpose and match the mission, the question must deliver both reliable and valid results. Reliability and validity are indications of how usable a particular measuring tool really is. "Reliability tells us how consistently we are measuring whatever we are measuring. Validity is concerned with whether we are measuring what we say we are measuring." (Buley) First reliability means the results are consistent, both internally and across time. If you take a measure of any part of the whole subject at any one time, the results will be consistent. That does not mean the results will be the same, just consistently measuring the same thing. If you wish to measure the knowledge a person has by how many people chose him as a subject matter expert, then the question must consistently measure this concept no matter how many people are asked. To be reliable the results also must be consistent over time – that is not that people's answers may not change but that the question consistently measures the same concept no matter when the questionnaire is delivered. For example, if my weighing scale is consistently off by three kilograms, each time I step on the scale my weight reports at three kilograms higher or lower than I really am. The results are consistent - but consistently wrong. Validity then kicks in as a measure of what you are really trying to do. If I am trying to accurately measure my weight, then the results matter. A consistently wrong answer means I am not accurately measuring my weight and if that is my intention the tool (the scale) is not a good one. This is easier seen in something tangible as weight and a scale as the measuring tool. It is more difficult to apply in the situation of mapping organizational

The Competency Development Process

knowledge. If we want to show the "who you know" or social capital, the tool must measure that. When we want to measure "what you know" the tool must actually be able to calculate this. The data cannot be reliable and valid, if our measuring tool is not accurately and consistently measuring what we say we are measuring. Some think that the main measuring tool is the 'system', however the question is really the input. Yes it is important that the technology takes in the results and charts an accurate reflection of the data. Yet no matter how wonderful the technology is, it is nothing without valid and a reliable input. The question is really the key. If the question cannot be assessed to be reliable and valid, there is no sense in even beginning the process. Pitfall No. 5: Not Assessing the Results Accurately Now we will assume that you have found and tested on a sample audience the questions and found them to be valid and reliable and that they actually reflect the mission.

Boldly map it, But with Knowledge Knowing about these pitfalls will help us chart our mapping activities with confidence. These are not the only pitfalls. 'Snap judgements' based upon the first assessment of the map often prove wrong; an in-depth analysis is required first to determine whether 'problems' revealed are real and then to develop effective 'cures'. In several of the organizations with whom I have worked the immediate reaction was to make firing, promotion and other rewards/punishment decisions based on the results of social network and competency mapping. This is a dangerous ground! Tread carefully for this is where the costs of the mapping process can go much beyond simple waste. Misinterpretation of the map can result in punishing and rewarding the wrong people. In doing so the cultural climate can turn to one of fright, knowledge hoarding, jockeying for position and a cutthroat competition. The results can be as or even more disastrous than the traditional organization and can eventually lead to the demise of the business. If our attempts fail due to one of these pitfalls, not only can it seriously impair the culture of the organization and thus inhibit participation in other knowledge management activities; it could also seriously endanger the image of the overall mapping and knowledge management program. On the other hand those who are aware of the dangers and do follow proper guidance. These can empower their organization to know itself and identify its social/human capital, which after all is much more valuable than most of the current focus in knowledge management. The experiences made by enterprises that have carried out are of great value, and some of these experiences are listed below and developed into practical advice:

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The involvement and participation of management �

Competency development must be a planned and systematic process going on for a considerable period of time.



The necessary resources to carry out the work must be allocated and prioritized for.



The management must define goals and strategies as a basis for competency mapping.



The employees must be stimulated to participation and training.



Management at all levels must contribute to creating a real and good climate of cooperation.

Planning and allocation of responsibilities �

The planning must be thorough and realistic in relation to available resources.



"Who is going to be responsible for what" must be defined in advance.



A disclaim of responsibility and lack of continuity may easily be the result if the enterprise has not defined clear guidelines from the start.

The participation of employees Implementing without involving the employees at an early stage in the process has turned out to be rather negative because: �

Involvement leads to strong identification with the development process.



Active participation on the part of the employees makes the analysis work more reliable.



Prioritization and initiation of training measures will be much easier.

The use of consultants The use of external consultants can be advantageous because: �

The enterprises may have problems in allocating sufficient resources in the initial phase.

The Competency Development Process



The enterprise does not have the necessary competence to implement the work.



The consultant will have experience from implementing similar processes in other enterprises.



The consultant can function as an interlocutor, analyst, planner, project manager, mediator of ideas and experiences, etc.

The development interview between the manager and the employee In most enterprises that regularly address the learning needs of each employee an interview between the manager and the employee forms a central element. Such interviews have been given different names such as career interviews, development interviews, etc if used in the right way this interview becomes a natural element in human resource planning. �

Development interviews are necessary to arrive at the right result as regards the functions, competencies and future development measures for the employee.



Based on the competencies of the employee the interview is conceived as meaningful at the same time as it makes it easier to have closer talks.



Regular interviews with follow-up result in a good dialogue between the manager and the employee.

In order to develop effective competency frameworks some basic issues need to be covered. �

One competency must not depend on another competency.



Competencies and indicated must apply in one place in the framework.



Competencies must not relate to more than one cluster unless it is essential from the point of view of a role.



Indicator and proficiency of one must not relate to more than one competency.



Indicated must not relate to more than one competency level, benchmarks or a standard.

Behavioural indicators are important component of a competency when used in assessments and this includes the following: �

Describe directly measurable observable examples of individuals competency.

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Describe just one piece of behaviour on evidence and should not be possible for individual to be good at one part of the indicator and level or that of another part of indicator.



Should not be duplicated across competencies or levels and should not be possible for an example of indicator in one competency or competency level also to be an example of indicator to another competency or competency level and benchmark.



While defining competencies it is advisable to include work role related draws and those indicators that describe what a person does. In addition it should include enough contextual information to indicate an action as meaningful and to demonstrate why the person is performing, behaving in a particular way.

Chapter

3

Understanding the Competency Management System An organization can take several steps to encourage the support for competency management system activities or any performance measurement and improvement efforts within its organization.

STRATEGIC GOALS: GAINING COMPETITIVE ADVANTAGE THROUGH COMPETENCY MANAGEMENT SYSTEM The strategic goals of the organization and consequently its competencies have to align with people competencies. For effective articulation or implementation of strategy, competencies form a crucial linking pin as it binds business objectives with that of people objectives. Articulating business strategy and its drivers would also entail specifying critical success factors, acquisition of assets and usage of current assets. Both the business and HR strategy straddle to work with one another in defining competency model and capability enhancement statement of an organization. During the 1980s, as a result of long-term scenario planning the assessment undertaken at the strategic level in defining gaps that need to be bridged is a similar pattern that follows in the competency mapping process. Competencies in turn work closely with learning to enable bridging such gaps identified. For example, development centre is one such out come to enable learning competencies. MOTOROLA anticipated significant growth in the economy of China during the 1990s. In the absence at that time of a cadre of highly trained Chinese managers, MOTOROLA devised an East Asian human resources strategy for the region. This included establishing links with Chinese universities, developing the MOTOROLA University in Beijing and providing coaching and mentoring throughout the company aimed at developing young Chinese managers. By 1996, the company through its development investment had gained competitive advantage over many other western businesses, which were finding it difficult to attract, recruit and retain young Chinese talent (GRATTON, 1997:26). In similar vein, during 1986, ROYAL DUTCH SHELL (one of the firsts and widely

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recognized as a learning organizations) pioneered the use of scenario planning two years before the oil crisis of 1988. By doing so they anticipated the worldwide drop in oil prices and gained competitive advantage over other oil companies. By using learning-based strategic planning they developed the capacity as an organization to respond to sudden changes in their market environment (GEPHART and BOJE, 1996:45). Some key factors include: Figure 3.1 �

Cultural appreciation of organizational competencies.



Institutional acceptability of what we believe are competencies of the company.



Matching method to identify and map organizational and individual competencies.



Gap Analysis.

Current state Drivers Business Strategy

• Business Model • Processes • Differentiators

Organization Design • Structure & KPI’s • Culture

Core Competence • Definition • SWOT • Capability Profile

Integrated Competency Intervention

Future State

Organizational Competency Building Critical Success Factors

Competency Model Development Competency Assessment

Portfolio of Assets

Engineer

Gap Analysis

Risk Adjusted Return

Competency Based

Realization of Strategic Clarity

HR Processes Development Centre

Realization of Tactical Goals

Consolidation

Performance Metrics • • •

KPI Milestone Targets

Business Competency Building

Processes Design

People Competency Building

• Technology • Processes • Change Drivers

Performance Competency Building

HR Strategy • People Profile • People Performance

Career Competency Building

Realization of Competency Plans

Realization of Results Milestones

Potential Competency Building

Figure: 3.1 The linkages between organizational and people competencies.

Understanding the Competency Management System



Defining Roles as they impact organizational capabilities and as they impact performance.



Defining behaviours that effect displaying people competencies.



Evaluating behaviours that relate to business competencies. Example: Strategic Mindset.

Shared vision GRATTON (1997), reporting on a study of a division of HEWLETT PACKARD, observes links between the highly focused performance management process used by the company, which successfully aligns strategic to individual objectives together with a set of values ('the HP Way'). Among the main features identified by employees surveyed were commitment, pride and trust in the integrity of the company. A study by the Singapore Institute of Management and Development Dimensions International (1994:61) reports the experiences of five highperforming companies, which have won the Singapore National Productivity Award. These companies displayed a number of similarities in their approach to: �

Introducing management practices designed to develop self-motivated workers who took pride in their work;

And thereafter link to people competencies � Competencies are the combination of Knowledge, Abilities, Personal Attributes and Skills that contribute to individual and organizational performance. • Knowledge: Information that is organized, learned and applied through experience, study, or investigation. • Ability: Innate potential to perform mental and physical actions or tasks • Personal Attributes : Individual traits, values, motives and attitudes that indicate an employee’s probable behaviour. • Skills: Result of repeatedly applying knowledge or an ability

Behaviour Knowledge

Skills Abilities Personal Attributes

Competency profiling aims to identify all of these KAPS in order to help create a real and sustainable change in behaviour.

Figure: 3.2 Competency Profiling Depicting the Iceberg Syndrome—Refer L M Spencer.

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Transferring authority for both tasks and responsibility down the hierarchy to give a sense of ownership.



Regular discussion between managers and employees about their performance growth and development.

Included in the benefits highlighted by the companies were lower-than-average turnover rates and employees with strong work values. It is obviously not surprising that people competencies and those that deal with personal attributes and characteristics are subtle and deep in the human psyche. The iceberg syndrome, (Fig 3.2) depicted here is symbolic of the fact that deep inside are those aspects of human behaviour that are hidden both to self and others. Figures 3.2 and 3.3.

DEVELOPING A

COMPETENCY MANAGEMENT SYSTEMS

Many organisations select on the basis of surface knowledge and skill competencies and that's a retiring of MBAs from good schools who are neither assuming that recruits have

ITC • • • • •

Strategic mindset Customer focus Making things happen Leading change People leadership

J&J • • • • •

Masters complexity Org and people development Customer/market focussed Innovation Interdependent partnering

HLL • • • •

PFIZER • • • • •

Team Work Leadership Customer Focus Innovation Integrity

AVENTIS • • • • • •

Respect for People Integrity Sense of Urgency Networking Creativity Empowerment

Truth and trust Courage in day-to-day work Caring for stakeholders and customers Action oriented

Figure: 3.3 Mapping for Competency Frameworks.

Understanding the Competency Management System

underlying motive and trade competencies or that these can be instilled by good management practices. The converse is probably more cost-effective in other words organizations should select for core motive and trade competencies and teach the knowledge and skills required to do specific jobs. Or as one personnel director put it you can teacher 32 climb the tree but it is easier to hire a squirrel. In complex companies competencies are relatively more important in predicting superior performance they're not ask related skills, intelligence, or credentials. This is due to a respected range effect. In high-level technical, marketing, professional, and managerial jobs almost everyone has an IQ of 120 or about and in an advanced degree from good university. What distinguishes superior performers in these charges are the motivation, interpersonal skills, and political skills, all of which are competencies. It means that the competency studies are the most cost-effective way to staff these positions. Motives trait and self-concept competencies predicts the behaviour actions which in turn predict the job performance and outcomes as in the motive trait behaviour outcome causal flow model. The competency always include an intent, which is the motive what rate falls that costs action to words and the outcome. For example, knowledge and skill competencies invariably include a motive trait is self-concept competency. Behaviour without intent doesn't define a competency. An example is management aimlessly walking around. Without knowing why managers walking around you can't know which if any competencies are being demonstrated the managers intent could be boredom, leg cramps, the monitoring of work to see if it is of a high quality or could be a desire to be visible to the troops. Competency management system is best done keeping in perspective the following:

1. Make a commitment at all levels—especially at the top level Research clearly shows that strong leadership is paramount in creating a positive organizational climate for nurturing the management of the exercise. Senior management leadership is vital throughout the competency measurement and improvement process. By senior management, we mean the organizational level that can realistically foster cross-functional, mission-oriented performance improvements, from senior operating or functional managers in the various acquisition and program offices throughout a federal agency, to the Secretary or Administrator of the agency. Senior managements should have frequent formal and informal meetings with employees and managers to show their support for improvement efforts and implementation initiatives. Also, they should frequently review progress and the results of improvement efforts.

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2. Develop organizational goals. Goals need to be specified and publicized to be able to provide focus and direction to the organization. Vision Statements and Strategic/Tactical Plans (including systematic ways to evaluate competency based performance) are important for methodically planning the targeted competency based performance improvements. To be meaningful, they must include measurable objectives along with realistic timetables for their achievement.

3. Offer training in improvement techniques. Training should be provided to appropriate personnel to help them properly make process improvements. The scope of training should include the operation of integrated project improvement teams, the role employees play in exercising sound business judgment, and the specific techniques for making process improvements (e.g., flowcharts, benchmarking, cause-and-effect diagrams, etc.). Comprehensive training is needed to expand the employees’ technical capabilities and to achieve “buy-in” for undertaking meaningful improvement efforts. Use of facilitators can provide “just-in-time” training to members of process action teams.

4. Establish a reward and recognition system to foster competency based performance improvements. In our view, organizations should tie any reward and recognition system to competency based performance improvement as measured by the competency maps. Thus, employee incentives will tend to reinforce the organizational objectives being measured by the competency maps. While handing out rewards to individual employees has its own place, certain group reward and recognition systems are also needed to encourage integrated, cross-functional teams of employees, customers and managers to undertake targeted competency based performance improvement.

5. Break down organizational barriers. To overcome unfounded fears about the perceived adverse effects of competency based performance measurement and improvement, we believe that the official uses of the competency maps need to be spelled out to all the employees and managers.

Understanding the Competency Management System

6. Co-ordinate Headquarters and Field Office Responsibilities. Implementation should be a collaborative effort between an agency’s lead corporate office (such as an targeted management office at HQ) and its local (or field) offices. The offices should jointly decide on their respective roles and responsibilities relative to the CMS. In most cases, the lead corporate office is in the best position to provide leadership, oversight, and a well-defined methodology. The assignment of other roles and responsibilities will differ based on what is appropriate for the offices’ circumstances, such as: �

How centralized or decentralized the offices are.



The extent to which data are collected from a centralized information system or from local databases.



The extent to which surveys are conducted centrally or locally.

Some agencies have found that local targeted offices are best suited for implementing the actual assessment process by generating quantitative data from appropriate sources, and by conducting surveys to obtain the necessary feedback for making procurement system improvements. Under this model, in partnership with the local offices, the lead corporate office: �

Assumes a leadership role in developing and refining the survey instruments to be used.



Prepares generic cover letters.



Facilitates the conduct of surveys at the local offices.



Fosters local improvement initiatives (including benchmarking) resulting from the survey efforts.



Monitors response rates, compliance with the required statistical methodology, and overall survey administration progress.

With a clearly defined methodology in hand, the local procurement offices in these agencies: �

Develop mailing lists.



Select samples.



Print and mail the surveys.



Compile survey data.

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Track and analyze the office-unique survey results.



Generate management information system quantitative data.

We recommend that there should be an agreement made among the lead corporate office and local offices to use a set of common measures, instruments, supporting computer templates and improvement strategies in line with PEA tenets.

COMPETENCY

MANAGEMENT METHODS AT THE CONCEPTUAL LEVEL

The methods available to articulate such a management system could vary. Some of them being:

1. Task Analysis Approach Basically task descriptions are generated through the review training manuals or direct observation of the job performance. The task descriptions are then clustered and weighed to reflect the essence of the job. The steps involved are: �

Generation of task description item banks by scientific staff.



Subject matter specialists review the consolidated list and delete the tasks not performed or out of date tasks.



The task list narrowed down to most representative tasks.



Experts rank the tasks based on the importance (least/ most), sort tasks into clusters based on the performance requirements.



Competencies required performing the tasks identified.

This method requires a great deal of time and effort.

2. Critical Incident interview method The job holders are interviewed in a systematic manner. They are asked structured questions about what situation and challenges they have faced. The remarks about what they thought did and consequences of the actions are note down. Both the incidences, ones in which the

Understanding the Competency Management System

interviewee has been successful and also unsuccessful are recorded. The interviewee is asked about what factors he/she attributes to the success or failure in an incidence. The recorded observations are analyzed to infer the needed competencies. This approach draws on the learning from the past behaviour. Due to the dynamic nature of the business and strategies there is a danger that past learning may not be a correct indicator of the competencies needed today and in the future.

3. Behavioural Event Interview: 3.1 Behaviourally Anchored Rating Scales (BARS) The premise underlying the Behavioural Event Interviewing technique is that historical performance can serve as an indicator of future performance. Companies like SMITHKLINE BEECHAM CONSUMER HEALTHCARE and PROCTER AND GAMBLE identify superiorperformance competencies using this technique. And since these are almost always used in the career-development process, the technique can be used across organizational-levels. The process requires trained facilitators, who conduct in-depth interviews with employees across the organization. They are quizzed on two successful and two unsuccessful events, originating in either their professional or their personal lives. The objective is to understand the differences in the reactions of average and superior performers. The facilitators record these interviews, and carry out a thematic analysis to cull out the themes. For instance, the ability to view failures as learning opportunities could be one. These themes are grouped into categories. Themes like learning from failures and the ability to think on one's feet can be grouped together. Individual superior-performance competencies are constructed from these themes. In this approach, the rater evaluates a competency by choosing from several descriptions of on-the-job performance one that best describes the individual’s abilities. When correctly constructed, behavioural anchors are highly relevant to the competency and to the individual’s job. In effect, anchors supplement the definition of the competency. Typically, a Direct Statement definition of the competency is used, and the anchors are presented in an order that reflects increasing ability or levels of sophistication in the competency. This approach to rating scales provides the rater with greater guidance in making a rating, and allows for comparisons of individuals who have different job roles within an organization. On the downside, BARS can be difficult to construct, and for certain competencies they must be updated regularly. It is very difficult to use BARS with technical competencies because technology changes rapidly and what was defined as a high level of performance before may not come close to describing high performance the next. Competencies in the areas of leadership, business acumen, and interpersonal relationships are more stable, making the work involved in creating BARS more palatable.

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This is a modified form of the critical incidence interview method. Two sets of samples are chosen for the interview. The first set constitutes of superior performers and the other of average performers. This classification is done based on the performance data available on each individual or based on the perceived judgement of the superior. Sample size chosen should be such that though small, it should be a complete representation of the population across functions/ locations. As in the critical interview method both are asked about critical incidences or challenges and their behaviours are recorded. The focus is on identifying the competency that distinguishes the superior performers from the average performers.

4. Expert Panel In this method a team or panel of experts is constituted to identify the competencies required in the organization. The experts are: �

Top management representatives (Strategic decision makers).



Experts from different functional background who have a fair idea of the nature of tasks performed in each function.



Representatives from the Human Resource Department.

The panel goes into the details of the critical behaviours needed for successful performance in each job or a group of jobs. The business strategy and the expected behaviour for achieving the desired results is studied and documented. The panel could start with a list of standard competencies and arrive at modifications needed. The advantage of this method is that it is a faster process and a politically expedient way to define competencies as experts may question the validity of the methodology.

5. Threshold scales This type of scale involves rating an individual on whether he or she meets a minimum performance level in a competency. The “yes” and “no” points on this scale, from which the rater selects to indicate a satisfactory performance, are clarified with a description of the minimum performance required that is similar to using a single anchor from a BARS scale. Threshold scales are most effective for collecting information on an individual’s qualifications for a given job role or assignment. They are not typically used to provide developmental feedback because there is no information available on just how effective or ineffective an individual is, so there is no way to prioritize developmental focus. The threshold approach is typically most useful when the yes or no rating is derived from ratings used in another type of scale. For

Understanding the Competency Management System

example, you can create a threshold for a Key Elements competency by specifying minimum ratings that an individual must achieve on each key element to be considered competent. Likewise, you can establish on a BARS scale a minimum rating point that indicates competence. This derived threshold approach provides yes/no or ready/not ready information as well as additional data to use in prioritizing development needs or making pay or placement decisions.

6. Repertory Grid In a repertory grid analysis the job holder is asked to write on separate cards the names of at least six people whom he supervises or works with. The job holder separates the cards into two sets, one those who are good at work and other those who he considers are less efficient. The cards are shuffled with name face down and the jobholder is asked to pick two cards from a pile and one from the other. The job holder has to now describe the ways in which the two are similar to each other and different to the third. This process generates a list of attributes. The job holder is asked to describe the behavioural indicators that made it possible to distinguish the good and less efficient. The Repertory Grid Technique can help a company identify its core competencies as well as superior-performance competencies. This technique is best used by businesses that are either in the introductory stage, where it is important to identify key success factors, or in the maturity stage, where change-management becomes critical. RGT is still new in the Indian management milieu, and is used only by TURNER MORRISON. It involves distilling the elements-or constructs-that underlie competencies, and using them to identify the latter. The process starts with a team comparing the company to two other organisations that it thinks can pose a threat to it in the future. This is done at the level of ''elements.'' For instance, the team might identify a company with an excellent distribution network as a threat; distribution is the element in this case. These constructs are laddered, or taken to their logical denouement, to understand the core competencies of the business. The same approach is used to arrive at superior-performance competencies; only, this time instead of companies, the team identifies three people: a superior performer, an average performer, and a low performer. Thus, the competencies stand revealed.

Competency scale dimension: LIKERT SCALES Types of Rating Scales and deriving levels and stages for development of competencies Rating scales that are used to evaluate an individual against a competency typically come in three basic forms: Likert scales, Behaviourally Anchored Rating scales, and Threshold scales. While behaviourally anchored and threshold has been dealt with above, LIKERT is

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being detailed here: Probably the most familiar type of rating scale, a LIKERT scale typically consists of a numeric scale with a brief description of each number’s corresponding meaning, such as: 1. Much less than acceptable. 2. Less than acceptable. 3. Acceptable. 4. More than acceptable. 5. Much more than acceptable. A variety of label types can be used (acceptability, proficiency, frequency, quality, quantity), and scale point definitions can be of various lengths. The common thread is that all LIKERT scales range from low to high, bad to good, less to more, and so forth, in a linear fashion. Text descriptors can also be used in place of numbers as scale points (for example, novice, expert, and master). LIKERT scales are versatile and relatively easy to create. One scale can be used consistently across all competencies in a model (if appropriate), and LIKERT scales can be used with Direct Statement or Key Element definitions. The disadvantage of LIKERT scales lies in their inconsistent interpretation across users of the scale. Behaviour or performance that is at the “Acceptable” level in one person’s view may be “More than acceptable” in another’s, so it may be difficult to compare one person’s ratings with another’s if different individuals created the ratings. For most training and development purposes, however, these scales are attractive in their simplicity and easy to use. Because the scales were empirically derived, the underlying dimensions vary according to the variances that we observed in the actual data (i.e.. quotes, from superior performers). Many competencies have more than one dimension. Typical dimensions are: Intensity or Completeness of Action: The first or main scale of most competencies (labeled "A") describe the intensity of the intention (or personal characteristic) involved and the Completeness of the actions taken to realize that intention. For example some stories of Achievement Orientation were stronger because they involved entrepreneurial risk taking rather than just wanting to do a job well. Size of Impact: The breadth of impact describes the number and position or people impacted or the size of the project affected. For example, use of competency might

Understanding the Competency Management System

impact a subordinate, a peer, a boss, the CEO of the organization or even national or international leaders. Impact can also describe the size of the problem addressed, from something affecting part of one person's performance to a project affecting the way an entire organization does business, For most competencies size of impact or breadth is the second or "B" scale. Job size or organizational level strongly affects this dimension and it is often more useful in comparing jobs than in comparing individuals within the same jobs. Some jobs afford much greater scope for impact. Nevertheless one or two point differences on sizeof-impact scales may distinguish superior performers. Superior performers in some jobs tackle problems slightly larger than their formal job responsibilities, whereas average performers focus on tasks slightly smaller than their formal responsibilities. Complexity: The complexity of the behaviour (e.g. taking more things, people data; concepts, or causes into account) is the primary scale on e few competencies, primarily "Thinking" competencies. Amount of Effort: Amount of extra effort or time involved in an undertaking is a second dimension for some competencies. " Unique Dimensions: Some competencies have unique dimensions. For example self confidence has a second scale. Dealing with Failure that describes how a person recovers from a setback and avoids depressive thinking. Initiative has a time dimension: how far into the future a person sees and acts. At higher levels, the superior performers see further into the future and plan or, act based on their vision, for example, acting in the present to head off problems or create opportunities that may take years to realize. Most competency definitions have two or three digression. For example. The definition of Achievement Orientation has three scales: �

Intensity and Completeness of Achievement-Motivated Action.



Achievement Impact (size of problem or effect on organization).



Degree of Innovation.

Competency examples can show any combination of strength on one dimension and low or moderate impact on other dimensions. Most of the difference between average and star performers is found in the “A'' or main scale.

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COMPETENCY CLUSTER A competency cluster is a collection of closely related competencies. The competencies identified or developed though the given approaches are classified into clusters. The competencies can be grouped though various classifications like, task competencies, leadership competencies, managerial competencies, thinking competencies etc. A competency cluster is a collection of closely related competencies that form a framework that relates one competency to another and provides an overall perspective of the set of competencies that have to be measured and evaluated against a job. All sets of articulation used within a competency framework should try to capture the language that is typical within the organization and that which is understood by the members of the organisation was performing typical roles. The competency cluster is usually driven by defining specific aspects related to it, for example. People Relationships. Strategic Mindset. Business Appreciation. Result Orientation. Competency cluster is also otherwise called as meta competencies. Some organizations provide competency cluster descriptions to indicate the nature of the competencies contained within each cluster. See Fig 3.4. The competency framework of the term given to the complete collection of cluster at our competencies with top without levels and standards and benchmarks and includes behavioural indicated. Frameworks could contain very detailed behaviour indicator to descriptions for specific function activity or a business purpose and they could contain broad generic behavioural indicated that are designed for use up a whole organization or a business unit for a wide range of purposes. The competency frameworks may entail a larger number of competencies that act upon the complexities that are involved the organisation on at and in some situations the framework actually have a minimum number that are easy to understand and implement. The more competencies the framework contains the more difficult it will be to implement if the competency framework is not determined and explained effectively in an organization circumstance. In addition in some of the situation competency clusters and documentation can become very lengthy and can dissuade users from implementing a competency framework. They're all competencies in the framework rate of all the jobs in organization in a department or in a function and that provides a detailed description of the competencies in relation to specific

Understanding the Competency Management System

job or the descriptions. This predictor framework can often be determined to deal with an overall aspect of a core competency framework. This demonstrates that a if a framework does not include competencies that distinguish between jobs within the job groups for which the framework was designed, it is likely to be seriously fallacious. If the framework covers a wide range of jobs with different degree of demands the level classification of the behavioural indicators is done. For each individual an assessment of his current competency inventory and the gap between the current and the desired competency inventory needs to be done.

Competency Cluster or Meta Competency Strategic Mindset Conceptual and Analytical Thinking Systemic Thinking Environment Scanning and Trend Analysis Networking and Management Articulation Demonstration Information Business Relationships Sensitivity and Empathy Bonding Adaptability Problem Solving Defining Right Trouble Shooter Proactive Builder Personal Habits Firm Drives Personal Examples Action Focused Leadership and Influence Proactively Changes Demonstrates bias for action Builds Consensus Group Process Motivating team members Building teams Recognizes accomplishments

Figure: 3.4 Competency Clusters.

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This gap identification is done at three stages: 1. Immediate assessment. 2. Continuous/ periodic assessment. 3. Industry and technical assessment. The immediate assessment can be done through an assessment centre where the individual is required to undergo a series of exercises under the guidance of a team of assesses. The Behavioural Event interview may also be a part of the assessment. The output of the assessment would be the competency map of the individual and recommendation for developmental needs to achieve the desired level. Periodic assessment is to be carried out by the superior of the employee along with the HR professionals based on the assessment template designed for the purpose.

Which approach is right for your organization? Using the two main approaches to defining competencies and the main types of rating scales provides many options for structuring competencies in your learning and performance management systems. But which approach is right for you? Your specific needs should drive your choice, but here are some general guidelines: If your focus is performance evaluation without an emphasis on formally linking the competencies to learning and training, then a focused and comprehensive Direct Statement approach with a LIKERT scale that addresses proficiency should meet your needs and be relatively easy to implement. Evaluation of performance areas by raters who know an individual well will provide the general information required for pay, promotion, or succession decision-making. If you place a heavier emphasis on development, you can use a Direct Statement definition, but the model should be used in conjunction with a development discussed between the individual and a coach or manager to provide more focus on the key aspects to be developed for each competency. If you rely on 360 degree or other formal evaluations for information on current proficiency, or if individuals are primarily responsible for their own development plans, you should use a focused Key Elements approach with LIKERT scales. This approach provides individuals with enough detail to understand their major areas of development and the specific areas within each on which they should focus their development. If your goal is to manage leadership succession effectively, you might use a general Direct Statement model with a simple LIKERT scale if the definitions provide enough detail for fairly consistent ratings across the organization. A Key Elements approach may ensure more consistent ratings because it provides greater detail on the aspects that need to be examined in arriving at

Understanding the Competency Management System

a competency rating. BARS can be used in conjunction with Direct Statement definitions to provide consistency not only across the organization, but also across different levels of leaderships within the organization. The biggest issues with using BARS are the effort involved in creating workable scales and the possible need for frequent updating. LIKERT scales are highly effective as long as the succession management process has built-in mechanisms for examining each person’s performance in the context of his or her specific job role. Individuals who know the job roles well and understand the organization’s overall model should be involved in this review to make it effective. With any successful management approach, formal ratings of an individual’s proficiency should be used as initial identifiers of potential —ratings cannot replace careful examination of the individual’s work context, history, and accomplishments in making succession-planning decisions. Depending on your organization’s specific needs, it may be best to use a combination of definition types and ratings scales within the same system. For example, you might address technical skills with Direct Statement definitions using LIKERT scales, but measure leadership, business and interpersonal skills using BARS scales in combination with Direct Statement definitions. One note of caution: If you plan to use a Learning Management System to collect and store ratings, make sure it can effectively handle every type of scale and competency that you need.

ARE

COMPETENCY MODELS REALLY NECESSARY?

If your organization has any discreet training needs that are focused and targeted, then competency models per se may not be required. Typically, organizations do not need competency models to educate a sales force on a particular product, train production workers in the operation of a specific machine, or train customer service reps on a new process or engagement technique. The common thread in all these applications is that the learning and individuals’ need for it, should be clearly defined by the product, service, or equipment. This in turn gives the trainee distinct boundaries and straightforward measures of success (for example, the learner can or cannot operate the equipment, complete the process and so forth). In these situations, the training is typically delivered through mass administration—many people receive training at the same time, and their grasp of the information can be checked through tests or on-the-job performance. In other situations, the learning or development required is less straightforward. As you move from the direct transfer of a specific skill or knowledge to a more complex set of processes, content, behaviours or procedures, learners require greater guidance in determining what training is appropriate for them at any give time. Navigating this more complex learning environment requires a solid competency model that clearly

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describes the important areas of performance for a job role, provides a basis for assessing current performance levels, and ties neatly to training and learning opportunities. The job-competency model is a very basic form of competency profiling that is built around specific tasks. It lays down the skills an individual will need to possess to be able to perform a particular job. The role-competency model looks at the role of an individual in the organization. It does not restrict itself to one job and instead, studies the part played by the employee in achieving the organization’s super-ordinate goals. The functional-competency model is built around key business functions, like finance, production, and marketing. It defines the specific functional skills, like treasury management, that employees working in those functions need to have or acquire. �

The core-competency model is based on the value systems, vision and mission of the organization. It defines the set of soft skills that should be possessed by every employee of the organization.

A combination of these models obviously allows the company to map the functional, managerial and behavioural attributes that are required for each position in the organization. Apart from ensuring a perfect fit, this also facilitates cross-functional moves and succession planning. Besides ensuring effective recruitment, competency profiling can help an organization chart career-paths for its key performers. And smart companies are also using the tool to enhance the performance of their employees, expedite re-engineering and catalyze changemanagement initiatives. A number of options are available for defining competencies and evaluating individuals against those competencies. To make the proper choices in defining and rating competencies you must thoughtfully determine how you will structure and use your learning, performance management, and succession planning systems. You should also ensure that the software you select to measure, track, and manipulate competency data could also handle your competency and rating scale requirements. (BT 2000).

Chapter

4

Competency Drives Transformational HRM Strategies LEADERSHIP REQUIRED BUILDING

FOR

TRANSFORMATION AND COMPETENCY

Most important is, first of all to decide if the current top management can be the leaders of transformation. No transformation whatsoever can be achieved without leadership from the top management who make the final decisions at every important juncture. Competency is useful in evaluating and choosing the top management. Corporations are increasingly asking outside committees to choose their president from the viewpoint of corporate governance. In these discussions, competency can be a common language or an evaluation standard. Also, in carrying out mergers and acquisitions, it is important to evaluate the competency of the current management in light of the possibility of corporate transformation after purchase. We are sometimes asked to perform this type of management assessment. In one case, we came to the conclusion that the current management of the purchased corporation was incapable of acting as leaders of transformation. We then prepared golden parachutes (retirement incentives) for them. As the above case demonstrates, judgements on leadership competency require deep analysis. Needless to say, competency-based assessments are useful in choosing directors who will be the group leaders for transformation as well as executives who will act as its core. An effective senior leadership team must be strategic and future-oriented so that the organization’s business is not overtaken by events in the environment and transformed into a dinosaur. The only route open to senior leadership to avert leadership obsolescence and rudderless governance is the use of the most powerful strategic planning tool in the conduct of its business. For business excellence, an effective strategic planning process must be concerned with Customer’s and supplier’s expectations, new business and partnering opportunities; technological developments that can impact on the organization's business; competition and organization's ability; and the events in the global marketplace. Others are the e-commerce environment; customer and market segmentation and customization; external (legal, regulatory,

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economic) environment; and community-societal expectations to ensure the organizations' public responsibility and good citizenship. A critical examination of all the above factors can translate to strengths and weaknesses as they concern the organization, suppliers, partners, markets, government, regulation and competition. And the crystallization of organization objectives with associated goals and strategies to eliminate weaknesses and contain threats while building on strengths and capitalizing on perceived environmental opportunities. The development and deployment of action plans complete with projections, key performance measures/indicators, allocation of resources, derived human resource plans by the senior leadership would ensure that the organization is strategically focused with the energies of all employees adequately channeled towards achieving satisfactory business results.

Customer and market focus Business excellence must be customer-driven for customers are the pivots of all business. It is trite knowledge that without customers there can be no business for, in fact , the only reason why businesses exist is to serve customers. It is important, therefore, for the senior leadership team striving for excellence to constantly take the temperature of its customers by determining its customers desires now and in the future so that its market offerings can continue to be relevant. Accordingly, it is of course, no longer sufficient for long-term survival to provide relevant market offerings. These must now be complemented with the development and maintenance of excellent customer relationships for customer retention and customer delight. Businesses now recognize that it costs ten times as much to cultivate and win a new customer than it is to keep an existing customer. This economic truth definitely reinforces the old truism: "make new friends but keep the old. One is silver, the other gold ". To achieve adequate customer and market focus it is imperative for customers and the markets served to be segmented so that groups of customers and the markets with most value to the organization can be ascertained for special leadership attention. Other imperatives for business excellence from the perspective of customer and market focus relate to product and service differentiation, complaint management process, measurement of customer satisfaction and dissatisfaction and strategies for market share its gain and growth.

Data/Information Analysis The core value that underpins this imperative of business excellence is "management by fact". Senior leadership of excellent businesses do not manage their businesses on gut feelings or whims and caprices or "that it is the way we have always done it" philosophy. Rather, they determine the data/information, which are the drivers of their businesses and install

Competency Drives Transformational HRM Strategies

adequate systems for their collation, analysis and interpretation. Typically, the data/information system concerns products/services, suppliers, employee, competitors and financial performance. The trending of the data on all the above drivers of business is crucial as it provides invaluable insights into improvement opportunities and change management. Comparison of the results that emerge from the analysis of compiled data with best practices and benchmarks are also normal cultures of businesses where excellence prevails. The establishment will also pursue excellent recruitment strategies and achieve high retention records and other imperatives for business excellence relevant to human resource focusing on the alignment of employee education and training to business results and performance improvement. Evaluation of training effectiveness using levels 1, 2, 3 and 4 – reaction, immediate, intermediate and ultimate – measurements; determination of employees well-being and satisfaction through periodic surveys and using the outcome of such surveys to devise leadership improvement strategies as alternate strategies. It should also pursue internal partnership with unions to achieve labor management co-operation to create conducive work environment, external partnership to achieve strategic alliance as a means of entering new markets with new products or services are also pre-requisites of business excellence. The latter aids achievement of longer-term objectives and serves as a basis for mutual investments and respect. At the same time, cross-border mergers and alliances promise to fuse together the best features of different cultures, but this may prove more idealistic than realistic.

Process Management In today’s globalized world with frenetic changes in technology, managing for innovation has become a critical success factor for any business, let alone those striving for business excellence. Process management is the key to manage for innovation. To achieve this key objective for excellent business results, the senior leadership team aiming at business excellence must pay attention to its design processes, production/delivery processes. Business processes and support processes should seek to trim drastically the cycle times involved to minimize operating inspection and test costs, time to market and build shareholder value through breakthrough processes.

The Cycle of Transformation and Competency The transform leaders start the transform cycle turning. This corporate transform is integrated with individual transform. This process has a sequential flow beginning with confirming employee motivation, such as "I want to change myself along with the company," moving on to issues such as—Are they aware of the gap between transformation competency and the reality? Do they make transform plans on how to improve themselves and carry them out? Do they verify and evaluate them? Do they ask themselves whether they are ready to move

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on to the next cycle of transform or not? Do they start the next cycle when they are prepared to do so?

The transformation cycle: 1. Confirm motivations for transformation and learning: First of all, confirm who in the organization really believes that a transform is really necessary. In strong organizations, people at the core realize, "Constant transform is essential." On the other hand, in weak organizations, only people in minor positions realize, "If something isn't done, it will only get worse." Strong corporations can start transform with the question of "How?" whereas weak corporations have to start it by asking "Who?" In weak corporations, transformation tactics tend to be colored by the tactics of guerrilla warfare or even mutinous hues. In either case, the key point is whether the person who should be the leader of transformation is motivated to do so or not. In some companies, those who are regarded as the leaders only pretend to have such motivation because of external pressure, so it is important to ascertain where their motivation comes from. The Human Learning process is the key to making transformation and learning synergize as they evolve to work with one another. The learning process involves both the cognitive and experiential including the intuitive and impulsive. This is the issue of demonstrating learning and consequent behaviours and enabling active encounters as they map one another effectively. Effective transformation presupposes learning as a necessary condition for an effective outcome through transformation. Cognitive – Recognize Problems

Experiential – Reflecting Active Encounters

Human Learning Process

Intuitive

Demonstrative

Figure: 4.1 The Human Learning Process.

Impulsive

Competency Drives Transformational HRM Strategies

When any group of people live and work together for any length of time, they form and share certain beliefs about what is right and proper. They established certain behaviourial patterns based on their beliefs, and habits that they follow routinely. These beliefs and ways of behaving constitutions (Organization’s culture) cultures is reflected in the way in which people in the organization perform tasks, set objectives and administer resources to achieve them. It affects the way they make decisions, think, feel and act in response to opportunities and threats. Culture also influences the selection of people for particular jobs, which in turn affects the way in which tasks are carried out and decisions are made. Culture is so fundamental that it affects behaviour unconsciously. Managers do things in particular ways because it is expected behaviour. The culture of an organization is therefore related to the people, their behaviour and the operation of the structure. It is encapsulated in beliefs, customs and values, and manifested in a number of symbolic ways. Ever so often we read from the Annual Reports of organizations that their human resource is their most important asset. Unfortunately, however, the actions of most senior leadership of organizations believe such claims because invariably when the going gets tough, the first expendable item in the organization's operating budget is the Human Resource Development budget that is either severely reduced or scrapped altogether. See Fig. 4.1.

2. Share the image of competency for transformation: The required competency (transformation competency) describes concrete actions to take, but competency is more than 'what is written down.' There is the necessity of sharing the image of competency in an organization from many angles. For example, taking a real person as a benchmark, or discussing what the key words of competency are like should be effective. The expression of competency in 'serendipity' (*1) is important in research and development, especially in basic research. It can be easily understood if citing concrete examples and discussing the behaviours of real-life individuals explain it. Culture and power then affect the choice incidence and application of the modes of strategy creation, which will also reflect the values and preferences of the strategic leader. The preferred mode must, however, be appropriate for the organization’s strategic needs, which are affected by competition. Moreover, culture and power are such string forces that, if the prevailing culture is overlooked, implementation may not happen. Strong cultures can obstruct strategic change, particularly if companies are in decline and people feel vulnerable. Strong cultures, then are an important strategic asset. Internalized beliefs can motivate people to exceptional levels of performance. An effective strategic leader will understand and mould the culture in order that a vision can be pursued and intended strategies implemented. Most successful companies develop strong cultures; the major doubt concerns an organization’s ability to change the culture. Moreover, large organizations formed by a series of acquisitions will frequently exhibit different cultures in the various divisions or businesses; in many international businesses this is *1

The natural ability to make interesting or valuable discoveries by accident. Often seen in scientific explanations.

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inevitable. The challenge for corporate headquarters is to ensure that certain critically important values which are reflected in all branches of the corporations and cultural differences do not inhibit internal architecture and synergy.

3. Recognize the Gap between Image and Reality: It is human nature to be easy on one self and hard on others or to be unable to see oneself in an unbiased way and these tendencies can have a negative impact on transform. Therefore, asking others to objectively evaluate how one is demonstrating transform competency, and using these evaluations to realize where one must make improvements is inevitable. The 360 degree evaluation is a useful tool for this.

4. Make Plans and Carry out Transform Plans: The important point here is not to set the development of competency itself as the goal. However, in reaching one's goals it is inevitable that one demonstrates competency. So if you verify whether or not you are demonstrating competency every day, you will be able to realize that the results will follow. This should be integrated with business plans and goal management processes.

5. Evaluate the Degree of Transformation: It is advisable to evaluate changes in competency annually as well as having daily evaluations. This is to monitor the change in the items of the 360 degree evaluation, for example. Needless to say, the degree of change in the evaluation should serve as a feedback for each individual. One should confirm that individuals remain motivated to carry out transform and move onto the next transformation cycle. Connecting evaluation to the degree of change in human resource systems is effective in fixing transformations in place. Various methods of connection are possible, so they must be designed according to the needs of each company or individual employee. What requires particular attention is the loss of confidence that accompanies transform. This is caused by the fact that, in order to demonstrate this new form of competency, individuals must break out of their shell, losing confidence when moving to take new action. However, this can be overcome so that they gradually become confident in demonstrating this new competency. Therefore, not merely evaluations, but many supporting measures must be undertaken as well.

6. Centripetal Force for Transformation: This cycle of transform does not function if it is left unattended. In order to make this cycle durable and create transformations that follow one after the other, a centripetal force is crucial.

Competency Drives Transformational HRM Strategies

Organizational Transformation Path Renewal Restraining Forces

Create an Economic model of integration Redesign Business Process Adapt to IT Q3

Driving Forces

Consolidation Align People Adapt and Envision new work ways Build HR policies Make Organization work Q4

Corporate Center

Regions

Corporate Centre Configuration

Revitalization

Achieve Mobilization Build Vision Restructure/Options Create a Measurement System Q1

Invent New Business Models Achieve Market Focus Create new ways to work Q2

Plants

Joint Ventures

Figure: 4.1a The Cycle of Transformation. This is what leaders must convey at every opportunity. The possible opportunities are—every meeting in the company, casual conversations with co-workers, in E-space, at interviews and so on. Images displayed by transform competency leaders at these opportunities attract employees and come to be shared among them. It is only through this continuous flow that a strong competency for transform can be achieved in corporations and individuals.

The HRM functional contribution to transformation Within this chapter it is not the intention to examine in detail the HR management approaches. It is sufficient to say that there are a profusion (some might say a confusion) of elements that can make up an HR management system. These may include: �

HR—Business strategies interface.



Total—quality management strategies.



Human resources strategies.

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Organization development strategies.



Reward strategies.



Communications strategies.

Connecting HR strategies and consequently that of other business processes is but an inevitable path for an effective competency management system in an organization. Current structures and processes in HR organizations focus on resourcing, performance management, reward mechanisms and employee relations. In a competency framework similar set of activities are performed through competency-based themes that would still drive the processes from a people management perspective. Figures 4.2 and 4.3. Aligned to these there may be a variety of further elements: In the competency based HR organizations the driver moves from content, tools and technique based management to that of competency-based processes. In this context some examples of such processes deal with attracting and managing talent, creating and sustaining a learning environment, building a communication network and consequent processes and

Changing Context and Role of HR – HR Emphasis

Business Strategy Vision Mission Values Competitive Strategy

HR Strategy Vision Culture People Organization HR Process Technology

Solution Framework Organizational

Team / Process

Role / Job

HR Focus Groupings Driven By the HR Organization Training and Compensation

Recruiting

Development

and Benefits

Employee Relations

Organizational HRD Facilities, Communication Interventions Administration and Cost

Domain Boundary Figure: 4.2 Steady state Human Resource Management Organizational Model.

Competency Drives Transformational HRM Strategies

Competency Based Human Resource Management Business Strategy Vision Mission Values Competitive Strategy

HR Strategy HR Vision Culture People Organisation Process Technology

Competency Framework Organizational

Team/Process

Role/Job

Competency–Based HR themes Talent Leadership Learning and Organizational Performance Building Management Building Development Motivation Communi- Management Relationship cation

Figure: 4.3 Competency Based Human Resources Management. driving motivation for organizational member satisfaction. In effect competency based HR organizations enable capabilities: Some examples in this context include: �

Induction and socialization driving competency based approaches.



Competence-based recruitment.



Skill mix analysis.



Benchmarking.



Job design.

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Support Capabilities Financial Management

Operations Management

Technology Management



Job evaluation.



Job restructuring.



Performance-related pay.



Competence-based/related pay.



Group/team-related pay.



Merit-based pay.



Gain sharing.



Individual competencies and objectives.



Team competencies and objectives.



Ongoing performance review—team and individual.



Performance appraisal/feedback.



Team development plans.



Personal development plans.



Continuing professional development.



Succession plans.



Career development plans.

HRM Management

Competency Linkages to Performance Management (Figures 4.4 and 4.5) In essence, performance management owes its origins to management by objectives (MBO) first proposed by DRUCKER (1954). FOWLER (1990) suggests as much by the title of his article 'Performance management – the MBO of the 1990s'. While MBO emphasized the linking

Competency Drives Transformational HRM Strategies

Competency Framework should drive the HRM processes... 20 days

Hiring, Induction and Placement

Assessment Mentoring

Acquisition Resourcing

Universal

Functional

Reward Management, Pay for Competency

Local / Unique Explicit

Feedback

Human Resource Development, Training, Career Planning

Foundation

Goal Setting Performance Management, and Task Accomplishment

Implicit Key P Indicators

Evaluation Competency Framework should drive the HRM processes

Development

Figure: 4.4 Competency Frameworks—Driving the HRM Processes. of individual and managerial objectives to organizational goals through an appraisal process, it was perhaps viewed as a HR-driven exercise and therefore lacked ownership by managers. Performance management differs in the respect that at its best it should link the strategic elements of a business with key managerial tasks including managing people. As will be outlined in later sections of this chapter, managerial responsibility for coaching and support and individual ownership of performance improvement are at the heart of a performance management. Competency based objectives drive performance with a focus on the means and results. It enables incumbents to aim for achieving goals while planning the necessary processes. This in turn helps establishing a system that is more long lasting and institutionalized in the organization. However, put simply, there is no one best way. Much depends on the present culture (the way we do things around here) or an envisaged future culture of the organization and the type of business which it is in. As HENDRY et al. (1997:20) observe, 'We believe that the approach you take should depend on your organization, its culture, its relationship with employees and the type of jobs they do.' In terms of culture, what works in the public sector may not work in the private sector. What works in the UK or the USA might not necessarily work in Asia or

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53%

Hiring/Selection 50%

Performance Management 42%

Training 38%

Job Description

36%

Development Planning 31%

Career Pathing

30%

Succession Planning

29%

Strategic HR Planning Compensation

19%

Percent of Implementers Rating Very Effective Figure: 4.5 Competency Based Human Resources Management: Frequently used applications: Refer Schoonover and SHRM. Eastern Europe. This is particularly worth bearing in mind in our new 'globalize' marketplace. TROMPENAARS (1995) notes that much of the management literature and practice has been developed and preached by individuals from the Anglo-Saxon world and is potentially laden with cultural assumptions. As such many purportedly 'universal' ideas, approaches and solutions put forward may have little relevance to a large part of the globe. Of particular relevance to performance management is TROMPENAARS (1995:25–6) statement that: In developing pay for performance systems globally, for example, we quickly run into major cultural differences in whether we should recognize and reward individual or group contributions. Individualistic cultures, such as those of the US and Britain, choose the individual and pay the price of impaired teamwork and the tendency to push for personal objectives even when they damage the team as a whole. Collective cultures, such as that of the Japanese, choose the group and often pay the price in a submerging of individual initiative and creativity.

Relevance to Pay (Figures 4.4 and 4.5) Competency-based or related pay is another area of continuing debate. A report by TOWERS PERRIN looking at European reward systems (1996), identifies that interest in competent related pay is rising. BROWN and ARMSTRONG (1997) examined a number of approaches used by firms in the UK, including GLAXO WELCOME, BASS, VOLKSWAGEN UK,

Competency Drives Transformational HRM Strategies

GUINNESS, ICI THOMAS COOK, PORTSMOUTH HOUSING TRUST, TRIPLEX SAFETY GLASS, ABBEY LIFE, SCOTTIES EQUITABLE, DERBY CITY GENERAL HOSPITAL NHS TRUST, THE WOOLWICH, and THE ROYAL BANK C SCOTLAND. BROWN and ARMSTRONG conclude that on the basis of their experience, competence-related pay is most appropriate when: �

Competence is the key to competitive advantage.



Competence frameworks align with core business requirements.



There are effective performance management processes.



It covers knowledge workers for whom conventional performance-related schemes are often ineffective.



The organization is flat and the emphasis is on continuous and lateral development.



A broadband pay structure is used.

BROWN and ARMSTRONG (1997) also point out that. An increasing number of organizations are relating salary increases to competence whilst rewarding exceptional achievements with bonuses.' Perhaps contribution-related pay would recognize both competence and performance better than either Competence/performance related pay. So, the debate continues. Perhaps the only area of agreement by commentators and within organizations is that pay and rewards should ideally be a separate discussion to that of the appraisal discussion itself.

Harnessing the collective genius of people for career and succession planning Once upon a time, employees faced a career ladder—each rung characterized by a unique set of responsibilities. Over the years, the world grew smaller and organizations became flatter. When discussing progression within a career, "promotion" was replaced by "lateral move." When talking about what distinguished employees in their positions, responsibilities gave way to competencies and contribution. Competency profiling is exactly what you would expect it to be—a complete understanding of an individual's organizational, managerial and behavioural competencies and not just in terms of skills, abilities, or intelligence. For, a manager's competence is a compendium of skills, behavioural traits, beliefs, motives, social roles, and self-image. In the twenty five years that it has taken for the technique to evolve as an effective management tool it was first used by the Harvard psychologist, DAVID MC CLELLAND, to refine the selection-process for the US foreign service in 1973—the way companies perceive the Human Resources (HR) function has changed completely. For, the traditional approach to HR is based only on job-specs, where people are hired, appraised and promoted on the basis of their ability to perform specific tasks. However, the rigidity of this style makes it difficult for

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companies to respond to economy, industry and customer dynamics in a fast-changing world. Paradoxically, this is where competency profiling has a role to play. “It only HR that is rooted in competency-based management can help a company bridge the gap between vision and implementation.'' Crucially, while the job-oriented approach to HR is centered on tasks and what it takes to complete them, a competency-based approach centers on people. Not only is it applicable across HR activities—from recruitment and appraisal to training and reward—it also enables the creation of the knowledge corporation by configuring the organization around individuals who are depositories of data. That's why, after a period of relative disuse, it is making a global comeback today. Competencies are commonly defined as the skills, knowledge, and behaviours critical to the success of the employee and, in a larger sense, to the organization. The question remains, though – for any given company, what are the right competencies? What, for example, are the talents and perspectives that have been championed in successful organizations? Are there competencies common to all of these admired organizations, or do competencies differ based on one business strategy versus another? (BT 2000) Over time it is now quite eminently established that competencies can be quite clearly linked to the following: 1. Selection, staffing and retention. 2. Performance Management. 3. Employee Development. 4. Work design, structuring including roles, tasks and benchmarks as relevant to performing the said role. 5. Rewards, and 6. Succession Planning. This clarity helps us not to stray away and ask for linkages with all that is done in HR but drives HR managers to enable processes that fit in with the six factors of HR in competency management. Success means more than following a simple prescription—emulating an industry leader, for example, is not—in itself—a recipe for success. On one hand a great deal can be derived from reviewing best practices. On the other hand, an organization has to determine the competencies that fit with its specific business strategies and culture. A key to business success is making sure companies have the right people in the right place and then harnessing the creative genius of those people. Competencies provide a way to accomplish both these tasks and if they are based on a company's strategy, can help people focus on those things that are going to make the biggest difference for the business. They can also reduce some of the ambiguity

Competency Drives Transformational HRM Strategies

Rewards—what behaviours do we reinforce?

Succession—how do we identify and develop tomorrow's leaders?

A competency is… A individual or a cluster of behaviours, capabilities and skills an individual. Inter/intra group or group needs to successfully perform a set of tasks or functions. A competency is a demonstrated behaviourial trait or skill.

Design–how do we Resourcing–how do structure effective we attract, select and roles and activities? Competency retain the right people?

Model

Learning & Growth— what capacities do we develop?

Managing Results —how do we measure and drive critical behaviours for results?

A competency model is… An assessment and decision-making tool which defines the key competencies for successfully performing a specific job or the operations of a particular functional area. The models are often segmented by career stage and include a cross section of technical and enabling competencies.

Figure: 4.6 The HRM based Competency Model. found in business today. Prior to reengineering, everyone had a very defined role that was fairly clear and unambiguous. With reengineering, everyone is expected to play a far broader role. Many people are uncertain about what these new roles look like. Competencies serve to clarify what the organization needs from its people in order to achieve a competitive advantage. For many organizations, competency descriptions are created and do no more than take up shelf space in people's offices. This happens because competencies don't get embedded in the systems and people processes of the organization. To improve and learn what sets great organizations apart, we need to compare great organizations with good ones because that will help isolate more clearly the things that really make a difference. Companies that use a competency-based approach have made a conscious effort to identify the skills, abilities and types of workers they need to achieve their goals. The company that knows what it's trying to accomplish targets in the people it hires, trains and develops. As a result, an organization is able to conduct its business quicker, better and more efficiently. The organizations with clearly defined competencies are likely to be more effective in accomplishing their missions. However, if an organization has a competency-based system, but has taken a generic model off the shelf, it may be no better than having no competencies. If the organization has strategy-based competencies, it's going to be more

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successful. In such companies, employees are going to have a greater sense of job satisfaction because expectations are clear and they are given a blueprint of delivering against those expectations. Figure 4.5. The companies that use competency-based systems will distinguish themselves as employers of choice. With job security largely a thing of the past, an employer of choice is often the company that demonstrates that it is willing and able to help its people grow. Competencies, if they're implemented properly, are obviously linked to people growth. Competencies have to be kept evergreen. Organizations can't list them today and simply leave them for the next ten years. As the business environment changes, as a company's strategy and mission evolve, those competencies will probably need to be updated and revised. Because organizations have flattened, opportunities for promotion have become scarcer. For many people who have grown up with a hierarchical mind-set, a promotion served as an invitation to grow and add more value to the organization. In the absence of that, people can end up stagnating. Organizations should develop competencies to provide their people with a framework that allows them to find opportunities to grow in their current assignment, thereby adding more value to the organization. In addition, as companies seek to grow in an information economy, they need people, at every level, assuming responsibility for the success of the enterprise. This means that organizations need everyone, regardless of position, exercising greater initiative and leadership. Competencies if implemented effectively can help organizations develop and harness the full potential of their people. Over the last few years, 'competency' has become a leading trend in the “human resources” sphere. Yet as consultants, who intend to realize innovations for our corporate clients by incorporating the competency concept into their human resources management systems, we believe that it is time for people in management to reconsider the true value of competency. By definition, competency is a characteristic ways of acting and thinking in order to bring about the desired results. Many companies today are developing a model of competency and applying it in their personnel evaluations as a substitute for a conventional capability assessment. A competency model may be defined here as "a presented model of action that has been drawn from certain characteristics of high performers' actions and attitudes, and while basing this in future corporate strategies, lowering it to a level that seems attainable for everyone. (Fig. 4.6)

MAPPING

COMPETENCIES INTO A COMPETITIVE ADVANTAGE IN AN

HR

CONTEXT The recent years have seen the emergence of a new business environment, which has been variously described as "New Economy", "Knowledge-Based Economy", "hyper-competitive environment", etc. There is also an emerging consensus among both the academicians and

Competency Drives Transformational HRM Strategies

practitioners that certain key factors differentiate this new paradigm from the earlier one. Some of these factors are: �

Knowledge as a key differentiator.



Rapid discontinuities in technological platforms/ business models.



Hyper-competitive business environment.



Internet as an emerging key medium for conducting business.

The impact of these factors is apparent both in the way organizations are re-orienting their processes and practices, as well in the changes, in the aspirations, work and life-styles of the employees. Organizations, for instance, are endeavouring to become high-performance workplaces by implementing measures such as: �

Implementing radical changes (e.g., downsizing, strategic transformations/ reorientation, global forays, etc.)



Flatter, team-based structure.



Greater focus on knowledge management and intellectual capital.



More focused performance management systems, etc.

Likewise, one also finds the global environmental changes making their impact on the mindset and life-styles of the workforce, e.g.: �

Higher aspirations.



Higher job mobility.



Changing concept of career.



Brainpower/ talent as the critical skill.



Work as a life-style, etc.

Clearly, these changes place new demands on the HR professionals, as well as necessitate a relook at the role of HR in the contemporary organizations. Challenges for the HR professionals can be classified under four broad heads: �

Managing talent.



Managing performance.

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Managing change.



Managing knowledge.

Deriving from the above, the paper then analysis at the implications these have for the HR professionals.

1. Managing Talent In a 1998 article, MCKINSEY QUARTERLY introduced the term "War of Talents" to highlight the fact that across industries, the ability to attract, retain and develop skilled people was emerging as the basis of competitive edge. As the ex-CEO of Allied Signals, Larry Bossidy had once put it: "at the end of the day, we bet on people, not strategies." The reasons for this "war" are not difficult to find. Talented manpower is becoming a scarce resource. The top 20 B-schools produce just 1,800 MBAs against the industry requirement of close to 3,000; the country produces only 29,000 engineers and MCAs, when, according to NASSCOM estimates, in just one single year—1999, the IT industry absorbed about 35,000 degree holders and 39,000 diploma/certificate holders. This gap between the demand and supply of skilled manpower will only widen as we move into the future. As we move into a more competitive and global economy, the market for skilled workforce will continue to change in three significant ways: �

Firstly, whether in the hi-tech industries or in the so-called old economy companies, due to the changing nature of work/job, the demand for sophisticated and skilled people – the Knowledge Workers – who can add/create value for the company will continue to increase. Irrespective of the industry sector, technical literacy, entrepreneurial skills, ability to manage stretch and a global mindset are becoming the key attributes companies look for in their employees.



Secondly, the growth of economy, especially in the service and high-technology sectors, is resulting in the emergence of a large number of high technology small and medium sized enterprises (hi-tech SMEs). Within last couple of years, we have seen a booming growth of small knowledge/service-based outfits (e.g., software developers, e-enabled service providers, event management firms, training/recruitment service providers, marketing agencies, etc.), which require, source and absorb a large segment of talent from the market.



Lastly, the phenomenal growth of the "New Economy" has opened up many new job avenues for the talented workforce. This is creating a phenomenal increase in the job

Competency Drives Transformational HRM Strategies

mobility. Earlier, a long stint in a company meant about ten years or more. Recently, one of the big-six consultancy firms awarded extra-bonus and ESOPs to their "loyal" employees who had been with the company for more than three years!! But managing talent is not just managing the skill scarcity. The technological and business discontinuities also increase skill obsolescence at a phenomenal rate. The increasing pace of change is not only making many past competencies obsolete, but is also throwing up skill requirements which are too new to be taught in the finishing professional institutes. These and such other environmental changes imply that the HR professionals will need to rethink about the employee value proposition they offer. In spite of all the rhetoric, talent is still the most under-managed resource in most companies. The need is to go beyond the traditional practices for attracting, retaining and developing talent. Studies, for instance have shown that factors such as the one’s mentioned below: �

Strong performance ethics in the company.



Opportunity for long-term wealth creation.



Exciting job challenges.



Autonomy on job.



Flexibility in employment terms (e.g., telecommuting, job-sharing, etc.)



Differentiated and competitive compensation packages.



Company's concern for maintaining work/life balance.



Company's practices for talent development (that go beyond just training), etc. are some of the key factors for retention and development of talent.

2. Managing Performance In an increasingly competitive economy, the value of HR function is only as much as it can contribute to enhancing the organizational performance and productivity. In order to remain relevant in the corporate functioning, as DAVE ULRICH pointed out, we need "to define what HR delivers and not what it does." A 1995 Rutgers University study encompassing 1000 US companies showed that there is a clear the link between corporate HR systems and the shortand long-term financial performance of the company. Innovative and appropriate HR practices were found to promote high performance companies, while the HR practices which were

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misalign to performance led to low productivity and performance levels and decreased corporate competitiveness. Designing such performance-based HR systems will be the second emerging challenge for the HR professionals. The issue to address would be—how to design HR systems, processes and activities which improve performance, help the organizations in some tangible way to serve their customer better, and increase shareholder value. While the performance appraisal (PA) system has always been a tool in the HR professional's basket, its glaring inadequacies in actually improving/ managing/ monitoring performance have also been largely ignored. In fact, in many companies, it is still implemented as an annual ritual, without any reflection on its impact on the actual performance. Moreover, in order to work as an effective performance tool, the PA system needs to be integrated with the other organizational systems, such as: �

Business Plan Development Process.



Work-Systems and Processes.



Compensation and Rewards.



Career and Competency Development Systems, etc.

There are a number of issues that need to be addressed to make it an effective tool for performance management, e.g.: �

Alignment: The extent to which the factors measured by the PA system are related to the organizational strategies and tactics.



Balance: The extent to which the system balances what is achieved (results which impact the short-term performance) with how it is achieved (competencies which ensure the long-term sustainability).



Relevance: The extent to which the system is integrated with the emerging changes in the nature of work itself, e.g., team-based work, project assignments, virtual teams, cross-border assignments, etc.



Consequence: The extent to which the system is able to address, not just rewards for rewarding good performance (e.g., promotion, increment, bonus, etc.), but also ensures superior future performance by building in monitoring mechanisms.



Acceptance: The extent to which the system fulfills the user's (line managers and employees) expectations, and is seen as a support to improve performance of the employees.

Competency Drives Transformational HRM Strategies

3. Managing Change The emerging business environment also places another demand on the HR professionals that of managing change. In the conventional setup, the role of HR has been more of maintaining the status quo rather than of initiating and managing change. When the HR professionals act as the change agent, it is/ has been in response to certain decisions or processes that have been initiated elsewhere – HR would pitch in when "change happened." Moreover, the very focus of these change efforts has been on "incremental" changes. For instance, the company may implement a cost-reduction program, process improvement initiative, qualityimprovement efforts, etc. In contrast, survival in the emerging business environment demands more radical, discontinuous and corporate transformations, which are initiated from within the company. During the last few years, we have seen many such transformations taking place among Indian companies. These changes are as follows: �

Cross-Industry Mergers and Acquisitions.



Movement Into Radically New Markets (e.g., Domestic To Global; Urban To Rural; Commodity To Branded, etc.)



Restructuring of Product/Service Portfolios.



Corporate Restructuring, Downsizing etc.



Radical Changes in Corporate Strategy.



Transformation of Corporate Identity, etc.

The reasons for such changes are implicit in the very nature of changing business environment. They are: �

The fast pace of environmental change is making many sectors, industries and markets obsolete or overcrowded. In order to survive and grow, the organizations are forced to move into newer and more attractive fields.



Changing market dynamics and customer expectations is rendering many old strategic options and paradigms ineffective. To cope with these changes, organizations are forced to innovate and adapt new strategies.



Technological innovations and globalization are creating new markets that were never there earlier. To leverage on these emerging opportunities, it becomes imperative for the organizations to realign their strategies, structures and systems to the new realities.

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Adapting to such changes has a deeper impact on the organization than the conventional incremental changes; they aim at altering, in the words of DAVE ULRICH, "how the organization thinks and feels about itself." The challenge for the HR professionals would be to build up corporate capacity for initiating, managing and institutionalizing such changes. A 1992 study on corporate change, commissioned by GENERAL ELECTRIC, highlighted seven critical factors that constitute the corporate capacity for change. Building and nurturing these would be the key agenda for HR professionals in the emerging environment: �

Leading Change: developing and identifying the resources within the company champions, sponsors, leaders - who can initiate, lead and support change efforts.



Creating a Need: stimulating the need (which exceeds the resistance) for change among those that would be involved and affected by proposed change.



Shaping a Vision: helping the organization and its members develop a vision of he desired outcome of the change.



Mobilizing Commitment: mobilizing the commitment of the key stakeholders – management, unions, powerful informal cliques – for the changed outcome, so that they feel enthused about it.



Changing Systems and Structures: aligning the organizational systems and structures so that they support the changing efforts.



Monitoring Progress: developing mechanisms that help indicating the progress and direction of change.



Making Change Last: institutionalizing the change in the organization.

4. Managing Knowledge In the emerging business environment, an organization’s capacity to create, absorb and utilize knowledge is becoming the key differentiator for competitive success. This is true not only for the knowledge-based industries (IT, service, etc.), but also for the traditional manufacturing (the co-called smokestack) industry. There are a number of reasons for this paradigm shift: �

Product/service offerings are increasingly becoming only knowledge-based. Whether a car or an insurance policy, more and more knowledge goes into their design and creation (a contemporary car has more computing power than Apollo 11).

Competency Drives Transformational HRM Strategies



Across the industries, one finds the products, services and technologies becoming commodities. Thus, the only basis for competitive advantage lies in organization’s internal processes and capabilities (e.g., for servicing the customer, for developing new products, for managing projects, etc.).



The fast changing business environment also makes old solutions and offerings obsolete fast. To remain competitive, organizations need to keep developing innovative solutions at a regular interval.

All these new competitive requirements demand creating an organization that can effectively create, process and codify its knowledge into its offerings and processes. While managing knowledge may not be entirely an HR function, HR does have a major role in designing and implementing many processes and systems. Besides managing and developing talent, there are two other HR interventions that will become critical: �

Creating a Knowledge-Sharing Culture: While many companies have created intranets, and have got the technical infrastructure in place, it is also a common experience that sharing of knowledge and information does not happen automatically. In fact, often the organizational structure, performance management systems, practices and procedures themselves discourage people from sharing knowledge with peers (we need to remember that the traditional organizational designs were aimed at controlling/monitoring free-flow of knowledge, and not for facilitating it). New HR innovations would be needed to create structures, systems and processes that encourage knowledge sharing among the organizational members.



Systems to Managing Tacit Knowledge: While the technology helps in efficiently collecting and disseminating knowledge from and among organizational members, its effectiveness remains confined to explicit knowledge – knowledge which can be codified. A larger proportion of business-relevant knowledge, however, resides in the minds, skills, practices and relationships of people. This kind of knowledge gets shared only when people meet and interact. Designing systems and practices to make this happen is another emerging priority for the HR professional.

Empowering the Knowledge Worker Today, companies face the same pressures which they faced a decade ago, but in a radically different economic landscape. A new pressure, then barely on the horizon, has revolutionized the way many businesses must operate—the Internet. The Internet’s impact is ubiquitous. Among other impacts, it has lowered entry barriers to many markets; empowered the

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customer with information and choice; brought new distribution channels; and spawned entire industry sectors around activities such as customer relationship management, supply chain integration, security and the marketing of information. The economy has transitioned to what some call the ‘Age of Information’—an economy in which Gross Domestic Product is increasingly dominated by services. In this service economy, the knowledge worker has replaced the production assembly line worker as a key factor of production. Knowledge workers use and process data or information and in collaboration with other workers, create knowledge and take action, thereby increasing value. This value creation process is predominantly intangible in nature. In 1998, over 75% of the market value of the S&P 500 was captured in intangible assets. Intangible assets, like any other asset, are factors of production that should be used to generate value. These intangible factors of production are used in ways that may be many times removed from revenue generation or cost reduction; they are frequently indirect contributors to production of a product or service. For example, IT investments involve extensive use of knowledge workers and capital and are a powerful service facilitator with significant impacts on costs and internal and external customer relationships, but rarely are there direct correlations between IT projects and increased revenue or reduced cost. So, organizational financial performance is increasingly contingent on generating returns on intangible factors of production. Therefore, organizations must apply the knowledge worker’s expertize in ways that serve a defined corporate strategy to achieve a return on that worker. It follows that organizations must both empower the knowledge worker and measure their performance in relation to strategy. However, organizations are finding it extremely difficult to implement strategy and measure effectiveness of that strategy. According to Fortune Magazine, only 10% of the strategies that are effectively created get effectively implemented. A related finding by NORTON and KAPLAN is that without the Balanced Scorecard, 85% of executive teams spend less than one hour per month discussing strategy. So, even when companies invest a lot of time in refining their values, mission statements, and strategic initiatives, those ideas rarely trickle down to truly transforming an organization, and the average employee does not have a clear understanding how his or her actions influence the ultimate performance measures such as stock price or earnings per share.

Refocusing HR So what does all this mean for HR professionals? The traditional role of HR was that of the "back-office boys" who held "staff" roles and supported the initiatives of the line functions. As

Competency Drives Transformational HRM Strategies

the preceding discussion highlights, in the emerging environment, the value of HR is only as much as the business-value it can create. Obviously, if HR professionals have to play the role of "partners in progress" within their own companies – and contribute – they will need to add new competencies to their repertoire. This imperative of business excellence emphasizes that any business that seeks to achieve excellence cannot afford to pursue such short-term philosophy in dealing with its human resource. Ironically, it is during the lean moments that organizations should leverage their human resource for optimum productivity. So what are the imperatives of the Human Resource Focus? Essentially, they boil down to the senior leadership team proving that it truly values its employees and partners by developing and instituting work systems in which employees and partners can thrive. Thus, the business must establish effective communication strategies and achieve co-operation across organizational boundaries to the extent that the entire organization becomes boundless. And create an enabling environment that encourages initiative, innovation, knowledge and skill sharing; motivate its employees through job and career related developments, compensation, incentives, recognition and reward schemes; and focus on effective succession planning throughout the organization; Figure 4.6. While one can derive detailed list of competencies from the preceding discussion, they can be broadly classified under four headings: �

Business Knowledge: If HR professionals have to be value-adding service providers to their customers within the company, understanding customer’s priorities and context become imperative. Thus, understanding business and business processes – i.e., the market, technologies, financials, etc. are essential for HR to remain relevant.



Deliverable HR Knowledge: Obviously, these are the basic competencies of HR – staffing, appraisal, compensation and rewards, development, etc. However, the focus so far has been predominantly on what one does. Most of the HR activities are still done without any clear measures of their effectiveness (e.g., what is the ROI on recruitment costs). If HR has to be seen as a business partner, this would need to shift to what one delivers. That is, the HR processes will need to be designed in such a manner that clear measures are possible.



Change Agent Skills: As discussed earlier, businesses needs to continuously change in order to remain competitively viable. In the emerging environment, that capacity to change will be a key competency for companies. Naturally, this would also be a key area in which HR will need to make a significant contribution.



Credibility and Influence: Perhaps, most important of all, would be the challenge of building professional credibility. No, it does not mean that HR professionals lack

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Current State

Desired Future State

Transactional (10%) Transactional (50%) (Recruitment coordination, Training Administration, Payroll management, Appraisal

Traditional (30%)

co-ordination)

Refocus HR

Transformational (60%) Traditional (30%) (Agony aunt, conflict management)

(Competency Maps, Critical Success Factors, KPI, Performance Management, Leadership Building, Change facilitator, structure designer, future competencies developer)

Transformational (20%) (Vision Communicator, Facilitator)

Figure: 4.7 Refocusing HR from its current state to Desired Future State. professional credibility. But the expectations from what HR can deliver are still low. Good HR professionals are seen as people who are willing to listen, tolerate diversity, and are trustworthy, etc. But in order to command or influence the organization, a professional image should also include perceptions such as being accurate in delivering results, meeting commitments, being consistent in meeting targets, etc. (Fig 4.6)

ARE YOU A

COMPETENCY DRIVER?

Competency drivers have an entrepreneurial vision. A vision is not a goal but it is a direction. If it is realistic, and if it appeals to the emotions and the intelligence of employees, it can bind

Competency Drives Transformational HRM Strategies

people together and move the company in a chosen direction. Good competency drivers have a clear vision that they can articulate. Competency drivers have a corporate philosophy. It is the vision put into concrete terms. It is like a good battle cry. There are various possibilities, for example, MAGNA INTERNATIONAL bases its vision on the idea of fair economy. It believes that a certain percentage of its profits must go for different purposes and if the managers are not able to produce that profit over a three-year period they must go as well. Another company believes that the growth must be financed with internal resources. A corporate philosophy shapes perceptions of its people. If one is engaged in a cutthroat competition it will be useful to know about the competitor’s products and resources, but it is more important to know his corporate philosophy. Competency drivers strive to generate a unique position and to maintain a competitive advantage. The advantages could be in terms of price, performance ratios, and unique product designs, consistent or reliable service, in other words, factors that buyer’s value. They ensure that employees use their ability to act freely in the interest of the company. Success of a firm depends on this very factor. It involves making managers familiar with the overall corporate vision, philosophy and strategic intention for them to act independently. Such an approach promotes entrepreneurial initiative. Competency drivers build an

Overall Bank—CEO—HR Roles

Potential

Overall Bank 4 CEO

3

Qualification HR Head

2

Training

1 HR Manager

0

Experience

I R Mgr

Performance Management Special Intellect

HR Group

Training Head Legal Head

Competency Learning

Figure: 4.8 Example of organizational HR role incumbents measured on a competency scale.

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organization that is capable of implementing their vision. They do not meddle at lower levels. They involve line managers who are responsible for implementing a strategy in the planning stage itself. They make sure that their managers understand strategic issues through training and other media. Visionary manages are able to create a corporate culture to match with their vision, philosophy and strategies. Employees working there find the work meaningful and fulfilling. Good competency drivers are capable of identifying directions, choosing paths, initiating actions and carrying employees together. A good competency driver must have the integrity and quality of being honest with oneself. Implementing effective learning, development, and performance management systems requires the use of competency models and a functional approach to evaluating individuals against these models. This paper describes the primary options for defining and evaluating competencies and stresses the importance of using models that meet your needs. Understanding the type(s) of models and rating approach that best meet your needs is also a key consideration when selecting software to support your learning, development and performance management systems.

Chapter

5

Mapping Business Competencies to People Competencies COMPETENCY PROFILING APPROACH: CONNECTING BUSINESS COMPETENCIES TO PEOPLE COMPETENCIES Case for core competence We believe that a competency development initiative must flow from the core business competencies and our work approach therefore cascades the identification of people competencies from an understanding of the critical success factors that differentiate the organization from its competition. Managerial and Technical competencies then get demonstrated through the individual’s performance of his role. The collective performance of individuals and teams in their defined roles thus enable the intended organizational performance. Sustained performance gives the business its unique competencies. Competition for the future is a competition to create and dominate the emerging market opportunities and to stake out new competitive space. Creating the future is more challenging than playing catch-up in that you have to create your own roadmap. The goal is not simply to benchmark computers products and processors and imitate its methods but a developer depend point if you think about tomorrow's opportunities and how to exploit them. Path breaking is a lot more rewarding than benchmarking and one doesn’t get to the future by letting someone else takes it up first. In short, orders that have a data get to the future first. An understanding of how competition for the future is different, needs to be disputed followed by a process of finding and getting an insight into tomorrow's opportunities including inability to energies the company's top to bottom of what may be long and an arduous journey towards the future. The capacity to build up competence and get to the future first without taking undue risk is an important aspect and path breaking. It is interesting to have your strategy quite different from what prevails upon many companies. It is of your strategy that recognizes that a firm must learn much of its past before it can find the future. It's a view of core strategy that

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recognizes that is not enough to optimally position a company with an existing markets the challenges appears to form of uncertainty and elaborate food site into the whereabouts of tomorrow's markets. It is of your strategy that recognizes the need for more than an incremental annual planning and what is needed in a strategic architecture that provides a blueprint for building the competencies needed to dominate future markets. Your strategy recognizes that companies not only compete with in the boundaries of existing industries they also compete to shape the structure of future industries. It is of your strategy that recognizes that competition for core competence leadership, which precedes competition for product leadership and that current strength of the corporation as a portfolio of competencies as well as a portfolio of businesses. “Competencies”, aim at linking the human resource systems of an organization to its purpose. The competency focus gives insights into the process of aligning the human resources of an organization with the vision and mission of the same. It tries to chart out the differences between the core competencies of an organization and the individual competencies of an employee. This may seem to be a trivial issue, but for many it is very difficult to recognize this difference, Figure 1.6 Page 26 and Figure 5.1 Page 121. The underlying theme of the competency focus is to use the behavioural language to build robust core competencies, core values, priorities and skills that describe, guide and link the actions at work. Describing what was done helps performance measurement, describing what is being done helps training and describing what should be done helps define selection standards and performance goals. It is vital for a strategy that recognizes that competition offered takes place between coalitions of companies and not only between individual businesses. A multitude of dangers exist for that company that can't conceive of itself and its competitors in core competency terms. First, is a step to identify opportunities for growth and should not be needlessly truncated for want of developing or nurturing competencies. Secondly, even if the organization spots someone for a career opportunity and if the competencies that are needed to respond to that opportunities lie in another business unit there may be no way to redeploy the people who carry those competencies into the new opportunity arena. Unit managers are notoriously protective of their people and inhibit growth of individual competencies. Companies need to create explicit mechanisms for ensuring that the best get aligned behind the most attractive business opportunity. The result is impressive and provides an impetus to leverage competencies.

Mapping Business Competencies to People Competencies

Thirdly, as a company divisionalizes and fractures in to even smaller business unit’s competencies may become fragmented and weakened. Business unit boundaries may make car supplication difficult and slow the cumulative learning processors to which competencies are enhanced. Individual business units who are willing to support competence-building effort are only to extend other competence contributes to the competitiveness of two days in products. The individual business unit can sustain neither the investment nor have the patience to build a new core competence. Fourthly, the lack of a core competence perspective can also desensitize company to its growing dependence on outside suppliers of core products. The fifth issue covers the company that focused only on specific products that must reinvest adequately into new core competencies that can propel growth in the future. A manager who is only focused on maximizing brand share may find it expedient to rent competence and competencies rather than invest to build one's own. Tomorrow's growth

Current state Drivers Business Strategy • Business Model • Processes • Differentiators Organization Design • Structure & KPI’s • Culture Core Competence • Definition • SWOT • Capability Profile

Integrated Competency Intervention

Future State

Organizational Competency Building Critical Success Factors

Competency Model Development Competency Assessment

Risk Adjusted Return

Portfolio of Assets

Engineer

Gap Analysis

Competency Based HR Processes Development Centre

Realization of Strategic Clarity

Realization of Tactical Goals

Consolidation Performance Metrics • KPI • Milestone • Targets Processes Design • Technology • Processes • Change Drivers HR Strategy • People Profile • People Performance

Business Competency Building People Competency Building Performance Competency Building Career Competency Building

Realization of Competency Plans

Realization of Results Milestones

Potential Competency Building

Figure: 5.1 Roadmap to leveraging competencies for competitive advantage.

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depends on today’s competence building. Investment in core competence provides receipts for tomorrow's product harvest. In addition a company, which at least understands the competence basis of competition in its industry, may be surprised at the new entrants who dominate through competencies developed in other markets. In fact companies who are insensitive to the issue of core competence may unwittingly relinquish valuable skills when they divest an under performing business. A firm can't actively manage competencies if managers don't share the view of what those competencies are. This is important to cut and create mechanisms where managers can identify existing competencies prepare a system to establish a core competence acquisition agenda. This would help create an environment for building core competencies thus creating a system for deploying core competencies and finally protecting and effecting core competence leadership. Thus the need for clarity of a firm's definition of its competencies and a degree of consensus that attaches to the definition of the most rudimentary tests of a company's capacity to manage its core competencies. A substantial amount of effort is required to fully disentangle competencies from the products and services in which they are embedded to distinguish core from non-core to cluster aggregate different technologies in some meaningful way and private labels that are truly descriptive about shade understanding. The time it takes to have a private and insightful creative share definition of competencies in a large company are more likely to be measured in months than in weeks. Integrating business goals and objectives with competency mapping has to fulfil the following conditions: 1. There has to be a clear position taken in terms of a current and desired state that we would like the organization to be in going forward. 2. The organization has to define and redefine at periodic intervals its critical success factors. 3. The organization should have adequately researched to understand and specify specific value drivers. This may mean differentiating tangible and intangible assets including demarcating those that influence critical success factors and those that help enhance long term realizable value. 4. The business strategy closely aligns with the HR strategy and design of the firm. This is to ensure that organizational architecture, processes are not in isolation of the core strategy of the firm. 5. The model provides for design and redesign space while competencies are constructed.

Mapping Business Competencies to People Competencies

Core competencies are the soul of a company and as such are defined as the processes that connect with core competence management. And it cannot be delegated to a technical community or to third party for the purpose of identification and absorption at a later stage. Building consistent leadership of the core competence area is an important effort and as key to the success of correcting competencies of the corporate level to that of people. Consistency depends first of all on deep ones about which competencies to Britain's support and secondly on the stability of the management team that is charged with competence development. Such consistency is unlikely unless senior managers agree on what new competency should be built. Without such commitments a company may well fragment its competence building effort in various business units who pursue their independent competence building agenda and a firm, which is simply unable to build your competencies. (Figure 5.2). To level the core competence across multiple businesses and into new markets often requires redeploying at competence internally from one division or a strategic business unit to another. Some companies have a better access than others and hence get greater effective use out of their competencies. Many companies have a sizable stock of core competencies and many people who were truly world-class skills and capabilities but almost zero competence velocity that is in their ability to redeploy those individuals behind you to get market opportunities.

Intellectual leadership

Gaining industry Foresight Develop point of view about o Functionality o Core competencies o Customer interface Strategic architecture

Management of migration paths

Building core competencies, exploring alternate product concepts Assembling and managing the industry coalition Forcing competitors into longer and expensive migration paths

Competition for the market share

Building worldwide supplier network Crafting positioning strategy Pre-empting competition in critical markets Maximizing efficiency Managing competitive interaction

Figure: 5.2 Building Core Competencies for Competitive Advantage.

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In every driver to fight for with which we are familiar business unit managers accept that clashes a cop at resorts and business unit profits go back to the cooperation of the end of each year. It is also accepted although reluctantly that a proper manager has the right to reallocate cashed across businesses. The business unit are produced cashed in the current planning period may or may not get all it wants the next banning period. We find it paradoxically disturbing that in many companies have no similar allocation process for the talent that comprises the firm’s core competencies. The mobility of competencies is also needed and employees who comprise a particular competence who meet frequently exchange ideas experienced. Seminars and conferences have been important for instilling a sense of community and sharing among people working in the same competence area. Where a competence is spread across the Philippines a dozen countries of more collective learning and reallocation of individuals to new projects are difficult. A company should avoid unnecessary graphical fragmentation of its competencies. Protecting core competencies of erosion takes continued vigilance on the top of management. The focus here is on how to build core competence in a company through focus on end products and services single-mindedly. A company focused only on end products may fail to invest adequately in new core competencies. New entrants with new core competencies may surprise older companies. Companies insensitive to core competence may unwittingly lose valuable skills when they divest an under-performing division or business.

Risk of ignoring core competencies There are a lot of risks awaiting a company that can’t conceive of itself in core competence terms. �

Opportunities for growth will be needlessly truncated.



Even if someone spots the opportunity the resources needed to capitalize on it may lie elsewhere and there may be no way to redeploys these resources.



As company divisionalizes and fractures, competencies become fragmented and weakened.



It can lead to a company over-relying on its suppliers of core products.



A company focused only on end products may fail to invest adequately in new core competencies that propel future growth.



The company can be taken by surprise by new entrants with competencies developed in other markets.

Mapping Business Competencies to People Competencies

For core competence to take root into the organization five key management tasks should be taken care of: 1. Identifying core competencies. 2. Establishing a core competence acquisition agenda. 3. Building core competence. 4. Deploying core competencies. 5. Protecting and defending core competencies.

1. Identifying core competencies The first task in managing core competencies is to produce an inventory of core competencies. One of the frequent traps that accompany falls in is delegating the tasks to the technical community and fail to apply the test of “customer perceived value”. It is important not only to identify competencies but also to identify the elements of the core competencies. Further companies need to benchmark their core competence with other firms. Senior managers must be full participants in this process.

2. Establishing a core competence acquisition agenda A core competence matrix is often useful in setting specific competence acquisition and deployment goals.

3. Building core competence Consistency of effort is the key. Consistency depends first of all on a deep consensus about which competencies to build and support and second, on the stability of the management teams charged with competence development. Without such a consensus, a company may well fragment it competence-building efforts, as various units pursue their independent competence building agenda, or the firm may simply fail to build new competencies.

4. Deploying core competencies If an individual somewhere in the organization believes that he or she can contribute to the organization than individual is self promote din the team. There can be an allocation mechanism for ensuring that the best competence resources get assigned to the most promising new

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Premier plus 10

Mega Opportunities

What new core competencies will we need to build to protect and extend our franchise in current markets?

What new core competencies would we need to build to participate in the most exciting markets of the future?

F ill in the blanks

White spaces

What is the opportunity to improve our position in existing markets by better leveraging our existing core competencies?

What new products or services could we create by creatively redeploying or recombining our current core competencies?

Existing

New

Core Competence Existing

New

Market

growth areas. The mobility of the competencies is also aided when the employees who comprise of a particular competence meet frequently to exchange new ideas and experience.

5. Protecting and defending core competencies The health of the competencies should be visible to the top management. Then only the competencies can be defended and protected. Divisional managers should be assigned cross-corporate stewardship and must be responsible for the health of those competencies. As mentioned earlier, the other messages that this concept tries to convey is about having the employees of the organization align their actions with the organizational identity and goals. The most effective way of achieving the same is to allow the concerned employees to participate in the process of strategic decision-making. This participation generates a sense of belonging among the employees towards the organization and they feel motivated to work towards achieving the goals that the organization may have set for itself. A very effective way of building alignment is the behavioural language to convert the vision and mission statements into clear actions, which need to be performed and conveying these actions to the employees. The employees can be involved with the framing of the vision and the mission statements. It can help if all the employees speak the same language, i.e. they have the same interpretation of the ultimate goals of the organization. Using the vision and mission statements in the selection procedures can do this. This allows an initial filter, which allows only those people who fit into the mould of the organization to join in.

Mapping Business Competencies to People Competencies

THE CASE

FOR PEOPLE COMPETENCY IN THE CONTEXT OF BUSINESS CORE COMPETENCE (REFER FIGURE 1.15 PAGE 43)

While the competency model, is partitioned into four parts, its detailing defines the ways in which people competencies are connected. There are four levels at which interventions are possible while performing a competency mapping exercise.

Core competencies and capabilities The combination of knowledge and skills with tools is reflected at the organizational level in core competencies and capabilities. A core competency is a unique bundle of technical knowhow that is central to the organization’s purpose. A capability is also important to the organization’s effectiveness and is perceived to be valuable by customers. It is a set of business processes strategically understood. Core competencies and capabilities are ideally expressed in a mission statement that specifically communicates what the organization will do for its customers. Competencies that link with basic capabilities deals with technical competencies and enabling competencies.

Core values and priorities Core values complement the technical aspects of work by explaining why the work is performed. At one level it encourages shared beliefs of people in the organization and its culture, including norms on how to act. Priorities reflect an organization’s emphasis on the use of individual competencies such as working habits and people skills to make business processes and work systems more efficient or effective. It is different from capabilities that emphasize the deployment of technical know-how, physical or financial resources to improve performance. An important priority lies in an organization’s willingness to use participation to improve performance and create a competitive advantage. This priority is seen in the commitment to encourage associates to express their opinions on work issues. In addition, managers must be willing to listen to other’s opinions, accept them when appropriate and disagree when necessary. There is always this uncertainty while distinguishing between a business process that defines a capability and the people skills that define a priority. When people can easily be asked to join a business process, they are supporting a business capability. On the other hand, when the process requires a person with a specific set of skills, it is an organizational priority that is being dealt with. A statement of core values and priorities describes how people actually do their work. It expresses norms and boundaries of acceptable behaviour and business practices.

Technical knowledge and job skills Individuals use their technical knowledge and skills with tools to carry out their job responsibilities. Technical knowledge and job skills should be in support of the organization’s core

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competencies and capabilities. Technical skills provide a logical way from an organization to maintain and extend its core competencies and capabilities.

Performance skills and competencies Performance skills and competencies include work habits, communication styles, leadership and teamwork. They are easily transferred across different industries and jobs and they reflect a person’s efficiency or effectiveness in using technical knowledge and skills. Commitment to a task is a performance skill that shows the extent to which a person will work hard to get results. A performance skill can be directly observed and described at a behavioural level. A competency involves an inference about what a person is like.

Organizational characteristics: The more familiar components of organizational identity include vision, mission, values and culture. Core competencies provide the basis for an organization to define itself beyond its specific end products. Core values and priorities are quite different from core competencies.

Individual characteristics: Slices III and IV pertain to the skills used by the individuals to perform their specific jobs. They reflect the job content including specific tasks to be performed and the individual characteristics needed to carry them out. Assessment technology offers a perspective that distinguishes between a performance skill and a competency. The behavioural approach to assessment would say that a performance skill can be directly observed and described in terms of the things a person is observed to say or do. It is very important to describe operational skills in very clear and precise words. In many instances the organization successfully draws its competency model but fails to clearly mention the actions to be taken in order to achieve the organizational goals. Consequently, even though the organization competency model is ready and in place, it does not deliver the expected returns. Therefore, it becomes imperative to put down the steps to be taken by an employee to be explicitly mentioned in the competency plan so that there is no haziness or ambiguity in the understanding of the model. The statements of the competency plan should be put down in the form of operational defini-tions, which explain a concept in the form of steps to be taken to observe it. However, defining a statement in terms of operational definition is not the job of a single person. It becomes necessary to involve others in the process of defining the steps to perform a certain task.

Mapping Business Competencies to People Competencies

Characteristics Included in Competency Models Technical Skills

55%

Knowledge Areas

55% 50%

71%

77%

Perofrmance Behaviour

100% 54%

Personal Attributes Metrics/Results Key Experiences

60%

22%

41% 34%

71% Beginning User

Sophisticated User

Figure: 5.3 Characteristics included in a competency model. Refer Schoonover

Identity, process and strategy are crucial for survival in today’s world of cut throat competition. Conceptual leadership is becoming more crucial and the time available for critical thinking is diminishing by the day. The need of the day is of robust solutions to practical problems. Robust solutions are those, which work in the face of adversities. Behavioural competencies can be an asset to any organization. They are robust and are useful but can be hampered by abstract language and personality traits. Therefore it becomes imperative that the building of robust human resource competencies should be preceded by explicit explanation of the same so that everyone is able to easily understand and follow. There may arise many situations where there is a lot of ambiguity. In such situations, simple decisions become difficult and ineffective. To avoid this situation, one needs to be very clear about the existing situation and equally lucid about the course of action to be adopted from thereon to resolve the situation. Competencies thus help develop the required clarity. Here one needs to understand what is meant by the term Competency. Competency means different things to different people based upon their perception and context of application. In the field of Human Resources, competencies often deal with the characteristics of a person.

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An individual’s competency is defined as a written description of measurable work habits and personal skills used to achieve a work objective. To make the description clearer, the following points are to be kept in mind: �

An individual competency is different from the organizational competencies, capabilities, values and priorities.



A written description communicates exactly what the term competency means.



Measurable work habits and personal skills implies that competencies are a fair measure of an individual’s actions.



Individual competencies contribute to achieving a common work objective.

Different people depending upon their context of work look at competencies differently. Human Resources professionals look at competencies more on an individual level but business competency drivers concentrate more on the organizational competencies. Core competencies are stores of technical knowledge and skills that gives the organization an edge over other organizations and makes an impact on its services and products. Individual competencies along with organizational competencies help in avoiding and solving people problems. Capabilities are other things that the organization is capable of doing to achieve its goals. Currently, there is a high degree of discontent regarding individuals not being able to meet their targets. This discontent can be taken care of by improving the selection procedures, performance appraisal systems and coaching schedules according to the individual competencies of the employee. Thus task allocation should be done in accordance with the competencies of the concerned individual. Competencies define the coaching schedules. On the basis of individual competencies, one can decide to what extent the individual should be trained and what should be the contents of the training. Thus competencies, by helping correct job allocation; helps avoid the ambiguity and hence increase productivity. The best way to express competencies is by the use of behavioural language. It allows a clear and understandable description of the actions that needs to be performed in order to achieve the organizational goals. Individual competencies can also help diffuse conflicts and disagreements because they help put forward the situation in a very lucid format and give a different perspective to the entire matter. Behavioural language allows easy communication of standards, expectations, goals and objectives, thus making it the ideal way to build robust competencies.

Enabling Challenges Competency models comprise of groups of competencies. Some models are generic lists of individual characteristics that can be used in HR systems. Other competency models are

Mapping Business Competencies to People Competencies

specially designed for a particular organization. The primary reason for constructing a competency model was to link the processes like interviews, appraisals, training and compensation to vision, mission, values and culture. Some other reasons were planning to grow newer skills within the organization, communicating the behaviours that are desired in the organization and clarifying the leadership focus. The gist of the matter is competencies help managers and other employees to link, plan, communicate and clarify. There are certain problems related to competency models though. Expensive competency model not being applied or off-the-shelf competency models, which do not fit the bill of the specific organization in terms of correctly defining the uniqueness of the jobs or the organization, is a futile exercise. Expense incurred in getting the competency model designed, developed and installed can be prohibitive. Acceptance of the model is another common problem that the competency models may face. A competency model thus has to be developed very carefully. There are some challenges involved with the development and installation of the model. These challenges can be listed as participation, measurement, negative feedback, jobrelatedness and expense. 1. One of the major challenges is participation: Organizations need time and commitment of its management, top through to the participating management to involve and drive the mapping process. Competency inextricably links itself to the job incumbents, although the mapping is done against a position. People and their capabilities are assessed when proficiency levels are judged for role incumbents. There is therefore a natural resistance and threat perception that lingers with the participants. 2. One alternative of a process is that, which is faster and the other that is better: The faster model of development may be efficient in terms of the time taken for the development of the competency model, but eventually it may turn out to be more expensive. Executives sitting behind a closed door trying to formulate the competencies required and the competency model is not a feasible idea since the employees who are going to be subjected to that change might not like the model and refuses to use it. Participation is absolutely critical for acceptance and application of the competency model. Participation is not a manipulative ploy, but a mechanism for making your competencies more reflective of the true cause of performance. For the model to persist in the organization there should be broader participation in terms of multiple opinions and the ability to think and argue. Participation becomes a huge factor in the successful implementation of the competency system. Behavioural language is used to link what needs to be done with individual actions. Competencies thus become tools for direction and change. Assimilation of competencies into the everyday communications helps specific and explicit expression of feelings and opinions.

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3. The next challenge is measurement: Measurement is very crucial since the progress of a project or the performance of an employee can be tracked only when it is measured. Also, in situations where the employee demands an explanation the only way out is by having hard evidence on our hands. This evidence is provided by measurements. Measurement can be used to fathom the skill level of any employee that is being selected for a particular assignment. Measurement systems though have to be validated before they are put into action. For this purpose, they are put through a battery of test and the results observed to check whether they are in keeping with the characteristics observed. 4. Negative feedback and the way it is taken is another big challenge that any organization may face. Some employees may not take a negative feedback constructively and cause harm to the organizational goals. Therefore the organization should have the courage to face the conflict that would arise when negative feedback is given. It is extremely important to have accurate performance measures when it influences compensation, promotion and career opportunities. Many managers shy away from giving negative feedback because of the awkwardness or the fear of a legal battle. To resolve these matters, there are models which have a cap on how low the measurements can go or there are a few other models which use a threshold of minimum acceptable performance. These models may avoid the unpleasant experience but at the cost of overlooking and actually accepting negative or undesirable performance into the organization. Thus, negative measurement or feedback though extremely necessary, should be handled with care since it is very difficult to accept. 5. Yet another challenges the job—person suitability analysis: Individual competencies help map the characteristics of a person and therefore decide the suitability of that person for a particular job. Individual competencies can be used to structure specific questions that can be used in constructing the interviews that would help objectively choose the right kind of a person for the job under consideration. This task is becoming tougher and tougher by the day because in today’s dynamic environment the job descriptions are changing very fast. Nonetheless, competency systems should be job-related. 6. The one other challenge that the competency system must face is that of the expense incurred in designing and implementing the system: Development of competency systems that may function as performance management systems and their implementation is an expensive option and should be exercised only after taking all the considerations. These days the use of computers is relaxing the stranglehold of price on such

Mapping Business Competencies to People Competencies

systems. Software are being developed to automate and handle each and every task like structuring the interviews or group ware to encourage the groups to work on a problem and find the solution collectively. 7. To fully garner the benefits of the competency system, they need to be in sync with the current requirements of the organization and its goals. Competencies when in service of customers are powerful business tools. But it is extremely imperative to understand the meaning of the term competency in the given context. The competency scope does just that. It outlines what needs to be done in order to meet the requirements of the customers. In a competency scope, competencies are discussed with special attention on two factors; viz: the LEVEL factor which specifies how an organization can be effective in the marketplace or how an individual can be effective in doing a particular job and the TYPE factor which distinguishes between the use of concepts.

THE

CORE COMPETENCE SCOPE RELATES TO THE KSAO MODEL. THE MODEL IS OUTLINED AS UNDER:—(REFER FIGURE 3.2 PAGE 75)

KSAO

KSAO stands for Knowledge, Skill, Ability and other. Knowledge: The specific information acquired typically through formal education to perform a particular job. Skill: The proficiency of using a tool or equipment. Skills are acquired in an educational environment or an informal one. Ability: Ability refers to specifics such as intelligence, spatial orientation, reaction time and stamina. Abilities are often measured by tests that provide estimate the extent to which a person has the specific ability to perform a given task. Others: Additional characteristics needed for doing a job well. Include performance skills, attitude, personality, etc. K and S organize into technical skills, A and O translate into performance skills. Generally, behavioural language is used to define the actions and whenever a higher degree of detail is required operational definitions are used. Behavioural language is very concrete. It describes what one can see or hear being done. A performance skill written in behavioural language is the sequence of actions to be performed to the job well. Behavioural

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language is robust because the actions required to perform the task can be defined through the written or the spoken word such that any other person wanting to understand the action can do so, very easily and reasonably accurately. Verification in the case helps by showing the extent to which two or more people agree on a behavioural description. A performance skill is more concrete than personality traits or abilities. A competency system based on personality traits is not preferred because it would use terms that may be ambiguous. The tangible nature of performance skills means that it is helps reduce the influence of biases on people. The focus is on making reasonable inferences about people, based on verifiable information. Performance skills and descriptive rating scales are the foundation of the behavioural approach in objective decision-making. The three steps of the behavioural approach are: �

Step I: Observe what a person says or does. Snap judgements are not allowed. Only observation is what one is supposed to do.



Step II: Describe what is observed in relation to the performance skill. The real test of the second step is whether another person can verify what has been described.



Step III: Draw an inference from the description. The thumb rule is that this expansion of the description should be reasonable in light of what was observed and subsequently described.

The perception of a person depends upon the reactions of one towards that person. But with the behavioural approach, perception is not a reality. The three steps of behavioural approach enable the development of a reasonable understanding of the other person by substituting observation, description and inference for perception. A robust performance skill supports the steps of the behavioural approach. It will not contain abstract words and references. One of the major challenges facing organizations today involves alignment i.e. getting all the employees working in the same direction towards the same goal. A clear understanding of the direction in which the organization is headed is extremely essential. One effective approach is to help individuals see how their personal goals overlap the goals of the organization. This is called personal alignment and is achieved through participation and open discussion. Using behavioural language to link HR systems to an organization’s identity including its core competencies and capabilities, values and priorities can develop another type of alignment. This is what is called structural alignment. Structural alignment can be carried out only when there is a clear description of the identity of the organization. The process is made easier when the organization’s identity is expressed in behavioural language.

Mapping Business Competencies to People Competencies

The identity of an organization is a critical target for creating a structural alignment of the HR systems. Expressing an identity statement in behavioural language and then using it in the forms and procedures prevalent in the Human Resources achieve this. There are two types of identities viz. behaviour-based and virtue-based. A behaviourbased identity statement describes what a person needs to do to be in alignment to the organization’s vision, mission, values and culture. A virtue-based identity statement may have supporting information that converts the virtues into actions to take. Behavioural language can be used with each of the components of an identity statement. An organization’s vision, mission, values and culture can be described as individual actions to be taken rather than desirable qualities and attributes. The mission should reflect core competencies and capabilities as well as priorities. The vision could be expected to align with core values and priorities.

Core competence behaviours that drive vision and strategy A behaviour-based vision statement is a word picture that describes the future statement for work and the action that associates will take in it. The ideal mission statement includes movement. The behaviour-based vision is more dynamic than static. A behaviour-based mission statement explains why the organization exists in terms of its overall purpose, the nature of its business and the principles that it follows when doing business. A behaviour-based mission statement describes purpose and priority in a way that suggests the direction for most of the people in the organization to take. A mission statement provides a sense of identity and direction, thus unifying individuals and establishing the basis for future actions. There should be a reciprocal relationship between mission statement and core competencies, each should influence the other. A behaviour-based value-statement describes the shared beliefs and norms that characterize the organization. Often the shared values can be traced to the business philosophy held by the founders and the opinion leaders. An organization’s culture is a reflection of these shared values. They represent one of the important components of the same. One challenge is generating a value statement involves going beyond feelings about the work situation. The statement must use behavioural language to describe what people will do when they are using the value. When an identity statement is written in behavioural language, there is an opportunity to align it with the organizational level of the competency scope. Many HR systems are practical and tactical. They respond to the governmental regulations and specific needs. They become more strategic however when connected with the organization’s identity through behavioural language. When this is done one can say that the organization has a strategic HR system that reinforces its identity in day-to-day decisions about people. When the content of

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an identity statement is reflected in the content of HR forms and processes, it is said that content linkage exists. A cramped vision restricts the scope of an organization while an open vision can help align more and more people with the organization’s goals.

INTEGRATED METHODOLOGY THAT

DRIVES WORK LEVEL LINKAGES BETWEEN CORE COMPETENCE AND PEOPLE COMPETENCY An integrated methodology hence begins with defining organizational competencies, identification of the critical success factors for the business and outlining key performance indicators. Combined with an analysis of the structure, we arrive at a competency framework that defines the competencies for various positions in each of the functions. An assessment of the expertise requirements for each position is also done. Competencies of individuals are assessed against these through assessment and development centers. The gap between the desired and assessed competencies becomes the basis for drawing up individual development plans. These individual development plans fit into the overall training strategy of the organization. The expertise requirement at various levels becomes the basis for charting career paths for building specialists, generalists and future CEOs. Measurement of individual performance is done against these competencies so that performance management actually helps individuals to understand the behaviours expected of them and hence develop themselves. (Figure 5.4).

Developing a competency model Research to develop competency models is a discovery of the ground up theory approach. To discover competencies we work backwards from the criterion superior or effective performance in a job to identify the characteristics of people who perform at these levels. Thematic analysis methods are also used identify competencies while managing data. The first one has to do with coding interview transcripts for more competencies using the competency dictionary and the second has to do with conceptualizing new competency teams from interview narratives. Thematic analysis is the most difficult and creative part of the competency analysis process. Thematic analysis is a process of identifying teams is patterns in raw data. This ability is itself to levels of the competency conceptual thinking. Use of concepts in the ability to recognize applies a concept already known from previous study of research. Conceptualization or concept creation is a ability to recognize a pattern and invented new concept to make sense of raw data. Identifying teams from supporting data is an example of thematic analysis conceptualization. You have to recognize or invent concepts such as good not a good

Mapping Business Competencies to People Competencies

Focus of Competencies

Effectiveness of Competency Focus Very Ineffective 1

Very Effective 5

20% Aligning behaviour with core values

3.52

Enhancing performance expectations

33%

Providing an integrated HR process Aligning behaviour with core values

11%

Providing a career framework

8%

Developing bands or levels of competence

8%

Focusing on HOW work gets done

7%

Supporting superior performance

7%

Communicating generic leadership skills

2%

Developing specific roles

2%

Enhancing performance expectations

3.32

Communicating generic leadership skills

3.26

Focusing on HOW work gets done

3.18

Supporting superior performance

3.17

Providing a career framework

3.11

Developing bands or levels of competence

2.99

Developing specific areas

2.97

Developing functional areas

2.88

Percent of Respondents

Percent of Respondents

Figure: 5.4 Effectiveness and focus of competencies. Refer Schoonover and SHRM. and make sense of the data that's available. Knowing that team could help you make better personnel decision concerning the person concerned. While identifying competencies we need to look for the following points: �

The first one has to deal with a situation. The supervisor on an average talks about different kinds of things in their behavioural event interviews or do their focus on different parts of the job.



The second one has to do with who's in ward. Do they regard others positively or negatively?



The third has to do with parts. The difference between superiors and average is in the way they think, use concepts of knowledge, make sense of complex data, remember details, organize things in logical order?



The fourth has to do with motivation. Do superiors and average talk about wanting different things? Do they see situations on different terms? The just and the upright have to deal with feelings.

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The fifth has to do with sharing and experiencing feelings. Do superiors on an average differ in their feelings on how they express and control their feelings, as an external manifestation and have to do with their actions?



The sixth area deals with skills and artifacts deployed. Do superiors and average do different things or show different skills in dealing with similar situations of people?



The seventh area has to deal with outcomes with a question which superiors and average is produced different outcomes? In addition there are the characteristics in trades that are not expressed in the behavioural event interview that may become apparent to the interview for example physical appearance, physical setting, materials and props, articulation, conversational style, verbal fluency, cognitive or intellectual skills. It may be helpful to organize observations of differences in the general categories such as cognitive or intellectual skills, interpersonal and motivational skills.

Precise definition of competencies still requires considerable conceptualization ability. It is important to distinguish the degree of strength of the competency required. Some competencies are curvilinear. Having to do little of the competent scores as a pertinent to fail but having too much also predicts failure. For example, a certain level of clerical skill is needed to be an effective social worker. Too little competence in filling out forms means client won't

Critical Success Factors

Business level

Function/Department

Individual level

Competency Requirements Framework Competency Analysis Key performance Indicators & Targets Performance Management System

Gap Analysis Competency Development • •

Training requirement Recruitment

• Performance Management

Evaluate Process efficiency

Evaluate Personnel performance

• •

Rewards Career Development

Figure: 5.5 Integrated Competency Assessment Frameworks.

Mapping Business Competencies to People Competencies

receive their welfare payments. But social worker with too much interest informs processing to spend too little time with clients and to serve them effectively, was seen as cold and bureaucratic in their behaviour, Fig 5.3.

COMPETENCY CLASSIFICATION: TECHNICAL AND NON TECHNICAL Competencies are classified along two axes: the industry axis and the function axis. While each industry has a set of unique competencies required of specific positions, there are many others that are common across industries. For example, the “Data analysis and interpretation” is a competency common in all Finance functions across industries. Similarly non-technical competencies are essentials of effective managerial behaviour and while many are important in every industry, the emphasis differs depending on the unique structure, empowerment, culture, extent of automation etc. Case Examples The finance function in any organization is uniquely positioned to take a leadership role in a company’s transformation process since: �

Finance touches every point in the value chain.



It has more contact with other functional departments than any of the other areas.



Finance has the overall responsibility for information management and delivery.



It is viewed as the interpreter, communicator and educator regarding the financial impact of various management decisions.

However, in order to become an effective leader of change within the organization, finance must first redefine its own role. With this belief, we have done substantive work in helping the CFO and the finance function become a business advisor through relooking at the structure of the finance function, streamlined processes and clearly identified competencies for the finance professionals. Case 1: Detailed Competency Profiling for Finance Professionals—R P R Limited (Learning from ARTHUR ANDERSEN) This company was engaged in a full scale, worldwide finance reengineering project. The work, known as PROJECT ALLIANCE, was initiated to improve performance within the

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department and maximize the value that finance provides to other departments, while lowering the costs associated with the finance function. RPR identified six key initiatives under the Project Alliance “umbrella:” Budgeting and Planning; Performance Management; Information Technology; Shared Services; Resource Allocation Optimization; and, Structure & Roles and Skills (Competencies) (Skills Initiative). The Roles, Skills and Structure team, had two charges: (1) to identify the optimum structure for the Finance department and clearly delineate responsibilities across the organization; and (2) to increase the skill level of Finance personnel so that they better served their internal and external customers. The project was completed on an international scale, with the United States, France, the United Kingdom and Germany being the pilot countries. A cross-functional team comprising professionals from Finance & Human Resources worked on the competency development. The project resulted in development of Finance competency & Career Planning Centre developed after interviewing hundreds of employees in Finance and other (customer) functions. The tools, techniques and methods were found to result in good business benefits to the company. Case 2: Restructuring and roles redefinition—Public Bank: The consultant helped in re-orienting the Bank’s organization structure & competencies to make it more market-focused. The bank had old legacy systems and processes that led to large delays in decision-making processes and a lack of accountability. The work involved: �

Reviewing the Bank’s strategy and vision.



Reviewing the Bank’s existing organization and processes.



Developing the structure hypothesis based on Bank’s strategy and focused on Bank’s key customer and product segments.



Evaluating and presenting possible structural options to the Bank in the form of an interactive workshop for senior management.



Developing a high-level implementation plan.

The Bank benefitted by: �

Becoming more focused on market and customer requirements.



Reducing delays and improving quality of decision making.

Mapping Business Competencies to People Competencies



Defining clear roles and responsibilities for key personnel.



Reviewing the role of support functions and ‘legacy’ departments as service providers to the front-end.

Case 3: Finance function, structure and competencies—Company X The engagement required the consultant to assist the finance function of Company X India Limited to: �

Redefine its role, increasing its focus on decision support and performance enhancement and defining competencies.



Streamline its processes and incorporating best practices.



Consolidate its operations through shared services centre (SSC) and outsourcing.



Consequently the role redefinition and competency setting phase included.



Determine the resource requirements.



Assess skills requirement.



Design the finance function shared service centre – organizational structure and roles.



Develop a performance measurement framework.



The client has also been provided with a roadmap for developing a “World Class Finance Function”. This has been achieved by conducting an assessment of the finance function by its internal customers. This assessment has been undertaken along the lines of the Finance Transformation Framework (FTF) of Consultant. This assessment and the Finance function Global Best Practices have been used to provide a direction to develop the “Finance Function of the Future”.

Essentially a well oiled competency management system (CMS) enables the client to benefit through the following: 1. The competency maps connect individual competencies with those of the organizational competencies. One of the reasons for failure in bringing relevance in competency maps for individuals is when it lacks the business appreciation. 2. CMS enables defining a combination of technical and managerial competencies, importantly the aspects related to organizational critical success factors and key performance indicators and making competencies relevant to KPI’s, lest it becomes theoretical.

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3. Competencies eventually lead to effective organizational performance as both the organization and the individuals are in a position to define what enabling and hindering capabilities and working processes are necessary to determine an overall effectiveness of the company. 4. In our experience, well-defined competencies involve profiling business, departments, and functions, sub processes and individuals. Absence of deriving linkages amongst this lead to a serious disconnects between effective planning and execution. 5. Business and HR Management consultants who understand the critical linkages that exist between strategies, processes, systems and people implement CMS. The integrated methodology begins with identification of the critical success factors for the business. Combined with an analysis of the structure, we arrive at a competency framework (Fig. 5.5) that defines the competencies for various positions in each of the functions. An assessment of the expertize requirements for each position is also done. Competencies of individuals are assessed against these through assessment/development centres. The gap between the desired and assessed competencies becomes the basis for drawing up individual development plans. These individual development plans fit into the overall training strategy of the organization. The expertise requirements at various levels become the basis for charting career paths for building specialists, generalists and future CEOs. Measurement of individual performance is done against these competencies so that performance management actually helps individuals to understand the behaviours expected of them and hence develop themselves.

Chapter

6

Assessment Centres Building a competent, effective workforce has never been more difficult. Leaders and executives have been asked to take on new roles that require an array of new—often-unfamiliar—management and interpersonal skills. Associates are expected to demonstrate "high-performance" skills that allow them to work more efficiently and effectively. And even as globalization and fierce competition are increasing the need for qualified people at all levels, the pool of available resources has dwindled. Wide-scale downsizing has eliminated many positions once used to groom executives, leaving fewer experienced leaders available to replace retiring leaders. Qualified professional and frontline workers are also scarce and in high demand.

HISTORY

OF AN

ASSESSMENT CENTRE

AT&T developed the most well known approach to AC evaluation in 1956 (called Management Progress Study) to investigate changes in personal characteristics as managers moved through their careers. This led to the use of AC as an aid in selection first-line supervisors and higher-level managers and other specialists. They assessed 422 lower-level managers who were mostly managers of white male origin. They were considered to be representative of AT&T's future middle and upper level managers. In the 1970s they initiated a new study of 344 lower-level managers, about half of whom were women and about one third were minorities. They found women had advantages in administrative ability, interpersonal skills and sensitivity, written communication skills, energy and internal work standards. Men had advantages in company loyalty, motivation to advance in the company, attentiveness to power structures. No differences in intellectual ability, leadership ability, oral communication skills, or stability of performance. The biggest difference was in men's traditionally masculine interests and women's traditionally feminine interests. Putting together the information they determined that women and men had similar management potential. Race differences were stronger. The most significant finding of this study was that managerial potential is highly predictable. Assessment Centre is a standardized selection/assessment/evaluation method that uses a variety of different techniques including tests, interviews, simulations, cross-fertilized stories, personality typology instruments, role

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plays, case studies the rally wait in select potential managers. Using this variety of techniques a company can observe and objectively rate a promising candidate into senior manager potential. Perhaps a brief historical frame of reference of the assessment-centreed approach is necessary. The use of a formal assessment centre can be traced to the German and Japanese military and later during the Second World War to the British office selection boards. The idea then was brought from the British office to the US military and American office of strategic service. The main objective of the assessment centre initially started with untrained spies during the Second World War. While the Germans used observation techniques to identify the skills and potential under pressure situation is the real contribution breakthrough in the assessment techniques was the development of the realize situation type of exercise by the staff led by Dr. HENRY MURRAY of Harvard. However the credit for introducing the assessment centreed approach goes to the industry giant American telephones and telegram and a pioneering work done by Dr DOUGLAS BRAY in 1956 known as the management progress initiated a longitudinal study, to do the study of the career development of young managers at AT & T, Figure 6.1.

• Assessors – Industry Experts – Trained Behavioural Sciences Facilitators – Other HR Experts • Assesses – Senior Management Executives of Syngenta • Assessment – Multiple assessors (3:1 to 5:1 executives per assessor) – Multiple assessment methods (in-basket, psychometric tests, role-plays, interviews etc) – Competency based assessment strategically aligned to Syngenta’s requirements – Objective, consensual assessment and evaluation (Individual and Group) – Feedback communication with supporting rationale (Individual and Group) – Created and administered under test conditions Empirically validated Tools Relate ability of participants to the process Trained Administrators

1: Business Context, Role Requirement • Industry landscape • Syngenta India strategy • Assessment centre context, objective and relevance • CSFs for the key roles • Focus on competencies required 2: Facilitated Self Assessment & Selective Feedback • Use of propriety tools and inventories – Each method will assess multiple competencies – Multiple methods to evaluate each competency being assessed • Focus on areas like – Leadership style (Consultative, Result oriented, Monopolistic) – Management style (Cost driven, Decision driven, Employee friendly) – Interpersonal relationship style (Conflict management, Work-life balance) 3: Final Assessment, Feedback & Planning • Individuals understanding of the company strategy, their roles and their development areas • Assessment and scoring against standards/ benchmarks • Initiating the management development and pipeline planning process

Figure: 6.1 Assessment Centre Design.

Assessment Centres

No doubt an early study has played an important role in establishing the validity of the assessment-centered approach the reported results of the management progress study is concerned of hyperactive power of the assessment techniques to subsequent performance. The success of the study encouraged others to follow. Standard oil of Ohio was the second applied assessment centre approach followed by IBM, SEARS ROEBUCK, GENERAL ELECTRIC and CATERPILLAR TRACTOR. In 1981, more than 2500 organizations were applying the matter to select potential managers. In Canada this includes Steinberg's BELL CANADA bank of Montreal free and the federal government and others. Early stages of the assessment centre process were outlined in five sequential steps. 1. This involved the identification of job, 2. The selection and design of the instrument of measurement, 3. Observation, 4. The reporting including evaluation and feedback. 5. Core management capabilities. It would be worthwhile to elaborate on the way these dimensional managerial skills have been selected. Previous assessment efforts reported several dimensions that are necessary for success in managerial positions based on the evaluations of six different assessment programs. In all, fifteen different dimensions were identified through the various studies that were conducted in those days. The fifteen dimensions dealt with leadership, persuasion, flexibility, decisiveness, stressed tolerance, formal oral presentations, initiative, problem analysis, planning organizing and controlling, use of delegation, judgement, intelligence, financial ability, motivation and written communication skills. The selection and design of instruments of measurement such as the interview: the case study, the customer role-play and in basket exercise were steps that were implemented in order to decide which instrument is meant to measure are specific behavioural dimensional. Each of these instruments was developed to provide the assessors adequate data from a behavioural perspective. Candidates go to an assessment centre in small groups usually between six and twelve and provide assessors that opportunity to observe and evaluate their performance. A typical assessment centre activity lasts two to three days. Assessors of a variation of one is to every two candidates and can either be professionals trained to do assessment or psychologists, trained line managers or a combination of both.

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ASSESSMENT CENTRE DEFINED An assessment centre consists of a standardized evaluation of behaviour based on multiple inputs. Several trained observers and techniques are used. Judgements about behaviour are made, in major part, from specifically developed assessment simulations. These judgements are pooled in a meeting among the assessors or by a statistical integration process. In an integration discussion, comprehensive accounts of behaviour, and often ratings of it, are pooled. The discussion results in evaluations of the performance of the assessee on the dimensions/competencies or other variables that the assessment centre is designed to measure. Statistical combination methods should be validated in accordance with professionally accepted standards. At the end of the assessment activities all assessors get-together to evaluate all the data they have gathered and assess each candidate and come to a group of consensus. A general rating or score for each Assessee is arrived at as the desired level for reached dimension originally selected and an overall rating usually in terms of his potential success on the job is agreed upon. Typically the assessors spend two to three days of comparing observations and making a full evaluation report of each candidate. A final condensed report on each candidate is then developed to include items such as a prediction of success, weaknesses, potential and developers need. This information is important in career in succession planning decisions. A feedback meeting is usually conducted with each participant where the evaluation report is a late to him by the assessment staff or a responsible line manager. The assessment centre is a method for a playful selection in succession planning activities. However it has to be supported by effective human resources policy in order to derive the correct linkage between the policy in practice in regard to assessment of people about their capabilities and their elements and organizational context. Essentially the human resource policy is part of the comprehensive of original goals. The original goals are based on a consistent evaluation of the internal and external statistic factors including environment market values structured another of original goals and demands. The human resource policy is based on an analysis of current and future human resource requirements that have been identified on internal and external basis. Assessment centres typically involve the participants completing a range of exercises that simulate the activities carried out in the target job. Various combinations of these exercises like role play, job suitability analysis, group discussion, interviews, in-tray exercises, etc. and sometimes other assessment methods like psychometric testing and OD inventories (TORI, FIRO, Johari Window technique, MBTI, Blockages Survey, 16 PF, MARS, SPEC, Complete

Assessment Centres

Typology Profile, etc.) are used to assess particular competencies in individuals. The theory behind this is that if one wishes to predict future job performance, then the best ways of doing this is to get the individual to carry out a set of tasks, which accurately sample those required in the job, and are as similar to them as possible. The particular competencies used will depend upon the target job but one will often find competencies such as relating to people; resistance to stress; planning and organizing; motivation; adaptability and flexibility; problem solving; leadership; communication; decision making and initiative. The competencies relevant to a particular job are determined through job analysis, appraisal records, industry best practices, experience and feedback. In addition to the identification of competency, assessment centres are used for developmental activities, training need identification and group motivation as well. Many industry leaders are currently using assessment centres, or modified forms of assessment centres, to improve their human resources capital. Diverse companies like HLL, RANBAXY, TATA GROUP, TERA NOVA, HSBC, ICICI, COLGATE and MOTOROLA have well defined assessment centres to look into the overall personal and organizational growth.

Theory behind assessment centres: If we are interested in predicting an individual's behaviour and effectiveness in a certain job that requires complex behaviour, multiple KSAs (Knowledge, Aptitude, Skills) will predict those behaviours. This leads to the need to identify and then assess those KSAs, and will require multiple methods of assessing the KSAs and multiple assessors. The result should be higher validity than could be obtained from a single assessment method or single assessor.

What goes into the development of assessment centres? AC procedures begin with a preliminary study of the targeted jobs. A job analysis must be done to identify KSAs and a selection plan is developed to help to construct content valid methods of assessment.

CHARACTERISTICS

OF

ASSESSMENT

CENTRES:



Job candidates usually participate for a few days rather than a few hours.



May be used for promotion, transfer, or training evaluation of employees (usually management. level personnel).

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Participants take part in exercises (e.g., work samples or simulations) or are assessed with interviews and Bio data information sheets.



Assessee is evaluated in-groups ranging in size and may be divided into smaller groups form various exercises. Basic idea is to appraise individuals against the performance of others in the group.



Several trained assessors evaluate performance in the exercises.



Assessors are managers, psychologists, or peers.



Participants are usually managers assessed for a higher-level job and are usually selected to participate by their supervisors.



Evaluation of participants occurs at end of the AC. Assessor examines all of the information gathered about each participant. Information is translated into ratings on several dimensions of managerial jobs (e.g., communications, leadership, human relations, planning, problem solving and decision making).



In rating the dimensions, assessors look for critical behaviours that represent the effective and ineffective responses to exercise situations. A dimension is a category into which behaviours can logically and reliably be classified. Dimensions also represent areas critical to success in a target job. Dimensions come from interviews, focus groups and questionnaires. Job content experts also describe behaviours that lead to success or failure on the job. Data were analyzed, summarized and validated. Dimensions or groups of behaviours that were critical to success on the job were developed. Dimensions become a foundation of the selection process.



Assessor observation techniques involve the assessor becoming familiar with the target dimensions and expected behaviours. Each assessor is assigned 1–4 participants to observe. They use blank rating forms to record what each assigned participant says and does. After the exercise, the assessors use the dimension definitions to classify all relevant behaviours and check off the appropriate behaviours on the checklist.



Assessors should complete the evaluation ASAP after the exercise; focus only on behavioural data; evaluate one dimension at a time, considering all relevant data; should not let assessment in one dimension overlap into others; document reasons for ratings that could be unclear to others; compare candidates to job requirements, not other information.

Assessment Centres



Assessors meet to arrive at a consensus rating for each candidate to determine overall candidate recommendation. Review assessors' ratings and reasons for ratings in each exercise. Id discrepancies between assessors. Discuss evidence/behaviours supporting the ratings and aid appropriate revisions. Adjust ratings as appropriate. Produce a final consensus rating for each candidate.



Based on these evaluations, the assessors prepare a summary report for each assessee and then feed back portions of the report to the assessee. Raters then forward their recommendations for personnel action to the organization for review and consideration.

Assesment Centres ... An assesment centre is meant to measure the competencies, skills, characteristics of a person to evaluate their capability to carry out a specific function within the organization and against a pre-determined standard

Development Centre

Assessment Centre •

Objective: – To evaluate capability (for a specific function) – To evaluate against a standard

• Typical methods: – In-basket exercises – Group and team discussions – Case study excercises – Presentations – Paper pencil tests – Aptitude tests – Psychometric tests – Role-plays – Interviews



Objective: – To identity the training needs – To identity the potential to be nurtured



Typical methods: – Case study exercise – Psychometric tests – Group discussion

• Typical Output:

• Typical Output: – Competency gaps

– Individual development plans

• Methodology: – Run like a selection process – Evaluation emphazised – Highly rigorous method

• Methodology: – Runs like a training program – Evaluation underplayed – Flexible methodology

Figure: 6.2 Assessment Centre Design.

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As a case example, MOTOROLA has spent considerable time in developing management competencies based on skills, knowledge and behaviours. Their assessment process involves a series of indoor and outdoor practical team tasks, each with a nominated leader and non-participant observer, whose feedback at the end of the task is also assessed. Rather than being treated as "tablets of stone", these Assessment Centre scores are used as a basis for discussion from which a short-list of candidates for further interview is agreed. The advantage of this process is that if someone with a lower score is short-listed, there are still clear and openly expressed reasons for doing so, thus reinforcing transparency in the whole system. The assessment centre differs from that of a development centre with an important purpose to deliver individual development plans as against individual assessments. Development centres is normally an outcome post completion of an assessment centre. While the method at one level appears to look as overlapping the degree of depth, intensity of usage of the tools and the consequent interpretation all would differ between the two centres. The differences are mentioned above (Fig. 6.2). TATA STEEL: As guided by the TATA vision of doubling the revenues every four years, TISCO launched the Performance Ethic Program (PEP) that focused on the main competencies that are required by their business. The various positions were divided into clusters and jobs with the top 100 positions requiring the following competencies: Strategy ability, Entrepreneurship, Efficiency, Communication, Business understanding, Influencing, People skills and Leadership. CITIBANK: Citibank takes a lot of pride in its human capital and focuses on the following values and competencies: Business opportunity, Leadership, Adaptability, Innovation, Integrity, Relationship and Change management. AT&T: This dynamic organization stresses to be amongst the front-runners in the following aspects: Respect, Dedication, High standard of integrity, Innovation and Teamwork. The underlying principles of the Assessment Centre necessitate conducting the assessments on a here and now basis with data generated on an on line format that in turn is used for interpretation. The design also envisages ensuring that objectivity and randomness is adhered to while rotating assesses from one expert to another. The use of a psychologist has provided effective results in managing inter/intra-rater bias and issues of extreme positions. Competencies imply assessment, a means of evaluation that measures the readiness of an individual to a job role in relation to identified competencies for that position. Typically role descriptions sheets define competencies that are essential for that particular defined status at that point in time. As roles change greater or lesser emphasis for particular competency would take place. Competencies help individuals to contend with their personal disposition and acts as a form of self-appraisal together with feedback that they would receive as they experience and obtain their evaluation through the competency based tools. The choice of confidentiality

Assessment Centres

• Confidentiality of design and structure • Confidentiality of scores • Proper planning and preparation • Addressing speculation amongst participants and others about selective invitation • Interruption-free environment (no phone/mobile calls)

Underlying Principle

Centre Design

Here & Now: Only data generated in the centre is used for assessment

1

Assessors have no prior knowledge of the Candidates

Elimination of Assessor Bias

2

Rotation of Assessors

Elimination of Existing Interpersonal Dynamics of the Candidates

3

Rotation of Group Members

Assessment of Competencies

4

1 Tool measure > 1 Competency 1 Competency measured > once

Self Perception Management

5

Self Assessment Exercise

Figure: 6.3 Principles of an Assessment Centre. is dependent on how the competency measures would be put into use. A part of competency maping process tends to be utilized as a Development Centre and in which case they have a strong developmental orientation (Figures 6.3 and 6.7).

ESSENTIAL ELEMENTS

OF AN

ASSESSMENT CENTRE

The following are the essential elements for a process to be considered an assessment centre: 1. Job Analysis—A job analysis of relevant behaviours must be conducted to determine the dimensions, competencies, attributes and job performance indices important to job success in order to identify what should be evaluated by the assessment centre. The type and extent of the job analysis depends on the purpose of assessment, the complexity of the job, the adequacy and appropriateness of prior information about the job, and the similarity of the new job to jobs that have been studied previously. If past job analysis and research are used to select dimensions and exercises for a new job, evidence of the comparability of the jobs must be provided.

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When the job does not currently exist, analysis can be done of actual or projected tasks or roles that will comprise the new job, position, job level, or job family. Target dimensions can also be identified from an analysis of the vision, values, strategies, or key objectives of the organization. 2. Behavioural Classification—Behaviours displayed by participants must be classified into meaningful and relevant categories such as dimensions, attributes, characteristics, aptitudes, qualities, skills, abilities, competencies and knowledge. 3. Assessment Techniques—The techniques used in the assessment centre must be designed to provide information for evaluating the dimensions previously determined by the job analysis. Assessment centre developers should establish a link from behaviours to competencies to exercises/assessment techniques. This linkage should be documented in a competency-by-exercise/assessment technique matrix. 4. Multiple Assessments—Multiple assessment techniques must be used. These can include tests, interviews, questionnaires, sociometric devices and simulations. The assessment techniques are developed or chosen to elicit a variety of behaviours and information relevant to the selected competencies/dimensions. Self-assessment and 360-degree feedback are some examples of such an intervention. 5. Simulations—The assessment techniques must include a sufficient number of job-related simulations to allow opportunities to observe the candidate’s behaviour related to each competency/dimension being assessed. At least one—and usually several—job-related simulations must be included in each assessment centre. A simulation is an exercise or technique designed to elicit behaviours related to dimensions of performance on the job requiring the participants to respond behaviourally to situational stimuli. Examples of simulations include, but are not limited to, group exercises, in-basket exercises, interaction (interview) simulations, presentations and fact-finding exercises. Stimuli may also be presented through video-based or virtual simulations delivered via computer, video, the Internet, or an Intranet. For simple jobs one or two job-related simulations may be used if the job analysis clearly indicates that only one or two simulations sufficiently simulate a substantial portion of the job being evaluated. If a single comprehensive assessment technique is used, then it must include distinct job-related segments. Assessment centre designers also should be careful to design exercises that reliably elicit a large number of competency-related behaviours. In turn, this should provide assessors with sufficient opportunities to observe competency-related behaviour. The

Assessment Centres

stimuli contained in a simulation parallel or resemble stimuli in the work situation, although they may be in different settings. 6. Assessors—Multiple assessors must be used to observe and evaluate each assessee. When selecting a group of assessors, consider characteristics such as diversity of race, ethnicity, age, sex, organizational level and functional work area. Computer technology may be used to assess in those situations in which it can be shown that a computer program evaluates behaviours at least as well as a human assessor. 7. Recording Behaviour—A systematic procedure must be used by assessors to record specific behavioural observations accurately at the time of observation. This procedure might include techniques such as handwritten notes, behavioural observation scales, or behavioural checklists. Audio and video recordings of behaviour may be made and analyzed later. 8. Reports—Assessors must prepare a report of the observations made during each exercise before the integration discussion or statistical integration. 9. Data Integration—The integration of behaviours must be based on a pooling of information from assessors or through a statistical integration process validated in accordance with professionally accepted standards. During the integration discussion of each dimension, assessors should report information derived from the assessment techniques but should not report information that is irrelevant to the purpose of the assessment process. The integration of information may be accomplished by consensus or by some other method of arriving at a joint decision. Methods of combining assessors’ evaluations of information discussed in the assessors’ integration sessions must be supported by the reliability of the assessors’ discussions. Computer technology also may be used to support the data integration process provided the conditions of this section are met. How does an Assessment Centre Work? The assessment centre method involves multiple evaluation techniques, including various types of job-related simulations and sometimes interviews and psychological tests. A traditional assessment centre involves six participants and lasts from one to three days. As participants work through the simulations, they are observed by assessors (usually three line managers) who are trained to observe and evaluate behaviour and knowledge level. Assessors observe different participants in each simulation and take notes on special observation forms. After participants have completed their simulations, assessors spend one or more days sharing

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their observations and agreeing on evaluations. If used, test and interview data are integrated into the decision-making process. The assessors’ final assessment, contained in a written report, details participants’ strengths and development needs and may evaluate their overall potential for success in the target position if that is the purpose of the centre. Perhaps the most important feature of the assessment centre method is that it relates not to current job performance, but to future performance. By observing how a participant handles the problems and challenges of the target job or job levels (as simulated in the exercises), assessors get a valid picture of how that person would perform in the target position. This is especially useful when assessing individuals who hold jobs that don’t offer them an opportunity to exhibit behaviour related to the target position or level. This is often the case with individuals who aspire to management positions but presently hold positions that don’t give them an opportunity to exhibit management-related behaviour on the job. In addition to improved accuracy in diagnosis and selection, the organization that operates an assessment centre enjoys a number of indirect benefits. Candidates accept the fairness and accuracy of promotion decisions more readily and have a better understanding of job requirements. Training managers to be assessors increases their skills in many other managerial tasks, such as handling performance appraisals and conducting coaching and feedback discussions.

Validity and Fairness: The assessment centre method, in its modern form, came into existence as a result of the AT&T Management Progress Study. In this study, which began in the late 1950s, individuals entering management positions in BELL TELEPHONE operating companies were assessed and, from then on, their careers were followed. The study was unusual and was pure research-based. Neither the individuals assessed nor their bosses were given information about their performance in the centre. Nor was this information in any way allowed to affect participants’ careers. Participants were assessed soon after they entered management as new college recruits or after they were promoted from the ranks. Not only did researchers follow participant advancement during the ensuing years, but a second assessment also was conducted eight years after the first. The criterion used was advancement to the fourth level of management in a seven-level hierarchy. The eight-year prediction is more valid—an expected finding since most individuals would have begun to consolidate their management skills after eight years in management. Yet the original assessment ratings were still valid—even after twenty years.

Assessment Centres

THORNTON AND BYHAM (1982) reviewed 29 studies of the validity of assessment centre methodology. The authors found more support for the assessment centre method than for other selection methodologies, while lamenting the fact that most of the studies were done by a few large organizations (AT&T, GE, IBM, SOHIO, and SEARS). In 1985 THORNTON and his associates at Colorado State University processed 220 validity coefficients from 50 studies using a statistical approach called meta-analysis. They estimated the method’s validity at .37 (Gaugler, Rosenthal, Thornton & Bentson, 1985). Working independently of Thornton, WAYNE CASCIO of the University of Colorado arrived at the same figure (.37) in studying the validity of first-level assessment centres in an operating company of the Bell System. Cascio’s main interest, however, was in measuring the "bottom-line impact" of promotion decisions based on assessment centre information versus decisions based on criteria extracted from other methods (Cascio & Ramos, 1984). To determine the dollar impact of assessment centres, Cascio needed more than validity information; he needed cost data (fully loaded costs of the assessment process), plus job performance data expressed in dollars. Over a four-year period he developed a simple methodology for expressing in dollar terms the job performance levels of managers. Using information provided by more than 700 line managers, Cascio combined data on the validity and cost of the assessment centre with the dollar-valued job performance of first-level managers. With this data, he produced an estimate of the organization’s net gain in dollars resulting from the use of assessment centre information in the promotion process. Over a fouryear period, the gain to the company in terms of the improved job performance of new managers was estimated at $13.4 million, or approximately $2,700 each year for each of the 1,100 people promoted in first-level management jobs.

Adverse impact in performing an assessment centre Compared to other selection methodologies, the assessment centre method generally is seen as more fair and objective in terms of gender, race and age than other methodologies. Some differential performance have been found, but this usually is the result of differential applicant populations. The method is uniquely fair because of its emphasis on actual behaviour rather than psychological constructs. There is consistent research showing that assessment centres are unbiased in their predictions of future performance. These studies considered a candidate’s age, race and gender and found that predictions by assessment centre methodology are equally valid for all candidates. Federal courts have viewed assessment centres as valid and fair. Indeed, they often have mandated assessment centres to overcome selection problems stemming from the use of paperand-pencil and other selection instruments.

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Adoption of the assessment centre method The chief reason the assessment centre method is valid in so many different countries is that it is an easily adaptable evaluation system, not an evaluation instrument. Users need not adopt dimensions or standards of performance that are important in the U.S. but perhaps unimportant in their country; they merely adopt a systematic procedure for evaluating candidates against job-related dimensions that are specific to their particular organization and environment. For example, the dimension Interpersonal Sensitivity is shown in vastly different ways in Japan than in the United States, but the method by which the dimension is assessed works just the same (as well).

TOOLS AND TECHNIQUES

DEPLOYED IN AN

ASSESSMENT CENTRE

Tools Required In an assessment centre, candidates participate in a series of job simulations designed to allow them to demonstrate actual behaviours and skills important in the position to be filled. Because assessment centre exercises are virtually pieces of the targeted job, test validity is strengthened. Assessment centres are available for selecting supervisory, managerial, administrative, professional personnel, including police and fire command officers. 1. In-Basket: Candidates are asked to handle, in writing, materials that might be found in an in-basket. Items might include memos, letters, requisitions, personnel forms, telephone messages, etc. Assessors regarding their strategies and rationale underlying their actions may interview candidates. 2. Group discussion: Candidates are asked to discuss among themselves hypothetical problems appropriate to the targeted position and arrive at a consensus decision or recommended solution. 3. Interview Simulation: Candidates are asked to role-play a person in the targeted job and to interview a subordinate, citizen, etc., who is role-played by an assessor. The candidates are given information on the reason for the interview and any background information they may need. 4. Presentation and Report Writing: Candidates are asked to give a presentation to an appropriate group, or write a report on a specific issue, challenge or a case. e.g., subordinates, city council, the press, etc.

Assessment Centres

5. Management Problems (or Analysis): Candidates are asked to analyze, in writing, one or more problems. This analysis may be followed by a group discussion or question from the assessors. 6. Qualifications Screens: These questionnaires determine if candidates possess specific characteristics needed to perform a job. They are best for "screening out" candidates who do not meet minimum requirements such as relevant experience, schedule availability, educational degrees, or citizenship. 7. Structured Interviews: In these interviews, hiring managers, recruiters, or trained assessors systematically evaluate candidates on the basis of their responses to predefined questions built around key job competencies. These structured interviews can be conducted face-to-face, by phone, or over the Web. 8. Job Simulations: These evaluate how the candidates respond to situations simulating actual job tasks. Job simulations can be conducted using "paper and pencil" exercises, trained role-players, or computers. In addition to being effective for assessing candidate competencies, job simulations provide candidates with a realistic preview of key job roles. Their main drawbacks are that they are relatively labor intensive to create and non-automated simulations require extensive training if they are to be used effectively. 9. Knowledge and Skills Tests: These assess knowledge and skills in specific subject areas such as computer programming or accounting laws. They are fairly complex to design, particularly in terms of establishing appropriate questions and scoring guidelines. 10. Talent Measures: These measure "natural" personal characteristics that are associated with success in certain jobs. Some of the things assessed through talent measures are problem solving ability, work ethic, leadership characteristics and interpersonal style. On a broad level, talent measures tend to predict two kinds of performance: what a person can do (e.g., the ability to quickly learn new tasks or stay calm in stressful situations) and what a person will do (e.g., attendance, work ethic). Talent measures, when appropriately matched to the job, are the best predictors of superior job performance. They are also the most difficult to develop, because they require "looking below the surface" at underlying skills, abilities and work styles. 11. Culture Fit and Values Inventories: These help to determine how well an applicant will fit into a particular work environment. They are similar in many ways to talent

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measures, but focus on predicting tenure and organizational commitment as opposed to superior job performance. 12. Background Investigations: These gather information about a candidate from sources other than the candidate him/herself. This includes employment verification, criminal-record checks and reference interviews. Background investigations are most useful for avoiding potentially catastrophic hires. 13. Integrity Tests: These are written tests that predict whether an applicant will engage in theft or other counterproductive activities. They have proved to be effective in helping to avoid costly hiring mistakes, especially in jobs where theft or shrinkage has traditionally been a problem. Integrity tests can be a less expensive alternative to background investigations, but they are not as reliable at detecting past criminal behaviour. 14. Physical-Abilities Tests: These involve having candidates complete physical exercises to assess talents and capabilities such as strength, endurance, dexterity and vision. They tend to be used only for very physically demanding jobs. 15. Fact-finding and Analysis Exercises might be particularly appropriate for selfassessments since the fact base is finite and most inferences can be anticipated. This makes developing a scoring key easier. 16. Business Games also could be effective for self-assessments. The candidate might select from a checklist of different response options or choose different approaches and take different paths through the simulation. The simulation would branch to different stimulus presentations (e.g., reactions from actors), or conditions (e.g., rise in sales figures), based on candidate actions and decisions. This type of exercise would be more difficult to score given the various combinations and permutations that would be possible but could be lots of fun for the candidate. Performance could be scored either in terms of outcomes or goals achieved and/or competency levels displayed. These types of self-assessments would help differentiate an employer as unique and sophisticated in their approach to candidates. 17. Role-play Exercises would be good candidates as selection tools. Candidates would select or evaluate various response options at key points during the interaction. These exercises would be efficient in gathering multiple responses in a relatively short period of time. These types of measurements might be an alternative to

Assessment Centres

traditional testing approaches to candidate screening. It may be defined as a collection of predictors used to forecast success. These involve appraising multiple dimensions of performance using several methods and raters. These are used primarily in higher-level jobs due to the high costs involved in conducting the centre. AC are group-oriented, standardized series of activities that provide a basis for judgements or predictions of human behaviours thought to be relevant to work performed in an organizational setting.

Tracking tools: The competency dashboard (Figures 6.4, 6.5 and 6.6) We have a number of proven tools and analysis techniques that help to track the competency skill set and map the progress of the various developmental efforts so that the clients can efficiently and effectively utilize the updated competencies. The adjoining figure presented here depicts the system of capturing details of employee regarding his competencies and administration details. This tool is filled based on the results

Areas for development and illustrative tools... •

• Managing Job – Analyzing the job – Managing operating planning – Managing with objectives – Controlling decision -making – Communication – Managing time – Coping with stress



Managing his Team – Knowing the team – Planning for new staff and selection interviewing – Coaching, training and counseling staff – Delegating – Motivating the staff – Improving people’s jobs Developing leadership – Running a staff appraisal system



Sample tools to be used include – Analysis of performance measures – Stress management questionnaire – INQ questionnaire – TORI questionnaire Sample tools to be used include – Grievances record and satisfaction survey scores – In- basket exercises and Leadership questionnaire – MBTI, FIRO-B and team effectiveness questionnaires

Figure: 6.4 Development Tools.

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…Illustrative Tools • Sample tools to be used include • Managing his organization – Understanding the organization – Role plays and case studies – Conflict management – Handing politics questionnaire – Managing meetings – Effective Reading Quotient – Writing, reading and listening – Application of Intellectual – Speaking in public capital Assessment Base – Telephoning – Group Behavioral Analysis – Negotiating – Ready for Change – Managing conflict – Transitions – Managing change • Managing his career – Planning the career – Getting on in the job – Managing the boss – Keeping up to date – Maintaining your integrity

• Sample tools to be used include – Career planner tool – Locus of control questionnaire – Personality questionnaire – Goal setting tool – Star Track 100 – CPAP

Figure: 6.5 Development Tools. of the assessment centres, appraisals, interviews, OD inventories, etc. so that a gap matrix can be formulated. The gap analysis also focuses on the level of competency for the particular job position. For example, a senior HR employee would be required to be high on the competency of “strategic thinking ability” as compared to a HR management trainee. The training needs (or recruitment needs) are then mapped and future actions are planned to negate the existing gaps. The implementation of the outputs of these tools holds the key to the whole exercise. Please note that these tools and techniques are usually modified as per the need of the organization so that the implementation and the final results are as per mutually decided agreements. The system enables capturing current and desired competencies in respect of those identified for a particular job or a position. In this example it involves vision, strategic thinking and leadership. Drawing from the competency dictionary the assessors mark the proficiency levels of an individual into the system. Essentially a competency—more utilize as the date either the generated to the assessment centre and puts together a framework that enables the necessary player to map the competencies against the roles at varying points in time. Leaders need to reiterate the utilization of the competency dashboard that has a stronger and direct the direct impact on how efficiently is the competency mapping process is utilized on a day-to-day basis. Assessment centre data tends to get isolated from mainstream businesses as we have to deal with a combination of performance data generated at the Assessment Centre and identifying capabilities for future needs of business as business managers

Assessment Centres

Figure: 6.6 Self Perception and Evaluation Card. would ask to fulfill their business capabilities. However the dispute about logically connecting assessment centre data to the business realities and ensuring that strong differences that in turn impact the utilization of the said data may prove to be to the detriment of the incumbents. It is therefore an imperative to reiterate that to differentiate between what the business would need as desired competencies and what has been produced through the assessment centre can best be accomplished with the existence of an online database which effectively map those competencies that are required for business in the form of capabilities which by itself will be a subset of the business competencies and these together are prepared and related to the competencies that emerge from the assessment centre.

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ROLE OF ASSESSOR

ROLE OF FACILITATOR

• Understand the purpose/intent of each tool • Maintain the seriousness/ sanctity of the process to run/conduct as planned • Manage time efficiently • Assess the candidates on the • Ensure efficient group and assessor rotation competencies identified for each tool • Ensure adherence to the preset ground• Observe the candidates as an individual rules and in a group • Collate and tabulate the scores • Provide a summary (strengths/ • Makes sure that groups are available for weaknesses/ potential/ areas for every activity improvement/ development) for each • Distribute and collect all requisite hand-outs candidate interviewed (Questionnaires/ Case -studies/Instructions/ Answer- sheets) ROLE OF ASSESSEE

ROLE OF COMPANY SENIOR MANAGEMENT

• Participate actively in the exercises

• Pre work on Competency Dictionary

• Follow and maintain the ground-rules to the Assessment Centre

• Be present at the inaugurations to provide context

• Ensure completion of activities in the given time to enable sticking to schedule

• Participate in all out -of-centre activities (dinner, etc.) to signify the importance of the Assessment Centre

Figure: 6.7 Assessment Centre Design. Role of Assessor, Assessee, the facilitator and the company management (Fig. 6.7) Various roles pertaining to the four critical players into the formation of an Assessment Centre is outlined. (See Fig. 6.7) This essentially captures the multiple expectations and the team synergy necessary to bring together players who help form an effective assessment centre. Each of the incumbents has a role to perform and this in turn determine the role of the senior management as they impact the assessment centre. Of critical importance of role of the assessee under as they impact and determine how they would relate to the aspects pertaining to the assessment centre.

Minimum goals for the assessors to perform their roles effectively �

Knowledge of the organization and job/job family or normative group being assessed to provide an effective context for assessor judgements.



Knowledge and understanding of the assessment dimensions, definitions of dimensions, relationship to job performance and examples of effective and ineffective performance.

Assessment Centres



Understanding of the assessment techniques, relevant dimensions to be observed in each portion of the assessment centre, expected or typical behaviour, examples or samples of actual behaviours, etc.



Demonstrated ability to observe, record and classify behaviour in dimensions, including knowledge of forms used by the centre.



Experience, knowledge and understanding of evaluation and rating procedures, including how data are integrated.



Appreciation of concepts, knowledge and understanding of assessment policies and practices of the organization, including restrictions on how assessment data are to be used, when this is a requirement of assessors.



Interventions, application and understanding of feedback procedures, where appropriate.



Demonstrated ability to give accurate oral and written feedback, when the assessors give feedback.



Demonstrated knowledge and ability to play objectively and consistently the role called for in interactive exercises (e.g., one-on-one simulations or fact-finding exercises) when role-playing is required of assessors. Non-assessor role players also may be used if their training results in their ability to play the role objectively and consistently.

COMPETENCY PROFICIENCY LEVELS AND STAGES

OF

GROWTH

Articulating and measuring proficiency levels perhaps forms one of the critical parts of the competency mapping exercise. Invariably there are five to six levels of proficiency levels that are marked in respect of each role. Each of the competencies is identified as one of the six levels or standards and the assessment centre is utilized to measure the proficiency levels against their performance at the centre. Essentially proficiency levels make a difference to demonstrate difference between limited bases of an understanding of a particular competency to that task determining the expertize that has been identified in respect of the incumbent. Proficiency levels also act as a minimum standard or as a benchmark and also demonstrate that against a particular role profile for individual how he or she performed in the context of an assessment centre. It is important to understand that at the mastery and expertize level about the proficiency that typically is demonstrated by the incumbent necessitates the finer persuasion of the incumbents and the behaviours displayed as and when required. Another

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Proficiency Levels 0=

No / Limited basis:The competency is not expected to be demonstrated

1=

Novice: Demonstrates very little appreciation and sensitivity of the desired behaviour

2=

Development:Demonstrates the behaviour infrequently and inconsistently when expected

3=

Proficient: Demonstrates the behaviours consistently and appropriately

4=

Mastery: Demonstrates appreciation of finer nuances and varies the behaviours as and when required

5=

Expert: Can be taken as a role model and can coach others in developing the competency

Figure: 6.8 Competency Proficiency Levels.

Competency Levels & Stages of Growth LEVEL 1—KNOWING, AWARENESS & ACQUISITION LEVEL 2—APPLICATION & RELEVANCE CHECKING LEVEL 3—REFLECTION ON ACTIONS AND OUTCOMES LEVEL 4—INDIVIDUAL & COLLECTIVE TRANSFORMATION LEVEL 5—ASKING FOR MORE LEARNING

STAGE 1—DEVELOP AN IDEA, CONCEPT, INSIGHT STAGE 2—INVESTIGATE THE IDEA, COLLECT DATA STAGE 3—FIGURE, ANALYZE & DECIDE STAGE 4—PLAN FOR ACTION—SET TIME STAGE 5—ACT UPON THE IDEA PLAN—APPLY STAGE 6—TRANSFER THE LEARNING TO OTHERS

Figure: 6.9 Competency Levels and Stages of Growth. aspect is that at the mastery or at the expertise level the differentiator appears to be sharper when an incumbent has been evaluated as an appropriate role model or a mentor for other incumbents. It is important understand that at the proficiency level one ought to understand where the incumbent's stated to be a novice or are at the developing stage there has to be a sharp difference in relation to what is their meaning and definition of novice and should also

Assessment Centres

National Sales Manager Role Purpose

To lead the sales team to achieve budgeted sales with sustainable market share. Responsibilities include:

Achieving the budgeted targets and planning for sales growth on a short and long term basis. Accurate forecasting of the inventory requirement—minimizing inventory. Monitoring and guiding individual sales performance of sales executives/sales managers. Evaluating and strengthening the distribution network in the region.

Current

Key Accountabilities

Value and volume targets for all key products. National Sales Targets for all key products. Maintain / Increase market share Sales growth in the premium / core products segment. Receivables Management Team Development – Training and succession planning

Desired

Market Intelligence : Scan the market for opportunities, understand the environment and trends and assess implications on product sales. Inputs for business plan development: Highlight profitable markets Sales forecasts and targets based on knowledge of the above. Identify and evaluate new sales and distribution channels. Inputs on the effectiveness of the current distributor network in the region. Sales effort (through team) to increase productivity. Process Development and Improvement: Collates market information (Distributors / dealers / farmers / competitor information, market trends), inputs and feedback from sales force to improve existing processes. Trade Management : Relationship building at the distributor / dealer level - Increased focus Help improve the business skills of the dealer Help increase dealer productivity Optimum Resource Utilization: Trade programs, promotional and publicity material, field force, travel, inventory, credit limits. Infrastructure Development: Encourages use of information technology down the line; Uses technology in sales forecasting and planning

Competencies Current Education

· Graduation in Science

Experience

· Handling sales at the regional level. · Handling a team

Desired · PG Diploma in Scientology / Natural Sciences · Degree in Business Management –

Figure: 6.10 Role Purpose, Key Accountabilities and Competencies of a National Sales Manager.

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demonstrate the difference between limited basis and novice. Proficiency levels need to achieve the desired standard only if a sharp differentiation can be made between the five levels that are typically articulated while doing a competency mapping exercise. The mode of proficiency levels tend to be compared to that are internal standard which is applicable to that respective company based on its roles or the incumbents or the kind of capabilities that the company's articulated based on the core competencies of the organization. There are situations where the organization takes upon itself to benchmark their competencies based on those that are compatible with that of the other organizations or industries, as they deem appropriate. Yet again they can compare the roles of the current organization with the tougher desired benchmark organization and see how do these roles map one against the other. The strength of benchmarking competencies on the basis of standards that are applicable to ones own organization with the other organization brings upon the incumbent a certain yardstick for measuring oneself to a standard. In fact while conducting an assessment centre it is possible to use these benchmark as a way of the establishing proficiency levels that the incumbent would require to perform a job. Ranks and ratings for proficiency levels tend to differ on the basis as the intensity and standard that the organization could like to impact on their people. Scales tend to differ between a four to six point scales and that depends upon the detailing that the organization would like to create while mapping the competencies of one role with that of another. Then again they are not anything than the fact that organizations tend to have typically are five point scale that is applicable while mapping the competencies. It is also a fact that in many organizations they started with a basic level and conclude with that of the mastery or expertise level. The organizations then insist on retaining and the no basis criteria in order to have this competency still articulated for but have not been mapped for the moment, which demonstrates its desire to map it at another point in time. Ref. Figures 6.8, 6.9 and 6.10.

ASSESSMENT CENTRE SCHEDULE Typical schedule pertaining to an Assessment Centre is outlined below. This covers a combination of a centre together with the need for bringing together psychological tools and techniques as they impact the evaluation need for measuring specific behaviourally oriented competencies. In this illustration of a typical Assessment Centre (Fig. 6.11) the following areas have been covered: �

Decision making.



Conflict management.

Assessment Centres



Presentation.



Report writing.



Self assessment.

In addition the centre covers through a series of role-plays and other psychometric instruments aspects related to: �

Strategic thinking.



Communication effectiveness.



Group behaviour.



Leadership.



And, any other competencies identified to be measured for that particular role.

Assessment Centre Schedule GROUP A 23-Nov - -02 09:30 -10:15 10:15 -10:30 10:30 -11:30 11:30 -12:00 12:00 -13:00 13:00 -13:45 13:45 -16:15 16:15 -16:30 16:30 -18:00 24-Nov-02 09:30 -10:30 10:30 -10:45 10:45-11:15 11:15-11:45 11:45-13:00 13:00 -13:45 13:45-14:15 14:15-15:15 15:15-16:15 16:15 -16:30 16:30-18:30

Agenda Introduction TEA BREAK Decision Making Psychometric Test 1 Conflict Management LUNCH In-Basket Exercise TEA BREAK Role Play Agenda Presentation TEA BREAK Presentation (contd) Psychometric Test 2 Report Writing LUNCH Psychometric Test 3 Self Assessment Individual Interview TEA BREAK Individual Interview (Conted)

Track 1

Track 2

Track 3

Track 4

Track 5

A1

A2

A3

A4

A5

A2

A3

A4

A5

A1

A3

A4

A5

A1

A2

Track 1

Track 2

Track 3

Track 4

Track 5

A4

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Figure: 6.11 An Assessment Centre Schedule.

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This is followed by an exhaustive interview procedure to act as a summarized view of the individual and a team of specialists, functional heads, business managers and psychologists conduct the process.

Usage of the Centre Schedule Informed Participation: The organization is obligated to make an announcement prior to assessment so that participants will be fully informed about the program. Ideally, this information should be made available in writing before the centre. A second option is to use the material in the opening statement of the centre. While the information provided will vary across organizations, the following basic information should be given to all prospective participants: 1. Objective(s): The objective(s) of the program and the purpose of the assessment centre. The organization may choose to disclose the dimensions measured and the general nature of the exercises prior to the assessment. 2. Selection: How individuals are selected to participate in the centre. 3. Choice(s): Any options the individual has regarding the choice of participating in the asssessment centre as a condition of employment, advancement, development, etc. 4. Staff: General information on the assessor staff, including composition and assessor training. 5. Materials: What assessment centre materials completed by the individual are collected and maintained by the organization. 6. Results: How the assessment centre results will be used and how long the assessment results will be maintained on file. 7. Feedback: When and what kind of feedback will be given to the participants. 8. Reassessment: The procedure for reassessment (if any). 9. Access: Who will have access to the assessment centre reports and under which conditions?

Assessment Centres

10. Contact: Who will be the contact person responsible for the records and where the results will be stored or archived.

Mapping Process Method 1. Defining competency and formation of a dictionary: Each of the competencies will have to be identified and defined properly. This definition has to be behaviourally anchored and should be in consonance with the organizational understanding of that particular competency. (As shown on the figure 6.13). 2. Explanation of Meta Competency Levels: Each of the competencies are blocked together in what is called as a Meta Competency Band. Meta competencies in turn are small in number but substantive in its impact and meaning to a role incumbent. It also provides for ease of implementation while sifting through large number of competencies. (As shown on the figure 6.12). 3. Defining the matrix of employee bands: Employee bands are provided here as an illustration of some Competency mapping processes followed by some consulting organizations. This essentially has to deal with the type of activity performed by the role incumbent at various levels of proficiency and is then detailed into personal responsibility, type of tasks, guidance available and time scales involved in completing this task concerned. In many ways this is similar to position evaluation exercises. The sample matrix is shown in the figure 6.14. 4. Building a Technical Competency Dictionary: Technical competency dictionary is typically an outcome of the organizational functions and the role expectations from performing that function. For example, in the manufacturing area, production, planning, logistics and materials management forms the role requirements. Competencies relate to planning targets and achievements, materials costing and scheduling, productivity and shop floor performance etc. dictionary in this area is an exhaustive list of competencies as they relate to each of the functions. Examples could be in the areas of manufacturing, marketing, design, engineering, treasury, cash management, trading, corporate banking or customer service, network manager etc. The illustration is shown in figure 6.15. 5. Agree on the Assessment Set: Assessment set includes both technical and managerial competencies, bands, level matrix, type of roles, proficiency benchmarks. Each of this is applicable to each job family and roles within such a family, (as shown in figure 6.16).

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Information Seeking (INF) Scale Level 0 1

2

Behavioural Description None. Does not seek additional information about a situation, other than what has been given. Asks Questions. Asks direct questions of immediately available people (or people who are directly involved in the situation even if not physically present), consults available resources. Note that even in crisis situations, superior performers take a few moments to gather all the immediately available information before taking action. Personally Investigates. Gets out personally to see the plane, factory, ship, customer’s installation, loan applicant’s business, classroom, student’s failing papers, or other problem. Questions those closest to the problem, when other might ignore the people.

6. Defining behavioural skill parameters: Behavioural skills need elaboration soon after competencies have been agreed or identified for particular job responsibility. The competencies are then interpreted for its behavioural implication. Each of the possible behaviours is then exhaustively listed and articulated in a way that defines behaviour. Or in other words, defined in such a way that behaviour can be observed, understood interpreted and then evaluated. This is seen in figures 6.19 and 6.17. 7. Preparing Assessment Work Sheets: Each role incumbent who experiences an assessment centre has a set of profile sheets that describes his behaviour holistically in relation to the competencies for which he/she was evaluated. It is then matched to his/her job role requirements. This illustration is shown in figure 6.20. 8. Individual competency mapping results with benchmarks and self-assessment: The worksheets are then placed against proficiency levels and distinguished for variations between established benchmark for that particular competency in that particular role for that specific position. A differential analysis is conducted to reach a current and desired position. Illustrations is shown in figures 6.21, 6.22 and 6.23.

Developing a competency dictionary It has been found that competency behavioural indicators are clear to have scaling properties that are a clear progression from lower to higher levels on one or more dimensions. Competency definitions have a typical dimension that deals with intensity of action, the size of impact, complexity, amount of effect, unique dimensions and degree of innovation. Competency examples can show any combination of strength on one-dimensional and low or more debt impact on other dimensions. Most of the differences between average star performers is found primarily in the intensity and complete as of achievement-motivated action.

Assessment Centres

Sample—Further explanation of Bands—Broad meta competence levels AMOUNT OF GUIDANCE BAND TYPE OF ACTIVITY AND LEVEL OF PERSONAL AVAILABLE SCOPE FOR INITIATIVE RESPONSIBILITY INVOLVED I

Carrying out set procedures. Limited initiative possible

II

Completing specific operational tasks. Personal initiative linked to how this gets done

III

Individual tasks making sure procedures are followed correctly Individual or team tasks against preset objectives

Illustrative TIME SCALES INVOLVED

Extensive: rule books, proShort: from a few hours cedure guidelines, fairly close to perhaps a day or two supervision Significant: likely to be precedents, working guidelines and probably some local supervision.

Fairly short: from a few weeks to a few months.

Managing systems to Individual team or action achieve agreed results in objectives against agreed the short to medium budgets term. Initiative to adjust systems to improve results.

Variable: probably some precedents and guidelines on results required. May have to make significant decisions on how to manage systems to get what is wanted.

Short to medium term: typically one reporting or budget cycle (quarterly, half yearly, annually)

IV

Managing complete segment of an organisation: large team, function, department, or significant project

Decisions on tactics to be followed to achieve team function, project or departmental objectives

Given objectives or goals and allowed to decide on tactics to achieve them. Limited only by overall organisational policies.

Medium to longer term: typically several reporting or budget cycles

V

Leading a significant part of the organisation or the whole of a smaller one. Responsible for many departments or functions.

Decisions on strategies to be followed to achieve agreed business or market objectives

Closely involved in making decisions that impact on the whole organisation. Limited only by business and financial circumstances.

Long term: typically up to the maximum planning period used by that organisation.

VI

Leading the whole organisation and personally responsible for its fortunes in the long term

Decisions on the purpose and direction of the business in its entirety

No limitations other than the Very long term: setting stock market, where applicable, the direction of the

or the other owners of the business.

business for as far ahead as can be seen.

Broad Meta Competency Levels Figure: 6.12 Further Explanation Sample of a Broad Meta Competence Levels.

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Competencies have been clustered on the basis of underlying intent, which is a level of analysis between deep underlying social motives and superficial behaviours. Intent is specific to a particular circumstance and has more ephemeral and surface quality that an underlying motive or disposition. Competent behaviours can be driven by one or more social motives in any combination. A table containing the full-scale accompanies each competency description. The scales wave length because they're empirically derived. We have found more variations in some competencies than others. As the levels are in order of intensity, complexity and so on and each level are distinguishable from the preceding and falling levels. The numbering system is designed so that the viewer is always to a point. A generic dictionary scales are applicable to all jobs and none precisely. Many competencies may be irrelevant to do any given job. Even where a competency is critical to a job, several skill levels may be irrelevant. Effective recruitment, selection, training and performance appraisal required a competency study to determine the threshold and differentiating levels of each critical competency. The scales represent only the most common competencies. Most jobs require unusual or unique capabilities or characteristics that up only captured or not captured at all in the generic scales. The competency range from about to Confirming Competency Dictionary Confirming dictionary of competencies & behavioral indicators from templates...

• •

• •

Since terms used for competencies can have multiple interpretations, it is essential to have agreed upon terms for each competency, i.e. it is essential to have a dictionary. Competency dictionaries provide a clear description of each competency, a set of behavioural indicators and a rating scale for each. The ‘Behavioural Event Interviewing (‘BEI’)’ technique is typically used to build the competency dictionary. The BEI technique involves interviewing high performing incumbents in order to identify and explain competencies required for their positions. Standard templates of competency descriptions (with behavioural indicators and rating scales) can be used in order to provide a starting point for theBEIs . In case of enabling competencies, a number of standard templates are available. In case of technical competencies, we can use templates more for generic functions such as Finance, Customer Management, etc., than for specific functions such as Crop Research and Development. For technical competency dictionaries, in order to facilitate comprehensive assessment, it is essential to decompose each technical area into its constituent skill blocks and then describe each such block. For e.g. in Finance, skill blocks can be Accounting & Tax, Financial Controls, etc.

Figure: 6.13 Confirming Competency Dictionary.

Assessment Centres

could send to more than 20 per cent of ajar depending on the positions studied. The January competency scales are best adapted for typical managerial and marketing and sales positions lease 12 for specific positions like the schoolteachers, creative scientists etc., many charms require unique combinations of competencies used simultaneously. For example, coronation development consultants use a high-level of self-control and combine the moderate levels of conceptual or analytical thinking and high-level of influence skills in leading conflict resolution sessions. Higher levels on the scales are not necessarily better. The scales are arranged to reflect the intensity, completeness, or complexity of expression of each competency. In most cases someone performing at a high-level of performance scale will also be capable of managing at the lowest levels. Each stab has optimal point on each scale. A person whose course much higher than door optimal level for a job may run into as many problems as someone who scores much lower. Therefore it is important to determine the best level for each charm and not assume that a high-level will contribute to a better performance.

Figure: 6.14 Sample Matrix of Employee Bands.

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The competency dictionary presents competencies in generic form. In scales designed to cover behaviour a wide range of jobs and to be adapted for many applications. Several cautions are therefore in order. 1. The generic dictionary scales are applicable to All Jobs-and None precisely. Many competencies may be irrelevant to any given job. Even where a competency is critical to a job, several scale levels may be irrelevant. Effective recruitment, selection, training and performance appraisal requires a competency study to determine the threshold and differentiating levels of each critical competency. Otherwise, the user runs the risk of selecting or training for characteristics that do not predict a job performance. For example, a person may select for Building the Technical Competency Dictionary

Building a technical competency dictionary Identifying constituent skill blocks for each technical competency and providing proficiency scales Illustrative

• Each technical competency should be broken up into constituent skill blocks. • For e.g. Technical competency in Procurement can be broken up into the following constituent skill blocks: Procurement Planning Channel Design Solicitation/Bidding Contract Administration Contract close - out

Each constituent skill block will then have to be explained and proficiency levels will have to be described. For e.g. the skill block Procurement planning can be described as—‘Leveraging an understanding of procurement policies and best practices and an understanding of the market place to maximise procurement efficiency’. Proficiency levels can be - Basic, Developmental, Proficiency, Mastery and Thought Leadership. Each of these levels need to explained in terms of the skills in relation to Procurement Planning.

Figure: 6.15 Building a Technical Competency Dictionary.

Assessment Centres

Sample Competency Definitions

Competency Profile Job Family: Managers 1. LEADERSHIP AND EMPOWERMENT Competency Statement

Behavioural Examples

1.1. Team Leaderships: builds a skilled, motivated and committed team; utilizes the talent and expertise of all members; identifies and allocates resources efficiently for task accomplishment: champion's new initiatives and innovations.

• Identifies and hires individuals with required competencies • Involves others in the formulation of plans on issues that affect them • Matches individuals to assignments to capitalize on their strengths and provides opportunities to strengthen skills and broaden knowledge

1.2. Managing People: Communicates and inegrates Agency and Branch vision and direction: acts in accordance with Agency management values; recognizes employee potential and provides development support to meet immediate and future Agency needs and to assist staff to work to their full potential.

• Builds consensus by communicating clear directions that motivate and generate commitment of staff to Agency and Program vision, values and objectives • Anticipates Agency requirements, and accurately and objectively identifies employee strengths and development needs • Provides on-the-job training, coaching and mentoring as required • Develops people to meet future resource requirements • Provides candid and constructive feedback on a timely basis to motivate high performance and address performance issues

1.3. Empowerment: Creates a risk tolerant environment that fosters personal commitment, growth and achievement.

• Delegates responsibility and commensurate authority • Provides framework, resources and support as applicable • Encourages proactive action by staff • Conveys confidence in others abilities and adjusts the level of authority and support necessary to suit individual and situational circumstance 2. RIGOUROUS THINKING/KNOWLEDGE DEVELOPMENT

2.1. Critical Thinking: Analyzes issues and pro- • Approaches problems objectively considering all potential solutions on an equal basis blems thoroughly; focuses on critical details while maitaining a broad strategic perspec- • Gathers and integrates relevant information from many tive; develops practical and timely solutions. perspectives and disciplines to understand comples, mutli-laacted problems • Makes appropriate generalizations from data and draws sound conclusions 2.2. Innovation and Risk Taking: Generates, ex- • Looks at a variety of perspectives to devise solutions that plores and supports new ideas and alternate work solutions; shows courage in challenging the • Challenges conventional wisdom and status quo practistatus quo and in improving the quality of ces with the aim of improving them decisions and processes to acheive desired • Takes a stand on the basis of honest and critical analysis results. and professional judgement, irrespective of popularity of perceived consensus • Promotes innovative thinking in others

Figure: 6.16 Sample Competency Profile—Managers.

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Oral And Written Communication Skills

Decision Making Skills Behavioral Indicators

Behavioral Indicators • Organize and present ideas effectively for formal and spontaneous speeches • Effectively participate in group discussions • Prepare concise and logically written materials • Listen carefully and respond to verbal and nonverbal messages • Effectively utilize campus resources for public relations • Respond appropriately to positive and negative feedback • Debate issues without being abrasive to others • Possess courteous telephone skills

Decision-Making, Supervisory, Management and/or Leadership Skills • • • • • • • •

Organize and present ideas effectively for formal and spontaneous speeches Effectively participate in group discussions Prepare concise and logically written materials Listen carefully and respond to verbal and nonverbal messages Effectively utilize campus resources for public relations Respond appropriately to positive and negative feedback Debate issues without being abrasive to others Possess courteous telephone skills

Figure: 6.17 Sample Behavioural Indicators. competency levels higher than needed, thus ignoring potentially excellent candidates in favour of overqualified candidates who may not be satisfied with the job. The generic scales speed up and add precision to competency studies, but they are not a substitute for actual research. 2. The scales represent only the most common competencies. Most jobs require unusual or unique capabilities or characteristics that are poorly captured or not captured at all in the generic, scales. Unique competencies range from about 2 per cent to more than 20 percent of a job depending on the position studied. The generic competency scales are best adapted for typical managerial and sales positions, least well for preschool teachers or creative scientists. Many jobs require a unique combination of competencies used simultaneously. For example organization development consultants use a high level of self-control combined with moderate levels of conceptual or analytical thinking and high levels of influential skills in leading conflict resolution sessions. 3. Higher Levels of all the Scale Are Not Necessarily Better. The scales are arranged to reflect the intensity completeness or complexity of expression of each competency. In most cases, someone performing at a higher level on a scale will also be capable of the

Assessment Centres

Agree on the Assessment Set • Structure a set of meta and sub set competencies that are relevant to the role profiles and should be a function of the competencies defined for the organization as a whole. • The competencies should have a combination of managerial and technical competencies and should drive its behavioral expectation from the role to be performed by the incumbent. • The competencies should be pulled out of the dictionary to help keep the organizational competencies relevant and meaningfully articulated. • In order to focus each competency building cycle, an organisation may choose to assess, at one time, only a specific set of positions across various functions. Other positions may be taken up at a later time. • The Matrix of Employee Bands may be referred to for choosing the Assessment Set. Bands which are considered most critical for the overall performance of the organisation may be taken up first for assessment. • For e.g., an organisation may decide to assess employees in Bands IV, V and VI across all functions except, say Administration. This lends essential focus to the Capability Building effort. The focus may then be staggered to other Bands and functions, as the need arises.

Figure: 6.18 Assessment Set. lower levels. Each job has a optimal point on each scale. A person who scores much higher than the optimal level for a job may run into as many problems as someone who scores much lower. Therefore it is important to determine the best level for each job and not to assume that a higher level will contribute to a better performance. Training and Practice are Needed to Code Behaviours Reliably. (See figure 6.12 and 6.15)

USING ASSESSMENT CENTRE RESULTS TO EFFECT CHANGE Obviously, making constructive use of assessment results is critical if the organization is to improve and perhaps, to survive. There are certain significant aspects of using the results of

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assessment performance measurement that should be kept in mind when deploying an assessment centre.

Using Band Matrix, prepare Assessment Worksheets for each Role Profile

Behaviours on Skill Parameters Beginner

Intermediate

Throughly understands Depth of Knowledge Familiarity with basic con- fundamental concepts and cepts their application in the field of knowledge Breadth of Know- Familiar with specific aspe- Thorough understanding cts in the field of knowledge of aspects related to work ledge related to work execution execution and familiarity with related aspects in the field of knowledge Quality of Output

Meets basic quality require- Above level of quality which satisfies organiments zational output requirements

Guidence Supervision to ensure required quality of output

High level of supervision expected, every stage monitered to ensure quality Detailed procedures and guidelines available to describe worksteps

Advanced Thoroughly understands advanced concepts and their application in the field of knowledge Thorough understanding of all aspects in the field of knowledge High quality output delighting clients/ customers and setting new benchmarks for the organization

Expert Very deep understanding of, and on the cutting edge of R&D/involved in path breaking Thorough understanding of all aspects and aareness of global standards and best practices in field of knowledge Flawless, exemplary work setting aspiration targets for others to emulate

Output monitored/super- Directionally monitored, vised Output quality de- provided significant fined to ensure adherence freedom to determine to standards of delivery quality and level of outputs

Is a guide for others Approached by others for evaluating/criticizing their output

Up the learning curve and Get it right first time on Time to deliver in a Typically goes through a learning curve starting from can therefore crash learn- most occasions given situation/ some leeway granted for scratch able to deliver with- ing time environment in resonable time in simple Permitted to experiment gaining familarity with and learn quickly to get situation/environment situations it right Expected to be an authThought leadership Low expected to lead inno- Lead innovation in teams ority and lead innovvation within span of actividisplayed ation in the organizaties tion Brings in new ideas Innovation displayed Minor process/workstep Ability to improve methods/approaches to demo- which are radically diffimprovements nstrate significant benefits erent from existing methods/ approaches

Get it right the first time every time No space for learning Expected to deliver based on inherent expertise

Figure: 6.19 Defining Behavioural Skill Parameters.

Globally recognized thought leader Pradigm shift in approach/method

Assessment Centres

Prepare Assessment Worksheets for each Function/Role combination based on the Competency dictionary & Band Matrix • The Band Matrix provides cues on the nature of competencies required at relevant bands. • The competenacy dictionary details out each competency in terms of description, behavioral traits and skill level ratingscale. • Based on the cues from the Band Matrix and the competency details in the dictionary, assessment worksheets for each position in the Assessment Set are prepared. • The Assessment Worksheets provide a detailed profile of the position to be assessed, the enabling and technical competencies requires, behavioral indicators for these competencies and the desired skill level w.r.t eachcompetency. Position Job profile Marketing Head- International markets

Illustrative

DESIRED PROFICIENCY LEVEL

5

4

3

2

1

Lend f ocus to marketing efforts

marketing strategies D evelop

Understanding intl tobacco mkts

Thinking clearly& analytically

Making Decisions, Weighing Risk

Identifying & Solving P roblem s

Planning & Scheduling Work

Setting Goals & Standards

Time Management & Prioritising

Disciplining & Counselling

Appraising People & Performance

Training, Coaching & Delegating

Getting unbiased information

Giving clear informatio n

Listening & Organising

0

Figure: 6.20 Assessment Worksheets for each Function / Role Combination based on the Competency Dictionary and Band Matrix.

Assessment performance measurement systems must provide intelligence for decision makers, not just compile data. Assessment performance measures should be limited to those that relate to strategic organizational goals and objectives and that provide timely, relevant and concise information

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Mapping Individual Competencies to Benchmarks & Self Assessment Strategic Mindset 5

4

Leadership and Influence

Managerial Skills

3

2

1

-

Creativity

Dialogue and Communication

Group Workings Rating

Benchmark

Personal & Interpersonal Skills Self-assessment

Figure: 6.21 Individual Competency Maps.

for use by decision makers—at all levels—to assess progress toward achieving predetermined goals. Although each organization is unique in how assessment performance results can best benefit the organization, several concepts appear to apply across the board.

Assessment Centres

Competency Measure: Meta & Sub Competency Proficiency Levels Treasury Corporate Bank Strategic Mindset 3.0 3.3 Conceptual and Analytical Thinking 3 3 Systemic Thinking 3 3 Environment Scanning and Trend Analysis 3 4 Networking and Management 3.3 3.0 Articulation 3 3 Demonstration 4 3 Information 3 3 Business Relationships 3.3 3.0 Sensitivity and Empathy 3 3 Bonding 3 3 Adaptability 4 3 Problem Solving 4.0 3.7 Defining Right 4 4 Trouble Shooter 4 3 Proactive Builder 4 4 Personal Habits 3.3 2.7 Firm 3 2 Drives Personal Examples 3 3 Action Focused 4 3 Leadership and Influence 3.0 2.3 Proactively Changes 3 2 3 3 Demonstrates bias for action Builds Consensus 3 2 Group Process 3 2 Motivating team members 3 2 Building teams 3 2 Recognizes accomplishments 3 2

Credit Cards 2.3

2.3 3 2 2

2.0

2 2 2

2.7

2.7

3 2 2 2.0

2.7

3

2 2 2

2.7 3 2 3

2.3

3 3 2 3.0

Private Bank 3.0

NRI

3 3 3 2 3 3 3 3 3

3 3 3 3.0

2.7 3 2 3

2.7

2 3 2 2.7

2.3

3

3 3 3

2 3 3 2 2 3 3 3 3

3 2 3 3 3 2

3.0

2.3

3

3 3 3 2 2 3 3 3 3

Figure: 6.22 Meta and Sub Competency Proficiency Levels: Using Results: Unit Levels. They include the following: Assessment results must provide meaningful information. Management needs intelligent information for decision-making. If properly constructed, the assessment performance measures selected will result in data that is meaningful to decision makers in terms of improving organizational assessment performance. The data generated should be timely, relevant and concise. Assessment results should provide information on the efficiency of the production of goods and services, on how well current assessment performance compares to intended programmatic purposes and on the effectiveness of organizational activities and operations in terms of their specific contribution to program objectives. Numerous factors need to be considered when determining the effectiveness of assessment results.

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They include the following: �

Does the data indicate any assessment performance trends over time and over projects/functional areas?



Can the data be used to improve assessment performance in areas other than the one’s assessed?



Have the correct assessment performance measures already been selected for assessing desired assessment performance?



Do the measures reflect priorities?



Do the results reflect an understandable causal relationship between the assessment performance?



Effort and assessment performance result?



If assessment performance competency proficiency targets are not met, what inhibited successful assessment performance?



If assessment performance competency proficiency targets are significantly exceeded, are there additional benefits to the organization that can be gained in terms of reducing operating costs or improving assessment performance?



Are they factually gathered and interpreted?



Is there sufficient empirical data available to support the interpretation?



Is there a plan of development action scheduled here in after?



Were they discernable behaviours?

Employing Supplemental Information Sources. An agency can leverage the CBHRS’s power by supplementing assessment centre results with data from other sources that provide information on the “health” and direction of the organization. Such information provides a more detailed picture of an organization’s external environment and internal capabilities. It can also identify issues or problems not otherwise reflected in Assessment Centre results. This in turn helps the organization to interpret assessment results with a fuller understanding and make appropriate adjustments to its strategies.

Assessment Centres

Assessment results must be properly analyzed. Understanding what a particular result really means is important in determining whether or not it is useful to the organization. Data by itself is not useful information, but it can be when viewed from the context of organizational objectives, environmental conditions and other factors. Proper analysis is imperative in determining whether or not assessment performances indicators are effective and results that are contributing to organizational objectives.

Using Assessment Performance Information To Improve Business Performance Assessments are often followed with little effective analysis of results, or honest attempts at improved assessment performance. The following represent some of the ways that leading organizations, both public and private, use assessment performance information to improve assessment performance, manage risk and support decision-making. 1. Competency Gap Management Assessment performance results can be used to determine competency gaps between specific strategic objectives and/or annual goals and actual achievement. The root causes of these competency gaps are analyzed and countermeasures developed and implemented. Whenever there is a gap between current results and an organization’s objectives, it is an opportunity for process improvement. Reengineering and redesign are a frequent response to the identification of competency gaps between objectives and achievement, and are usually very effective, particularly when they include “process flow analysis” which requires a detailed examination of the existing processes and allows for exploration of alternate procedures within a process. Process flow analysis is especially useful when assessment centre results indicate assessment performance competency gaps in the areas of punctuality, purchasing costs or efficiency. Understanding which key processes need the most attention and then aggressively addressing the differences between current assessment performance and the desired end state is a hallmark of successful organizations. 2. Self-diagnosis A contracting or purchasing activity can use the information for “self-diagnosis.” Assessment data together with other reports and statistics can help the activity anticipate and resolve issues before they become problems, or at least minimize the effect of problems by taking early action. Information from other reports and statistics may also indicate the need to adjust COMPETENCY BASED HUMAN RESOURCE (CBHRS) strategies and measures.

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3. Enhancing strategic feedback and learning KAPLAN and NORTON recommend that, in addition to tracking progress on past results, managers can use the CBHRS to learn about the future. Managers should discuss not only how they achieved past results, but also whether their expectations for the future remain on track. Changes in the environment (e.g., new technology, legislative initiatives, etc.) may create new opportunities or threats not anticipated when the managers developed their initial strategies. If an organization followed established strategies, but did not achieve target results, managers should examine internal capabilities and assess whether the underlying strategies remain valid. Based on such analysis, managers may adjust or redirect their strategies or identify new strategies. This focus serves as a foundation for effective process improvement and risk management. It also completes a feedback loop that supports decisionmaking at all levels of the organization. 4. Benchmarking An organization can use the CBHRS to benchmark its assessment performance against other organizations. Benchmarking also helps to get a picture of how the agency acquisition function performs compared to others. It also serves as one input for developing target goals. However, as noted by the INTERNATIONAL BENCHMARKING CLEARINGHOUSE, the strength of benchmarking is not in identifying best assessment performance, but in learning best practices. That is, the organization should identify, study, analyze and adapt the “best practices” that led to the “best assessment performance.” Understanding the best practices helps managers to make better-informed decisions about where and how to change their organization. To make valid comparisons, the agency should consider how the other organization is both similar and different. Common factors to consider, whether selecting another agency or an industry for benchmarking, include: �

Is the total size and budget similar?



Is the amount spent on acquisition comparable?



Is the percent of total budget spent on acquisition similar?



Does the other organization have a similar mission or perform work of comparable complexity?



Are the products and services acquired similar?

Several sources have information available for benchmark comparisons: �

An agency can compare its assessment performance on the core measures identified in this CBHRS to other federal agencies that use the same measures.

Assessment Centres



Other agencies may also have similar supplemental agency-specific measures. �

The Centre for Advanced Purchasing Studies (CAPS) reports on 23 industries plus municipal governments and state/county governments on 21 standard benchmarks.



The Assessment Centre contains information useful for comparing several financial behavioural and internal business process measures (e.g., behaviourally manifested percent of acquisition awarded competitively, percent of acquisition spent on commercial items, etc.).

5. Oversight and Compliance The procurement executive can use the CBHRS and supplemental data to support oversight and compliance activities. Results of CBHRS measures and other reports and statistics help highlight areas of concern. If CBHRS measures are properly aligned with significant objectives, then review efforts should be focused where they will have the most benefit. Reviews should analyze the cause of concern and identify appropriate remedies (e.g., recommending changes in operational practices, clarifying existing or developing new policies, eliminating or revising policies that create problems, eliminating non value-added activities, etc.). The CBHRS also provides a framework for reporting to the agency head, CONGRESS, and OMB. 6. Risk Management Risk management can be defined as an infrastructure within which key decision makers hold the operating units accountable for results. This is done by shifting the emphasis to a riskbased approach that diagnosis systematic problems, evaluates effectiveness, and links assessment performance to consequences in order to strike a proper balance between risk and return. In other words, risk management is more strategic, whereas oversight is more reactive. The CBHRS fits within the risk management framework by tying results to strategic vision and holding units accountable for results. It is not the only element of risk management, but a key element. 7. The Business Case In addition to strategic feedback and learning, managers can also use the CBHRS to build a strong, sound business case to support proposals for changes or requests for resources. The CBHRS illuminates links between strategies, measures and expected outcomes at different levels in the organization and across different operational components. This provides a framework for explaining how and why a proposed change will benefit the organization and the expected effect on linked components. For example, a contracting activity could use the

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CBHRS to demonstrate how a proposed change to processing requisitions would improve its efficiency and also benefit program mission accomplishment. The CBHRS also provides the framework for justifying requests for resources. For example, in presenting the annual budget request, a manager can use the CBHRS to demonstrate the expected results from a given level of funding. Similarly, the manager could use the CBHRS to defend requests for increases in resources, by showing how additional resources would improve results for one or more measures. 8. Cross-functional problem solving By illuminating the links between strategies, measures and expected outcomes at different levels in the organization and across different operational components, the CBHRS also encourages cross-functional problem solving. For example, a Division may identify a Bureau or Department-level policy that impedes its ability to accomplish a certain objective. The Division could raise the issue, using the CBHRS to demonstrate the cause-and-effect relationship, and work together with the appropriate Bureau or Department management toward a solution. Or an acquisition office may work with finance to establish an electronic system for receiving and processing invoices that benefits the assessment performance of both organizations. Once the assessment results have been correctly analyzed, communicated internally and externally, used for development of any corrective action and for revising assessment performance measures as needed, effective assessment performance management requires that the organization consider strategic goals – i.e., where it expects to be in the not too dis-tant future and to incorporate these goals into the assessment performance management structure. The CBHRS as an assessment methodology is unique in its emphasis on placing the organization’s strategic vision at the centre of the assessment performance assessment structure. In fact, when using the CBHRS, development of strategic goals is the first step in creating a assessment performance assessment process that is designed to support accomplishment of the strategic vision. Only after the organization knows where it is heading can it develop the assessment performance measures that will help ensure accomplishment of the strategic vision. By arriving back at the first step of the assessment process, we have essentially completed our brief discussion of the CBHRS assessment performance assessment methodology and how it contributes to successful assessment performance management. The following guidelines for use of these data are suggested: �

Assessee should receive feedback on their assessment centre performance and should be informed of any recommendations made. Assessee who are members of the

Assessment Centres

organization have a right to read any formal summary of the written reports concerning their own performance and recommendations that are prepared and made available to management. Applicants to an organization should be provided with, at a minimum, what the final recommendation is and, if possible and if requested by the applicant, the reason for the recommendation. �

For reason for test security, assessment centre exercises and assessor reports on performance in particular exercises are exempted from disclosure, but the rationale and validity data concerning ratings of dimensions and the resulting recommendations should be made available upon request of the individual.



The organization should inform the assessee what records and data are being collected, maintained, used and disseminated.



If the organization decides to use assessment results for purposes other than those originally announced and that can impact the assessee, the assessee must be informed and the consent obtained for doing so.

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Chapter

7

Training Assessors in an Assessment Centre TRAINING ASSESSORS

ON

ASSESSING SELECT

INSTRUCTIONAL METHODS

Eight methods have been illustrated below: 1. PRESENTATION Competency Assessment Definition of presentation Presentation is oral presentation of material by the assessee.

Purpose of presentation �

To convey new information.



To insure all assessors have received the same information.



To persuade assessors to accept a particular point of view.



To influence the assessors’ attitude or to stimulate motivation

Assessment criteria presentation method �

Objectives—Presentation is useful for acquisition-phase objectives when the assessor needs a mass of information.



Time—Presentation saves time at the expense of assessor participation.



Class size—No limit as long as presentation can be heard.

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Assessee proficiency—Presentation is the most demanding method in terms of assessee behavioural competency, because of the demands made on the abilities to communicate, maintain interest and effect real learning.



Assessor background—Useful method for assessors who have little background, but can be easily geared to more advanced audiences.



Facilities—regardless of size of audience assessors should be able to see and hear speaker easily (will need sound amplification in larger rooms).

Advantages and disadvantages of presentation 1. Advantages �

It is effective for introducing material or giving an overview.



Any number of assessors can be taught at once.



Retention is aided because it requires participation through questions, visual aids, etc.



It is good for a tight schedule with time constraints.



Only one assessee is required.

2. Disadvantages �

What is “told” is not necessarily taught?



There is a temptation to speed up telling to stay on time constraints.



Some topics and ideas are difficult to convey by presentation alone (for example, how to tie a square knot).



There is limited opportunity for assessor participation. (Learning is an active process. This is why we encourage assessors to take notes during a presentation.

Presentation with questions It would be advantageous to use questions during a presentation when the answers to the question provide an invaluable source of feedback for the assessee. The other major source of feedback is observation; assessors look attentive, yawn, nod off, etc.

Training Assessors in an Assessment Centre

There are times in the presentation when you should ask questions: �

End of a teaching point or section to summarize and clarify the preceding information.



End of a lesson to ask assessors to recall major points as a means of review.



At a crucial point in a lesson when all that follows depends or hinges on a certain point.



Whenever the assessee receives negative feedback from the class such as lack of attentiveness, bored expressions and interferences during the presentation.

Handling answers �

You must be prepared for a variety of answers – right, wrong and irrelevant answers. You should also be prepared for no response at all.



When you do receive answers, be sure to acknowledge all the responses. This will encourage the assessors to participate.



To continue discussion, ask another question or probe deeper.



To continue the presentation sequence, affirm or deny the response and make a transition to the next teaching point.

Techniques for heightening interest in a presentation 1. Use an overhead projector to illustrate difficult points and to present questions to the class. This will help focus attention on your topic. 2. Use a chalkboard or flipchart to display key points and also to record student answers. 3. Combine a series of questions into a practical exercise which all will complete. Volunteers can then offer their own responses.

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2. DISCUSSION DEBATE Competency Assessment Definition of discussion method Discussion is a method used to encourage group participation and to be able to air different viewpoints when covering nonfactual judgmental areas.

Reasons for using discussion method �

Gives assessors an opportunity to apply previously learned information to practical situations.



Develops for the assessor to have an in depth understanding of the subject.



Assessor’s thinking is stimulated to related areas of experience.



Active participation firms retention.

Assessment criteria for discussion 1. Objectives a) “Practice of knowledge” type objectives can be achieved effectively. This requires assessors to apply what they’ve learned and they must already have some knowledge about the discussion topic (gained previously in the classroom or in some other way). b) Highly factual material is sometimes hard to discuss. 2. Time Discussion is very time – consuming. Yet, the benefits of discussion are great if time is available. Presentation takes one – third the time to discuss the same teaching points; yet assessors will retain the information longer if they derive the facts themselves, with the assessee acting as a discussion leader. 3. Class size 15–20 (25 maximum persons at a time). Otherwise, discussion is limited to a few individuals and shy and reticent persons won’t talk at all.

Training Assessors in an Assessment Centre

4. Assessee proficiency A high degree of expertise is required. The subtle behavioural competency of guiding and directing discussion without causing people to feel manipulated is required. 5. Assessor background The assessors should be quite knowledgeable to participate in an effective discussion. 6. Facilities provided Traditional classroom arrangement of rows of desks one right after another makes discussion difficult because people can’t face each other easily. A circle or U – shaped arrangement is more appropriate if there is space in the room.

How to prepare for discussion 1. Common experience (for example, reading assignment) a. Establish objectives. b. Make a tentative outline of main points. c. Write out discussion questions. d. Development answers to questions. e. Develop lesson plan complete with aids, etc. 2. No common experience Create a common experience. You could do this by showing a film, having the assessors work a Case study, participate in a role-play or simulation, or complete a practical exercise and then use discussion to critique it. The various activities would form the basis for discussion. We call this the common experience method of preparing for discussion. Simply, if people do not have a common core of experience it is hard to discuss anything. That’s why our “icebreakers” Usually concern the weather, the weekend, etc. These are topics common to everyone.

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Conducting the discussion 1. Discussion lesson plan should have these major divisions: �

Introduction



Development



Summary—in fact, a discussion may have several summaries.

2. Components with the introduction. �

Tie – in – Review pertinent information previously taught that will convince assessors they have sufficient background to intelligently discuss content.



Objective – Statement of specific objectives will help limit the discussion and keep it on the point.



Motivation – This becomes especially important because a discussion depends upon class participation.

3. ROLE PLAY Competency Assessment Definition A role-play reproduces, before actual job contact, the dynamics of personal interaction between participants. Participants act out a real – life situation. There is no set dialogue, and participants play their parts based upon role descriptions provided by the assessee. If performed in front of a group of observers, the group then critiques the role-play and discusses the implications of the performance to the situation or problem under consideration.

Assessment criteria for role play �

Objectives—Appropriate objectives for a role-play would be those objectives that call for human interaction (for example, counselling, negotiation, training and management training.



Time—if your goals are to give all class members a chance to play all the roles, you’ll need to break the class to break the class into “trios”.

Training Assessors in an Assessment Centre



Class size—The only problem this imposes is one the number of assessee needed if you conduct the role plays in small groups (one assessee can circulate among groups, but it is helpful to have assistants).



Assessee proficiency—A high degree of behavioural competency as an observer is required. Because the outcome of a role-play cannot be controlled, the assessee must also be behavioural competency in writing role descriptions if he/she is creating new ones.



Assessor background—A high degree of knowledge is required. Assessors must already have the knowledge; the role-play gives them a chance to practice and develop the behavioural competency in using the knowledge.



Facilities—Breakout rooms are required if you break into small groups.

Procedure for conducting a role play 1. The objective for the role-play is clearly defined by the instructor before roleplaying begins and the scene is set. 2. Participants should be selected just before role-playing begins although a brief warmup period may be necessary. 3. Role descriptions should be provided which adequately describes the “mood” or “feelings” the role player is supposed to have at the time. Any pertinent facts about his/her situation should also be included in the role description. 4. The assessee should stress the real job – oriented purpose of the role play in order to encourage participants to try to make the experience realistic for each other. 5. Observers should be provided with evaluation checklists that contain criteria. 6. The instructor should allow the action to proceed only so long as it is contributing to understanding (usually to 5 to 10 minutes). 7. Usually some discussion with the class as a whole is useful in summarizing the important points to be drawn from the role-plays.

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Physical arrangements There are many possible combinations for role-play depending upon your purpose. Two of the most common are: 1. Role players act out their roles in front of the class members, who act as observers. This is useful as a demonstration tool, but provides no real practice for the rest of the class. 2. Helping trio uses two role players and an observer. Participants alternate roles until all three assessors have played each part. Usually all these trios would role play simultaneously.

4. DEMONSTRATION Competency Assessment Definition Demonstration is a “show and tall” method which allow for an accurate portrayal of a portrayal of a procedure, technique or behavioural competency.

Reasons for demonstrations �

Dramatic impact.



Realistic depiction.



Saves time.



Sets performance standards.



Multi sensory approach made more stimulating.

Assessment criteria for demonstration method �

Objectives – Demonstration is effectively used to explain a procedure, technique, or behavioural competency to assessors.



Time – Time consuming because you are not just telling, but also demonstrating.

Training Assessors in an Assessment Centre



Class size – Limitation on class size if the object or procedure is difficult to see in the front of the room.



Instructor proficiency – Subject matter mastery required.



Assessor background – Usually minimal.



Facilities – If you’re demonstrating with an equipment, you must have that equipment.

Preparing to use demonstration method �

Establish objective.



Outline steps to be demonstrated.



Determine needs: (1) Equipment, materials, aids, etc. (2) Assistant instructor. (3) Classroom space.

1. Organize. 2. Write a lesson plan beforehand.

Steps in conducting demonstration 1. Introduction �

Tie – in to previously taught information.



State objectives.



Motivation – stress application.



Key questions to focus assessor’s attention to difficult steps in demonstration.

2. Development �

Review (optional) information previously learned that relates to the demonstration.

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Preview (optional) if it’s a complicated demonstration, tell how demonstration will be accomplished.

Demonstrate: (1) Proceed step-by-step. (2) Show and tell. (3) Check understanding with feedback questions. (4) Encourage assessors to ask questions. (5) Use aids. 3. Summary �

Recap main, critical and difficult points during the demonstration.



Tie – in to application.

5. CASE STUDY METHOD of (Competency Assessment) Definition A case study is an account of a real situation that has occurred. The study describes what has happened in a given situation, but leaves it to the members of the training group to decide the nature of problems indicated by the situation, their significance and their probable solution.

Use/Advantages �

To present in detail to a group a problem with which the group is concerned.



To present and study the solution of a problem similar to one confronting the group.



To help the learner see various alternative solutions to the problem.



To help people develop analytical and problem – solving behavioural competencies.

Training Assessors in an Assessment Centre

Procedure for using case study (either individually or in a group) �

The materials are checked for accuracy by the instructor and distributed to the participants.



The chairperson or moderator introduces the topic, explains what the case study is, and states the responsibilities of each individual. He/she then guides the discussion and other activity.



Factual material in the form of a record of a real situation is presented to the class for study and discussion.



The class analyzes the case and then decides on the nature of the problem.



The class examines all the assumptions and opinions expressed in the case for better understanding.



The class discusses all the data available.



The class proposes solutions or possible courses of action to be taken.



The instructor recapitulates group thinking by listing items on the board.



The class evaluates possible solutions or courses of action in order to select the best action to be taken.

Note: Five questions that is valuable to keep in mind when discussing a case problem: �

What are the facts?



What problem is raised in this case?



What conditions should be met by a good solution?



How should this problem be solved? How should it have been solved?



How can the problem or situation be avoided in the future?

The method lends itself well to breakout the group activity.

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6. CRITICAL AND INBASKET INCIDENT PROCESS (Competency Assessment) Definition Incident process is a method of instruction that presents a problem or “incident” to the class. To arrive at a sensible solution to the problem, more information is needed than was originally presented and class members obtain the information by asking the instructor (or other resource) specific questions.

Assessment criteria for incident process �

Objective – This method is used appropriately and only if it realistically imitates actual job behaviour, for example, inquiry and problem solving.



Time – it requires some time to become realistic.



Class size – 18 – 25 assessors’ maximum.



Instructor proficiency – A high degree of behavioural competency required plus complete understanding of the facts and applications to real – life situations.



Assessor background – The better the assessors’ background, the better the questions.



Facilities – There is no special requirement.

Procedures for using incident process �

State specific incident or problem.



Individual or group takes the role of a responsible person who must make a decision.



Statement does not provide all necessary facts for making a decision.



Members ask questions of the instructor. They try to obtain information by asking questions concerning relevant facts, clues and details.



Decisions for action in the incident are made.



The group evaluates actions, decisions and consequences.



With feedback from the instructor, the group learns what questions were useful, what caused difficulties, and how they could have been avoided.

Training Assessors in an Assessment Centre



The group generalizes on how to do better by preventing similar difficulties in future actions.

7. SKIT, PSYCHODRAMA (Competency Assessment) Definition A skit is a short, rehearsed dramatic presentation involving two or more persons. It is usually acted from a prepared script and dramatizes an incident that illustrates a problem or situation.

Assessment criteria for a skit �

Objectives – The skit is appropriate for early acquisition type objectives. It is often used when we wish to set a standard for behaviour (for example, a procurement officer being interviewed by the media).



Time – The most effective skits are brief and to the point.



Class size – A skit can be watched by any number of people; size of audience becomes important if there is something to see at the front of the room.



Instructor proficiency – A high degree of behavioural competency is required to plan and carry off an effective skit.



Assessor background – because a skit is primarily a passive experience for the observers, the assessors do not need an extensive background. It is important they understand basically what is happening.



Facilities – No special requirements are necessary.

How to plan a skit �

Analyse the lesson objective you want the assessors to achieve. This will keep you on track and insure that your skit is not just fun and games.



List the points you want the assessors to see and hear (know). This is your skit outline.

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Determine how you want the assessors to feel (dramatic effect). This will suggest the setting and the tone of the script.



Write the skit.



Practice or rehearse the skit.

8. READING/PROGRAMMED INSTRUCTION (Competency Assessment) Definition What is programmed instruction? A method of instruction, which has following characteristics: �

Specific measurable job related objectives.



Systematic presentation of ideas in relatively small steps.



Frequent active assessor responses or involvement.



Immediate feedback to the assessor as to the correctness of the response.



Tests which measure the assessors’ attainment of the objectives.



Assessors working at their own rate because they have their own set of materials.

Steps taken to prepare yourself to use programmed instruction/reading materials? 1. Work through the materials, as a assessor would. 2. As you work through the materials, make a list of the potential problems that you think the assessors may encounter. Some of those problems might be: �

An unusual format or style of programming.



Technical mistakes.



Written explanations that may not be clear.



Difficult or complex ideas.



Faulty directions.

Training Assessors in an Assessment Centre

3. Either correct minor errors yourself or have the assessors make the corrections before they begin to take the program. 4. Decide how you will: �

Introduce the program.



Monitor and assist assessors while they are taking the program.



End or summarize the program.

How will you actually use the programmed/reading materials? 1. Introduce the program – This introduction should contain a statement of objectives, reasons for learning the material, and an overview of what assessors will encounter. 2. Give program directions: �

The time given to finish.



What problems they may counter.



How to get help if they need it.



When and how to take breaks.



What to do when finished.

3. Monitor and assist during the program: �

Stay in classroom.



Circulate and demonstrate a willingness to assist with difficult parts.

Be alert for learning problems and be ready to help.

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8

Competency Based Selection Process COMPETENCY BASED SELECTION PROCESS Competency based selection can gain a greater competitive advantage. The market for human talent is imperfect. High turnover is usually done with the high failure rate amongst the newly hired. Competency based selection increases performance and also decreases turnover rates. High job performance and satisfaction in turn predict retention because good performers need not be fired and satisfied employees are less likely to be dissatisfied with their job. The people well matched to their jobs intrinsically enjoy their work more while producing a better organizational climate. Organizational change follows a pattern while reorganization, globalization, privatization’s, growth, cultural change, or downsizing and is predictably seen amongst organizational members. Globalizing organizations need to know which employees have the competencies to perform in international environments. Bureaucrats have the opportunity to become entrepreneurs in a free market. There are concrete steps in developing a competency based selection system: 1. Develop competency model for the target jobs. 2. Selected or develop assessment methods. 3. Trainers certainly assessment that had. 4. Assess the competencies of candidates for jobs. 5. Make job person match decisions for selection placement and promotion. 6. Valid data selection system—wherever possible organization should track the performance of people selected using competency assessment methods to confirm the validating and return on investment in the method.

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7. Develop a competency based job and person database and matching system. 8. Many standard assessment centre exercises can be observed and coded for competencies. 9. In basket exercises. 10. Stress exercises and interviews. 11. The presentation, vision and strategy speeches. 12. Job interview. 13. Leaderless group exercises. 14. Treasure hunt. 15. Business production game. 16. Role Plays. 17. Peer coaching and counselling exercises. In a selection interview, rating of the candidates by managers can be completed to 360 degree meeting or appropriate rating methods can be used. This can include competency assessment questionnaire or a competency queue starts, customer survey, systematic multiple level observation of groups, manager style and organizational climate.

THE

NEED FOR A GOOD SELECTION PROCESS

The acquisition of new employees is a most important and complex task. To find and employ the best individuals available is every Human Resource manager’s goal. A company cannot prosper, grow or even survive without adequate human resources. A Personnel Manager and Line Manager must therefore be dynamic and creative in finding, screening and selecting the quality and quantity of personnel needed for both short and long-range staff requirements. The purpose of this course is to examine the many techniques involved in the selection process so that a selection programme can be organized in relation to specific situational needs. Recruitment activity begins when the individual responsible for recruiting receives an approved personnel requisition. The requisition should be based on an accurate job description given by the line manager. The requisition should clearly indicate the duties of the job and have a realistic qualification required for the job.

Competency Based Selection Process

Steps taken to develop a competency-based selection system 1. Develop Competency Model(s) for the Target Job(s). A good rule is to involve as many of the people who will use the model in the study as possible. Managers who have been trained in and conducted Behavioural Event Interviews (BEIs) and worked with researchers to identify competencies believe in the model and are much more likely to implement it. The competency model dictionary defines the specific competency levels that predict threshold and superior performance in the jobs studied and becomes the template used to select or place employees. 2. Select or Develop Assessment Methods. Selection methods are chosen from the interview, test, assessment centre, bio-data and rating methods (discussed in greater detail in the following section “Competency Assessment Methods”) on the basis of costeffectiveness, administrative ease and candidate acceptability. Valid methods (e.g. assessment centres) may be too costly and difficult to administer: others, such as tests, may be rejected by candidates or an organization’s culture. The author’s experience is that the Behavioural Event Interview is the most cost-effective selection tool. It approaches the assessment centre in validity yet requires one to two hours instead of one to two days, is easy to administer and is acceptable to almost everyone. 3. Train Assessors in the Assessment Method. Organization staff who will conduct assessment need to be trained to do the BEI, to administer tests, or to run an assessment centre. Our experience is that most people can in two or three days learn to conduct and code a BEI with sufficient reliability to make effective selection decisions. 4. Assess the Competencies of Candidates for Jobs. 5. Makes Job-Person Match Decisions for selection, placement and promotion (Discussed in greater detail in the section “Job-Person Matching Methods”). 6. Validate the Selection System (optional but desirable). Whenever possible, organizations should track the performance of people selected using competency assessment methods to confirm the validity and return on investment in the method. Develop a Competency-Based Job and Person Data Base and Matching System. Once a few jobs have been studied and people assessed, a computer is needed to keep track of job-competency requirements, employee competencies and job-person match data. (Adapted from Competency at Work. L M SPENCER).

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Preparing for a selection centre It is a real achievement to get to an assessment centre and it means you have a good chance of a job offer. The following gives some vital information about the situations one is likely to face and how to handle them. It covers: �

Interviews.



Group discussions.



Written tests and exercises.



Social events.

Selection Centre Procedures: Selection Centre, can take place at the employer’s premises or at some other appropriate venue. Typically it may take up one, or two days. A variety of techniques are used to give the employer and a better picture of one's suitability for the jobs on offer. One is usually told what to expect either via a letter or on the day of the assessment. Some of the most common assessment methods are outlined below:

Interviews: One-to-One Interviews – One may have several in-depth interviews with different interviewers concentrating on your personality, motivation and interests. It is also common to be interviewed on the technical aspects of the job especially if it relates to science or engineering. Panel interviews – With up to four or more interviewers ranging from a representative from Human Resources to a senior manager within the company. General interview advice holds well: stay alert, think out your answers carefully and above all, be positive.

Group discussions These are the important and almost universally used tests. Assessors will observe a small group of candidates. One may be asked to chair the group, or the discussion may be a free for all. The subject for the discussion may be practical or hypothetical, e.g. which members of a sinking ships crew should have places in the only (small) lifeboat. Assessors will be looking

Competency Based Selection Process

(amongst other things) for persuasiveness, enthusiasm, active listening and participation, quality of expression, analytical thought, determination and originality of ideas and sensitivity. The aim of these exercises is to assess one's capacity for teamwork and leadership and one's ability to get to the heart of a problem quickly and effectively.

Written tests and exercises These come in a variety of forms. They help assess one's general capability for a particular career, or they can be used to test specific abilities. One has to get through the exercises as quickly and as accurately as one can. Examples of the most common exercises are given below. �

In-Tray exercise – This is an example of a typical exercise: A manager arrives at work at 8.00 am and has an hour to deal with the contents of the in-tray before flying to a conference abroad. The in-tray will include a variety of items and the manager must make a decision about each one such as immediate action, deferring action, delegation and use of other resources, etc.,. You will have to determine priorities and deal appropriately with each item taking into account as you only have one hour. This exercise assesses analytical ability, sensitivity, lucidity and common sense and of course, the ability to work under pressure.



Drafting exercise – A sensitive or embarrassing situation is presented on paper, for example, the name of a Managing Director has been (intentionally) omitted from the guest list of a public function and he is deeply offended. He has written demanding to be included. The candidate is given half an hour to draft a letter of reply. This exercise tests the candidate's judgment, conciseness, tact, honesty, imagination and powers of expression.



Personality tests – Some employers use personality tests to determine how you would fit into the organization and work teams. Questions asked aim to identify your likely reactions to situations where there are no right or wrong answers, for example, how would you react when entering a room full of strangers. Its best to be honest. Personality tests tend to have a built in question structure that may detect any inconsistencies.



Aptitude tests – These are designed to assess a wide spread of abilities, for example, numerical, literacy and diagrammatical. Answers are either right or wrong and one has to work through them as rapidly and as accurately as you can within the time allotted.

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Assessment centres allow companies to address these challenges by helping them: �

Identify hire, and promote the most talented people.



Improve bench strength and plan for succession.



Provide candidates with realistic job previews.



"Grow" their own leaders and accelerate leadership development qualities.

Selection and Placement of Candidates for Higher Levels of Management: In the early seventies, organizations began using the assessment centre method to help select and place individuals in higher levels of management. Assessment centres have been used to help evaluate candidates for presidencies of organizations, plant managers, general managers, and many senior government positions. Most of these assessments were made by a team of outside "professional" assessors (consultants). It is difficult to find qualified highlevel, in-house people who can take the time to assess and evaluate candidates objectively.

Selection and Placement of Empowered Personnel: The greatest growth of assessment centres (since 1985, the greatest growth of assessment centres have been stimulated...) has been stimulated by organizations moving to an empowered workforce. These organizations are giving employees: �

Responsibility for their designated areas or outputs.



Control over resources, systems, methods and equipment.



Control over working conditions and schedules.



Authority (within defined limits) to commit the organization.



Evaluation by achievements.

Most of them are organizing employees into self-directed work teams. The teams are made up of team members and a team leader (the team leader is a working, non-management member of the team). Teams take responsibility for: �

Improving quality and productivity; job rotation.



Planning/Scheduling.



Who works on what?

Competency Based Selection Process



Quality audit.



Equipment adjustment, maintenance and repair.



Housekeeping, vacation planning, absenteeism, tardiness and performance issues.



Choosing the team leader.



Many other areas.

The adaptation of self-directed teams drastically changes the role of supervisors and managers. Supervisors (often called group leaders) have a very large span of control, with as many as hundred subordinates. Because teams and team leaders take on many of the normal supervisory functions, the supervisors became more managerial in function, concentrating more on budgeting and planning. This, in turn, affects the role of middle managers. The multiple-level changes in job functions have forced organizations to use new methods in connection with selection, promotion and placement decisions. Because assessment centres worked so well at supervisory and managerial levels, it was natural to turn to assessment centres as a methodology. Hundreds of manufacturing plants have used assessment centres to select their employees, team leaders and group leaders. To accomplish this, many new processes were developed, especially in connection with "green field" plant start-ups where large numbers of applicants must be processed. TOYOTA assessed 22,000 applicants to staff their 3,000-person plant in KENTUCKY. At the employee level, exercises involve applicants in problem-solving group exercises, simulations of the manufacturing process, and one-to-one interactive exercises. Supervisor exercises provide opportunities to demonstrate coaching, leadership and decision-making skills, as shown in Fig. 8.1.

PREPARING ORGANIZATIONS TO PROCESS

FACILITATE

COMPETENCY BASED SELECTION

Organizations commence at the socialization stage as a part of the selection process and follow it through formal training interventions, feedback mechanisms, appraisals mentoring etc. the roles and responsibilities at each of these stages of the competency selection process is explained below. Stage 1: Socialization Organizations today, particularly those at the leading edge of technology, are faced with a dynamic environment, shaking the very roots of human values and organization

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competency driven culture. There is an increasing need for experimentation, for learning from experience, for flexibility and adaptability for growth. It is imperative for excellent organizations to build strong competency driven culture for adaptation to changing values, the needs of the individual and the growth of the emergent man. A strong competency driven culture is a set of shared meanings—values, norms and beliefs, a way of doing things, that make it possible for members and new members of an organization interpret and act upon their environment thereby helping everyone to head in a unipolar direction as that of the organization. A culturally permissive and adaptive organization allows people to do their own thing through autonomy and empowerment to a remarkable degree of perfection. Competency driven cultures is not linear. They cut across organizations in many ways. Organization competency driven culture encounters difficulty in understanding and interpretation when impacted people are demanded to sacrifice their individuality for the sake of common beliefs, good. Individuals accept what is good for business only if there is something in return for them. Eternal exhortation for sacrifices with no clarity of the future causes unspoken disgruntlement. People who ask questions do not get into the category of not being loyal as is commonly understood. They are exercising their fundamental right to know. What is essential to achieve is a degree of social and intellectual uniformity that enables an organization to work better and aim towards attainment of the corporate goals. In organizations to get new recruits too acclimatize into a competency driven culture an elaborate familiarization & socialization program is being drawn for various level i.e. Stage 2: Selection standards and hiring demands The corporation in search for talent has articulated policies for hiring of top performers would subject applicants for employment to a selection process so rigorous and extended that it often seems designed to discourage individuals rather than encourage them to take on the company and the job. By employing selection standards and methods, by grilling the applicants through the several stages of assessment interviews, highlighting strengths and weaknesses and making sure not to over sell the job or the company, the organization prods the candidate. This helps the candidate to take a firm decision whether the company would fit his/her style and values. The company in turn has an opportunity to perform a job suitability assessment exercise. This hiring methodology based on absolute standards and rigorous routine enable identification and appointment of people who fit the mould of desirable, long-term employees. The company demonstrates to the selected candidate the validity of the process by sharing the

Competency Based Selection Process

reasons for selection or the rejection. The regretted candidate returns with a reasonable feeling of having been through a fair and judicious procedure and concludes may the better person win. The process necessitates time, effort and more importantly commitment of line and staff on every applicant who is short-listed for a personal interview. Stage 3: Basic familiarization program This is followed by a business familiarization program to all new recruits through a orientation of the corporation by providing them a bird’s eye view of our business/functions and the leaders these businesses and functions. The objective of this familiarization program is to help the new recruit meet with a random assortment of managers of the company including senior managers, understand the profile of people across the company, appreciate the values, the climate and the competency driven culture in which the company operates. They would mark for them those small areas that they have to take cues towards helping them settle down and commence their contribution as quickly as possible. Familiarization programs commence the competency building process. It covers the vision, values, business goals, objectives, people, structures and simple aspects of culture, the way we work principles. The recruit is gaining a first hand impression of what managerial competencies appear to be working in the organization as they walk around and meet with people. It also becomes essential for human resources to work a program schedule that provides the new recruit a fair and wide cross section of the businesses, processes, technology, people and work styles. A formal familiarization docket giving basic details of the company is issued as a part of this program. Stage 4: On-the-job training In specific instances for professionals like field/territory sales managers, production managers in far-flung locations the company is expected to conduct an on-the-job training program completely structured ranging between a periods of 24–46 weeks as the case may be, depending upon the needs of the individual manager. Learning, as one can appreciate, is best achieved when an individual experiences it through a very realistic working situation. This we believe is what happens when a new manager goes through the on-the-job training. In built into the on-the-job training at the various units, are the various tutors and guides who are available for these young managers to draw upon for professional and personal guidance and at the same time, also seek adequate help towards learning their basic job requirements. The objectives of this on-the-job training is to tell our new recruits that

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we believe that their contribution is a direct function of the amount of inputs that are provided to them through the company as well as that which is gained through their own efforts. That this on-the job training is, after all, one such means of providing them knowledge, skills, competencies and attitudes required to perform their jobs effectively. The socialization program through exposure to other people, process and systems subjects the new recruit to experiences calculated to induce humility, bring in a sense of mutual respect and value for each other and make him/her question their own prior behaviour, beliefs and values. Their learning is to see that the world has as many competent people as desired. In fact in the initial stages of the training program, long hours of intense work, impossible schedules, stretch goals carry the individual close to his/her limits. When everybody’s vulnerability runs high and performance pressures mounts up one also becomes closer to one’s colleagues. There is an interdependent feeling of all being in the same boat. Let us make it together. The on the job training is a process towards learning the correct way to perceive, think and feel in relation to issues and situation as it pertains to the organization. Stage 5: Unit/factory/sales branch familiarization Soon after the new recruit completes his/her corporate familiarization, he/she is sent to the concerned unit where he is being located for his initial placement for on the job training. On joining at the unit, the unit head in turn draws a 3–5 day familiarization program providing more in-depth information the overall unit’s operations. Logically, if one were to see, the new recruit initially at the corporate level gains a broad based company familiarization, goes into the unit and gets deeper knowledge of the unit activities and finally through the on-the job training, the new recruit manager is completely thorough with the specific nitty-gritty’s of on-the-job requirements.

Cultural messages and sagas The young trainees and new recruit managers are sent to trenches pushing them to master one of the disciplines at the core of the company’s operations and businesses. The company in the course of the first few months having got him to open his mind to its way of doing business and getting thing done, now cements that orientation by putting him in the field and giving him a lot of carefully monitored and planned experience. It rewards his progress through appropriate motivational inputs constantly kindling in him the urge to achieve and excel. Competency driven culture establishes that new associates must work their way up through the ranks and that there is almost never a quick way to jump or short circuit a few rungs on the ladder.

Competency Based Selection Process

Corporate induction program Post 3–6 months from the date of joining of a new recruit, the company then invites the manager over to the head office for a fifteen day company induction program. This program is designed to provide the manager with in depth information in relation to all the businesses of the company, its function and its overall interface in terms of structure, strategy, process and staff with other group of companies in the country and worldwide. Here is an opportunity for a new recruit to put forth the queries, issues or unanswered questions he may have encountered since the date of his joining; have them raised at the time of the program, seek clarification and depart from the program location with a clear mind and a bundle of energy and enthusiasm. In fact an unstinting facet of commitment towards achieving what he originally intended to at the time of joining our company – to perform and make a successful career.

Competency based feedback We believe that in built into the settling down process of a new manager is also the task of giving and receiving honest, observed feedback on the manager’s performance, learning and contribution. The feedback is regular, planned and is a joint endeavour to make improvements happen. Tasks and agreements are recorded and action plans drawn for improvement. Therefore, there are quarterly appraisals that are completed by the unit head on each of the managers working at the unit and the appraisals are so designed to provide up front feedback on the strengths, areas of development of the new recruit. This feedback is based on the experience that the unit head has encountered along with the new recruit during the first quarter or second quarter as the case may be. This feedback is of vital importance as the new manager is constantly curious to know how the new organization is looking at his performance, learning and his contribution. The new recruit’s assumption is that initial impression in a new organization means a lot for his/her own growth in the company and may be in a way that is the truth. It is, therefore, the organization’s responsibility to provide the manager complete inputs on how he has been shaping up and settling down in the organization and, at the same time, also tell him frankly and fairly, the areas he needs to sharpen or develop. The unit head, while going through his feedback session will not stop at identifying areas but would also take pains to help the new recruit identify ways and means to overcome these weaknesses. Some of the areas that are in built into the on-the-job training and which are relevant to the appraisal process are the following: �

Project assignments: Through the entire probation period, the new manager is assigned with a number of relevant and analytical project assignments. These assignments help him not only to learn the details of working life but also help him keep his antenna of conceptual and analytical skills sharpened. He also has an opportunity to

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utilize these skills through the presentation of the project assignments to senior management. The presentation gains importance as it would not only be presented in a researched manner but would also contain implementation and recommendations. �

Report writing: Over and above the project assignments, the new recruit managers are also encouraged to make brief knowledge reports on various things that they have observed on their own or on areas where they believe it is possible for them or the company to improve or make progress further. By the time all the quarterly appraisals are completed, the manager is more or less aware of his areas of strengths and development and is also fairly clear how far he has settled down on the job and in the company. Appropriate appraisal forms is created and used for the purpose of quarterly appraisals and feedback sessions.



Feedback and chat up pad: All new recruits at the time of their joining are provided with a "feedback and chat up pad". The objective of this pad is to provide an ongoing written feedback to the new recruit on his learning in the present assignment. The new recruit is encouraged to meet as many managers relevant to his work as possible and seek for feedback on his progress from time to time. The pad also helps a new recruit understand and appreciate the company competency driven culture with the basic tenet being that in order to effectively settle down, he must get a clear understanding of the ethical standards and values that are seen as core principles for practice of an effective manager.



Tutors for mentoring in specific competency gap areas: In built into the system of on the job training is the system of mentors/tutors and guides. Each new recruit has a tutor while he is on training or on probation. The company identifies promising individuals as role models. Nothing communicates more powerfully to the young professionals within the organization than the example of peers or superiors who are recognized as winners and who also share the common qualities. More importantly that they have also been through this settling down process and have in a corporate sense made it to the top. They now have become perfect examples of people to be emulated. The young new recruit watches the role model/tutor/guide make formal presentations, take decisions, manage people, form teams, build structures, create systems, solve problems, handle conflicts, dictate memos, attend customer calls, prioritizes things to do and tries to duplicate the traits,

Competency Based Selection Process

management styles that seem to work effectively. The mentors project themselves as analytical, humane, energetic and adept at managing other people and teams. Specific areas of competency gaps are identified and formal mentoring process commences. �

Confirmation Assessment Centres This is a stage where a new recruit has been through his complete probation period and is now knocking at the doors seeking entry to be a confirmed manager of the company. At this stage, the new recruit is completely conversant with the routine aspects of his job. His knowledge and awareness of his own profit centre or function has increased and he is basically familiar with all the company operations, functions and businesses. He has also had an opportunity to demonstrate his absolute value to the organization and he is, therefore, now ready to enter. This process is facilitated through individual confirmation interviews and an assessment centre. Initially at the unit level with the unit manager and at the corporate level with the HRD manager and other departmental heads in functional areas, thereafter through the concerned vice president, concerned functional vice president, vice president personnel and finally with the CEO/Chairman of the company. Each of these assessing managers and the executive committee members make independent reports on the manager incorporating their comments on his suitability for being confirmed as a manager and finally the chairman decides on the entry of the manager into the company. A logical correlation is drawn between the reasons for hiring the candidate and whether the candidate has displayed the traits and characteristics observed while selecting through the training/probation period. The CEO who takes upon himself/herself the final responsibility finally approves all recruitment. The new recruit in turn observes the CEO being in charge of attracting talent into the corporation.

Career in the long haul All new recruits understand that there is just a logical method towards making a career. That this career path depends on performance and excellence is abundantly clear. Value adherence is made to be an important staying criterion. Since they are being evaluated on how they do in the long haul, they are discouraged to seek short cuts or go for short-term victories. By the time they reach responsible positions they understand the business not as a financial abstraction but as a reality of the people they know and skills they have learned. They can communicate with people in the lowest ranks in the shorthand of shared experience.

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A person’s power to get things done in the company seldom depends on his power or formal authority. In great respect it rests on his track record of success, reputation, integrity, competence and network of relationships. At the heart of a competency mapping process conducted through the assessment centre is the behavioural event interview method and that differs from traditional interview method. This interview technique provides step-by-step instructions on how to conduct such assessment centre as is necessary to identify and define competencies. The behavioural event interviews are the heart of the job competency assessment process. This data happens to be the richest source of hypothesis about competencies that predicted superior or effective job performance. To do competency research it is essential to know how to conduct analysis of behavioural event interview. The traditional interviewing methods do not work well to identify competencies. Numerous studies have shown that unstructured non-behavioural selection interviews have little power to predict who do a good sharp. What are their strengths and weaknesses? They are ineffective for many reasons as most people don't know what their competencies strains and weaknesses or even their job likes and dislikes really are. It's not unusual to find that managers who earnestly believe their greatest print is dealing with people who are disliked and are trusted by their co-workers. Artists who say they hate business and think filling is the trading can become first-rate salespeople if they are highly many people may not reveal their real bottles and abilities. Most interview questions are leading and most people can give the socially desirable answer and that would mean what they think interview wants to hear and as a result people's will report on background strains and preferences do not provide reliable valid data or information about their competencies achievement motivation. The basic principle of the competency approach is that what people think or say about their capability levels or a skill is not credible, unless it has been proven through a behavioural exercise or a mapping process. What they actually do in most critical incidents they're faced is to be believed. The purpose of this method is to see that they really practice what they preach.. This is accomplished by asking people to describe how they actually behaved in their specific incidents. Example:

READINESS ASSESSMENT: ORGANIZATIONAL CULTURAL PREPAREDNESS TO COMPETENCY BASED HR PROCESSES Respond to the items below as they apply to the handling of professional employees. Upon completion, compute the total score. For comparison, scores for a number of strong, intermediate and weak culture firms are to be found at the bottom of the page.

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Not True Of This Company

VeryTrue Of This Company

1. Recruiters receive at least one week of competency training.

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2. Recruitment forms identify several key traits deemed crucial to the firm’s success, traits are defined in concrete terms and interviewer records specific evidence of each trait.

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3. Recruits are subjected to at least four in-depth interviews

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4. The company actively facilitates de-selection during the recruiting process by revealing minuses as well as pluses. 1

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5. New hires work long hours, are exposed to intensive training of considerable difficulty and/or perform relatively menial tasks in the first months.

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6. The intensity of entry-level experience builds cohesiveness among peers in each entering class.

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7. All professional employees in a particular discipline begin in entry-level positions regardless of prior experience or advanced degree.

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8. Remuneration systems and promotion criteria require mastery of a core discipline as a precondition of advancement.

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9. The career path for professional employees is relatively consistent over the first six to ten years with the company.

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10. Reward systems, performance incentives, and promotion criteria and other primary measures of success reflect a high degree of congruence.

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11. Virtually all-professional employees can identify and articulate the firm’s shared values (i.e. the purpose of mission that ties the firm to society, the customer or its employees).

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12. There are very few instances when actions of management appear to violate the firm’s exposed values.

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13. Employees frequently make personal sacrifices for the firm out of commitment to the firm’s shared values.

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14. When confronted with trade-off between systems measuring short-term results and doing what’s best for the company in the long term the firm usually decides in favour of the long term

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15. This organization fosters mentor-protégé relationships.

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16. There is considerable similarity among high potential candidates in each particular discipline

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Compute your score For comparative purpose: Scores Strongly socialized firms

Weakly socialized firms

65–80

IBM, P & G Morgan Guaranty

55–64

AT & T, Morgan Stanley, Delta Airline

45–54

United Airlines, Coca-Cola

35–44

General Foods, Pepsi Co

25–34

United Technologies, ITT

Below 25

Atari

Modified from Source: Richard Pascale, “The paradox of corporate Culture: Reconciling Ourselves to socialization, “Copyright Regents of the University of California. Reprinted form the California Management Review, vol. 27, no. 2 winter 39, 40, permission of the Regents.

EVALUATING THE SELECTION TECHNIQUES The techniques engaged by organizations in hiring talent are quite ingrained in the culture of the company. Organizations hire talent at varying levels of management and deploy strategies that depend on the type of talent to be sourced. Nearly every top management employee employed in the business is encountering an international dimension to his or her work. For some, this involves international posting of

Competency Based Selection Process

home country employees, while for others it involves the establishment, management and monitoring of reward packages for employees of subsidiaries. But to HR it means enabling competencies that can work in different cultures and performance situations. What does all this mean in practice? The whole gamut of activities associated with the management of people at work, of course, potentially falls within the scope of HRM. However, a few aspects seem to be critical. They are: �

The process of bringing people into the organization: making very sure that new entrants have the potential and willingness to contribute to organizational success.



The management of performance: making very sure that what employees do is geared to the achievement of relevant goals and that the resources are available to make this happen.



The reward of performance: on the basis of what gets rewarded gets done, making very sure that rewards are managed rather than merely administered.



The development of talent: creating the environment in which learning is seen as a way of organizational life.



The management of culture: developing and communicating a particular vision of what working for this organization means.

All of the above have been the subject of research and comment recently and the following sections will consider each in turn. Three selection tools that have seen significant growth in recent years. They are assessment centres, ability tests and personality questionnaires. The use of all three by the larger UK organizations doubled from 1985 to 1995, although for assessment centres (because of cost) and ability tests (because of fears of adverse impact) there is evidence of a plateau in take-up. The use of personality questionnaires, however, has shown a steady increase over the decade, with over 70 per cent of large organizations now using them for a variety of assessment purposes. All three are an indication of the increased seriousness with which selection is being taken in that they are likely to be more costly to stage than the interview. The strategy demands global HR leadership with standard systems but local adaptation. The key underlying ideas are to satisfy your company's global human resources needs via feeder mechanisms at regional, national and local

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levels, and to leverage your current assets to the fullest extent by actively engaging people in developing their own careers. Implementing these ideas can be broken down into ten steps. By taking these steps, a company should be able to put into place an effective global human resources program within three to four years. Run your own global labour market. In a large company, it is hard to keep track of the best candidates. For this reason, IBM now advertises many of its posts on its worldwide Intranet. UNILEVER usually advertises only posts in the lower two pools, but this policy varies by country and by business unit. Competency based selections has many advantages �

Allows a competitive internal job market to function across nationalities, genders and other categories.



Shows ambitious people they can make their future in the company.



Makes it harder for bosses to hide their leading lights.



Attracts high-flyers that may be ready to jump ship.



Helps to break down business-unit and divisional baronies.



Reduces inbreeding by transferring managers across businesses and divisions.



Gives the rest of the company first picks of talent made redundant in another part of the world.



Solidifies company culture.



Is consistent in giving employees responsibility to manage their own careers.

There are also certain disadvantages �

Line managers have to fill the shoes of those who move; a central arbiter may need to settle disputes between departments and divisions and applicants not chosen might decide to leave. To prevent that, disappointed applicants should automatically be routed through the career development office to discuss how their skills and performance mesh with their ambitions.

Competency Based Selection Process



IBM used to hire only from the inside, but five years ago it began to recruit outsiders – including those from other industries – to broaden thinking and add objectivity. UNILEVER is large enough that it can garner a short list of three to five internal candidates for any post. Yet it still fills 15 per cent to 20 per cent of managerial jobs from outside because of the need for specialist skills and because of the decreasing ability to plan where future growth opportunities will occur.



Every manager in a lifeline job should be required to nominate up to three candidates who could take over that post in the next week, in three months or within a year and their bosses should sign off on the nominations. This should go a long way toward solving succession questions, but it will not resolve them completely.



The problem in large multinational companies is that many of today's successors may leave the company tomorrow. In addition, managers name only those people they know as successors. Third, the chief executives of many multinational companies keep their succession plans – if they have any – only in their heads. This seems to overlook the harsh realities of life and death. A better approach is that of one European shipping magnate who always carries a written list with the name of a successor for the captain of every boat in his fleet. Global networks that transfer knowledge and good practices run on people-to-people contact and continuity. Executive continuity also cuts down on turnover, recruitment and opportunity costs. As international competition for talent intensifies, therefore, it becomes increasingly important for companies to retain their good managers. Monetary incentives are not sufficient: the package must include challenge, personal growth and job satisfaction.

A policy should be adopted that invites employees to grow with the company, in every market. In addition, a career plan should be drawn up for every executive within his or her first hundred days in the organization. And plans should be reviewed regularly to be sure they stay aligned with the business strategy and the individual's need for job satisfaction and employability. Overseas assignments and cross-border task forces are excellent ways to challenge, develop and retain good managers. They can also be awarded as horizontal "promotions." This is particularly useful since the fiat organizations currently in fashion do not have enough levels for hierarchical promotions alone to provide sufficient motivation.

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The first, and perhaps most fundamental, step toward building a global HR program is to end all favouritism toward managers who are nationals of the country in which the company is based. Companies tend to consider nationals of their headquarters country as potential expatriates and to regard everyone else as "local nationals." But in today's global markets, such "us-versus-them" distinctions can put companies at a clear disadvantage, and there are strong reasons to discard them: Ethnocentric companies tend to be xenophobic – They put the most confidence in nationals of their headquarters country. This is why more nationals get big assignments, climb the ranks and wind up sitting on the board – and why the company ends up with a skewed perception of the world. Relatively few multinational companies have more than token representation on their boards. A.B.B. is one company that recognizes the danger and now considers it a priority to move more executives from emerging countries in Eastern Europe and Asia into the higher levels of the company. Big distinctions can be found between expatriate and local national pay, benefits and bonuses, and these differences send loud signals to the brightest local nationals to learn as much as they can and move on. Less effort is put into recruiting top-notch young people in overseas markets than in the headquarters country. This leaves fast-growing developing markets with shallow bench strength. Insufficient attention and budget are devoted to assessing, training invaluable local nationals already on the company payroll. Conventional wisdom has defined a lot of the pros and cons of using expatriates versus local nationals. But in an increasingly global environment, cultural sensitivity and cumulative skills are what count. And these come with an individual, not a nationality. After all, what exactly is a "local national"? Someone who was born in the country? Has a parent or a spouse born there? Was educated there? Speaks the language? Worked there for a while? All employees are local nationals of at least one country, but often they can claim a connection with several. More frequent international travel, population mobility and crossborder university education are increasing the pool of available hybrid local nationals. Every country-connection a person has is a potential advantage for the individual and the company. So it is in a multinational company's interests to expand the definition of the term "local national" rather than restrict it. The main tool of a global HR policy has to be a global database simply because multinational companies now have many more strategic posts scattered around the globe and must monitor the career development of many more managers. Although some multinational companies have been

Competency Based Selection Process

compiling worldwide HR databases over the past decade, these still tend to concentrate on posts at the top of the organization, neglecting the middle managers in the country markets and potential stars coming through the ranks. IBM has compiled a database of senior managers for 20 years, into which it feeds names of promising middle managers, tracking them all with annual reviews. But it made the base worldwide only ten years ago. Now the company is building another global database that will cover 40,000 competencies and include all employees worldwide who can deliver those skills or be groomed to do so. IBM plans to link the two databases by 2000. UNILEVER has practiced a broader sweep for the past forty years. It has five talent "pools" stretching from individual companies (e.g., GOOD HUMOR BREYERS ICE CREAM in the United States and WALLS ICE CREAM in Britain) to foreign subsidiaries (e.g., UNILEVER United States Inc. and UNILEVER U.K. Holdings Ltd.) to global corporate headquarters. From day one, new executive trainees are given targets for personal development. Those who show the potential to move up significantly are quickly earmarked for the "Development" list, where their progress through the pools – company, national, business group and/or region, global, executive committee – is guided not only by their direct bosses but by managers up to three levels above. "We want bigger yardsticks to be applied to these people and we don't want their direct bosses to hang on to them," explains HERWIG KRESSLER, UNILEVER'S head of remuneration and industrial relations. To make sure the company is growing the general management talent it will need, the global HR director's strategic arm reaches into the career moves of the third pool – those serving in a group or region – to engineer appointments across divisions and regions. To build this type of global HR database, you should begin with the Step 2 role descriptions and a series of personal-profile templates that ask questions that go beyond each manager's curriculum vitae to determine cultural ties, language skills, countries visited, hobbies and interests. For overseas assignments, HR directors correctly consider such soft skills and cultural adaptability to be as important as functional skills. The fact that overseas appointments are often made based largely on functional skills is one reason so many of them fail. So it is increasingly important that nothing happens by default whether the head office imposes rigid controls or allows local management to reflect domestic practice. A practical knowledge of local frameworks and international practice is essential. The transfer of training techniques across cultures is fraught with difficulties for both trainer and the trainee. Trainers working within multicultural settings need to be especially sensitive to their trainees' needs and socio-cultural learning backgrounds. Both trainers and participants in the

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workplace bring to training courses a baggage of past and present educational experiences that impacts their reaction to organizational learning approaches. Considers how a particular assessment technique can make explicit what trainers often assume to be implicit in terms of their training practices and how industry can learn from educational case studies. Describes the results from implementing a "one minute" assessment feedback to Asian students undertaking a technical English enhancement program. Suggests classroom assessment can heighten greater personal awareness to training approaches within a multicultural setting, broaden understanding of participant needs and encourage a more systematic strategy for expanding and improving training and learning quality. Implies exploiting cultural synergy requires managing rather than merely accepting, the cultural divide. How can we assign people to international positions who can live and work successfully across cultures? This question has been asked and debated for as long as human resource professionals have worked in the international arena. Today we find ourselves in the strange situation of having very good answers to this question and yet few organizations are listening to the answers and implementing the best-proven and available practices. Indeed, recent surveys have shown that the great majority of multinational organizations are still making international selections based only on job skills, while they should also be considering the potential for intercultural adjustment as well as personal and family mobility issues. Very few organizations make use of proven selection systems developed and available outside of their organizations. So, what are these best practices? They begin with the simple but difficult situation of having multiple candidates for each international position instead of a single choice. Human Resource (HR) professionals often report that it is difficult enough to identify one employee, who can perform the international job, will accept the assignment, and is mobile, let alone try to come up with two or three. However, the very definition of the word “selection” requires alternatives from which to select. If you are not in the multiple candidate situations you are not even in the selection game – you are in the game of making “whole” the single choices that you have. On the other hand, if you can achieve a ratio of three candidates to one position and use the Overseas Assignment Inventory (OAI), which has known validity correlation, utility theory and actual practice show that failure rates can be dramatically reduced, resulting in huge cost savings. Secondly, you must have time. This means sufficient time to make use of instruments like the OAI and to conduct thorough assessment interviews. Too many international selection scenarios resemble a fire drill. The rapid pace of international business presses HR professionals to fill needs much too quickly. When the prospective international employee candidates are married, the employee and spouse should be assessed and selected as a team.

Competency Based Selection Process

Involving the spouse in this process sometimes goes against organizational norms and IHR professionals may not be experienced with spouse/couple/family assessment, but research and practice have shown that international assignment success is achieved by the couple or family as a unit. If the spouse has difficulty adjusting to life in another country, this directly affects the employee and the assignment is jeopardized. It only makes sense then that the spouse should be assessed for intercultural adjustment potential along with the employee and selection decisions are made for the couple as a unit as well. Almost exclusively line management, who do not share this decision-making process with HR, is still making most international selections. This can mean that HR is seen only as policy implementers and not as strategic business partners. Best practice here is for HR to employ a value-added assessment selection system and to be consulted and included in these decisions. Career planning and management is a difficult thing to accomplish in these days of globalization, rapid change, mergers and acquisitions. It is even more difficult when applied to international assignments. Yet, when such an assignment is treated as part of a career plan and not as a single event, the chances for success are much improved. In fact, many excellent international assignment candidates are demanding to know what is next for them if they accept the international assignment. They fear the “out of sight, out of mind” syndrome, where they will not be considered for new opportunities while on international assignment. They want to be assured that the company will value their international experience and, to the extent possible, help them with next steps in their career in the long run. International assignment compensation and benefit policies vary widely across organizations. Many of them offer very lucrative packages, apparently making the assumption that financial incentive lead’s to superior international performance. The risk here is that this type of policy may attract those who see the financial reward as the single, or most important, motivation for the international assignment. The best practice is to seek candidates who balance financial motives with those of career development and international experience. A final best practice to be discussed here is to follow a “closed loop” system of systematically evaluating international assignment successes and failures and learning from them. Many organizations do little follow-up, despite the availability of 360 degree instruments like the Evaluation of Expatriate Development (EED) which assesses proven factors of success and provides feedback and development information. Given the knowledge and availability of the best practices discussed here, the question posed at the beginning of this essay should be redirected. Now we need to ask how these best practices can be implemented in our organizations. The workplace of the new millennium will be multicultural and global. With a greater intercultural interaction, the differences are not easily going to disappear.

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HOW

STAFFING-ASSESSMENT TOOLS WORK:

All staffing-assessment tools are designed to predict job performance through measuring some combination of three basic things about candidates: The main difference between assessments lies in how they measure these things and how this affects their ability to predict different types of job performance. From a design perspective, assessment tools can be broken into three general categories: �

Background Checks, Integrity Tests and Physical-Abilities Tests measure very specific things about candidates' history or personal characteristics. As a result, their effectiveness is limited primarily to jobs in which theft, drug use and the ability to perform physical functions are significant employee-performance issues.



Qualifications Screens and Knowledge Tests are good for measuring highly objective or "visible" things related to experience and motives such as education or salary expectations. It is relatively easy to build a 15-minute qualifications screen to "screen out" candidates who lack the minimum requirements for a job. However, qualifications screens are not effective for identifying less visible characteristics related to things such as problem-solving, honesty, leadership, or customer service. These measures are also relatively easy for candidates to fake.



Talent Measures, Culture Fit and Values Inventories, Job Simulations and Structured Interviews can effectively measure less visible candidate characteristics that influence job performance such as interpersonal style, motivation, and analytical skills. These assessment tools are good for "selecting in" candidates who not only can do the job, but also are likely to do it well. These tools are also among the most difficult to build and tend to require at least 30 minutes or more to complete. In addition, their complexity makes them susceptible to poor design and misuse. These tools should not be used unless a company is willing to spend the time and resources to ensure that they are used correctly.

The needs and goals of an organization determine which assessments to use: �

Increasing Job Performance – If they are appropriately matched to the job, talent measures designed to assess work style and ability are usually the best predictors of job performance. Structured interviews and job simulations are also effective but require more time and resources from recruiters and/or hiring managers.

Competency Based Selection Process



Increasing Tenure – Culture fit and values inventories tend to be the most effective for predicting tenure. Well-designed qualifications screens can also predict tenure, particularly for less complex entry-level jobs.



Increasing Staffing Efficiency – Qualifications screens tend to provide the highest level of return in terms of efficiently processing candidates. This is particularly true when they are integrated with a candidate-management or applicant-tracking system. Web-based talent measures can also be effective for rapidly evaluating candidates but tend to have higher "per use" fees.



Decreasing Counterproductive Behaviour – Integrity tests, background checks and drug screens tend to be the most effective for screening out candidates who are likely to engage in counterproductive behaviour such as theft, drug use, or workplace aggression.

In general, using several different staffing-assessment tools will lead to better hiring decisions than relying solely on one or two types of tools. However, using a number of assessments tools increases the time and expense involved in evaluating candidates.

Assessment centre use dropped off markedly in the 1990s for a number of reasons. The biggest reasons were: �

Candidate time requirements—The labour supply for many professional and managerial positions was shrinking at a time of high demand. Quality candidates were not willing (nor required) to go through lengthy assessment procedures to secure good jobs.



Assessment costs—With few internal resources that could be trained as assessors, organizations had to rely on consulting firm support for assessors. These professionals were very costly and made Assessment Centres cost prohibitive for most positions. Assessment Centres continued to enjoy popularity primarily for identifying or selecting senior level talent. Consulting firms experimented with training lower level resources as assessors and using mechanical scoring procedures to reduce cost structures but had difficulty maintaining quality standards.

The biggest drawback in the ongoing use of traditional assessment centres is the amount of managerial time required. In a typical assessment centre, a manager leaves his/her job for two or three days to observe participants’ performance in simulations and then spends an additional day or two meeting with other observers to make final evaluations. Although managers

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recognize the importance of selection and promotion decisions, they are often reluctant to devote this much-concentrated time to assessment. A related problem is the formality of the traditional assessment centre, which tends to make the centre an "event." This may build expectations and call attention to who is being assessed and who has not been asked to participate. The traditional assessment centre also forces organizations to put people through the process in groups; but the method is useless when there are only two candidates for a position. These constraints have limited assessment centre method applications in some organizations to only a few selection or promotion decisions. As a result, many important and effective applications, such as defining training needs, have not been utilized widely. Although organizations recognize the increasing importance of accurately diagnosing training needs before sending people to training programs, the problems associated with staffing developmental assessment centres often make their use prohibitive, even though assessment centre methodology is the best available diagnostic instrument for many positions. Managers agree on the importance of thorough and accurate diagnoses, but are reluctant to spend the time needed to produce the excellent diagnosis that the assessment centres methodology yields.

Selection and placement of diagnosis empowered personnel: The greatest growth of assessment centres since 1985 has been stimulated by organizations moving to an empowered workforce. These organizations are giving employees: �

Responsibility for their designated areas or outputs.



Control over resources, systems, methods and equipment.



Control over working conditions and schedules.



Authority (within defined limits) to commit the organization.



Evaluation by achievements.

Most also are organizing employees into self-directed work teams. The teams are made up of team members and a team leader (the team leader is a working, non-management member of the team). Teams take responsibility for: �

Improving quality and productivity; job rotation.



Planning/Scheduling.



Who works on what?



Quality audit.

Competency Based Selection Process



Equipment adjustment, maintenance and repair.



Housekeeping, vacation planning, absenteeism, tardiness and performance issues.



Choosing the team leader.



Many other related areas.

The adaptation of self-directed teams drastically changes the role of supervisors and managers. Supervisors (often called group leaders) have a very large span of control, with as many as hundred subordinates. Because teams and team leaders take on many of the normal supervisory functions, the supervisors became more managerial in function, concentrating more on budgeting and planning. This, in turn, affects the role of middle managers. The multiple-level changes in job functions have forced organizations to use new methods in connection with selection, promotion and placement decisions. Because assessment centres worked so well at supervisory and managerial levels, it was natural to turn to assessment centres as a methodology. Hundreds of manufacturing plants have used assessment centres to select employees, team leaders and group leaders. To accomplish this, many new processes were developed, especially in connection with "green field" plant start-ups where large numbers of applicants must be processed. TOYOTA assessed 22,000 applicants to staff their 3,000person plant in KENTUCKY. At the employee level, exercises involve applicants in problem-solving group exercises, simulations of the manufacturing process, and one-to-one interactive exercises. Supervisor exercises provide opportunities to demonstrate coaching, leadership and decision-making skills.

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9

Competency Based Interview Strategies An apparent contradiction of recent years has been the increase in the attention paid to selection against the background of relatively large-scale unemployment. Even apparently routine shop floor jobs have been the subject of lengthy selection procedures. Perhaps the most significant pressure producing an interest in selection has been the slimming down of most organizations that mean that it is much less possible to throw people at a problem. It is much more important now to get selection right each time and if COOK (1990) is right in saying that good employees are twice as valuable in terms of contribution as poor employees, then putting time and resources into selection becomes crucial. There has been a growing realization that reliance on the interview, as typically performed, is no longer satisfactory. Various meta-analysis of research data have given the traditional interviewed a poor press. League tables of the effectiveness of selection techniques place the interview towards the bottom – in one case (SMITH, 1986) showing little more utility than astrology and chance prediction. The interview remains a popular device and it is difficult to see how some form of face-to-face selection could ever be left out of most selection decisions, particularly at the later stages. However, all is not lost for the interview. Considerable improvement can be made in its effectiveness if three features are emphasized: 1. Typical interviews are relatively unstructured. Using a structured approach, in which each candidate faces the same key questions, improves the performance of the interview. To be effective, any selection device needs to be both reliable and valid. Reliability relates to the degree to which the device produces the same results when applied (even by different users) to the same candidates, over and over again. Validity is concerned with the degree to which the selection device does the job (basically, predicts job performance) it purports to do. Because the typical interview is unstructured, it fails the reliability test in that each application tends to be different and, therefore, produces different results from the same candidates when repeatedly applied. If a device is unreliable, it cannot be valid. Structuring the interview goes along way to overcome this failing and has the added advantage of being

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demonstrably fairer and, therefore, less likely to be challenged on the grounds of unfair discrimination. 2. Interviews need to include questions that are situational based which reflect job circumstances known to differentiate between good performers and poor performers. If organizations cannot reliably distinguish between good and poor performers (and this is not as straightforward as some managers believe) then it may be difficult to identify the situations that could form the basis of situational questions. Careful job analysis, which may be outside the resources of some organizations, is also a prerequisite of the approach. 3. Interviewers need to be trained. Most interviewers have received little or no training but believe that they are effective selectors. As the introduction to one of the earlier training videos on selection suggested: 'Most people in this country believe that they are good drivers, good lovers and good interviewers/one of the principal findings of a study on selection interviewing was that performance improved with training (MAYFIELD and CARLSON, 1966). Traditional Interviews continue to be haunted by stereo typical interviewing styles that depends on an agenda based discussion and often at the mercy and disposition of the assessors. Some typical interview styles are mentioned here:

1. The Fact Finder The fact finder asks for specific information about people's background. Typical probing questions are regarding a college grade point average or for many people the type of course they designed. The problem with facts of this type is that they say little about a person's motives values sells concept of cognitive skills. They reveal nothing about why the person received good or bad grades, what motivates him or her or how she was she behaves in critical situations. Fact-finding probes control the responses of the interviewee. These may be data, but there are not about many important competencies.

2. The Therapist The therapists ask about people's underlying feelings, attitudes and motives. Typical probes are telling you bought yourself followed by reflections of what the interviewee's stating says that situation how did you feel.

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Data from therapists interviews depend very much on the therapist’s interpretation of the interviewee reactions average interpretations are notoriously unreliable. Feeling data usually says little about what a person can do or actually does. A person could feel negatively about a task but does it well because he or she is high in achievement motivation or is highly skilled and capable of performing under difficult circumstance.

3. The Theorists The theorists ask people for their espoused believes or values. And their typical probes are why did you? What did you do? The problem in this approach is that it gets a clear reason or after the fact rationalization of why a person thinks he or she does something and the rational reasons for it, but not actually behaving in such a situation. It is therefore hypothetical.

4. The Fortune Teller The fortuneteller asks people what they would do in future and their typical probes are ie. what would you do if this would happen and similar questions to project into the future. People's beliefs about what they think they would do are as unreliable as their theories about why they did things in the past. Then there is the salesperson. Who tries to win people to his point of view by asking leading questions such as “Don’t you think this is the best way to do it” and leading questions thus put words in other people's mouths. The selection of matching people and jobs either people outside the organization recruiting and new hire selection or inside placement and promotion. Competence in these for competency based selection methods are based on the following supporters. The better fit between the requirements of a job and competencies of the jobholder, the higher job performance and job satisfaction will be. Successful shoppers of matching therefore depends on accurate assessment of individual competencies, the competence morals of drugs, and method offices in the goodness of fit between a person in the job. The following issues suggest a need for competency-based selection. �

Poor performance for or productivity in a critical job.



High turnover and retention.



Succession planning.



Long learning curves.

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Equal opportunity.



Organizational change.

There are four organizational approaches that influence the type of Human Resource systems that are put into place. The four approaches can be summarized as follows: a. Perception-driven. b. Experience-driven. c. Attribute-driven. d. Behaviour-driven. a) Perception-driven: The perception-driven organization is more intuitive and feeling-oriented. The HR system in this organization places less emphasis on being specific, gathering information and measuring. Its HR efforts will rely on gut-feel interviews, like ability appraisal, motivational coaching and smile training. There is a de-emphasis on structured job-related HR systems. b) Experience-driven: The experience-driven organization uses work-experience in an intuitive way. A few features that characterize this approach are: �

Conversational interviews.



Counsellor appraisal.



Mentor coaching.



Hands-on training.

c) Attribute-driven: An organization that emphasizes attributes uses trait words to describe people. All of a person’s characteristics are considered regardless of the extent to which they are used in a current work assignment. A few features that characterize this approach are: �

Trait interviews.



Recognition appraisal.



Personal growth coaching.



Instrument training.

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d) Behaviour-driven: When an organization adopts the behaviour-driven strategy, it emphasizes organization, description and cautious inferences about people. One of the most difficult challenges faced by a new interviewer is to go beyond the gut feeling and gather behavioural information about a candidate’s job-related skills. A second challenge faced by today’s interviewer is to avoid the temptation to assess only a candidate’s fit to the organization. An interview that is based on only the candidate’s fit to the organization will not measure the skills needed to do the job itself. The behaviour-based interviewing strategy can asses the extent to which a person is both a fit for the organization and able to do a particular job.

Interview Approaches Taking a look at various approaches to interviewing. The following are the few that fit into the models explained above. �

Gut-feel interviews.



Conversational interviews.



Trait interviews.



Behaviour-based interviews.

1. Gut-feel interviews: This person-oriented intuitive approach uses the interviewer’s gutfeel as the standard for assessing the candidate. The interviewer does not use a structured interview with job-related questions. Instead questions are spontaneously asked in light of the interviewer’s reaction to the candidate. In this type of interview subjective criteria are used to interpret the answers and impressions, which serve as the basis for selection. A major disadvantage with this approach is that the decision is highly influenced by the interviewer’s perceptions and beliefs. 2. Conversational interviews: This approach involves an unstructured interview with a focus on a candidate’s job-experience and job skills. It resembles a conversation between two equals. A disadvantage of this approach is that the conversational interviewer must be a very capable person who knows the job very well. Also failure to use a structured interview weakens the defensibility of the selection process. 3. Trait interviews: A trait interview uses a structured approach that is oriented to the total person. It measures key personality traits. The questions relate more to the personal characteristics of the total person than to specific work-related skills. With a structured approach, a trait interview can be effective in assessing crucial personality traits needed for a specific job. But a good trait interviewer needs more training than a manager typically gets.

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4. Behaviour-based interviews: A behaviour-based interview is structured like the trait interview and jobs focused like the conversationalist. The structured interview form asks singular open-ended questions about past events in the candidate’s work experience. The interviewer takes descriptive notes during the interview and rates the candidate’s skills for doing the job by comparing examples of past performance to skill definition. The interviewer then bases the selection decision on the overall match of the skills to job requirements. There are many reasons for using the behaviour-based interviewing strategy. First there is evidence that the technique is both reliable and valid. Secondly, the behavioural language provides the basis for linking organizational identity to the interviewing system. That behavioural event interview needs to adhere to the following guidelines Know whom you will be talking to. Arrange a private place to hold the interview and the quality time for the interview. Arrange to tape record the interview. Know what you say. Behavioural event interview in addition has introductory explanation of clarity of job responsibilities and articulation of behavioural until events some characteristics needed to do the job including conclusion in summary. Benefits of using a systematic approach to interviewing: �

Avoid subjective gut-feel decisions.



Helps interviewers avoid asking the same questions of each candidate.



Enables the standardization of the perceptions of the interviewers about the candidates.



Makes the linkage of interviewing to other HR systems possible.



Suggests information to be covered in interview training.

There are five steps in behaviour-based interviewing: 1. Skills analysis. 2. Select and edit skill definitions. 3. Create a structured interview.

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4. Gain behavioural examples. 5. Rate skills. 1. Skill Analysis: It is a systematic process of identifying the technical skills and the performance skills important for doing a job well. There are several important elements of a skills analysis. �

Identify job experts: Job experts are able to give an accurate description of what needs to be done to do the job well. This approach is very different from the indepth study of high performers.



Assemble job information: A skill analysis co-coordinator collects existing information on the job and organization, documents the qualifications of job experts and directs the job experts on the steps of the work analysis. This enables the job experts to include information systematically on the work context and the job content in the skills analysis.



Identify important work activities: The most frequently rated activities are combined into skill definitions. These statements are then linked to performance skills and questions for easy selection by interviewers.



Specify essential job functions: Essential functions are the fundamental job duties of the employment positions that the individual holds.

2. Select and Edit Skill Definitions: There are two ways to develop skill definitions. In the first approach the job experts pool the activities and tasks that are important in doing the job well and then build the skill definitions and other relevant data pertaining to the job and the organization around these pools. The second approach is much quicker and yields comparable results. Here a questionnaire is used to generate a job profile and then customize the generic skill definitions. These definitions are edited so that they are aligned with the identity statement of the organization as well as the specific job requirement. A disadvantage to this approach is that the more the performance skill is edited the less does it benefit from the research responsible for developing a generic vision. 3. Creating a Structured Interview: A Structured Interview is also called a patterned interview. In this approach a list of pre-planned questions are present with an interviewer from which he may select his questions. Comparing it to the scoring guides scores each answer to the question. Such a technique is called a linear interview. Such an interview has to be structured failing which it loses its effectiveness.

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4. Gain Behavioural Examples: Behavioural examples are a candidate’s description of past instances when he used a skill. Behavioural examples provide events from the candidate’s background to compare to job-related skill definitions. The selection decision can be based on the extent to which the person has the skills needed for the specific job. Thus not the entire person but only his job-related skills are assessed. 5. Rate Skills: In this final step, a process called triangulation evaluates the interview responses. The three steps that comprise this process are as follows: �

Read the skill definition specifying what to measure.



Read all the notes taken in the interview.



Compare the notes taken in the interview to the skill definitions by using the rating scale.

After the ratings are completed the pattern of the ratings along with other candidate information is used to make the selection decision. Skill definitions can be used to link performance discussions with selection interviews and organization’s identity. This linkage can be achieved through a task-based appraisal system that uses behavioural narratives to provide a sample of what a person did during a performance period. The comparison of this information to either skill definitions or task statements provides the basis for a meaningful performance discussion. A rating matrix is then used to describe the extent to which the individual’s actions and measured outcomes met the expectations. A similar approach can be used for coaching. This linkage is achieved by converting phrases in skill definitions and task statements into goal statements. Goal-based coaching enables a manager to use a systematic job-related approach to individual development. It begins with the manager describing and modelling work expectations. Once the areas for improvement are jointly selected, the managers help the jobholders to convert the phrases in job-related competencies or tasks into goal statements. The jobholder uses the statements for self-monitoring. Behaviour based performance skills can be used to develop instructional objectives that reflect the skills to be learnt in doing particular jobs in a particular work context. This enables the linkage between instructional objectives and organizational identity including core competencies, capabilities, core values and priorities. This competency focus thus looks into the matter of what competencies are all about and what the organizations should do so as to ensure that their core competencies are put into place. And as well as that the competencies of their employees are built in a manner, which are in alignment with the organization’s identity and helps the organization to achieve its goals.

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Frameworks for competencies have been devised along somewhat different principles in Australia, the USA and the UK, with several other countries now beginning to look at what they might adopt or adapt. The impetus for research in the UK gathered momentum in to the eighties with the government's response to indicators that the UK was lagging behind to European countries, with higher unemployment figures and lower skilled and more poorly qualified workers. Concerns expressed in the Manpower Services Commission's N Training Initiative: An Agenda for Action (MSC, 1981) culminated in the 1986 White paper working Together, Education and Training (ED, 1986). The core idea was that each industry would set up a lead body with overall responsibility for the development of standards. The assessors of NVO candidates will either be their own workplace supervisor, whether they have one, or an equivalent person from another workplace. The advantage of the former is that assessment formally or informally already forms part and parcel of the normal supervisory and management functions within organizations. Supervisor should have an in-depth knowledge of a person's work performance and be best placed to ensure that appropriate evidence is gathered. The disadvantages are that personal bias, knowledge of the person unrelated to what is being assessed will result in the misuse of power and position in relation to the assessment. Another of the great strengths of the competency approach is also its greatest draw taking time to gather evidence of different and corroborating kinds can result in delayed learning if which the candidate evidently needs to learn aspects of the job in order to domestic competence, and is afforded the time to do this well. It can strengthen the case of: candidate's competence and result in the production of a portfolio of evidence which is more meaningful than a piece of 'writing about' produced via an exam or test. However, the gatherings of such evidence and its assessment have become notoriously time-consuming. There are huge problems around the availability of opportunities to demonstrate some of the competence required to complete a qualification. The number of obstacles to successful completion can lead to corner cutting, and a corruption of the assessment process. There is also the potential for assessors to collude with candidates over incomplete areas of evidence in order to finalize an otherwise seemingly endless process (SMITHERS, 1993).

Competency Interview Types of competency interview �

General competency interviews: One-half hour to One hour in duration is sufficient. It provides an exchange of enough general information to enable both employer and

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candidate to determine if further contact is needed. A personnel representative or one member of the selection team or committee may conduct this competency interview. E.g. who will take the final decision for short-listing candidates for a final competency interview? �

Screening competency interviews: A short-term competency interview designed basically to eliminate unqualified candidates. E.g. When the applications are more, recruiters use this method. College recruiters use this method to decide on the right applicants.



Second or selection competency interview: One hour to one day in duration; both employer and candidate engage in a more in-depth discussion of qualifications, responsibilities and other aspects of the position and the organization. The candidate is being seriously for the position and the competency interviewer must gain as much information as possible to make a final decision.

If an organizations product sale is being outsold and service quality is not on par with its competitors the perception may be our people are not as good as that of our competitor or we need better people.

Need for Preparation for a competency Interview at both Assessor and Assess Situation Why should there be preparation? 1. Prior preparation avoids poor performance. 2. By squeezing it into a busy working day is doing disservice to the competency interviewee concerned. Guidelines for preparation: 1. Thoroughly read and understand the job description: It is important document which Outlines: �

The basic purpose.



The principal accountabilities and dimensions of the job.

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The business environment.



The organization framework.



The internal and external relationships involved.



The challenges involved.



The knowledge in terms of skills and experience necessary to do the job.

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2. Do not make the mistake of assuming the job content without referring to the job description. In many instances the job description does not exist or it is outdated and no longer applicable. If this is the case, it is the responsibility of the competency interviewer to see to it that a current job description does exist and the content is fully understood. 3. If the competency interview is being done without the exact nature of the job with its current responsibilities clearly in mind, the competency interview will be done with a handicap. 4. You should be able to place the right person in the right job without relying on luck or instinct or both. 5. New job responsibilities may have to be added or even some of them are to be deleted depending on the circumstances. 6. The important thing is that the physical target is to be hit accurately and proper understanding of the target is necessary.

Skills assessment Every job requires the successful performance of at least four or five skills. Skill assessment is essentially a refining of job description. E.g.: Skill assessment for entry-level sales position requires �

Good communication skills.



Assertiveness.



Ability to organize and plan.



Proper motivation.

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The important thing to realize is that this core set of skills must be present in every candidate seriously considered for that position.

Resume analysis: Resume is a widely used method for marketing an individual’s talents and abilities. It is an indicator of the human being it represents. It comes in all different formats. The two important ones are: 1. Chronological Resume: It indicates the time period in each company so that the competency interviewer can see where and how long the candidate stayed in each company. 2. Functional Resume: It states the candidate’s achievements. It is more of a selling tool. This does not give the many facets of the candidate’s background that is how long he has worked and in how many companies. The preferred one is the chronological one with important achievements worth mentioning. The resume should be: �

Neat.



Free of any misspellings.



Professional.



Consist in conveyance of the candidate’s capabilities.

The environment �

The candidate’s first impression of the firm is going to be formed at the time of competency interview. So a suitable environment for the competency interview where there are no interruptions should be arranged. The candidate may be the best-qualified person for the job may become insulted or slighted. E.g.: One manager wanted an applicant to get the feel of what it is like to work at the company. So the door was purposely left open to allow the sense of workplace to filter into the room. This did little more than create distractions and both the manager and the candidate had difficult time concentrating on each other.



Competency interviewing over lunch is advised only after the screening competency interview has been completed.

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Competency interview is a reciprocal flow of information, so the environment has to be proper for the informational exchange to take place.



Competency interviewer has to concentrate on a complex task, that of screening, evaluating and identifying an individual for a position in the company. It is nothing less than demanding and it requires the full use of the facilities in a controlled setting.

Eliminating the bias: A bias is essentially a preconceived notion, a mental lens that distorts one’s perception of a candidate. E.g. a male employment manager who is very conservative and has a son who was studying in the 1st year B.Com. After joining college his son who was a simple person with good academic record changed his lifestyle totally. He no longer concentrated on his studies and his dress habits were modish and he became very arrogant which frustrated the conservative father. The father happened to his son’s friends who are all from affluent families with their fathers having their own business operations. The father thus formed an opinion that the sons of business people are all wayward ones. He was very angry with them because he strongly believed that they are responsible for his son’s dramatic change in behaviour. So whenever the competency interviews were held for candidates from affluent families he made the discussion a very uncomfortable one and outwardly rejected them. This came to the notice of his superiors who then helped him to come out of the biases, through proper counseling. So it is very important that the competency interviewer go through the mental process of eliminating bias, for a failure to do so may result in losing some deserving candidates.

Reducing stress: The more stress one introduce into the competency interview the less information will be received. The comparative analysis of the final – choice candidates will become less effective. Quality information on which the final judgement to be based will become difficult to get. Why is the competency interview stressful? The competency interview by its very nature is a very stressful situation. The competency interviewer has to be mindful of this in order to get the relevant information about the candidate’s background. The competency interviewer has to carefully listen to every response of the candidate and watch carefully for every eye contact, poise, neatness etc. The competency interviewer also

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has to make a conscious effort to reduce the stress level on both sides of the desk. The applicant also knows that a professional for weakness or defects in their employment background will probe them. This is unsettling and can definitely inhibit both the quality and quantity of the information given. Different ways of reducing stress �

Concentrate on the applicants work experience in relation to the position available.



Concentrate on job related questions.



Do not keep on worrying about all the things that can go wrong if the position is not filled with the right individual.



Be polite, courteous and professional.



If a negative circumstance arises in a particular part of the candidates work background try to keep the stress down by turning the negative into positive.

E.g.: If an individual was terminated once, the competency interviewer can keep the stress at bay by replying, “Well, I can certainly relate to that, I’ve faced the risk myself” or “Well, don’t feel alone, most of us during our business careers have faced similar situations.

Tone, direction and control: The tone should be cordial, and the direction should be clear. Competency interviewers should not lose control at aggressive applicants and also be able to get information the candidate wants them to get.

Taking notes: Retention decreases as time increases. So it is advisable to take notes during the competency interview. A written record of the competency interview will ensure that the important points are not missed.

Closing the competency interview: �

Give the candidate an opportunity to ask questions about the position and the company.

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Inform the candidate about the timeframe of the recruitment to avoid leaving the candidate hanging for a long time.



Competency interviewer must find out the extent to which the candidate’s assets outweigh the liabilities.



Candidates should leave the competency interview feeling that they have been handled professionally.

THE ART

OF THE COMPETENCY INTERVIEW QUESTIONING

Gathering information is the key to competent competency interviewing and nothing is more important than an ability to be flexible in your questioning techniques; you must do it so smoothly that no one realizes it but you. A questioning style that is appropriate in one instance may give you false, misleading, or–-worse still–no information at all in another instance. The following twelve techniques will help you bring the changes as the situation demands and ensure that you strike the right note every time. 1. Close-Ended Questions These are the most commonly asked questions in competency interviewing, and also the most commonly abused. How often have you heard of competency interviewers? Asking a closed-ended question such as, "Can you work under pressure?" Only yes and no are the possible answers (and who answers no?). The competency interviewer has no information, any way of evaluating any one candidate against another. But while a closed-ended question is inappropriate in its most common usage, it is useful as a questioning technique when you are looking for commitment ("Can you start on Monday?") or when you are refreshing your memory or verifying information from earlier in the competency interviewing sequence ("You were with XEROX for ten years?"). You can also use it to get the ball rolling when you have a series of questions on the same subject. 2. Open-ended Questions These questions are logically the opposite of the first questioning technique. With an open-ended question, the competency interviewee cannot get by with a monosyllabic answer but instead the question demands an explanation in response. For example, "How do

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you succeed in working under pressure?" is an open-ended question that asks the competency interviewee to answer in detail. As a rule of thumb, this style of question is preferable to closed-ended questions, and is guaranteed to keep the candidate talking and you listening. These questions often start with; "I'm interested in hearing about..." "I'm curious to learn..." "Would you share with me...”? In a competency interview how does one handle the question "Tell us about yourself?" An often-asked open question. Perhaps the most frequently asked question across competency interviews. The opening statement needs to be a summary of one’s goals, overall professional capabilities, achievements, background (educational and family), strengths, professional objectives and anything about the personality that is relevant and interesting. This question represents an opportunity to lead the competency interviewer in the direction the candidate want him to go e.g., The specialty or whatever else one may wish to highlight. The intention of the candidate should be to try to subtly convince the competency interviewers that he is a good candidate and have proved that in the past, and have a personality that fits the requirement. Remember that the first impression he creates will go a long way in the ultimate selection. Keep in mind, most candidates who are asked this question just blurt out their school grades, college, marks and qualifications. All this is already there in the CV. Why tell the competency interviewer something he already knows? A final word on approaching this question. Once said what has to be said the candidate should keep quiet. He should not repeat for the sake of speaking for he just might say something foolish. Sometimes competency interviewers need not interrupt in order to give the candidate the impression that he has not spoken enough. This is just a stressinducing tactic. The candidate should not fall for it, if he feels enough is said. The competency interviewer can have a long pause to let the candidate ask, "Is there something specific that you wish to know about me?" Is it better to have a longer selection competency interview or a shorter one? The length of a competency interview in no way is an indicator of how well a competency interview went. This is especially so when there are a number of candidates to be

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competency interviewed for example in the civil services competency interview or the MBA entrance competency interview. In the past a number of candidates have reported varying lengths of competency interviews. Nothing positive or negative should be read into this. An competency interview is only a device whereby the panel seeks information about the candidate. Information that will help the panel decides whether or not the candidate should be selected. If the panel feels that it has gathered enough information about the candidate in 15 minutes of the competency interview commencing and that it has no further questions to ask the competency interview will be terminated in 15 minutes. If on the other hand the panel takes an hour to gather the information required to take a decision the competency interview will last for an hour. In either case the decision could be positive or negative. It is a fallacy to believe that competency interview panels take longer competency interviews of candidates whom they are more interested in. No panel likes to waste its time. If an competency interview is lasting longer than usual then it only means that the panel is seeking more information about the candidate in order to take a decision. 3. Past-Performance Questions This technique has been developed into a whole style of competency interviewing concerning past-performance, or behaviour. Questions are based on the promise that past actions can predict future behaviour, that any given individual can be expected to do at least as well as badly on the new job as he or she did on the last. They are open-ended by nature, yet focus on requesting specific examples of past behaviour. They are usually prefaced with, "Tell me about a time when..." "Share with me an experience when..." "Give me an example of..." Ask past-performance questions early in the competency interview, so that an competency interviewee will realize early on what he or she is expected to share. and give detailed examples about the past. 4. Negatively Balanced Questions When competency interviewing, you can be tempted all too often to believe that a candidate is strong in one area and so will be equally impressive in all areas. This is not always the case. When an eerie light appears around the applicant's head, and hymns from a choir of heavenly angels replace the background noise of your office's typewriters, it is time to get a grip on yourself and look for the applicant's feet of clay. Whenever you find yourself becoming unduly impressed, try, "That's very impressive. Was there ever an occasion when things didn't work out quite so well?" or the simple question, "Now can you give me an example of something in this area you are not so proud of?"

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5. Negative Confirmation When you have sought and found a negative balance, you may feel content that you are maintaining your objectivity and move on, or that the answer you receive may be disturbing enough to warrant negative confirmation. Let's say the competency interviewee told you about a time she found it necessary to go around or behind her supervisor to achieve a goal. As a manager, you will be given considerable pause: If such behaviour is common with this individual, you would be unwise to invite her into your team. Consequently, you will seek a negative confirmation with, "You know, that 's very interesting. Let's talk about another time when you had to..." Successive examples will help you confirm negative traits and perhaps save you from a poor hire. On the other hand, you might find that particular negative situation to be an aberration, a one-time thing and nothing to worry about. 6. Reflexive Questions Reflexive questions are great top-closures and conversation forwarders. They help you calmly maintain control of the conversation no matter who articulates the competency interviewee. If, for instance, an applicant starts to ramble about various experiences, it is easy to interrupt with a reflexive question that will allow you to proceed with other topics. Adding to the end of a statement phrases like these does this: “Don't you? Couldn’t you? Wouldn’t you? Didn’t you? Can’t you? Aren’t you? “For example: "With time so short, I think it would be valuable to move onto another area, don't you?" The candidate's reflex is to agree, and the conversation moves on. 7. Mirror Statements This is a subtle form of probing used in conjunction with a most effective tool, silence. The technique is to mirror or paraphrase a key statement and follow it by closing your mouth, nodding and looking interestedly at the competency interviewee. Use mirror statements to capture the essence of a candidate's answer and to get more detail. Repeat the substance of key comments ("So, whenever you are two hours late for work, you take off two hours early to make up for it"), then sit and wait for the competency interviewee to expand on the mirror statements you made. 8. Loaded Questions Loaded questions are much abused because they can allow the competency interviewer to play power games. The question style requires the competency interview to decide between tough options. For instance: "Which do you think is the lesser evil, embezzlement or forgery?" There is, however, a fine line between absurd loaded questions and carefully balanced judgment-call questions. For most competency interviewers, the technique is useful to probe the

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competency interviewee's decision-making approaches. The easiest and most effective way to employ it is to recall a real-life situation where two divergent approaches were both carefully considered; then frame the situation as a question, starting with, "I'm curious to know what you would do if..." or, "What would be your approach be to a situation where..." 9. Half-Right Reflexives This question style is used to smoke out yes-men, the incurably incompetent, the oddballs who have a total resistance to giving information and the competent but incurably tongue-tied. The technique is to make a statement that is only partially correct and ask the competency interview to agree. It is astounding what enlightening insights this technique can create. For instance: "I've always felt that customer service could stand only after the bill has been paid, haven't you?" This example of the half-right reflexive always generates fascinating responses by the candidate. 10. Leading Questions Here, you lead the listener toward a specific type of answer. These questions often arise accidentally as a result of the competency interviewer explaining what type of company the competency interviewee will be joining. The competency interviewer might proudly explain, "We're a fast-growing outfit here, and there is constant pressure to meet deadlines and satisfy your ever-increasing list of customers," then ask, "How do you handle stress?" The competency interviewee knows that to retain any chance of landing an offer he or she must answer a certain way and consequently does so. This is not to say that leading questions are inadvisable, but like closed-ended questions, they must be used appropriately. They’re best use is as information verifiers, to get the candidate to expand on a particular topic. For example: "We are a company that believes the customer is always right. How do you feel about that?" But you should use the technique only once the candidate's belief or performance in a particular area has been established. In either case, leading questions should not be used early in the competency interview or confused with the somewhat sophisticated half-right reflexive. 11. Question Layering A good question poorly phrased will lose its bite and give you incomplete or misleading information, but question layering can probe an answer thoroughly and on many levels. Let's start with the earlier example of wanting to know whether a potential employee can work under pressure. Many competency interviewers would simply ask, "Can you work under pressure?" and while the intent is good, the question style is wrong for several reasons (as mentioned before): The question requires only a yes or no answer, which tells you nothing; and it leads the competency interviewee toward the type of answers he or she knows you want to hear.

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Instead, you should take a leaf out of a good reporter's notebook. The reporter uses all the styles we have discussed, but in a way that peels back different layers of truth until a topic has been examined from every angle: The reporter asks who, what, why, when, where, and how. In this instance, you do the same thing by joining the closed-ended question with some other questions. See how much more relevant information you can get: �

"Can you work under pressure?" (Close-Ended).



"Tell me about a time when you had to work under pressure." (Open-Ended).



"So, it was tough to meet the deadline?" (Mirror Statement).



"How did this pressure situation arise?"(Probing).



"Who was responsible?"



"Why was this allowed to occur?"



"Where did the problem originate?"

Now you have eight different angles to the same question, each revealing a different aspect of the personality, performance and behaviour of your candidate. Nearly every question in the competency interview can be given the layering treatment. In fact, this technique makes the possibilities for questions theoretically endless; it just depends on how thorough you want to be. Remember: You should not accept a candidate's first answer to any of your questions. You have a right to look closer and check for cracks. If you feel something is lacking in an answer, pursue it by layering your questions. You'll never know unless you ask. 12. Hamburger-Helper Questions Just as people will sometimes use a little hamburger helper to make the ground beef go a little further, so you can use these three techniques to stretch a question. �

If you are either dissatisfied with the first answer and want more data, or are so fascinated with the answer that you want to hear more, say, "Give me some more detail on that. It’s very interesting," or, "Can you give me another example?"



You may hear an answer and add, "What did you learn from that experience?" This is an excellent layering technique that can give you a handle on judgement and emotional maturity, as well as give you more thinking and planning time.

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Perhaps the best technique for gathering more information is simply to sit quietly, looking at the competency interviewee and saying nothing. All mankind is embarrassed by a conversational lull. Remember the last cocktail party you attended, when the silence lasted just a couple of seconds and was terminated by two or three people talking at once? This human frailty can be used to your advantage during the competency interview: The competency interviewee thinks, "Well, he's not saying anything, so he must be expecting me to say something else. I must not have finished my answer to his satisfaction." Even as the competency interviewer, you will find a little silence in the competency interview difficult to manage at first, but it can pay substantial dividends in the long run.

COMPETENCY INTERVIEW RATING SCALE TESTING TECHNIQUE: ASSESSING YOUR ABILITY AS A COMPETENCY INTERVIEWER Practice is the most productive way of developing and improving your competency-interviewing technique. Chart your progress and performance as an competency interviewer by responding to the following statements, and mark the options closest to your experience. Be as honest as you can: If your answer is “never”, mark Option 1; if it is “always”, mark Option 4; and so on. Add your scores together, and refer to the Analysis to see how you scored. Use your answers to identify the areas that need most improvement. Options: 1 Never

2 Occasionally

3 Frequently

4 Always

1. I re-evaluate the job description of each vacancy that arises.

1

2

3

4

2. I make a detailed list of the requirements and expectations of a job.

1

2

3

4

3. I consider a range of different recruiting methods.

1

2

3

4

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4. I write advertisements that attract many suitable job applicants.

1

2

3

4

5. I identify the best medium in which to place each job advertisement.

1

2

3

4

6. I compare each CV with the job specification.

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2

3

4

7. I choose a suitable location in which to conduct competency interviews.

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2

3

4

8. I prepare myself thoroughly before any competency interviews take place.

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2

3

4

9. I brief my colleagues before the panel competency interviews begin.

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2

3

4

10. I review a candidate’s CV and letter just before and after an competency interview.

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2

3

4

11. I know how to make a flustered or nervous candidate feel relaxed.

1

2

3

4

12. I control the course of an competency interview confidently.

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2

3

4

13. I take care to verify a candidate’s claimed qualifications.

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14. I ask each candidate to account for any gaps in their employment history.

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2

3

4

15. I encourage candidates to talk about their previous experience.

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2

3

4

16. I encourage timid candidates to speak about themselves with confidence.

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2

3

4

17. I examine each candidate’s strengths and weaknesses.

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4

18. I give each candidate a clear and positive picture of the organization.

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2

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4

19. I ask each candidate how he or she feels they can benefit from the organization.

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4

20. I spend the majority of a competency interview listening to what a candidate is saying.

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2

3

4

21. I am objective about what a candidate is saying throughout a competency interview.

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4

22. I am polite to candidates and show interest in their points of view.

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2

3

4

23. I assess whether a candidate will fit in with the organization.

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24. I conduct tests, if necessary, to establish that a candidate can do the job.

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4

25. I gain additional insights by watching and reading a candidate’s body language.

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4

26. I remain attentive and interested throughout each competency interview.

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4

27. I note down my first impressions immediately after each competency interview.

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4

28. I ask for a second opinion on all short listed candidates.

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29. I establish how soon a candidate can join the organization.

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30. I conduct negotiations over the salary and benefits package smoothly.

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31. I send rejection letters promptly to all the unsuccessful applicants.

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32. I ensure confidentiality at all times.

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2

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Analysis When you have completed the self-assessment, add up your total score and check your performance by reading the corresponding evaluation. Whatever level of success you have

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achieved during the competency interviews, it is important to remember that there is always room for improvement. Identify your weakest areas, and refer to the sections in this book where you will find practical advice and tips to help you establish and hone your competency interviewing skills. 32–64: Your skills need improving 1. Learn from your mistakes, and take time to prepare from your mistakes, and take time to prepare well for every competency interview that you hold. 65–95: Your competency interviewing skills are fairly sound, but certain areas still need improvement. 96–128: You have a successful competency interviewing technique. Continue to look for ways to develop your competency interviewing style.

SAMPLE: FREQUENTLY ASKED COMPETENCY (GENERAL)

INTERVIEW

QUESTIONS



Tell me about yourself.



What are your ideas on salary?



Why should we hire you?



Tell me a story!



Describe yourself.



How would others describe you?



How do you spend your spare time? What are your hobbies?



What percentage of your college expenses did you earn?



What jobs have you held? What have you learned from them?



Why do you think you might like to work for our organization? What do you know about our products or services?



In what type of position are you most interested? Why? What do you know about this field?



What do you consider to be your major strengths and weaknesses?

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How did you choose UWM? Do you think you have received a good general training?



What led you to choose your major? What courses did you enjoy most Least? Why?



How does your education prepare you for your chosen field of work?



What do you know about the opportunities in the field for which you are trained?



What are your short term and long term career goals? How are you preparing yourself to achieve them?



What are the disadvantages of your chosen field?



What do you want to do five years from now?



What qualifications do you have that make you feel you would be successful in your chosen field?



What were some of your extracurricular activities in college? What did you learn from them? Did you hold any offices?



Do you have any objections if we check former employers for references?



Do you have any plans for graduate work? Are you willing to relocate or travel?



Do you think your grades are a good indication of your intelligence? Why or why not?



What two or three things are most important to you in your job?



Why did you leave your previous position?



What criteria are you using to evaluate the company for which you hope to work?



What two or three accomplishments have given you the most satisfaction? Why? What motivates you to put forth your greatest effort?



In what ways do you think you can make a contribution to our company?



What jobs have you enjoyed the most? Least? Why?



Is it an effort for you to be tolerant of persons with a background and interests different than your own?



How do you work under pressure? What have you learned from your mistakes?

Competency Based Interviews Strategies

EXAMPLES A string of several questions at once Question which indicate the desire response � “Ah, I see you worked for XYZ International?” � “Of course, no health problems, eh?” �

QUESTIONING TECHNIQUES

� �



OPEN

CLOSED

TYPE OF QUESTION MULTIPLE LEADING PROBING BLOCKBUSTING NOUN ACTION UNIVERSAL COMPARATOR

� � �

� �

“How old were you then?” “What are the sales of ABC Inc?” “How many employees were there at the time?”

� �

259

WHEN TO ASK NEVER NEVER

When interviews is rambling talking too much When you wish to probe for facts or details of accomplishment

� When you want high quality information on “Which/what (noun) specifically?” specific things or actions “How (verb) exactly?” � After vague, universal statement like all none “ALL?” “NEVER?”Did every one think that?’ everybody always “never.” “Compare to what?” � After statement using vague comparison like better increase improve less more efficient etc. � At the beginning of an interview to get interviewee “Tell, me more about…” talking “What do you think about…?” � When you wish to hear the interviewee opinions “How do you feel about…?” attitudes or beliefs.

When the interviewee is emotionally involved Reflecting back a statement of what you in what is being discussed think you heard When discussing complex matters � “You seem to feel upset with…?” “ABOUT “ When interviewee is incoherent � “If I understand correctly, you…?” QUESTIONS � “In other words you don’t…? REGLECTIVE � You thought perhaps he was over reacting ?” �“What would you do if ..? � When you wish to test creativity and or the HYPOTHETICAL ability to think quickly and logically � “Could we role play this situation? I’ll be CHALLENGE the customer student � To test selling or public speaking skills EVIDENCE MISSING LINK � “What could happened it…? DEVIL’S ADVOCATE � To test interviewee's approach to objectives � “What will you accept as evidence that you targets the system?” GRAMING � “What do you think you was missing from � To probe interviewee analytical abilities OUTCOME FRAME the system?” BACKTRACK FRAME � “What counter arguments can you think of?”� A way of challenging the interviews objectivity RELEVANCE FRAME

“ What is the real objective/outcome you are aiming at..?” � Let’s backtrack a moment. How did you see things at the time?” � Help me to see how this fits in with ..? �

SILENCE

To test planning ability and probe reasons for actions � To help put information in context � When you cant see why a point was brought up but want to get interview back on track by giving benefit of doubt �

� �

To draw out reticent timid interviewees To obtain information you think is being withheld

Figure: 9.1 Illustrative Questions.

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Competency Based HRM



Describe the relationship that should exist between a supervisor and subordinates. In what kind of work environment are you most comfortable?



What major problem have you encountered so far and how did you handle it?

Here are some examples of closed and open questioning techniques that can be asked by an competency interviewer at the right time during an Interview Session.

CASE EXAMPLE—GLOBAL FABRIC CORPORATION This case has been constructed simplistically to provide a company’s business and change management context with a HR policy statement (as reproduced from the HR Head’s diary) that determines the role between corporate office and divisional management. Keeping such a policy in perspective how does a company accomplish competency based selections.

GLOBAL FABRIC CORPORATION THEME This case describes how a predominantly family managed business that changed to a professional management as a response to the competitive forces in the global economic environment. Of particular interest is how the company managed to add new competencies while retaining the old one to emerge as a dominant player in its chosen areas of business.

1. BRIEF HISTORY GLOBAL FABRIC CORPORATION (GFC) at present (in 1998) is a reputed textile mill in a premier city in Western India having a turnover in excess of $ 900 million. The mill that was set up in the sixties, produces fine and superfine home furnishings, woollen trousers, top wear, formal wear fabrics, rugged casual wear fabric, women and children specialty fabrics and conventional products. In at least two of its products (superfine cotton and rugged casual wear fabric), the mill is the market leader in India and has an established name in the overseas markets. The company is at the moment in the midst of a mega transition to achieve a globally dominant position in its chosen field.

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GFC is the flagship of the Seth Group of Companies. The group owns twelve other textile mills and also has interests in cement, consumer durables, fertilizers & power. The founder started the group in 1955, with a single cement plant and small export business selling yarn. Today, the fourth generation (since the Founder) is managing the business, which is fairly well diversified and widely held. The family is known in Western India for its activities in the educational, research and development, social service and religious spheres. GFC enjoyed a tremendous reputation for its conventional products in the past and had been doing extremely well till about the eighties. Customers valued its quality, investors were happy about the moderate but consistent dividend payments and employees enjoyed the security of their jobs. Demand was high and business was booming, till the entire textile industry faced an unprecedented crisis in the early eighties.

THE TEXTILE INDUSTRY Traditionally, textiles were one of the biggest industries in India, mostly operating as family controlled business. Most of the textile mills have been started in the pre-independence era (1900 onwards) by traders, bankers, money lenders in response to the Boycott & Swadeshi

Phase I Analysis, Objective Setting and Leadership Commitment �

Establishes a clear picture of the current situation.



Sets specific measurable objectives.



Commits leaders to a vision for change.



Aligns the change process to the problem and setting.



Provides groundwork for the broad- scale introduction and integration of the change process.



Analysis covers three broad categories of information— performance, programmatic and cultural. Figure: 9.2 Global Fabric Corporation: Phase 1.

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movements. Their fortunes fluctuated with the government policies before independence, but post independence (after 1947), business was generally booming due to the controlled and protected markets and the rising population and purchasing power. Also, very much unlike in other industries, the technology in textile remained almost unchanged so that given the almost static environment; this was one industry that had no reason to seek a change to more professional management practices. The owner families like “Pedhis” or “Gaddis” therefore, ran the industry where the owner retained close and constant personal control over every routine matter and thought of it as his personal fiefdom. Absolute and total lack of modernization, cost consciousness, systems & procedures, qualified business managers, customer orientations characterized the industry. It was, therefore, a sitting duck to rapid environmental changes.

CRISIS & RESPONSES The eighties saw an upsurge in labour indiscipline in the textiles units in Western India and a protracted industrial labour strike. This gave a boost to the power loom sector that was also being encouraged by the government (as incentive to the small-scale industry) and the mill owners who were unable to run their mills because of the strike. The power loom sector, by virtue of being in the unorganized enjoyed tremendous cost and flexibility advantages, apart from being beneficial to consumer demands. The result was that many textile mills closed down and many textile managers shifted their industries. GFC somehow managed to survive because of its reputations and better technology. However, the crisis brought out glaringly the weaknesses of the industry. The need for change was never more obvious, as mentioned in Phase I changes Refer Fig. 9.2. To put it more simply, the environment had become more turbulent and hence, the simplistic and adhoc structures, processes and behaviours of the organization were no longer sufficient to make an appropriate response. The top management of GFC realized this and decided to bounce back and meet this challenge. This happened in the year 1980–90. Luckily for the group, a younger member of the family, Mr. DEEPAK SETH had by then acquired a business qualification and had been running a small group company on professional lines, quite successfully. The group having realized the importance of a proper understanding of business to run it effectively decided to hand over the reins to the young Turk, Mr. DEEPAK SETH. He became the internal change agent. The group also wisely realized the need for external facilitation to tide over the crisis and hired a team of reputed management consultants for the job. The team along with the internal change agent drew out a corporate strategy to appropriately respond to the changing environment.

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GADDI CULTURE At this point, it would be advisable to describe in detail the traditional management structure, processes and culture in existence, which was to be changed to the new one. The basic structure, which was followed in most family, owned business till then was the managing agency system whereby some members of the family, could control a number of companies. This automatically meant almost complete authority but little responsibility. One or more family members normally exercised close supervision in day-to-day matters and exercised absolute financial powers. This created the need for competent professionals and the family members used to run the business based on their innate business acumen. Consequently, there was no second line of leadership to perform the essential managerial functions. The style was thus extremely individualized (or personalized) than institutionalized leadership. To give an example, rather the mill was run single handedly by Mr. DEEPAK SETH'S grandfather, Mr. MADHUBHAI SETH and after him by the General Manager of the mill Mr. BIMALKANTI SHAH. Through Mr. BIMALKANTI SHAH was not a member of the family; he had come to be accepted as an extension of the family itself. The individualized/personalized style continued. Data on changing business environment and alternate cultures evaluated enclosed as slides, Figures 9.3, 9.4 and 9.11. The departmental managers or even the head had no financial powers and these were all concentrated with the person who was in charge of the mill.

The Changing business environment

� � � � � � � � �

Incremental adjustment continuity planning cartels, barriers national borders restrictions and constraints uninformed customers consumer protection standard commodity products

� � � � � � � � �

Radical transformation change coping with unexpected competition freedom of movement access and opportunity demanding customers consumer power differentiated products and services

Figure: 9.3 Global Fabric Corporation: Changing Business Environment.

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Recruitment was arbitrary and frequently one could find entire neighbourhoods working in the same department. These people were basically hired on an adhoc basis by the departmental head as personal favours to their neighbors. A son succeeding his father on his death or retirement was an accepted practice favours. Financial decisions were taken based on the gut feel of the family. Little or no thought was given to financial management. Prudence in spending, cost cutting, etc. were unheard of. The mangers were technocrats, who spent all their time in managing technology and had absolutely no understanding of their role in the context of the parameters of success to the business. They lived and revelled in a technological world that was isolated from the realities of the market and the world at large. In short, the business was run like a "Pedhi" or a "Gaddi". This was a logical but incorrect transfer of structure, process and culture from the traditional family business of banking, trading and money lending to modern industry. Favouritism, concentration of power in the owner, arbitrariness and lack of proper structure and policies characterized the system. The epitome of this is the example of an employee who was sacked on grounds of indiscipline, getting himself reinstated by invoking the chairman's (the senior most family member) favor. The last relic of this culture was the rest room besides the executive mass where managers would actually sleep for an hour after lunch. It was a similar case with the cashier, who used to sit on a "Gaddi" and disburse payments. He was, in fact, the successor of the erstwhile "munim" and had come to identify his prestige, power and comfort with the gadd he sat on. A serious resistance was encountered when an attempt was made to put a proper counter

The Changing business environment

� � � � � � � � �

Track record scale and security diversification expansion static structure hierarchy procedures individuals single discipline

� � � � � � � � �

Relevance of contribution flexibility, responsiveness focus & segmentation prioritization dynamic flow relationships processes task forces / teams multidisciplinary

Figure: 9.4 Global Fabric Corporation: Changing Business Environment.

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265

with chairs in place of the "Gaddi". It was argued that it was just not possible to function from a modern seating module. The organization culture then was also extremely mangy and unclear. The key functions such as cotton buying, finance and purchase of technology were performed directly by some of the family members who would report not to the head of the mill but to the head of the family. MADHUBHAI SETH used to handle cotton purchase for a long time while his son was more interested in finance. Managing the technology was left to the engineers who then had little to contribute towards cost effectiveness and quality. Twice did the mill hire an outsider to run the mill? However, he too became an extension of the family only and ran it, as they themselves would have. Another interesting feature was the system of agents who bought the cloth from the mill and sold it to dealers and retailers all over India. The function of the Sales Manager was thus confined to allocating the cloth produced amongst the agents. The agents themselves had become very influential people since they represented the customers to the mill and gave the mill its revenue. MADHUBHAI himself consciously followed the policy of developing these vendors so much so that whenever any agent came to visit GC he could not leave without having lunch or dinner with MADHUBHAI. The mills also had a very benevolent policy towards its employees. Though salaries were very less, job security was assured. In fact, more often than not retired employees were given extensions, provided they could convince the owner.

MEGA TRANSITION From this general outline of the culture and management style, it would be apparent that in order to be suitable in the context of growing competition from the lean, mean and flexibly unorganized sector, a mega transition was called for which was initiated by the team of DEEPAK SETH (the internal change agent and the management consultants (external facilitators)) Fig. 9.5. The team arrived at a consensus on focusing on very stable and large target segments of the market and choosing a product mix for meeting the needs of the segment. Another very important criterion in identifying the product mix was the necessity of high entry barriers to deviate extensive competition. Incentives being offered by the Government for Exports were also an important factor. Transition slide is provided below. High investment in plant, machinery and innovation were made to set up a cost effective production process to manufacture denim (coarse casual wear fabric) and fine and superfine cotton shirting. A separate marketing outfit was established as a separate company to market the product. Professionals from the market who would give certain orientation to the business manned

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GFC Evaluation of Trends:Emerging Scenario Trends with immediate impact • Globalization • Liberalization

• e Commerce • Global Communication

Trends with Impact in near future • Convergence • Deregulation • Privatization • Governance & Shareholders

• Outsourcing • Mergers & Acquisitions • Strategic Alliances

• Core Competencies • Return on Human Capital • Focus on Value/ Revenue Growth

• Knowledge Management

Re-defining the organisation... THE PAST… Organization Structure Leadership

TODAY… Hierarchical

Flexible, Center - less, Networked

Selected stars

Everyone is a leader

People & Culture

Long term rewards, Vertical decision making

Delegated authority, Own your career

Coherence

Hard wired into process, Internal relevance

Embedded vision in individuals

Knowledge

Focused on internal processes

Alliances Governance

Complement current gaps Internally focussed & top down

Focussed on customers Create new value and outsource Internal & External

Figure: 9.5 Global Fabric Corporation – Evaluation of Trends: Emerging Scenario. this. Some slight modifications were also made in the structure and processes, but only in a halfhearted manner as that the systems continued more or less as it was. The priority was making an immediate turn around which the company managed. It had an extremely good run for about six to seven years during which time it established itself as a leading name in textiles in India. It also made significant progress in exports and found a place amongst the top five denim manufacturers in the world Fig. 9.9.

FOCUS ON COMPETENCY BASED HUMAN RESOURCES During this time the company started facing competition from reputed textile multinationals that had started setting up textiles mills in other Asian countries for export to the West. These

Competency Based Interviews Strategies

Talent Acquisition & Management

Competency Driven HR Management

� Position company image well � � Build campus image � Use Recruitment ads for brand building � Use the Recruitment process for creating goodwill & a professional image � Role Clarification � Position Evaluation Exercise � � Star Tracking System � � Make creative exceptions for getting outstanding people � Change gradually for others � Flexible, individualized compensation programs � Offer choice & dignity of lifestyle

267

Performance & Competency Management

Minimum Individual Performance level necessary � MBO: Control Results � Competency Based Performance Management (CBPMS) � Business Goal Setting critical � Find time for monitoring � Mid stream changes inevitable, keep track Competency Mapping Team Goals for critical assignments � Big Customer � New Project � Industrial Relations Issues � Target performance � Core Values

Connecting Rewards � � � � �

Link to job value if measurable, Else link to performance, Pay for Competencies Talented people are expensive, Poor performer: No Reward, no increase High Performer: Several times the average performer Permanent Rewards: Base Pay hike, One Time Rewards: IPAP Special Reward for Teams, Creativity, Shop floor Work

Figure: 9.6 Global Fabric Corporation—competency driven HR management. countries enjoyed the same competitive advantage as India. The focus on quality, cost effectiveness and customer orientations hence became more important than ever before. By this time the company had acquired the best technology, established a good marketing network and manned some key positions with good professionals. The weak link was the quality of the people, the culture and personnel (Human Resources) practices. The company had decided to focus very clearly on these areas. Once again it sought the services of the new HR head. Executive search agencies, which had been instrumental in getting some good professionals into GFC, were commissioned. He got into action along with the new head of Human Resources, Mr. G. SHEKHAR who was the internal change agent and whose most important agenda was organizational change. Figures 9.6, 9.7, 9.8and 9.10. The organizational change exercise started on many fronts simultaneously. The critical areas identified for interventions were organizational structure and manpower planning, recruitment or top class professionals at all levels, a performance appraisal system, compensation structure review, training and attitude change.

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Customer centric measure must be translated into measures that GFC must take internally to meet customer expectations. The process perspective deals with the following: 1. Critical process: Processes that have maximum impact on customer satisfaction. 2. Identify Core Competencies. 3. Evolve a method to measure the competency of different processes. 4. Create a linkage between Top Management’s understanding about processes and competencies, and the actions to be taken at the shop-floor level. Meanwhile, Mr. DEEPAK SETH had hired the best multinational consultants for an ambitious growth and expansion strategy. The consultants' advice was on building upon the core competencies of the company and expanding globally along those lines. They also pointed to the need for an organizational change to professionalism. However, important the need for change was, Mr. SETH was very clear in his mind about the need to manage this change very carefully. He was aware of the traditional, conventional, Tamil speaking hierarchical in structure, but informal in systems, "joint family” kind of cultures prevalent in the group. Understanding this culture was very important before attempting to change it. One of the factors influencing the choice of Mr. G SHEKAR, apart from his reputation and professional competence, was the fact that he hailed from the same part of the country, spoke the same language (vernacular) and understood the nuances of the local culture. The senior members of the family could, therefore, identify with him and hence be more comfortable. Customer centric measure must be translated into measures that GFC must take internally to meet customer expectations. The Process perspective deals with the following: 1. Critical Processes: Processes that have maximum impact on customer satisfaction. 2. Identify Core Competencies. 3. Evolve a method to measure the competency of different processes. 4. Create a linkage between top management’s understanding about processes and competencies, and the actions to be taken at the shop-floor level.

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Competency Based Human Resources Management means much more…. Define the Case for Change Core Competence, Link to business goals Critical Success Factors Business Benefits Quick Wins

Assess Readiness for Assessment Centre Top Team Commitment Stakeholders Capacity Culture Etc.

Build sponsorship & commitment from leadership team Gain involvement and buy-in Align organisational/Roles/Key Members infrastructure/culture Embed long -term Benefit & Development Plan

Develop strong execution team relationship Communicate, Communicate, Communicate Identify and work with resistance Transform phases

As s e s s me nt Initiatio n and s olutio n Des ig n

Imple me ntatio n/ De ve lo pme nt

…all the ‘building blocks’ of competency framework are in place and managed effectively to optimise benefits

Figure: 9.7 Global Fabric Corporation—Competency Based HRM—Action Program.

INDUCTION OF PROFESSIONALS WHO FIT INTO A CULTURE AND COMPETENCY FRAMEWORK OF A CHANGING ORGANIZATION Recruitment of good professionals was started simultaneously with other change interventions. GFC, as has been pointed out earlier, lacked good business managers though it had some of the finest textile technocrats. The new environment required people with a high degree of cost efficient and quality consciousness with an ability to appreciate the issues of critical importance to the bottom line, who would question all assumptions so as to find solutions to the problem at hand. It also called for people with excellent leadership qualities. Knowledge of the latest management practices; people management and supervisory skills were also very important requirements. This was in stark contrast to the profile of the existing managers. The existing managers, apart from having a closed technological perspective had lived in an insular world for too long. They are not familiar with the concepts of production management, planning control, man management, and also in many cases lacked core functional knowledge.

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Human Resource Development Strategy PlannedRequirements for change � � � � � � � � � �

Clear vision and mission Top management commitment Drive a competency focused organization Sharing the vision Employee involvement and commitment Communicating the purpose of change An effective communications network Understanding the contributions required Project management of change Ongoing management education and development programs Figure: 9.8 Global Fabric Corporation—HRD Strategy.

For the production managers, production was important and not profitability, creating new designs was more important than adding to the bottom line. In some cases where people were good in their limited area, they lacked an understanding and appreciation of roles of other managers, or lacked the vision and drive to grow. Most managers were experts in their own limited area without having any cross functional knowledge required to assume higher responsibilities. The recruitment plan hence sought professionals at all levels. First the top slots (department heads) were filled with the best professional talent available. The people chosen were those who had excellent academic qualifications and varied experience in multinational organizations known for their professionalism, apart from a high level of entrepreneurial spirit. At the same time management trainees were recruited from good business schools and textile technology institutions to act as internal change agents. However, one thing was given atmost importance, that of selecting people with a high level of maturity, intellectual integrity, innovativeness, honesty and a belief in social responsibility. These were the long-standing values of the group and any deviation from these would have been very jarring and the system would not have been able to withstand the sudden change. Also, a conscious effort was made to make the new hires to gain a good understanding of the culture and system before bringing in a new one. The message clearly was that the old and the new have to work hand in hand. This went a long way in reassuring the old about their

Building Competencies for Organizational Future

jobs and importance and also helped the professionals to gain an understanding of the history, past practices and records.

FOCUS ON COMPETENCY BASED PERFORMANCE CULTURE Earlier there was no systematic, detailed and fair performance appraisal system. Performance Appraisal was more or less the subjective opinion of the boss. Increments were based on the grades and were only partly related to the job performance. Promotions were made on the basis of a quota system whereby each department could recommend only a fixed number of people for promotion. All in all, neither was high performance rewarded nor was it differentiated from poor performance. The end result had been a culture of complacency and mediocrity where loyalty and seniority mattered more than performance. A performance appraisal system was put into place, which started with a goal setting exercise, followed by a position evaluation process to assess the value of each job/position. A conscious effort was made to upgrade/promote the incumbent wherever it was justified. Fortunately, there were a large number of excellent performers in the system, which could be developed through the performance review process. Promoting internal resources to fill up higher positions boosted the morale of the good performers among the old lot. Further all effort was made to keep the process as open, objective and fair as possible. The process as well as the undiluted competence of the new professionals and their willingness to work together with the old employees of the company created a consciousness for performance, without creating bitterness against the new comers. In the course of this process, a few, good performers who were not rewarded in the past got frustrated and left for greener pastures taking advantage of the company’s newly earned reputation in the job

Performance Review OLD

NEW

• No systematic, detailed & • Appraisal system were •

fair appraisal system Appraisal was based on subjective opinion of the boss

• Quota based promotion

• •

system • Seniority and loyalty based• promotion • Increments based on • grades rather than performance

made open, objective and fair Establishment of goal setting exercise Started position evaluation system High performers were promoted Double promotion were given to sort out anomalies

271

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market. The number of such people was, however, insignificant. The growth opportunities were also restricted by the extremely tall and hierarchical, seventeen-grade structure. To get over the rigidities of the structure, double promotions were reported to, but more often than there were hardly any growth and development opportunities for the best performers.

ORGANIZATION STRUCTURE AND MANPOWER PLANNING – Annexure Part of the blame for this must also go the absolutely fuzzy and unclear organizational structure below the level of department heads. The roles, responsibilities and accountabilities of none of the middle level and frontline positions were clear, with the result that it was not possible to hold a particular person responsible for non-performance. The departments were being run like a joint family and not like business units. This fuzzy hierarchy was a convenient way of manipulating the system to promote individual discretion’s, and build up personal power basis. It also hindered any attempt at a systematic and rational manpower planning. Such unclear structures led to mud slinging matches between the departments,

Business Manager

Head Supply Chain

Head(Sales & Mktg.)

(Region IV & V) Global Network Facilitation

Head

Head (Sales & Mktg.)

Manufacturing Operations

(Region IV & V) Global Network Facilitation

MBU Head Projects

Head Operations Vendor

Head MBU 1

Shared Services

Regional Sales & Mktg.Head Region I (Americas) Regional Sales & Mktg.Head Region II (Continent) Regional Sales & Mktg.Head Region III (Asia/ Australia/ NZ)

Head (Design)

Finance, Legal Head

Product Innovation Development

HR, Affairs Head

Technology Development

Head MBU 2

Figure: 9.9 Global Fabric Corporation – Organizational Structures and Manpower Planning.

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which were supposed to be working as a team. Production Planning, Manufacturing and Marketing and Quality Assurance used to quarrel over the same issues everyday for years together in what were called "Damage Meetings", without either the quality or the delivery schedule improving even one bit. A comprehensive rational manpower planning exercise was undertaken through discussions with department heads. The immediate reaction particularly in big departments like manufacturing etc., and which employees from the old cadre headed was defensive. It was seen as an encroachment of ones "empire". The process of making such department heads, give the organization structure within their departments itself generated a lot of resistance. The process was finally carried through with the help of considerable pressure from the top. The next step was organizational restructuring leading to a more flat and responsible organization. By bringing in competent professionals, it became possible to increase the span of control of the higher positions and also to have independent responsibilities for every position in the structure. The delayering process led to clear identifications of gaps, loopholes and squarely fixed accountabilities. It also meant that the department heads could no longer just pass the buck down but were forced to take decisions and accepts responsibility for them. Some incompetent people were shifted from these departments to other departments where they were put to better use. The delayering also brought into sharp focus the incompetence’s and training needs of most employees, which could then be addressed.

COMMUNICATION All these exercises were generating some sense of insecurity in some corners. It was felt that such insecurity could be detrimental to teamwork and organizational health and hence a comprehensive program of internal communication was launched for the management staff. This program laid down clearly before the people the ambitious growth plan of the company, its fabulous achievements, the strengths and the weaknesses. It also laid down the values, the expectations from the people and the criteria for evaluating performance, as well as the opportunities and new channels of growth. It developed pride in the employees in belonging to a rapidly growing professional company, which aspired to be a world leader in textiles in six years time. The program provided the employees with information and reduced some of their insecurities and anxieties. Stickers, mementos, stationery, etc., followed the message, proclaiming, reiterating and reinforcing the message of change.

COMPENSATION REVIEW All this talk would have been hogwash if another very important element of professionalism – market driven compensation packages were not put in place. As already mentioned before, the salaries and perks in GFC were very low. In fact, the annual increment level for managers

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also was at times as low as Rupees Ten. GFC was the leader in the textile industry, but the textile industry as such was not managed quite professionally and, hence the industry standards also were very low. These levels were not sufficient to attract or to retain good talent. A comprehensive compensation review was undertaken which revised the salaries and perquisites to bring them at par with other professional organizations. It cost the company in terms of money, but earned the co-operation and goodwill of the old staff. There was some heartburn where the gain was not high enough but overall it was a satisfactory outcome. The HR head played a key role in this and brought to the task, his varied and long experience with such assignments. The average increase in compensation was about 25%. This also succeeded in removing the grouse the employees had against new hires that had been brought in at fairly high salaries. The old staff slowly realized that the new people were not blind to their talents and capabilities and that they could also get higher salaries and perquisites if they were able to acquire the competencies demanded by the changed situation. The feeling of jealousy thus gave way to a spirit of mutual respect and a healthy competition. The professionals of GFC thus gained in confidence, maturity and competence and became aware of their own shortcomings and training needs. The staff now on their own seeks training in particular areas to improve their own skill, knowledge level and to sharpen functional expertise and cross-functional understanding. The climate is slowly becoming conducive for "continuous learning" and the organization is moving towards becoming a "learning organization". A lot however, still needs to be done in the area of training. Efforts have started in all earnest to provide need-based training to all employees for their continuous development along with the rapidly growing organization. The rapid expansion strategy is also throwing up opportunities for exercises like career and succession planning and efforts are on to strengthen the organization internally so that growth and development of the individual along with the organization becomes self perpetuating.

OWNER – MANAGER RELATIONSHIP Another visible change to professionalism has occurred in the relationship between the professional managers and the owner. Due to the increased competence level and confidence of the new professionals and the renovated old ones, the owners now have started concentrating more on broad policy matters leading to decreasing interference in most matters. Again because of the new found professionalism the relations between the owners and the managers have become strictly business like, without any hint of a master-servant relationship as seen in the earlier days. Also now automatic induction of the family into business would become more difficult than ever before. The families members have now to start working right from the bottom, preferably get a business qualification, understand the intricacies of management and prove themselves somewhere else before they are inducted into the board. This has made a major difference to the quality of board membership and board decisions.

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It is thus through a policy of external facilitation, internal determinations, consultations and assimilation of change that GFC is changing over to a lean, competitive, flexible organization and a dominant world player from a traditional family controlled, unprofessional business. The odyssey is not yet complete. But the enthusiasm and the momentum generated by the success of the change process has developed a confidence in the organization that it shall be able to manage this change successfully.

ANNEXURE TO THE GLOBAL

FABRIC

CORPORATION

A. Annexure: Enabling Competencies Manpower planning policies Corporate role: �

To decide manpower planning.



Decide on numbers for all corporate departments.



Approval for all small business units plans and numbers.



Integrate annual manpower plans.



Monitor adherence to plans.

Enabling Competencies Mindset

Characteristics

Competency • Managing competition

• Bigger, broader picture.

• Knowledge

• Balance of contradictions.

• Conceptualization • Managing complexity

• Process

• Flexibility

• Diverse teamwork • Change as opportunity.

• Managing adaptability

• Sensitivity

• Managing Teams

• Judgement

• Managing uncertainty

• Openness to surprises

• Reflection

• Managing learning

Figure: 9.10 Global Fabric Corporation—Enabling Competencies.

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Competency Based HRM

The Changing business environment

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quantity absolutes knowledge information automation management Instruction Superficial

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Values quality relative & contextual competence understanding adding value facilitation Learning Facts and theories

Figure: 9.11 Global Fabric Corporation – Changing Business Environment. Small business unit’s role: To draw up SBU plans and propose for due approval of corporate Interaction between corporate and SBU All SBU’s plans procedures and structure need to be endorsed by a corporate human resource department at least once a year, as and when changes are proposed.

Internal vs. external hiring and transfers Corporate role: Internal hiring and transfers: �

To decide on internal hiring.



Transfers at corporate level and on internal hiring.



Transfers from one SBU from to another SBU.



Internal hiring in SBU.

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Manpower Planning OLD • Managers were technocrats and • lack perspective • Limited view of organisation • process & roles - onal • Lack of cross functi • knowledge • Recruitment were arbitrary and based on personal favor • Managers lacked appreciation • for mgt. Concepts like prod. Planning, control, marketing and its effect on bottomline •

NEW Best professional talent were brought Started recruiting B-School graduates People with high level of maturity, integrity, innovative ness, were brought New recruits were trained to have understanding of culture and system of org.

Existing employees were reassured of their jobs and importance

SBU’s role: �

To decide on internal hiring for intra SBU.



Introduce internal promotion interview systems.

Interaction: Interaction should be ensured in all cases involving inter SBU hiring/transfer and intra SBU hiring. External hiring strategy: Corporate role: �

To lay down guideline for external hiring.



To approve all external consultants/media.



To decide on external hiring strategy for corporate departments and SBU.

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SBU’s role: 1. To decide all external hiring strategy for all recruitment within SBU. External recruitment consultants: Corporate role: �

To approve a panel of recruitment consultants and the payment terms and conditions.



To draw up job profiles in case of all corporate hires and SBU hires.



To make necessary payments to consultants in case of all corporate hires.

SBU’s role: �

To draw up job profile for all hires.



To make payments to consultants for all SBU hires.



To use only agreed headhunters.

Advertisement: Corporate role: �

To develop the basic advertisement strategy of the group.



To approve all media.



To approve layout, colour schemes and other special graphics appearing in the advertisements.

Interaction: �

In case of all advertisements for SBU.



For deciding advertising strategy colour scheme, other special graphics appearing in the advertisements.

Hiring: Corporate role: �

To lay down a policy framework for selection of all candidates.

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To develop all necessary forms, i.e. application forms, interview evaluation forms, medical check forms etc. for the hiring process.



To do actual selection at all levels in the corporate.



To do the selection for senior levels in SBU.



To select all hr candidates at all levels.

SBU’s role: 1. To select all the other levels except the senior levels specified. 2. To ensure that all processes as laid down by the corporate are duly confirmed. Interaction: �

In case of hiring senior levels specified.



In case of all HR function hiring.

Hiring of referrals: Corporate role: This is to be solely handled by corporate and the entire decision on hiring to be taken at this level. Role of SBU: To keep corporate informed of any such special case or considerations.

Selection process checklist includes the following: 1. Application forms. 2. Recruitment relationships: �

Educational institutes.



Employment agencies.

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Executive search firms.



Advertising agencies.

3. Resume review: 4. Interviewing: �

Preliminary interview.



Selection interview.

5. Arrang]ements: �

Travel reimbursements.

6. Testing: �

Skills.



Psychological.

7. Reference checks. �

Credit.



Security.



Character.



Previous work performance.



Academic records.

8. Employment offers: �

Duration of probation.



Salary negotiation.



Contract document.

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Sources of manpower supply:

Internal sources: �

Transfer and promotion of present employees.



Employee referral programs.



Mobilization of the management staff.



Re-employment of former employees.

Present employees: When a specific position vacancy arises the first place to look for candidate is in the present work force. Through transfer and promotion many vacancies can be filled for experienced personnel. This will have the effect of creating many entry-level positions. The basic ingredient for maximizing the internal promotions and transfers are: �

Good communication system.



The cooperation and backing of management.



Skills inventory.

Employee referral programs: This is a valuable source of good-quality workers. They do some prescreening of the workers rather than embarrass themselves, their friends or the company. The employees can be encouraged by: �

Internal communication of job opening.



Employee newsletter, bulletin board, etc.



Offering of special incentives.



Through retired people.

Mobilization of management: No one is more aware and interested in recruitment than the people who are personally affected by the shortage of personnel. They can be encouraged to do their own recruiting so

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they too will become part of the organized effort. Every manager can be a goodwill ambassador and part time recruiter while attending conventions and meetings.

Re-employment of former employees: The records of desirable departing employees are a good and potential source of employment. The experience and training they have gained with a competitor can be an asset to the company when they are hired back. The former employees also will feel good that the previous company for which they have worked want them back. This also will have some disadvantages like salary inequities that it will create with the existing ones. It should be made clear that the former employee is coming back for a higher position with more responsibilities and a well-acquired knowledge.

External sources of supply �

Educational institutes.



Employment agencies.



Executive search firms.



Advertising. –Print media –Electronic media

Educational institutes: Educational institutes are an excellent source for filling entry-level positions. Most campus recruitment is done through the college placement office. It is important to provide information on the job assignment, training given, salary, employee benefits and advancement prospects. Special recruitment literature aimed at attracting and motivating the best talents at the entry level can be given to the institutes. Companies can enhance their college relations through cooperative work-study plans, summer intern programs, scholarships etc.

Employment agencies: There are government employment exchanges that specify that technical apprentices are to be taken from the government technical institutes.

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Executive search firms: This is a good management tool to tap high-level talent. Even companies with high sophisticated human resource department turn towards executive search firms to recruit senior level managers. They find the good candidates, screen them and match them with the requirements of the company for a flat fee. Companies should rate the search firms and be convinced of their expertise and then give the assignments to them.

Advertising: print media: A good advertising agency can be of great assistance in selection of a good medium and developing a good message. The title of the advertisement should attract the readers and motivate them to read on. The advertisement should be specific about skills, education and experience requirements. The salary package and all the other benefits should be clearly mentioned in the advertisement.

Electronic media: Many companies have their organization web sites in which there is a page exclusively for recruitment. They have their own application forms in these pages. They also have their web pages in other web sites. Some recruiting agents have their web sites attracting applicants for various positions.

Application form—salient features The challenges facing the human resource professionals when faced with huge numbers of application forms is how to reduce it to a manageable number in a way which is reliable, valid, fair and just as important, cost effective. The process of reducing numbers of applications is known as sifting. The key to effective sifting is: �

Design of the application form.



Construction of a marking scheme.



Willingness to wield the axe.

The sifter should know what information he is looking for and if can get at it easily. that is why the design of the form is very important. The speed of sifting is more if there is a marking scheme or a set of decision rules to permit quick decisions about applications. If the form

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is properly constructed and the numbers are high it should be possible to reject the applicants as soon as they fail a hurdle. This is called the immediate discard. Technique: This saves lots of time and money. It is important to be consistent in the criteria that are being applied. For the marking system to work effectively however one should be prepared to wield the axe. There should be trust in the process and confidence in applying the rules. What happens when sifters are left to their own devices? Sifters tend to make assumption about personality, motivation and the job knowledge from the information given rather than using the information. Rather than looking for evidence for specific criteria they make judgements with all the problems that they entail.

Structuring application forms: �

Competency based application form.



Bio data.



CV.

Competency-based application forms The competency based application form requires applicants to provide evidence, that would mean examples from their experience that they will be able to demonstrate the competency when required. The response will be written in about hundred words or so in the form. Example: answer for the competency “team working”

Team working Please tell us about a time when you worked in a team. Try to cover a short description of the team and its goals; your role in the team; how you realized that the other team members needed motivating; what did you do? What is the result? The example question is open-ended. Although a way of structuring the answer is suggested through the points to cover. This structure was implicit rather than explicit.

Sifting competency based application form: This screening process is one of matching the evidence given to the behavioural indicators one is looking for. This involves reading the entire application form and then making a

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judgement on the quality of the evidence given:

Structured application form The structure can be explicit if the applicant want to express them more clearly then an overtly structured form can be used. E.g.:

Decision-making In this job you need to be able to take responsibility for and be prepared to defend your decisions. Please describe a situation where you have to make a difficult decision and explain it to other people.

What was the situation and the factor affecting it?

What were the consequences of getting it wrong or avoiding it?

How did you explain it?

How did you deal with any resistance?

What was the result?

Sifting rules: Each applicant should be given a rating on each competency of A, B, C according to the following rules: Rating—A �

Strong evidence



The answer is clear and directly answers the question asked



The answer contains most of the indicators

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Rating—B �

Acceptable evidence.



The answer gives an indication that the evidence is present but it is a little vague.



It has to be explored in the interview.



The answer contains some indicators.

Rating—C �

Poor evidence/lack of evidence.



The answer does not relate to the question.



The answer contains a few indicators.

Rules for short listing: �

Applicants scoring two or more C are to be rejected.



Applicants scoring one C can be put on hold.



Applicants with no C score should be invited for an interview.

Biodata This application form uses a biographical data to arrive at a conclusion about the likely future performance of a job. it is also called weighted application form. The data that is available is objective and verifiable. Bio-data is the widely used method for marketing an individual’s talents and abilities. it is an indicator of the human being it represents. it comes in all different formats. The two important ones are: �

Chronological resume: It indicates the time period in each company so that the interviewer can see where and how long the candidate stayed in each company.



Functional resume: It states the candidate’s achievements. It is more of a selling tool. This does not give the many facets of the candidate’s background, that is how long he has worked and in how many companies.

So the preferred one is the chronological one with important achievements worth mentioning.

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The resume should be: �

Neat.



Free of errors.



Professional.



Consist in conveyance of the candidate’s capabilities.

The key difference in between the CV and an application form lies in the person who controls it. In the application form the organization calls the shots. With the CV the individual decides what to put. The applicants sometimes use this to impress the selectors to call them for an interview.

Recent innovations: �

Use of internet-many sites hold CV for companies to go through. Some sites even provide search facilities to help companies to match skill sets to vacancies.



Sift CV electronically.

E.g.: Australian recruitment company MORGAN and banks claims to shift 300000 CV in ten seconds.

Internal Change Agents

Professionall mana ed

Family Owned � Absolute financial powers � Close Supervision on day-to-day matters Change � No 2nd level leadership � Business run on gut feel � Individualistic style � Complete authority but no responsibility

� Market Driven Organization � Core Competency Model � Succession Planning � Delegation of power � Formal Structure � Fixing of responsibilities � Learning organization � Lean & competitive

External Consultants

Figure: 9.12 Global Fabric Corporation: What Changed?

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Case Post Analysis End of Case Study: Global Fabric Corporation

Introduction of the HR Head as a Change agent

• 17 levels of hierarchy • Authority restricted to head of the mill (normally was family member) • Fuzzy and unclear structure below department Heads • Inter Departmental conflicts • No responsibilities assigned

• Formal Organizational structure • Clarity in roles, responsibility and authority • Flatter organisation � span of control Shifting incompetent people

Figure: 9.13 Global Fabric Corporation: Structural Change? Performance appraisal system Perfor mance mgmt system

Performance coaching

Compensation & reward system Human & mat resources

Recruiting & selection

Work design

Policies & procedures

Structure

Learning system

Career planning

Work climate

Organi zational system Management practice

Leadership

Performance consulting

Change–mgmt consulting

Organizational culture

Mission & strategy Organizational – performance consulting

Figure: 9.14 Global fabric Corporation: Competency Driven Organization?

Competency Based Interviews Strategies

Competency Model Applied at GFC • Selection: Professionally qualified people. • Performance Management: Effective Structure and Process put in place. • Employee development: Use of communication to dispel anxiety and recruitment of professionals to help as internal change agents • Work design: Organizational restructuring carried out for clarity in processes. • Rewards: Compensation reviews based on performance and not subjective like before. • Succession: Hierarchies reduced from the seventeen grade structure.

Figure: 9.15 Global fabric Corporation: HRM Competency Perspective?

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Chapter

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Assessment Group Discussions and Testing Techniques �

In a group discussion what should be observed and how should it be used?



Who takes a strong stand either in favour or against the topic right at the start of a Group Discussion?



What is the strategy of the first speaker on the topic in a Group Discussion?

In a group discussion what should be the objectives of the evaluator and how should they be achieved? In order to conduct any unstructured group discussion, the objective is to be defined. A good definition of the objective is—to see who contributed meaningfully in an attempt to achieve the right consensus. The key words in this definition are ‘seen’, ‘meaningfully’ and ‘attempt’. Let us understand what each of these imply in terms of action points: �

The first implication is that merely making a meaningful contribution in an attempt to achieve consensus is not enough. The evaluator should observe who has made a meaningful contribution in an attempt to build the right consensus. In other words, you must ensure that the group heard the person. If the evaluator hears the person so will be the group.



It should be observed whether the participants are assertive for those 15 minutes. If the candidate gets cowed down easily in an aggressive group, he need not be considered for the position. Many Group Discussion participants often complain that they did not get a chance to speak. The fact of the matter is that in no Group Discussion do you get a chance to speak. You have to make your chances.



The third important implication is that making just any sort of contribution is not enough. The contribution has to be meaningful which suggests that the participant

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has a good knowledge base, is able to structure arguments logically and is a good communicator. These are qualities that are desired in a group discussion. �

Many GD participants feel that the way to succeed in a GD is by speaking frequently, for a long time and loudly. This is not true. The quality of what they say is more important than the quantity. Don’t ignore a person if you feel he has not spoken enough. If he has spoken sense and has been heard, even if only for a short time, it is usually good enough. There must be some substance in the arguments. Therefore, observe carefully.

The evaluator should always enter the room fully prepared to observe the candidates-with the topic for the discussion, the required format for noting down the observation on various attributes and an alert mind not to miss even small details. Jot down all that was observed and it pays to analyze it later. The following important points can be observed: �

Everybody else will state the obvious. Can anyone state something different?



Can anyone take the group ahead if it is stuck at one point?



Can anyone take it in a fresh and more relevant direction?



Can anyone dissect the topic and go into the underlying causes or into the results.

One way of deciding what sort of contribution is meaningful at what point of time is to follow three simple rules: �

First, in times of chaos a person who restores order to the group is appreciated. The person’s level of participation in a fish market kind of scenario can be low, but the degree of influence must never be low. In other words, one must make positive contributions every time he speaks and not speak for the sake of speaking.



The second rule is applicable when the group is floundering. In this situation, a person who provides a fresh direction to the group is given credit.



The third implication is that one must be clearly seen to be attempting to build a consensus. Nobody expects a group of ten people, all with different points of view on a controversial subject to actually achieve a consensus. But did anyone make the attempt to build a consensus?

The reason why an attempt to build a consensus is important is because in most work situations the applicant will have to work with people in a team, accept joint responsibilities and take decisions as a group. One must demonstrate the fact that he is capable and inclined to work as part of a team.

Assesment Group Discussions and Testing Techniques

Different ways to try to build a consensus are: �

First, one must not just talk, but should also listen. One must realize that other people also may have valid points to make.



Second, one should not only try to persuade other people to his point of view, but also come across as a person who has an open mind and appreciates the valid points of others.



The participant must try and resolve contradictions and arguments of others in the group.



The participant must synthesize arguments and try and achieve a unified position in the group. Try to think of the various arguments of his own and others’ as parts of a jigsaw puzzle or as building blocks of a larger argument for or against the topic.



Who tries and lay down the boundaries or the area of the discussion at the beginning.



Who decides what the group should discuss before actually beginning the discussion. This will at least ensure that everyone is talking about the same thing.



Who tries and summarizes the discussion at the end. The summary should not merely restate his point of view; also accommodate dissenting viewpoints. If the group did not reach a consensus, say so in the summary.



The person must carry people with him. Must not get emotional, shout and invade other people’s private space. Should not bang the first on the table except in extreme circumstances.



If one has spoken and notices that someone else has tried to enter the discussion on a number of occasions and has not had the chance to do so, maybe given a chance the next time he tries. But chance should not be given to anyone who is not trying to speak. That person may not have anything to say at that point and the other person who gave the chance will just end up looking foolish. Should not appoint oneself as a de facto chairperson of the group that would antagonize others in Group Discussion. Should not try to impose a system whereby everyone gets a chance to speak in turn.



A Group Discussion is meant to be a free flowing discussion. Let it proceed naturally. Do not ever try to take a vote on the topic. A vote is no substitute for discussion.

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Should not address only one or two persons when speaking. Maintain eye contact with as many members of the group as possible. This will involve others in what the person is saying and increase his chances of carrying them with him. Should do this even if he is answering a specific point raised by one person.



Should not agree with another participant in the group merely for the sake of achieving consensus. If he disagrees, he should say so. He is not there to attempt to build just any consensus. One has to attempt to build the right consensus.

The other important issue to observe is – Is the person wise in taking a strong stand either in favour or against the topic right at the start of a group discussion? In theory yes. If someone believes something why shouldn’t he say so? If he is convinced about something the natural response is to say so emphatically. However in practice what is likely to happen if one takes a very strong and dogged stance right at the beginning of the competency interview is that he will antagonize the people in the group who disagree with him and will be unable to carry them with him and convince them of the validity of his argument. The person should hear the topic and think about it for a minute with an open mind and note down the major issues that come to his mind. He should not jump to any conclusions. Instead he should arrive at a stand in his own mind after examining all the issues in a balanced manner. Only then he should begin to speak. And when doing so, he should outline the major issues first and only then state his stand. In other words, give the justification first and the stand later. If the person was to state his stand first chances are that the others in the group who disagree with his stand will interrupt to contradict him before he can elaborate on the reasons why he has taken that stance. In this situation the evaluator will only get an impression of what he thinks and not how he thinks. Remember to evaluate on how one thinks and not what his thoughts are. How to judge the first speaker on the topic in a Group Discussion ? In most GD’s, the opening speaker is the person who is likely to get the maximum uninterrupted airtime. The reason is simple - at the start most other participants in the group discussion are still trying to understand the basic issues in the topic, or are too nervous to speak and are waiting for someone else to start. Therefore here the evaluators get the best chance to observe the opening speaker. Now this is a double-edged sword. If the opening speaker talks sense naturally he will get credit because he opened the discussion and took the group in the right direction. If on the other hand the first speaker doesn’t have too much sense to say, he will attract the undivided attention of the evaluators to his shortcomings. He will be marked as a person who speaks without thinking merely for the sake of speaking. As someone who

Assesment Group Discussions and Testing Techniques

leads the group in the wrong direction and does not make a positive contribution to the group. So the evaluator should observe the first speaker who has taken a high-risk high return strategy. It can make or mar the group discussion performance depending how he handles it. The first speaker should start only if he has something sensible to say. Otherwise he should keep shut and let someone else start the discussion.

SAMPLE QUESTIONS: OPEN ENDED Group discussion questions �

Tell me about some of your accomplishments in your first job?



Describe your relationship with your subordinates, peers and superiors?



What were the reasons for leaving your previous job?



What are the kinds of activities you get involved in your leisure time?



How did you choose that college?



What made you select that major in college?



What makes you think you are the right candidate for this job?



Give me an example of two difficult situations or pressured situations you were in and how you handled them?

SAMPLE INTERPRETATION LISTING FOR GD’S Evaluation Criteria 1. Initiative:

Confidence in starting, ability to generate new points.

2. Imagination:

Ability to feed new ideas, ability to think along different lines.

3. IP Skills:

Team spirit, respect for others views, acceptance by members.

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4. Contribution:

Quality and relevance of contribution, ability to sustain contribution.

5. Leadership:

Ability to guide the discussion, ability to take charge when things go out of hand, ability to sort out differences.

6. Communication:

Language facility, diction. Voice inflection, body language.

7. Logic:

Ability to analyze and present things in an appropriate manner.

8. Personality:

Posture, gestures, dress, appearance and body movements.

Rating Scale 1. Very Weak:

Significantly below criteria required for successful job performance. Normally about 5% of the people fall into this category.

2. Weak:

Generally does not meet criteria relative to quality and quantity of behaviour required. Normally about 20% of the people fall into this category.

3. Capable:

Meets criteria relative to quality and quantity of behaviour required. Normally about 50% of the people fall into this category. This is the standard rating against which all candidates are to be compared.

4. Strong:

Generally exceeds criteria relative to quality and quantity of behaviour required. Normally about 20% of the people fall into this category.

5. Exceptional:

Significantly above criteria required for successful job performance. Normally about 5% of the people fall into this category.

Sample: Assessment group discussion evaluation format Assessment Group Number _______ Hiring Source: _________Date: _____ Topic for Discussion: _ __________ Panel Members Name: __________ The below sample of assessment group discussion evaluation can be assessment centre.

Assesment Group Discussions and Testing Techniques

Sr. No . 1 2 3 4 5 6 7 8 9 10 11 12

Code Name

Name Initiative Imagination

IP Skills

Contribution Leader Communi Logic cation ship

Personality Overall Rating

TESTING TECHNIQUES Design of a test procedure The rationale for the design of a test procedure is to compare the abilities of unknown and proven abilities of many individuals in achieving the requirements of job criteria.

Isolate job criteria: Each position must be analyzed to identify the result that is expected from the employees. These are the conditions that must be reached for acceptable performance.

Identify and weigh performance abilities: �

Make a list of performance abilities estimated to meet the job criteria. Rank and weigh the listed abilities from the most critical and significant to the most trivial and insignificant. This weighting will establish how each ability will reflect contribution to the total measurement. These abilities become the predictor variables for job success.

Select appropriate tests: Select from the test sources, appropriate tests which purport to measure the predictor variable in question. Examine test manuals carefully in terms of situational validity and reliability. This selection can be from a single test or a battery of tests.

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Select the criterion group: The criterion group is a group of employees already performing on the job whose ability is known. Employees are selected from both high and low degrees of proficiency in the predictor variables. Various sources may be used to attest to their known levels of proficiency, such as company records, production records and work observations. The employees known to have ability are ranked from high performers to low performers by their supervisors using job results as a guide. Obviously, only line management can identify the two most significant components of a test procedure, job criteria and the criterion group.

Administer tests to the criterion group: Give the selected test that purport to measure the predictor variables to the criterion group including both high and low performers. Use judgement and select the significant few that count.

Validate the test: Analyse the test scores to see if the highly successful employees received the high scores and the less successful employees received the low scores. If not a reselection of test must be made. The entire test procedure yields a set of test scores measured by proven and known employees within a company doing a specific job. These scores are arranged into statistical norms and are used as a basis of comparison with new applicants taking the same tests. These new applicants are compared and measured with the criterion group for levels of proficiency in the predictor variables.

Administering tests: Applicants often get scared when they take tests. The following suggestions should be helpful in minimizing spurious results: �

The applicants can be put at ease by explaining that tests alone do not decide their fate. Explain that it is the whole picture that counts.



Avoid the use of the term examination, iq, or intelligence tests. Explain that there are no failure or pass, only proper placement of abilities.



Use a testing room where there are no distractions. The environment and the furniture must be comfortable.

Assesment Group Discussions and Testing Techniques



Be prepared with all materials for conducting a test such as stopwatch, answer sheets, pencils etc., to be used during the tests.

Psychometric test To practice psychometrics is to go about measuring psychological characteristics. ‘Psyche’ refers to the psychological characteristic, and ‘metric’ refers to the measurement of it. This is an entire sub-discipline within psychology dedicated to improving the accuracy with which we can measure psychological characteristics, and the various instruments available on the market today are the tangible signs of this. The psychological characteristics that HR professionals want to measure most are those related to intelligence and those related to personality. It is useful to divide psychometrics into two main categories: �

Measures of maximum performance, which indicate what an applicant can do.



Measures of typical performance, which indicates what an applicant is likely to do, or would prefer to do.

Most ability tests (such as numerical, verbal or spatial reasoning tests) fall into the first category, whilst personality questionnaires or inventories fall into the second. It is a matter of regret that ability tests and personality questionnaires are often lumped together – erroneously – as ‘psychometric tests’. A personality questionnaire is not a test because there are no right or wrong answers. Ask one of us which of the following we prefer to do: bungee jumping, needlework or collecting for charity, and you get a preference – our preference. It is neither right nor wrong. But ask for the square root of 729 and if the answer is not 27, it is wrong.

Measures of maximum performance Managers have to take decisions, exercise judgement, solve problems and analyze situations. They have to do other things too, but there is no getting away from the reality that mental power is crucial to successful performance as a manager. Sir JAMES BLYTH the chief executive of THE BOOTS COMPANY, believing that complex management jobs require high ability coupled with a personality which is likely to enable high performance in the longer term, introduced psychometric assessment into the company so as to find the best people, whether from outside or inside (personal communication, JOHN RICHARDS and NICKY HILL, 1996). He was right, especially about ability tests. They provide and immediate tap into mental power. All studies agree that tests of general cognitive ability are good predictors of job and training performance when the job or training demands a high level of thought. The more complex the job or the training, the better the tests work.

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Do ability tests add value to a selection process? In terms of contributing to good selection decisions, and leaving aside all other considerations, ability tests deliver the biggest bang of the buck, far in excess of personality measures, or interviews, or educational attainments. This does not mean that they are brilliant at prediction – at their best they predict something like 25 per cent of the variance in job performance – but they are the best single measure.). They are, of course, many human characteristics that impact on job performance that tests cannot assess, such as getting on with people and showing initiative. An important rider, therefore, is this: ability tests tell us what individuals can do, but they are not good at predicting what they will do. Particularly for applicants with little or no track record, tests provide information, which is not readily available elsewhere. But the benefits of testing are conditioned on sensible use; they also vary with the nature of the job, the size of the employer, and the resources devoted by the organization to the testing program. There are ample evidence that tests have at times been so carelessly used as to be irrelevant to the hiring decisions taken, or worse.

Measures of typical performance Measures of typical performance tell us about our preferences; if faced with a choice between an hour of proofreading or giving a lecture, which would we prefer to do? They tell us nothing about our ability to carry out these tasks – you may prefer to give a lecture but may be poor at doing so. Nor, if the question is put as a forced choice, do they tell us anything about whether we would enjoy our choice. Just because we express a preference does not mean that we like doing that activity. (Would you prefer to climb Mt. Everest or K2? We all have personalities and if we go to work we take them with us. We might leave our brains at the gate (although we shouldn’t) but we take our personalities in with us. They then affect how we do the job, and the job in turn affects how we behave. If the upshot is that we behave markedly differently at work compared with outside, then you could say that there is such a thing as an occupational personality. Two points emerge from this. One is that it is worth trying to get an assessment of personality, simply because it is too important to leave out of the selection equation, and the second is that the assessment should be of behaviour at work. Evidently, unfairness could be introduced by ill-considered choice of tests or questionnaires, or by uninformed interpretation. Here are some examples of what one of us has called casual implementation: �

Failing to give adequate notice, or opportunity for preparation, familiarization and practice.

Assesment Group Discussions and Testing Techniques



Failing to give feedback, where promised.



Failing to explain the relevance of the tests or questionnaires to the job being applied for.



Passing results on to others when confidentiality had been promised.



Failing to explain how the results will be used.



Failing to adapt administration conditions for certain categories of people, e.g. people with disabilities.



Continuing to use tests and questionnaires which are known to disadvantage a particular group, e.g. using mechanical reasoning tests with women.

These failings are listed in no particular order of seriousness: they all happen, and they are all avoidable. Sometimes those doing the testing fail to empathize with those on the receiving end, or they don’t think, or they don’t know themselves how, for instance, results are going to be used. Here we would repeat our position on questionnaires. Do use them but please take the trouble to use them appropriately. Failure to do so can have considerable consequences for the individual, and for the organization as a whole.

Barriers to information processing in testing There are many potential barriers to effective information processing. Some examples, which are particularly relevant to selection decisions, are given below: �

Lack of concentration: tiredness, boredom or lack of motivation can lead to poor levels of concentration.



Stereotypes: mental shortcuts which help us simplify the world can cause us to prejudge in the absence of evidence, or operate as self-fulfilling prophecies.



Prejudice: and extreme case of stereotyping which will lead to negative evaluation of a person in most cases, regardless of information available.



The ‘halo’ and ‘horns’ effect: when an overall evaluation of someone is made – positive or negative – then this can influence all subsequent judgements.



The primacy and recency effect: evidence brought out early in the process or towards the end of the process that is weighed out of proportion.

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Inaccurate causal attributions: the way we attribute the causes of events is prone to error. For example, if we fail then it is the situation – if others fail it is their fault.

Giving feedback �

Those who are trained in and familiar with the instruments used should only give feedback.



Feedback can be given face-to-face but this is not always possible with external candidates. In such cases it can be given by telephone or letter, with the opportunity to telephone the tester to discuss.



Ask candidates how they felt about their performance, before commencing feedback.



Say what they did well, then what they did not do so well. Try to end on a high point.



Be prepared to cite actual things they said or did, and ask them to tell you their significance.



Tell them what you were looking for, and why they did not meet the standard.



Never divulge actual test scores, i.e. Percentiles; instead offer a rough guide on how performance compares to the relevant comparison group.



Do to be judgemental with personality data – a person’s approach to work is either appropriate or less appropriate to a particular job, not good or bad in itself.



Do not give the impression that the decision was made solely on test or personality data.

For unsuccessful candidates, stress that being unsuccessful simply meant that they were not right for the position, and that they have valuable strengths in other areas.

CONSOLIDATED SELECTION ASSESSMENT CENTRE Of all the selection methods, selections assessment centres are the most used to measure competencies. Assessment centres are characterized by multiples of: �

Candidates.



Assessors.

Assesment Group Discussions and Testing Techniques



Exercises, simulations or tests.



Competencies.

The plus points of selections assessment centres are: �

Good validity evidence.



Provides a realistic job preview.



Favourable candidate reaction.



Involvement of line managers.



Strategic value.

Example of a typical selections assessment centre: Position: Call Centre Manager �

Applicants have applied using an application form.



Initial sifting was done and applicants were chosen.



Further screening was done using competency based interview.



Sixteen candidates were invited to attend the interview–Eight on the first day and eight on the second day.



The client provided four assessors whom were trained and one administrator.



The process was run at the client’s management training centre.



The assessment centre was designed to measure eight managerial competencies that fell into three areas of thinking, relating and acting.



To measure them were assembled an,



In-tray exercise.



Role-play.



Group discussion.

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Presentation exercise.



Tests of numerical and verbal reasoning ability.



Two exercises or tests measured all competencies by at least and no exercise was used to measure more than five competencies.



The tasks requiring interaction with others the role-play, presentation and group discussion were observed and marked by assessors, producing a rating of the competencies measured by each exercise. Each candidate was marked at least once by each of the assessors.



The assessors then discuss among themselves their marking and then discuss each candidate sharing and challenging each other’s observations and ratings.



Finally, in a “wash-up” session the assessors agreed overall ratings for each candidate on each competency and made a final selection with recommendations of hire, hold or reject based on previously agreed criteria.

The one thing to note about all assessment centres is that among all the multiples it is the competencies that hold everything together. The multiple methods and multiple assessors are there to get sound, trustworthy fixes on those competencies. The candidates are seen by different assessors and are judged in terms of different attributes. That is why assessments centres and unlike tests and questionnaire fit hand in glove. Assessment centres offer the best chance of making good selection decision when the high quality of the remaining candidates requires fine distinctions to be made. They usually appear at the end of a selection process. Job Analysis Matching Competencies to Exercises

Content Generation

Assessment of ideas

Writing Up

Scoring/ Calibration

Trailing

Evaluation of exercises

Assessment Exercise Design JSS—CASE STUDY-1 “OK, so it’s to three,” said Pradhap,” We’ve got Jaya, Shivsankar and Solomon. “Oh! Wait! We have to follow the selection process here,” said Vinita. I know you all favour Jaya –she has got good experience and looks very smart

Assesment Group Discussions and Testing Techniques

Boys! But we are in a serious business! Let us put our heads together and analyze the different ratings they got in different competencies. Jaya unfortunately doesn’t hit the criteria. We have decided on a compulsory seven of “Achievement Drive” and she has got only five. So she is out of the race now. I’m sorry guys! “Good point”, said Pradhap. The results speak for themselves. We are not going by popular decision.” “Right, so it is only two now. Shivsankar and Solomon. Let us now take a closer look at the ratings they have got-Pradhap, please project the results. And Pradhap obliged. “So what do the ratings say?” asked Fatima one of the assessors. I think it’s saying that Shivsankar is very task-focused. His two highest scores are “Achievement and Planning”. This person is sharp, focused and he’ll get things done. The only concern is his interpersonal skills. He has to get along with many levels of people in his Purchase Department and outside and inside suppliers. “Good summary! Said Pradhap. Let us now see the scores of Solomon. He is also hot on achievement but not so good on planning. He may need some help in planning side.” Thanks Pradhap! Said Vinita Other high points for Solomon is his interpersonal skills; he’ll get along well with other people, and use the skills to get what he wants. Best of all the influencing skills are superb! “So, now the choice seems to come down to what we can live without: interpersonal skills or planning skills. Well now we have to really decide!

SHIVSANKAR

ACHIEVEMENT INFLUENCING ANALYTICAL THINKING

8 7 7

LEARNING ABILITY 6 INTERPERSONAL SKILLS 4 PLANNING &ORGANISING 8

8 9 6

LEARNING ABILITY 6 INTERPERSONAL SKILLS 8 PLANNING &ORGANISING 5

SOLOMON

ACHIEVEMENT INFLUENCING ANALYTICAL THINKING

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SEDA—CASE STUDY-2 Seema looked a little troubled. She thought she would go over the issues one more time, as she still found it a little difficult to believe. “So David, you are telling me that despite being the most popular method of selection by far, interviews are pretty blunt tools, prone to bias and we don’t really know what they really measure?” “That’s right,” David grinned. He loved being able to make such clear cut statements-they were rarely possible in the world of selection and recruitment. “Interviews are not perfect-they never have been and they never will be. How can they be? They are simply one or two people making a judgement about another person’s potential to work effectively in an incredibly complex environment. We can never deliver perfection –100 percent accuracy-and we should never promise it. Nor would we want it-what sort world would that be? But we can do everything possible to maximize the effectiveness, and minus the possible bias. “So why are they used so much?” asked Seema who was totally confused now? She started to wonder whether she needed to have interviews at all? Glad that he has planted some confusion in the mind of Seema, David started,” It gives you, that is the interviewer the security of seeing the candidate face to face. It gives the candidate the opportunity to put their case to a representative of the organization and to make some conclusion about whether they want to work there or not. The important issue is if you are going to have an interview? Of course you will! We have to be really prepared how we are going to use this tool effectively.

BHARAT LIMITED—A CASE STUDY-3 Mary was dead on her feet. The other assessors had at least experienced some variation during the day. She, though, had just completed six consecutive personality questionnaire feedback sessions – a cruel and unusual punishment. Looking round she saw Sunil narrating to the administrator. ‘Why did I invite him today anyway?’ She thought. Still, at least she had written up all her notes and was ready for the ‘wash-up’, as Sunil called it. In the main room the assessors were frantically concluding their marking before the 3.00 p.m. deadline. As Mary walked in she was greeted by a cacophony of pantomime boos and hisses. ‘Okay, Okay, it’s nearly all over. I know you’ve enjoyed it really. Think, you could have been working!’ As the assessors shuffled their papers. Sunil sidled up to the front of the room and turned on the overhead projector. ‘Which candidate would we like to consider first?’ he smiled. ‘We?’ thought Mary. ‘Cheek.’ ‘I reckon that there are three we can chuck out straight away,’ said Adhir, one of the more vocal assessors.

Assesment Group Discussions and Testing Techniques

‘Hang on,’ said Sunil hurriedly. ‘We have a process here, and we should stick to it. How about looking at the scores on the doors…’ “But it will be time consuming! We are already running out of time. Let us come to a conclusion fast.” said Adhir. Mary just thought of the effort put by the candidates in preparing for this selection process. She thought I am going to do justice to the good process that we have got and opened her mouth to voice the same… Was there a team effort in the selection process… What could be the corrective measure to be taken?

ROLE PLAY PROBING QUESTIONS: SITUATION 1 These questions are essentially designed to probe deeper into the candidates answer: Interviewer: Why did you leave your last position? Applicant:

We worked under a lot of pressure.

Interviewer:

Describe to me those pressure situations?

Applicant:

The deadlines for delivering the orders were very tight.

Interviewer:

Weren’t you consulted while the delivery schedules were fixed?

(The responses may be varied ones. A few responses and the interviewer’s judgement is given below:) Response 1: The management did not consider us while fixing the delivery schedule. We were just asked to work towards the deadlines. Inference of the interviewer: It sounds like a genuine one. If they are not involved at the time of deciding the delivery schedule some genuine problems will be overlooked. Response 2: The management used to consult us but there was a lack of teamwork. So I was not able to meet my target properly.

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Inference of the interviewer: This shows his shortcoming as a leader who is not able to motivate a team to meet the targets. According to the responses, the interviewer can judge what kind of organization he has worked for and the work culture he is used to.

SITUATION-2 Interviewer:

What do you feel are some of the advantages of being a manager?

Applicant:

Power and responsibility.

Interviewer:

Why do you feel that way?

Response 1: I feel that way because by exercising the right kind of power. I’ll be able to get things done through my subordinates. Since I’ll be held responsible for the end results it helps me to become more organized in executing the job. Inference of the interviewer: This shows the positive attitude of the candidate towards his position as a manager and also indicates that he uses his power and responsibility constructively towards achieving the goals. Response 2: I feel that way because unless we exercise power it will be difficult to extract work from subordinates and as I am responsible for the results I get it done anyway. Inference of the interviewer: This shows his autocratic way of leading his people.

A

SAMPLE SET FOR DEFINING COMPETENCIES FOR SELECTIONS

1. Competencies dealing with people Leading 1. Establishing Focus: The ability to develop and communicate goals in support of the business’ mission. �

Acts to align own unit’s goals with the strategic direction of the business.



Ensures that people in the unit understand how their work relates to the business’ mission.

Assesment Group Discussions and Testing Techniques



Ensures that everyone understands and identifies with the unit’s mission.



Ensures that the unit develops goals and a plan to help fulfill the business’ mission.

2. Providing Motivational Support: The ability to enhance others’ commitment to their work. �

Recognizes and rewards people for their achievements.



Acknowledges and thanks people for their contributions.



Expresses pride in the group and encourage people to feel good about their accomplishments.



Finds creative ways to make people work rewarding.



Signals own commitment to a process by being personally present and involved at key events.



Identifies and promptly tackles morale problems.



Gives talks or presentations that energize the groups.

3. Fostering Teamwork: As a team member, the ability and desire to work cooperatively with others on a team; as a team leader, the ability to demonstrate interest, skill and success in getting groups to learn to work together. Behaviours for Team Members: �

Listens and responds constructively to other team members’ ideas.



Offers support for others’ ideas and proposals.



Is open with other team members about his/her concerns.



Expresses disagreement constructively (e.g., by emphasizing points of agreement, suggesting alternatives that may be acceptable to the group).



Reinforces team members for their contributions.



Gives honest and constructive feedback to other team members.



Provides assistance to others when they need it.

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Works for solutions that all team members can support.



Shares his/her expertise with others.



Seeks opportunities to work on teams as a means to develop experience, and knowledge.



Provides assistance, information, or other support to others, to build or maintain relationships with them.

Behaviours for Team Leaders �

Provides opportunities for people to learn to work together as a team.



Enlists the active participation of everyone.



Promotes cooperation with other work units.



Ensures that all team members are treated fairly.



Recognizes and encourages the behaviours that contribute to teamwork.

4. Empowering Others: The ability to convey confidence in employees’ ability to be successful, especially at challenging new tasks; delegating significant responsibility and authority; allowing employees freedom to decide how they will accomplish their goals and resolve issues. �

Gives people latitude to make decisions in their own sphere of work.



Is able to let others make decisions and take charge.



Encourages individuals and groups to set their own goals, consistent with business goals.



Expresses confidence in the ability of others to be successful.



Encourages groups to resolve problems on their own; avoids prescribing a solution.

5. Managing Change if any: The ability to demonstrate support for innovation and for organizational changes needed to improve the organization’s effectiveness; initiating, sponsoring and implementing organizational change; helping others to successfully manage organizational change.

Assesment Group Discussions and Testing Techniques

Employee Behaviours: �

Personally develops a new method or approach.



Proposes new approaches, methods, or technologies.



Develops better, faster, or less expensive ways to do things.

Manager/Leader Behaviours: �

Works cooperatively with others to produce innovative solutions.



Takes the lead in setting new business directions, partnerships, policies or procedures.



Seizes opportunities to influence the future direction of an organizational unit or the overall business.



Helps employees to develop a clear understanding of what they will need to do differently, as a result of changes in the organization.



Implements or supports various change management activities (e.g., communications, education, team development, coaching).



Establishes structures and processes to plan and manage the orderly implementation of change.



Helps individuals and groups manage the anxiety associated with significant change.



Facilitates groups or teams through the problem-solving and creative-thinking processes leading to the development and implementation of new approaches, systems, structures and methods.

6. Developing Others: The ability to delegate responsibility and to work with others and coach them to develop their capabilities. �

Provides helpful, behaviourally specific feedback to others.



Shares information, advice and suggestions to help others to be more successful; provides effective coaching.



Gives people assignments that will help develop their abilities.

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Regularly meets with employees to review their development progress.



Recognizes and reinforces people’s developmental efforts and improvements.



Expresses confidence in others’ ability to be successful.

7. Managing Performance: The ability to take responsibility for one’s own or one’s employees’ performance, by setting clear goals and expectations, tracking progress against the goals, ensuring feedback, and addressing performance problems and issues promptly. Behaviours for employees: �

With his/her manager, sets specific, measurable goals that are realistic but challenging, with dates for accomplishment.



With his/her manager, clarifies expectations about what will be done and how.



Enlists his/her manager’s support in obtaining the information, resources, and training needed to accomplish his/her work effectively.



Promptly notifies his/her manager about any problems that affect his/her ability to accomplish planned goals.



Seeks performance feedback from his/her manager and from others with whom he/she interacts on the job.



Prepares a personal development plan with specific goals and a timeline for their accomplishment.



Takes significant action to develop skills needed for effectiveness in current or future job.

Behaviours for managers: �

Ensures that employees have clear goals and responsibilities.



Works with employees to set and communicate performance standards that are specific and measurable.



Supports employees in their efforts to achieve job goals (e.g., by providing resources, removing obstacles, acting as a buffer).

Assesment Group Discussions and Testing Techniques



Stays informed about employees’ progress and performance through both formal methods (e.g., status reports) and informal methods (e.g., management by walking around).



Provides specific performance feedback, both positive and corrective, as soon as possible after an event.



Deals firmly and promptly with performance problems; lets people know what is expected of them and when.

2. Communications and influencing cluster 1. Attention to Communication: The ability to ensure that information is passed on to others who should be kept informed. �

Ensures that others involved in a project or effort are kept informed about developments and plans.



Ensures that important information from his/her management is shared with his/her employees and others as appropriate.



Shares ideas and information with others who might find them useful.



Uses multiple channels or means to communicate important messages (e.g., memos, newsletters, meetings, electronic mail).



Keeps his/her manager informed about progress and problems; avoids surprises.



Ensures that regular, consistent communication takes place.

2. Oral Communication: The ability to express oneself clearly in conversations and interactions with others. �

Speaks clearly and can be easily understood.



Tailors the content of speech to the level and experience of the audience.



Uses appropriate grammar and choice of words in oral speech.



Organizes ideas clearly in oral speech.



Expresses ideas concisely in oral speech.

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Maintains eye contact when speaking with others.



Summarizes or paraphrases his/her understanding of what others have said to verify understanding and prevent miscommunication.

3. Written Communication: The ability to express oneself clearly in business writing. �

Expresses ideas clearly and concisely in writing.



Organizes written ideas clearly and signals the organization to the reader (e.g., through an introductory paragraph or through use of headings).



Tailors written communications to effectively reach an audience.



Uses graphics and other aids to clarify complex or technical information.



Spells correctly.



Writes using concrete, specific language.



Uses punctuation correctly.



Writes grammatically.



Uses an appropriate business writing style.

4. Persuasive Communication: The ability to plan and deliver oral and written communications that make an impact and persuade their intended audiences. �

Identifies and presents information or data that will have a strong effect on others.



Selects language and examples tailored to the level and experience of the audience.



Selects stories, analogies, or examples to illustrate a point.



Creates graphics, overheads, or slides that display information clearly and with high impact.



Presents several different arguments in support of a position.

5. Interpersonal Awareness: The ability to notice, interpret and anticipate others’ concerns and feelings, and to communicate this awareness empathetically to others.

Assesment Group Discussions and Testing Techniques



Understands the interests and important concerns of others.



Notices and accurately interprets what others are feeling, based on their choice of words, tone of voice, expressions and other nonverbal behaviour.



Anticipates how others will react to a situation.



Listens attentively to people’s ideas and concerns.



Understands both the strengths and weaknesses of others.



Understands the unspoken meaning in a situation.



Says or does things to address others’ concerns.



Finds non-threatening ways to approach others about sensitive issues.



Makes others feel comfortable by responding in ways that convey interest in what they have to say.

6. Influencing Others: The ability to gain others’ support for ideas, proposals, projects and solutions. �

Presents arguments that address others’ most important concerns and issues and looks for win-win solutions.



Involves others in a process or decision to ensure their support.



Offers trade-offs or exchanges to gain commitment.



Identifies and proposes solutions that benefit all parties involved in a situation.



Enlists experts or third parties to influence others.



Develops other indirect strategies to influence others.



Knows when to escalate critical issues to own or others’ management, if own efforts to enlist support have not succeeded.



Structures situations (e.g., the setting, persons present, sequence of events) to create a desired impact and to maximize the chances of a favourable outcome.



Works to make a particular impression on others.

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Identifies and targets influence efforts at the real decision makers and those who can influence them.



Seeks out and builds relationships with others who can provide information, intelligence, career support, potential business and other forms of help.



Takes a personal interest in others (e.g., by asking about their concerns, interests, family, friends, hobbies) to develop relationships.



Accurately anticipates the implications of events or decisions for various stakeholders in the organization and plans strategy accordingly.

7. Building Collaborative Relationships: The ability to develop, maintains and strengthens parstnerships with others inside or outside the organization who can provide information, assistance, and support. �

Asks about the other person’s personal experiences, interests and family.



Asks questions to identify shared interest, experiences, or other common ground.



Shows an interest in what others have to say; acknowledge their perspectives and ideas.



Recognizes the business concerns and perspectives of others.



Expresses gratitude and appreciation to others who have provided information, assistance, or support.



Takes time to get to know co workers, to build rapport and establish a common bond.



Tries to build relationships with people whose assistance, cooperation and support may be needed.



Provides assistance, information and support to others to build a basis for future reciprocity.

8. Customer Orientation: The ability to demonstrate concern for satisfying one’s external and/or internal customers. �

Quickly and effectively solves customer problems.

Assesment Group Discussions and Testing Techniques



Talks to customers (internal or external) to find out what they want and how satisfied they are with what they are getting.



Lets customers know he/she is willing to work with them to meet their needs.



Finds different ways to measure and track customer satisfaction.



Presents a cheerful, and a positive manner with customers.

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11

Experiencing the Competency Management Process in Organizations “Competency management” is a joint process that involves both the supervisor and the employee, who identify common goals, which correlate to the higher goals of the institution. This process results in the establishment of written competency expectations later used as measures for feedback and competency evaluation. The evolution of the concept of “Competency management” as a new Human Resource Management model reflects a change of emphasis in organizations away from command-andcontrol toward a facilitation model of leadership. This change has been accompanied by recognition of the importance to the employee and the institution of relating work competency to the strategic or long-term and overarching mission of the organization as a whole. Employees' goals and objectives are derived from their department's, which in turn support the mission and goals of the organization. The competency management process provides an opportunity for the employee and competency manager to discuss development goals and jointly create a plan for achieving those goals. Development plans should contribute to organizational goals and the professional growth of the employee. The planning process must also involve consideration of the emerging organizational environment. The changing environment is characterized by demographic change, increased enrollment pressures, competition for faculty, pressures to constrain administrative costs, regulatory and policy pressures, higher transaction volumes and services expectations and greater influence of customers or constituents. There is a need for the organization to adapt to the new environment. For this, it is necessary for making the transition from a bureaucracy to a network organization. The new organizational model emphasizes a focus on decision-making and accountability at the level and proficiency where the work is done, development of a service culture that rewards team

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competency and integration of operations. Critical to the success of this new model is the adoption of a customer service orientation, a flexible attitude in the face of constant change, and streamlined business processes supported by networked administrative systems. Competency management is an act of communication that empowers people to rise up to a calling that's bigger than them. As an ongoing process of planning, coaching, reviewing and rewarding, it can inspire people to reach for goals as momentous as putting a man on the moon. In 99 out of 100 companies, one would find evidence of a process that hasn’t change significantly in decades – the ubiquitous appraisal form, rating "report cards", and a lot of people who are not entirely clear about what good competency means to their company. Communicating a vision is a step in the right direction, but it won’t translate into action unless people can absorb the message and apply it to the way they go about their work. Usually, popular government demands equity and accountability. Equity and accountability demand leadership, efficiency and quality. Leadership, efficiency and quality demand competency management. Competency management is not new, but it is revolutionary. Competency Behaviour Management can be traced back to FREDERICK W. TAYLOR’S writings in the early 1900’s as he created the concept of scientific management and the modern field of public administration, through the famous experiments at WESTERN ELECTRIC’S HAWTHORNE plant, to the writings and statistical techniques of WALTER A. SHEWHART and through the efforts of W. EDWARDS DEMING to rebuild the broken Japanese economy after World War II. More recent American examples of companies adopting Competency behaviour management include FORD MOTOR Company. Finally the concept of alternate competency reviews is dealt with before the conclusion. For competency managers, this changing environment offers many new challenges and opportunities. Competency managers and their employees are increasingly being asked to become generalists who step outside of traditional narrowly-defined job roles descriptions in support of team objectives and goals. These changes are resulting in the development of new approaches to human resource management. The Human Resource Management Initiatives conceptual framework also underscores the vital role of education, training and development in the envisioned network organization. In this organization, continuous learning is a prerequisite to successful job roles competency and organizational effectiveness. Employees must be able to learn work, developing effective technical and people skills in order to assume new responsibilities, and keep pace with and anticipate the changing nature of work and our workplace. For competency managers and employees alike, responding to these changes requires the ability to learn, adapt to change, solve problems creatively and communicate effectively in

Experiencing the Competency Management Process in Organizations

diverse groups. In addition, employees must take personal and proactive responsibility for their careers to ensure future employability and advancement. The realities of the contemporary workplace will continue to challenge existing paradigms and should be considered in managing the competency of employees in a dynamic working environment.

Competency Management Process Definitions Competency Management Process: An ongoing communication process that involves both the competency manager and the employee in: �

Identifying and describing essential job roles functions and relating them to the mission and goals of the organization.



Developing realistic and appropriate competency standards and benchmarks.



Giving and receiving feedback about competency.



Writing and communicating constructive competency appraisals.



Planning education and development opportunities to sustain, improve or build on employee work competency.

Employee: The person who’s competency is managed. Competency Standards and Benchmarks: Standards and benchmarks of competency are written statements describing how well a job role should be performed. Competency Appraisal: Competency appraisal is a process of assessing, summarizing and developing the work competency of an employee. The concept of competency management has been one of the most important and positive developments in the sphere of human resource management in recent years. SPENCER first coined the phrase in his work “competency at Work”. But it did not become recognized as a distinctive approach until the 1980s, growing out of the realization that a more continuous and integrated approach was needed to manage and reward competency. Competency management rose like a phoenix from the old-established but somewhat discredited systems of merit rating and management by objectives. Competency management is a fairly imprecise term, and competency management processes manifest themselves in many different forms. There is no single right way of managing competency, the approach must depend on the context of the organization – its culture, structure, and technology – the views of stakeholders

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and the type of people involved. But in very broad terms competency management is a strategic and integrated approach to delivering sustained success to organizations by improving the competency of the people who work in them and by developing the capabilities of teams and individual contributors.

Typical Competency Management Process Strategies Strategic in the sense that it is concerned with the broader issues facing the business if it is to function effectively in its environment, and with the general direction in which it intends to go to achieve longer-term goals. Integrated in four senses: 1) Vertical integration – linking or aligning business, team and individual objectives. 2) Functional integration – linking functional strategies in different parts of the business. 3) Human resource (HR) integration – linking different aspects of human resource management (HRM), especially organizational development and human resource development and reward, to achieve a coherent approach to the management and development of people. 4) The integration of individual needs with those of the organization, as far as this is possible. �

Concerned with competency improvement in order to achieve organizational, team and individual effectiveness. Organizations have to get the right things done successfully. Competency is not only about what is achieved but also about how it is achieved. Management is involved in direction, measurement and control. But these are not the exclusive concerns of managers: teams and individuals jointly participate as stakeholders.



Concerned with development, which is perhaps the most important function of competency management. Competency improvement is not achievable unless there are effective processes of continuous development. This addresses the core competencies of the organization and the capabilities of individuals and teams. ‘Competency management’ should really be called ‘Competency and development management'.

An alternative definition provided by FLETCHER (1993):

Experiencing the Competency Management Process in Organizations

Determining Competency expectations

Managing Competency standards

Supporting Competency

Rewarding and appraising Competency

Figure: 11.1 Competency Management Process. The real concept of performance and competency management is associated with an approach to creating a shared vision of the purpose and aims of the organization as shown above in Fig 11.1, helping each employee understand and recognize their part in contributing to them, and in so doing, manage and enhance the competency of both individuals and the organization.

Concerns of competency management Concern with outputs, outcomes, processes and inputs – Figure 11.2 �

Competency management is concerned with outputs – the achievement of results and with outcomes – the impact made on Competency. But it is also concerned with the processes required to achieve these results (competencies) and the inputs in terms of capabilities (knowledge, skill and competence) expected from the teams and individuals involved.



Concern with planning – Competency management is concerned with planning ahead to achieve future success. This means defining expectations expressed as objectives and in business plans.



Concern with measurement and review – If you can't measure it, you can't manage it. Competency management is concerned with the measurement of results and with reviewing progress towards achieving objectives as a basis for action.

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Competency Based HRM



Concern with continuous development and improvement – Competency management is concerned with creating a culture in which organizational and individual learning and development are a continuous process. It provides means for the integration of learning and work so that everyone learns from the successes and challenges inherent in their day-to-day activities; Fig 11.2.

Detailing the Process: It is a dynamic process that consists of the following steps: 1. Job roles description & strategic plan Writing a job roles description is a process of systematically collecting, analyzing and documenting the important facts about a job roles. A strategic plan is composed of a mission statement, identified goals related to the organization's mission, as well as strategic initiatives necessary to accomplish each goal. Assignment of responsibility for the accomplishment of goals and strategic initiatives is related to the essential functions of the job roles description. 2. Job roles description Before a job roles vacancy is advertised, a job roles description is completed. After the employee is hired, this job roles description becomes the job roles assignment and forms the basis of the job roles function description on the Competency Evaluation Form. Writing a job roles description is a process of systematically collecting, analyzing and documenting the important facts about a job roles. This process is called job roles analysis. The job roles description provides a basis for job roles-related selection procedures and competency standards and benchmarks. The job roles description specifies: �

The concrete, specific and particular job roles functions and tasks.



The functions and tasks which are essential.



The percentage of time typically spent performing each function.



The skills, knowledge and abilities required to perform the job roles successfully.



The physical and mental requirements of the position.

Experiencing the Competency Management Process in Organizations

Corporate mission and strategic goals

Business and departmental plans and goals

Competencies requirements

Competency and development agreement

Competencycy standards

Competence evidence

Competency and development plan

Competency measurement

Action work and development

Continuous monitoring and feedback

Financial reward

Rating

Formal review, feedback and joint assessment

Figure: 11.2 Competency Management Process—Its Concerns.



Special conditions of employment.



The level and proficiency of supervision received and exercised.

The competency manager should share the job roles description with the employee during his or her first few days on the job roles. 3. Aligning the strategic plan and core competence with competency processes A strategic plan is composed of a mission statement, identified goals related to the organization's mission, as well as strategic initiatives necessary to accomplish each goal. The mission statement describes the fundamental reason that your organization or department exists. The goals identify the results which will further that mission, and strategic initiatives set out the

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concrete, specific and particular steps which must be taken to achieve those results. Strategic planning is a dynamic process that is usually revisited at intervals of between one to two years. Here is an example of a strategic plan. Individual employees will each make a contribution to the realization of goals and may be responsible for accomplishment of concrete, specific and particular strategic initiatives in support of those goals. To ensure that initiatives are completed, those responsible for particular strategic initiatives are usually named and due dates specified. 4. Standards and benchmarks of competency Standards and benchmarks of competency are written statements describing how well a job role should be performed. Competency standards and benchmarks are developed collaboratively with employees, whenever possible and explained to new employees during the first month on the job roles. The competency standard provides a benchmark against which to evaluate work competency. While the job roles description describes the essential functions and the tasks to be done, the competency standard defines how well each function or task must be performed in order to meet or exceed expectations. The organization also establishes general criteria for evaluating work competency. Standards and benchmarks of competency are usually: �

Developed in collaboration with the employees who do the tasks or functions.



Explained to new employees within the first month on the job roles.

The organization specifies general criteria for the five appraisal ratings that are found on form for the sCompetency appraisal model. These ratings describe the level and proficiency of competency compared to a job roles description and standard of competency. E = Exceptional: Competency well exceeds expectations and is consistently outstanding. A = Above Expectations: Competency is consistently beyond expectations. S = Solid Competency: Competency consistently fulfills expectations and at times exceeds them. I = Improvement Needed: Competency does not consistently meet expectations. U = Unsatisfactory: Competency is consistently below expectations. Deficiencies should be addressed as noted in the competency appraisal.

Experiencing the Competency Management Process in Organizations

As a Competency manager, you will use these criteria to rate the employee's competency. At the beginning of the appraisal period, review these ratings and the competency standards and benchmarks for each position that reports to you so that you can fairly evaluate the employee's competency. 5. Defining objectives and competency standards Competency management is largely about managing expectations. These are defined and agreed in the form of objectives, standards of competency, and behavioural requirements usually expressed as capabilities or competencies. A clear distinction should be made between objectives and standards. The former are finite, time-related and concern a specified person or team. Standards tend to be ongoing; and although they may be defined for an individual or team, they can be generic, i.e., they can apply to all people in similar roles. For example, there will be generic standards for a customer service role that relate to everyone who deals with customer; regardless of the sector they work in.

Objectives Objectives describe something that has to be accomplished – a point to be aimed at. Objectives, or goals (the terms are interchangeable) define what organizations, functions, departments and individuals are expected to achieve over a period of time.

The nature of objectives—targets and tasks Objectives are expressed as: �



Targets – quantifiable results to be attained that can be measured in such terms as return on capital employed, output, throughput, sales, levels of service delivery, cost reduction, reduction of reject rates. Tasks/projects – to be completed by specified dates to achieve defined results.

The nature of objectives—work and personal objectives Objectives can be: �

Work-related, referring to the results to be attained or the contribution to be made towards the achievement of organizational, functional or team goals.

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Personal, taking the form of developmental or learning objectives, which are concerned with what individuals should do to develop knowledge, skills and potential and to improve their competency in specified areas – for example building competencies.

The nature of objectives—levels and integration of work objectives Work objectives can be defined as: �

Corporate level, where they arc related to the organization’s purpose, values and strategic plans.



Senior management level, where they define the contribution the senior management team is expected to make to achieving corporate goals.



Business-unit, functional or departmental level, where they are related to corporate objectives, spelling out the specific targets and projects to be accomplished by the unit, function or department.



Team level, where they are related to the purpose and accountabilities of the team and the contribution it is expected make to attain unit/departmental and corporate goals.



Individual level, where they are related to the principal accountabilities, key-result areas, or main tasks that constitute individuals’ jobs and focus on the results they are expected to achieve and their contribution to team, departmental and organizational competency.

The integration of objectives is important in order to achieve a shared understanding of competency requirements throughout the organization, thus providing opportunities for everyone to make an appropriate contribution to the attainment of the team, departmental and corporate goals and to upholding core values. Integration is achieved by ensuring that everyone is aware of corporate and functional goals, and that the objectives they agree for themselves are consistent with those goals and contributes in specified ways to their achievement. 6. How to develop written competency standards and benchmarks When competency standards and benchmarks are in place, both you and your employees will know what the expectations are for the competency of essential functions and related tasks. This

Experiencing the Competency Management Process in Organizations

common understanding provides the basis for an ongoing feedback and competency counselling between appraisals as well as for the formal competency appraisal process. 7. Developing standards and benchmarks collaboratively There are a number of approaches to developing written competency standards and benchmarks. �

One is the Directive approach in which the competency manager writes the standards and benchmarks, in consultation with management and the employee relations representative for his or her department. Then the standards and benchmarks are shared with the employees affected for their information and to address any questions they may have.



Another is a collaborative approach in which employees work with you to develop the competency standards and benchmarks for their positions. While it is a legitimate option to develop the standards and benchmarks without employee input, the benefits of a collaborative approach are important. Both the competency manager and the employee bring valuable information to the process and the end result is more likely to be supported by everyone involved. As the competency manager, however, you will make the final decision about the appropriateness of the standards and benchmarks in consultation with management and the employee relations consultant for your department.

Mutual agreement with the employee about standards and benchmarks is preferable, but not always possible. Mutual understanding and recognition of the standards and benchmarks is necessary. In the collaborative process of developing standards and benchmarks for a task or function, include all of those employees whose work will be evaluated according to those standards and benchmarks. If the task or function is unique to one position, then include the employee in that position in the development process. If more than one employee performs the task or function, involve all employees whose job roles description includes it. For the sake of fairness and consistency, consider collaborating with other units in your department if employees reporting to different competency managers perform the same tasks or functions. Before you meet, explain to everyone involved exactly what competency standards and benchmarks are, why they are important and how they will be used. Confirm that the employees understand the process and solicit their comments and questions. Tell them that you would like to work together to develop standards and benchmarks for their positions and that their recommendations and concerns will be considered seriously. Describe the process you will follow. Also explain that it is your responsibility to make the final determination about the appropriateness of the standards and benchmarks.

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8. Writing the Standards and benchmarks Make sure that all participants in the standards and benchmarks writing process have access to the following documents: �

An up-to-date copy of their job roles description.



A copy of the department mission and goals, if available.



The form for the competency appraisal model used in your Vice Chancellor area.

You may find that it is appropriate to define standards and benchmarks that apply to an entire essential function, though typically standards and benchmarks are developed for related tasks. It is not necessary to write a competency standard for every task in job roles. Focus on those that are most important to the position. Discuss and describe those behaviours and results which would constitute the minimum acceptable Competency for the task or function. Competency that satisfies those standards and benchmarks will receive the rating of solid competency. You may also describe the behaviours and results that would demonstrate competency that would exceed expectations, and/or would fall below expectations. The same principles apply to the development of standards and benchmarks, regardless of the rating. Standards and benchmarks should be written in clear language, describing the concrete, specific and particular behaviours and actions required for work competency to meet, exceed or fail to meet expectations.

Use concrete, specific and particular terms describing measurable or verifiable features of the competency 1. Describe competency expectations in terms of timeliness (deadlines, dates), cost (budget constraints, limits), quality (subjective and objective measures of satisfaction), quantity (how many), customer satisfaction, independent initiative demonstrated and any other relevant verifiable measure. 2. Specify the acceptable margin for error. It is very rare for perfection to be an appropriate standard, even for outstanding competency. 3. Refer to any concrete, specific and particular conditions under which the competency is expected to be accomplished or competency assessed. Statements like the following refer to the conditions under which the task or function is done: 1) with training from Frank, 2) using job roles aids provided by Ly, 3) assuming all required

Experiencing the Competency Management Process in Organizations

information is received on time from department, 4) assuming [this task] is performed 50% of the work day. Written competency standards and benchmarks may also be developed for the general categories to be evaluated, found under Significant Competency Dimensions of Competency Appraisal Model. Three: initiative/innovation, teamwork/collaboration, leadership, decision-making, etc. and, when appropriate, optional dimensions such as cost control. Develop standards and benchmarks for these categories with the particular position as well as the needs of the organization in mind. If you supervise a supervisor, collaborate to develop competency standards and benchmarks for the supervisory categories of leadership, delegation, development of subordinates, competency counselling and affirmative action. Competency standards and benchmarks may be written to different level and proficiencies of complexity. The more general the applicability, the harder it is to be concrete, specific and particular. LEVEL AND PROFICIENCY Level and Proficiency 1

DESCRIPTION

Simple description of general expectation. Example: Task Description: Assemble widgets. Standard: Put widgets into the correct slots. Example: Task Description: Write annual reports. Standard: Annual reports will be submitted by agreed upon date.

Level and Proficiency 2

Simple description of concrete, specific and particular expectations. Example: Task Description: Assemble widgets Standard: Put widget A into slot B, completing 5 correct placements per minute.

Example: Task Description: Write annual reports. Standard: Annual reports will be submitted to the Business Officer 5 working days before January 15. Level and Proficiency 3

Description of concrete, specific and particular expectations and success indicators.

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Example: Task Description: Assemble widgets. Standard: Put widget A into slot B, completing 5 correct placements per minute for 95 widgets out of 100. Example: Task Description: Write annual reports. Standard: Annual reports will be produced following the departmental format and submitted to the Business Officer 5 working days before January 15. Level and Proficiency 4

Description of concrete, specific and particular expectations, success indicators, and conditions, if any. Example: Task Description: Assemble widgets. Standard: Put widget A into slot B, completing 5 correct placements per minute for 95 widgets out of 100, assuming the equipment is in working order. Example: Task Description: Write annual reports. Standard: Annual reports will be produced following the departmental format and submitted to the Business Officer 5 working days before January 15, unless otherwise directed by the Department Head.

Examples: �

Secretary.



Administrative Analyst.



Supervisor.

9. Guidelines for competency standards and benchmarks Keep in mind the following guidelines when writing your competency standards and benchmarks: �

Competency standards and benchmarks should be related to the employee's assigned work and job roles requirements.

Experiencing the Competency Management Process in Organizations



Your reporting systems should be adequate to measure and report any quantitative data you list.



Quantifiable measures may not apply to all functions. Describe in clear and concrete, specific and particular terms the characteristics of competency quality that are verifiable and that would meet or exceed expectations.



Accomplishment of organizational objectives should be included where appropriate, such as cost-control, improved efficiency, productivity, project completion, process redesign, or public service.

10. Checking your standards and benchmarks After you have written your competency standards and benchmarks, check them against the questions in the following list: �

Are the standards and benchmarks realistic? Standards and benchmarks should be attainable and consistent with what is necessary to get the job roles done. Standards and benchmarks for competency that meets expectations should represent the minimum acceptable level and proficiency of competency for all employees in that position.



Are the standards and benchmarks concrete, specific and particular? Standards and benchmarks should tell an employee exactly which concrete, specific and particular actions and results he or she is expected to accomplish.



Are the standards and benchmarks based on measurable data, observation, or verifiable information? Competency can be measured in terms of timeliness, cost, quality and quantity.



Are the standards and benchmarks consistent with organizational goals? Standards and benchmarks link individual (and team) competency to organizational goals and should be consistent with these goals. The success of the organization's and the department's missions depends on this strategic connection.



Are the standards and benchmarks challenging? Standards and benchmarks may describe competency that exceeds expectations. Recognizing competency that is above expectations or outstanding is crucial to motivating employees.



Are the standards and benchmarks clear and understandable? The employees whose work is to be evaluated on the basis of the standards and benchmarks should understand them. Standards and benchmarks should use the language of the job roles.

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Are the standards and benchmarks dynamic? As organizational goals, technologies, operations or experiences change, standards and benchmarks should evolve.

11. Observation and feedback Observing work competency and providing feedback about it should be a routine part of the competency management process. Feedback should be based on observed and/or verifiable work-related behaviours, actions, statements and results. This type of feedback is called behavioural feedback. Effective feedback helps the employee sustain good competency, to develop new skills and to improve competency whenever necessary. Observing employee competency and offering feedback about what you see should be a routine part of the way you manage employee competency. Feedback is most effective in reinforcing or improving work competency when the employee has confidence in the basis of that feedback. And you, as the Competency manager, will be more confident when giving feedback based on information that you can support. 12. Observing employee competency From the standpoint of competency management, observation involves noticing concrete, specific and particular facts, events, or behaviours related to work competency and the results of work competency. Observations are the raw data upon which effective competency feedback may be based. The purpose of observing employee behaviour and the results of work competency is to identify and describe it in order to help the employee be successful and continue to develop his or her skills, knowledge and experience. When you make observations about the results of employee competency, the output employees generate and the impact of their work, you gather additional information to make both praise and constructive feedback more effective. Observations should be the basis for feedback, and may also suggest actions that might be taken to support, develop or improve Competency. Feedback based on observed or verifiable data is more likely to influence employee behaviour than feedback that cannot be supported by firsthand information. It is not always possible to observe employees at work, but you should be able to build occasions to observe their competency into your workday. In that way, you will provide opportunities to understand what they do, to talk with and get feedback from them, to see employees as they perform at their best and to recognize areas in which their competency could be improved. 13. When you can't be present to observe competency When you can't be present to observe employee Competency, be sure that you have processes in place through which you can learn about how they're doing. These processes should be

Experiencing the Competency Management Process in Organizations

open, fair, and understood by everyone. Options for obtaining input about competency in your absence may include, but are not limited to, the following: �

Evaluate the output and products of the employee's work.



Have routine one-on-one meetings with your employee and include discussions of competency.



Periodically review and discuss with your employee the standards and benchmarks of competency for his or her job roles and your expectations.



Ask your employee to do periodic reports and share them with you for discussion.



Obtain feedback from customers – in writing whenever possible.



Do brief stand-up check-ins or phone calls.



Ask an appropriate person who is present everyday to serve as a work leader or give the person authority to act in your stead and ensure that everyone understands the person's role.



Perform routine spot checks of the employee at work.



Ask for confidential evaluations of employee competency by peers (or direct reports of supervisors). This process should be clearly understood by everyone and applied fairly to all.

14. Behavioural feedback Feedback may be defined as "information about past behaviour, delivered in the present, which may influence future behaviour." Feedback is influential. During the competency appraisal period, provide feedback about competency regularly. When employees receive feedback that is timely, frequent and concrete, specific and particular they are more likely to understand what is expected of them, to repeat successful competency and to improve their work when necessary. Feedback that describes observed or verifiable behaviour and facts is different from feedback that evaluates the person based on assumptions, interpretations, generalizations and judgements about what the behaviour or facts mean. Compare the following statements: 1. That was a very poor report. I wish you were more committed to doing a good job role.

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2. Your report was not formatted according to standard practice and the content was based on data that is a year old. Note that in statement #1, the speaker has judged the employee as lacking commitment, and the statement about the report being "poor" is evaluative without being helpful. Statement #2 tells the employee exactly what needs to be improved without judging his or her character or motives. Employees' competency is more likely to improve when you ask them to do something differently rather than asking them to be different. People become defensive when they feel judged, and are more likely to accept feedback which is behavioural. Behavioural feedback consists of statements about observed or verified behaviour related to competency standards and benchmarks. If the employee does not understand what you expect or what the standards and benchmarks are, give clear messages about those expectations and standards and benchmarks, confirm understanding, and then give the employee a chance to improve competency to meet them. 15. Guidelines for giving behavioural feedback �

Behavioural feedback should be based on concrete, specific and particular, observable or verifiable, data and information, and should be delivered as close to the event or behaviour as possible.



I noticed that you arrived at 8:30 on Monday, Tuesday and Thursday rather than at 8:00.



After describing your observations to the employee, ask for his or her input before you decide what the behaviour means. For example, you may observe that an employee has been arriving late over a period of days. Before you decide that the employee is being irresponsible, get more information. You may find that there is a valid reason for the behaviour or there are other factors that would contribute to your understanding.



I'd like to talk with you about the reasons for your late arrival.



Discuss the impact of the competency or its consequences, but never make threats or promises of promotion. When an employee understands the impact of competency, he or she will know why it is important.

As a result, other staff had to leave their work to cover our service desk. Communicate by your words, body language and tone of voice that your intention is to be helpful when giving feedback. The goal of feedback is to reinforce or redirect competency so that the employee can be successful.

Experiencing the Competency Management Process in Organizations

Examples of Behaviourial feedback The behavioural approach to feedback is valuable when describing competency that needs to be improved, because the employee learns which concrete, specific and particular behaviours to change rather than receiving general comments that don't give much information. Compare the following statements. �

This was not your best work.



This project was completed three weeks later than you originally estimated and the result is that our client is thinking about bringing in an outside consultant next time. What will it take to deliver on time in the future?

Statement #1 is vague and does not tell the employee what the concrete, specific and particular Competency problem was. Statement #2 gives the employee a more complete picture of what needs to be improved and the importance of improving competency. It also enlists his or her support in improving future competency. Behavioural feedback is also valuable when giving feedback about successful competency. Compare the following statements: �

“Terrific job roles”!



Everyone on the team appreciates the way you facilitated this meeting. You identified the areas in which we were confused, you summarized to help us stay on track, and you maintained your neutrality. As a result, we were able to come to a decision today rather than haggling over details for another week.

When feedback about successful competency is given in concrete, specific and particular behavioural terms, the employee knows which behaviours to continue or repeat. Feedback about competency in need of improvement is best delivered in private to avoid embarrassment to the employee. Some people are also embarrassed when feedback about successful competency is given in front of others. Feedback is more effective if you know and respect the preferences of your employees. Notes that you make or records that you keep about employee competency should also be phrased in behavioural terms. Avoid statements that would imply subjective judgement or prejudice about the employee's personality, character, or motives. Encourage your employees to keep records of their own accomplishments. The Competency manager and the employee should exchange competency-related information throughout the review cycle. At these discussions, take the time to discuss accomplishments, needs for further training and any problems or concerns. If there are competency problems, schedule meetings at regular intervals for the purpose of providing feedback on competency. This practice will ensure that you address issues promptly and foster a problemsolving approach between the competency manager and employee. Occasionally, though not

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often, competency problems may arise that will warrant some documentation and competency counselling. Others may be persistent enough to warrant taking more serious steps. Before initiating any formal corrective or disciplinary action, contact your supervisor and your employee relations consultant in the Human Resources Department, or Human Resources Generalist at the Medical Centre, for guidance and assistance. The competency and development agreement, sometimes called the Competency contract, is the agreement on objectives and accountabilities reached by individuals with their managers. The agreement is usually reached at a formal review meeting and recorded during or after the meeting on a competency review form. The processes of discussion and agreement arc easier if both parties (the manager and the individual) prepare for the meeting by reviewing progress against agreed work or learning objectives, considering what plans need to be made to improve competency or develop competencies and skills, thinking about future objectives, and examining any areas where the manager could provide more support through help, guidance, coaching or the provision of additional resources or facilities. Many organizations ask both managers and individuals to complete a pro-review meeting questionnaire, which will provide an agenda for the review. A competency agreement defines the work to be done, the results to be attained, the competency standards to be achieved and the competence levels required. For individuals, the work to be done is agreed in terms of key result areas or principal accountabilities or, sometimes, in the case of relatively routine jobs, by reference to main tasks or duties. In more dynamic roles, existing accountabilities may have to be re-assessed and new ones agreed as part of a revised agreement. In some cases, it may simply be necessary to confirm existing arrangements. The individual agreement should be based on open, two-way and unambiguous discussion. This covers the areas listed below: �

What the person is doing now.



What the person might have to do in the future because of changing requirements.



How the work should be done (competence or process requirements).



What the expected output and outcomes of the work (competency requirements and standards) are



What knowledge, skills and ability are required to do the work (input requirements).



Any core values the individual would be expected to uphold – these may refer to such areas as quality, teamwork, customer service and responsibility to the community and care for environmental issues. The purpose of the discussion would be to define

Experiencing the Competency Management Process in Organizations

expectations on how the person's behaviour should support these values. The core values may be expressed in a list of competencies. �

What support the person requires – from the manager, from co-workers, from resources or other information.

16. The Competency and development plan The competency and development-planning part of the competency management sequence is primarily a joint exploration of what individuals need to do and know to improve their Competency and develop their skills and competencies, and how their managers can provide the support and guidance they need. The competency aspect of the plan obtains agreement on what has to be done to achieve objectives, raise standards and improve competency. It also establishes priorities – the key aspects of the job to which attention has to be given. Agreement is also reached at this stage on the basis upon which competency will be measured and the evidence that will be used to establish levels of competence. It is important that these measures and evidence requirements should be identified and fully agreed now, because they will be used jointly by managers and individuals and collectively by teams to monitor progress and demonstrate achievements. For individuals, this stage includes the preparation and agreement of a Personal Development Plan (PDP). This provides an action plan for individuals with the support of their managers and the organization. It may include formal training but, more importantly, it will incorporate a wider set of development activities such as self-managed learning, coaching, project work, job enlargement and enrichment, an element of self-assessment by the individual. If multi-source assessment (360-degree feedback) is practiced in the organization, this will be used to discuss development needs. 17. Action—work, development and support Competency management helps people to get into action so that they achieve planned and agreed results. It is a work- and people-related activity, and focusses on what has to be done, how it is done and what is achieved. But it is equally concerned with developing people – helping them to learn – and providing them with the support they need to do well, now and in the future. The emphasis should be on managing competency throughout the year. This will involve the continuous monitoring and feedback and formal reviews. It is also necessary to enhance 'deliberate learning from experience', which means learning from the problems, challenges and successes inherent in people's day-to-day activity. The premise is that every task individuals

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undertake presents them with a learning opportunity. This will be the case as long as they are encouraged to reflect on what they have done and how they have done it, and draw conclusions on what they need to do when they arc next presented with a similar task or have to undertake a different task requiring the use of the newly acquired skills. Providing the facilities and resources necessary to meet expectations should also provide support on a continuing basis through coaching and counselling. 18. Continuous monitoring and feedback Perhaps one of the most important concepts of competency management, and it bears frequent repetition, is that it is a continuous process of managing and developing competency standards which reflects normal good practices of direction setting, monitoring and measuring competency, providing feedback and taking action accordingly. Competency management should not be imposed on managers as something 'special' that they have to do. Neither should it be imposed on individuals and teams as something 'special' that is done to them. Competency management does no more than provide a framework within which managers, individuals and teams work together to gain a better understanding of what is to be done, how it is to be done, what has been achieved, and what has to be done to improve in the future.

Competency Appraisal Competency appraisal is a process of assessing, summarizing and developing the work competency of an employee. Writing the appraisal is preceded by a meeting with the employee, to provide the opportunity for mutual understanding of the appraisal process. The employee has the option to submit a self-appraisal which will be considered in the development of the appraisal. Competency appraisal is a process of summarizing, assessing and developing the work competency of an employee. In order to be effective and constructive, the competency manager should make every effort to obtain as much objective information about the employee's competency as possible. The following are steps recommended for the Competency appraisal process. 1. Commencement of the Process Typically, the competency appraisal for career employees is due one year from the end of the probationary period or before the merit cycle. Well before that date, begin to prepare for the appraisal. The preparation process involves review and data gathering, holding a preliminary

Experiencing the Competency Management Process in Organizations

Mission

Visionary leadership

Critical success factors

Values

Internal appraisal

Strategies

External appraisal

Objectives

Plans

Review

Action

Feedback

Figure: 11.3 Integrated Management Processes. meeting with the employee and employee preparation of a self-appraisal. The following steps are suggested: 1. Before meeting with the employee, review his or her job roles description and work record for the review cycle. Review your observations, notes and the previous competency appraisal. Obtain competency feedback from people with whom the employee has worked (including direct reportees, if appropriate). This is important information to have when evaluating customer service and teamwork aspects of the employee's job roles. Where customer service is a key part of the job roles, feedback from customers may also be solicited. Locate and have ready any supporting information. If during the review cycle, the employee is reported to more than one competency manager, it is appropriate to consult with the other competency managers for input into the appraisal. Before including any information in an appraisal that indicates there was a competency problem, ask the previous competency manager if the information about the problem has been shared with the employee. 2. Give the employee advance notice of the competency appraisal so that he or she has the chance to review and prepare. 3. Hold a preliminary meeting with the employee in private. The first meeting should take place before you write or deliver the formal competency appraisal. At this meeting, explain or review what will happen during the appraisal process and review the form for the Competency Appraisal Model. Do this even if you have

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appraised the employee's competency in the past. With the employee, review his or her job roles description and the department's strategic goals. Discuss and decide which essential functions and strategic initiatives (for which the employee is responsible) should be appraised for the period. Some functions or initiatives may not have figured prominently in the employee's role for the appraisal period and appraisal in those areas may not be necessary or significant. 4. Conclude the meeting by scheduling a second meeting. Invite the employee to prepare a written self-appraisal, if one is used in your department. A self-appraisal may be used as the basis of discussion during the formal appraisal process. You have the option of 1) receiving the self-appraisal at the preliminary meeting, so that you will have it prior to preparing your draft; or 2) receiving the self-appraisal at the time you review your draft with the employee, for purposes of comparison, and after discussing it with the employee, you may use the self-appraisal to inform the final version of the appraisal. Self-appraisal forms are included in the forms for the model used in your department. The self-appraisal is a valuable tool through which to discover the employee's perspective on his or her competency for the review cycle, as well as to identify interests related to goals and career development initiatives. 2. Articulations and Emphasis The writing phase of the competency appraisal process involves completing the form for the Competency Appraisal Processes used by your department, and writing the supporting comments. In writing the competency appraisal, and for each essential function, task, annual goal or strategic initiative to be appraised, consider three questions: 1. How does the level and proficiency of competency compare with the competency standards and benchmarks for this function, task, goal, or initiative? 2. How was the level and proficiency of competency confirmed? What did you see the employee doing? What do analytical reports or work products show? 3. What were the consequences, results and impact of the competency? Planning the competency appraisal meeting contributes to the success of the process. Below are some guidelines that should help you accomplishing the goals of the formal competency appraisal meeting. �

Prior to the meeting, review your written appraisal of the employee's competency. Review your notes covering the last year and the evidence in support of the rating you gave.

Experiencing the Competency Management Process in Organizations





Plan your discussion. There are many objectives for the discussion. They include:



Reviewing, discussing and confirming understanding of the essential functions listed on the job roles description, annual goals and standards and benchmarks of work Competency.



Recognizing strengths and achievements.



Confirming previously identified functional areas needing improvement and establishing agreement about how improvement is to be accomplished.



Identifying areas in which education, training, or other development opportunities are needed and a strategy for developing skills, knowledge or abilities. Discuss and confirm understanding and agreement about the steps the employee will take to accomplish self-development goals, as well as how you or the department will help.

Plan to meet with the employee in private.

When you meet, carefully review his or her self-appraisal. Discuss different areas of agreement and difference. Review your draft of the Competency Appraisal Form and supporting comments with the employee. Discuss the employee's strengths first, covering each point in detail. This sets a positive tone to start the discussion. Talk about previously discussed areas needing improvement. Ask the employee for suggestions about how he or she will improve competency. Introduce your ideas for improvement as well. Consider whether anything raised in the employee's self-appraisal sheds any new light on your assessment, and be prepared to modify your appraisal if appropriate. Show your interest in your employee's progress and your willingness to take up the discussion again any time. Close the appraisal when all points have been covered and the employee has had the opportunity to provide an input. �









If changes will be made to the appraisal, discuss those changes and agree upon a date by which the final draft of the appraisal will be prepared and the appraisal will be signed. After necessary changes have been made, asks the employee to read, comment (if he or she would like to) and sign the Competency Appraisal Form. Allow adequate time for the employee to do so. Assure the employee that his or her signature indicates that he or she has read the appraisal and that a discussion has already taken place. It does not signify that the employee agrees with the appraisal.

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What if the employee refuses to sign? The employee may take a few days before signing the appraisal form. However, if after a reasonable period of time the employee still refuses to sign the form, competency managers may note on the form that the employee has refused to sign, date and initial the signature block. You may attach work standards and benchmarks, supplemental competency information, work samples and additional comments. Inform the employee that he or she can add or attach comments to the Competency Appraisal Form as well. If the employee wants to add comments, allow time to write them, and attach the comments to the original, signed file copy. Comments should be filed with the competency appraisal. 3. Archiving A copy of the final signed competency appraisal should be given to the employee for his or her records. He or she can also use it as a guide for improving competency and for professional development. The competency appraisal process is intended to break down barriers and maintain an open communication, creating an atmosphere that allows a candid approach to discussions of competency. During the new review period, the competency manager and employee discuss the employee's competency on an ongoing basis until it is time for the next written appraisal. This communication is part of the ongoing process of observation and feedback. By the time you write the competency appraisal, you will have the resources you need to do effective job roles. You will have a clear and current job roles description and Competency standards and benchmarks in place. You will have a supportable basis for making your appraisals. You will have documented the employee's competency and given clear feedback about the competency over the course of the appraisal period. You will have provided the employee with opportunities to improve competency when necessary. There will be no surprises about competency problems. At the time of the competency appraisal, both you and the employee will discuss what the process will involve and you will invite the employee's input. If you follow the suggestions in this Guide, you will find the process of competency appraisal to be constructive and satisfying. 4. Evaluation Stage Probation is a working assessment period. It is the final and most important stage in the selection process of quality employees. By the end of the probationary period, competency managers should be confident enough that the probationary competency of the employee being appraised meets or exceeds competency standards and benchmarks. Generally, the competency of employees who are on probation should be appraised at least once before the completion of the six-month probation period. Refer to the concrete, specific and particular personnel program, policy or contract for further information about probation as it applies to

Experiencing the Competency Management Process in Organizations

particular employees. 5. Annual Review Period Once the probation is completed, the yearly cycle for the competency appraisal begins either after completion of the six-month probationary period or at the beginning of the merit cycle. 6. Required Form and Disposition of Completed Forms To ensure that organization records are consistent, use the ‘Competency Performance forms’. Departments may adapt the forms to their purposes, and adaptations to the standard models must be reviewed and approved by the Human Resources Department. Spaces are provided for the signatures of the employee, competency manager and department head. Signed original employee Competency Appraisal Forms are retained in the official employee file in the department. As mentioned above, employees should be given sufficient time to write comments concerning their competency appraisal, should they wish to. These comments are written on the form or are attached to it and placed along with the form in the official employee file in the employee's department. Ensure that the employee receives a copy of the signed appraisal form. 7. Records Retention The original, signed competency appraisal is retained in the department's personnel records for three to five years following an employee's separation. At the Medical Centre, copies of all appraisals are maintained in central records storage. 8. Competency Development Plan Developing employee competency furthers the mission of the organization and enhances the overall quality of the workforce within the organization by promoting a favourable climate of continuous learning and professional growth; helping to sustain employee competency at a level and proficiency which meets or exceeds expectations; enhancing job roles or career related skills, knowledge and experience; enabling the employees to keep abreast of changes in their fields; making employees competitive for employment opportunities within the organization; promoting affirmative action objectives; and motivating employees. competency development plans may be considered at each stage of the competency management process. Another important component of the competency management process is the development

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of employees' work-related skills, knowledge and experience. The development process offers another opportunity for you and your employee to work collaboratively to improve or build on his or her competency and to contribute to organizational effectiveness. 9. Continuous Learning Development of employee skills, knowledge and experience is essential in today's rapidly changing workplace. In order for the organization to remain competitive and to retain its reputation for excellence, employees should have up-to-the-minute information and the ability to use new technologies, adapt to organizational change, work in flatter organizations in which cross-functional skills and knowledge are required, and work effectively in teams and other collaborative situations. Employees, too, recognize that it is essential for them to continue to learn so that they will be effective in their current job roles and able to move into other positions or accept new responsibilities as circumstances demand. 10. Preparing the Plan There are four principal occasions when preparation of a competency development plan might be considered: 1) After definition or review of competency standards and benchmarks, 2) as a part of the ongoing process of observation and feedback, 3) as the final element of the competency appraisal process, 4) when an employee initiates a request for education or development opportunities. At any of these points in the competency management process, you may discuss training, education or development opportunities with your employee. Identify the concrete, specific and particular steps to be taken and document a strategy for accomplishing these objectives. That documentation should include: �

A description of the concrete, specific and particular steps to be taken.



The names of those who will assist the employee.



Last dates for the completion of the plan's objectives.



A statement of how successful completion of the plan's objectives will be appraised.

Below is a list of examples of activities that could be considered appropriate for employee development. The list is not exhaustive, but represents many of the most commonly used

Experiencing the Competency Management Process in Organizations

methods: �

Staff education and development classes.



Participating in the staff affirmative action programs.



On-the-job roles training cross training.



Organization course work extension course work or certificate programs.



Course work from external providers, schools, etc.



Attending or participating in institutes or conferences.



Membership in professional organizations.



Participation in professional organizations.



Coaching or consulting.



Writing professional articles or books.



Individual career counselling.



New employee orientation.



Working with a mentor.



Management of developmental programs (Management Skills Assessment Program, Middle Management Advance, etc.)



Attending teleconferences.



Internships.



Self-study or reading assignments.



Computer-based training.



Participation in projects.



Membership in campus organizations (e.g., staff associations).



Participation on teams, task forces, or committees.

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Critical perspective in competency management processes (Figure 11.3) Competency development plans should be considered with the needs of the organization and the needs of the employee in mind. Ask yourself, "What are the new functions that this unit will need to perform in the near term and over the next two to five years? What knowledge and skills will employees need to develop in order to perform these functions?" Doing an assessment of your unit's future goals and objectives will thus enable you to identify development opportunities for your employees that will also benefit the organization. Development options that improve employees’ effectiveness in their current job roles are called "position-related." Development opportunities for career advancement within the Organization are called "career-related." Activities, not job roles or career-related, which employees undertake out of personal interest are not included in a competency development plan. When you support and encourage the growth and development of your employees, you build employee motivation and commitment to the organization, and you improve morale. The unit, the department and the organization benefit when the employee succeeds in developing new skills, knowledge or experience. Consult with your own supervisor and department head when considering whether to support job roles-related or career-related competency development options. In most cases it is up to your department head to decide whether the employee may reasonably be expected to complete the proposed activity successfully and to authorize activities in which the following might be necessary: �

Flexible or alternate work schedules.



Leave without pay-leave at full or partial pay.



Full or partial payment of fees and expenses.



Temporary or part-time reassignment in another department.

Some of the factors that may be appraised in deciding whether to authorize an employee’s participation in a particular activity are: �

The employee's need for training.



The employee's career plan.



The needs and strategic goals of the organization.



The affirmative action and objectives of the organization.

Experiencing the Competency Management Process in Organizations



The available resources of the department.



The advantages of one type of training over another type.



The training needs of other department employees.



The effect of the determination on workload and other employees.

Competency Manager's Responsibilities 1. Assessment: As mentioned above, effective preparation of competency development plans, with and for your employees, requires the ability to assess the needs of the employee and the organization. You may develop your own skills in this area by attending the course, "Enhancing Career and Organizational Options," offered by staff education and development on campus. Help your employees to set career goals that are consistent with their skills, knowledge, experience and interests by providing feedback based on your observations and assessment of their abilities, readiness and potential. The assessment should be based on your actual experience and observation of employee competency and behaviour rather than on assumptions and personal biases.

2. Providing Information: Competency managers support career development when they inform an employee about the options for and possible barriers to career movement. For example, you may tell your employees about upcoming positions or openings for which they may be qualified, or about budgetary constraints, which may inhibit career options or development opportunities in the unit or department.

3. Referral: Refer your employees to others who can assist them in achieving development goals. As a competency manager, it is your responsibility to be aware of the appropriate referral sources both within and outside of your department. You may refer employees to books, journals, professional associations or other sources of information. You may also put them in touch with people who might be willing to serve as mentors or with those who might provide an information interview in which employees can

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learn more about a field or position from someone who is currently working in that area or capacity.

4. Guidance: Encourage your employees to focus on clear, concrete, specific and particular and attainable career goals. Share your knowledge and experience with your employees. Typical questions which employees ask are: 1) what is required to move to the next logical position, 2) what are the chances for advancement in this department, 3) how to be mobile within the organization, 4) what is the difference between a promotion and an upward reclassification, 5) how to qualify for training and development opportunities, and 6) who to contact for further information or career counselling. Provide guidance to your employees about steps they might take to improve existing skills and knowledge or develop in new functional areas.

5. Develop: Competency managers support employee development when they assign employees roles or tasks, which challenge them and provide the opportunity to grow. Base decisions about development options and opportunities on a careful assessment of the employee's readiness to accept additional or new responsibilities or challenges. Consider delegating a responsibility that is currently, your own, which is appropriate to the employee's classification and development. Provide on-the-job roles training and refer employees to classes, workshops and other learning and development opportunities and recommend employees to serve on committees, task forces or cross-functional teams.

Managing team competency Definitions TEAM: “A team is a small number of people with complementary skills who are committed to a common purpose, competency goals, and approach for which they hold themselves mutually accountable.” By this widely used definition, an effective team is small, usually having no more than 15 members, and often between 5 and 10. It benefits from the diversity of its membership by drawing on the variety of skills, knowledge, experience and perspectives that all members bring to the team. The reason that the team exists (its mission or charge) is clearly described, understood and accepted by all members and becomes the touchstone against which priorities are established, conflicts are resolved, problems are identified and solved and decisions

Experiencing the Competency Management Process in Organizations

are made. The Competency goals of the team are understood to apply to every member of the team, and accountability for accomplishing those goals is shared. The special contribution that a team makes to an organization is the pooling of the collective creativity, skills, knowledge and experience of its members. This benefit is only realized in a climate of open communication based on trust, mutual respect and commitment to a common purpose. Team members commit to an approach to working together which includes concrete, specific and particular guidelines or norms (see below), developed by team members, to help them to communicate ideas and concerns, give one another feedback, conduct meetings, solve problems and make decisions. Much of the work that teams do is conducted in meetings at which work processes, group effectiveness, and outputs are discussed; problems are analyzed and identified; and decisions related to future actions, changes, etc. are made. The meeting provides a forum and structure within which a team may work. Natural Work Group: "A group of employees and their [competency manager] who produce a product or service." The structure of a natural work group is a traditional hierarchical one in which the competency manager is ultimately responsible for the competency of his or her staff. Employees are part of the group because they work in the same unit or department. Another name for a natural work group is a functional group, because the competency manager and employees make a product or deliver a service together. Authority and accountability are not shared equally, and the concrete, specific and particular definition of a team given above may not apply in all respects to a natural work group. Cross-functional Team: A group of people brought together from different functional areas to redesign a process or product or to make decisions or recommendations about a process or a product. A cross-functional team is different from a task force, because it adopts the principles of teamwork defined above, and because its charge may be either short-term or longterm. Membership will come from a number of areas within the department or organization, but may also include suppliers or customers of the organization. Members may also represent different level and proficiencies of the organization and different functional areas, but while they are participating on the cross-functional team, they share responsibility and authority for the way the team works together and the accomplishments of the team. The degree of independent authority a cross-functional team has varies, depending on its charge. Cross-functional teams are often charged with the responsibility to implement the decisions they make and the changes they recommend. Self-directed Work Team: A team made up of a group of employees who share responsibility for a complete product or process, or accomplishment of a significant part of a process. The

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self-directed work team literally directs its own work and manages its own work competency. The membership may be made up of employees from the same level and proficiency or from different level and proficiencies of the organization. A manager or leader may also be a part of the team, however the role of the manager or leader is usually to provide guidance and support and to be a liaison to the organization and other teams, rather than to control and authorize work. In this sense, the manager or leader facilitates work competency rather than directing it.

Issues involved in managing team competency The movement to a teamwork model raises a number of important issues for the competency manager. An important consideration throughout is how to support a collective commitment to a shared mission, goals and objectives while at the same time reinforcing individual responsibility.

Who is responsible for competency management in respect of teams? Competency management in natural work groups usually operates according to the traditional competency management model in which the focus is on the work competency of an individual and his or her contributions to the mission of the organization, as observed and assessed by the competency manager. While the competency manager may solicit the input and involvement of the employee in each step in the process, authority and ultimate responsibility remains with the competency manager. The team itself to some degree usually does competency management of a self-directed work team. That degree varies from organization to organization, or even from department to department, and also depends upon the readiness of the team members to assume those responsibilities. A fully empowered mature self-directed work team will describe its own job roles, set its own standards and benchmarks, give feedback to members about work competency and team skills, appraise its own competency, and identify and support the training and development needs of its members. The organization will provide guidelines and a framework for that competency management, but within that framework, the team is responsible and accountable for its own Competency. A cross-functional team typically operates without formal supervision, though it may have a team leader. Members usually report to competency managers in their home departments. These competency managers are often not present when team members are participating in the work of the team and may only know about the results of the team's work and the team member's competency through the reports of others, evidence of the team's products, or via the customer reports.

Experiencing the Competency Management Process in Organizations

Whose competency should be managed? When a team approach to work is in place, the focus of competency management is on the accomplishments of the team as well as the individual's contributions to those accomplishments. When the competency management process recognizes individual competency instead of team competency, the incentives work in favour of individual accomplishment alone, which can result in competitiveness at the expense of team interests. Experience has shown that team effectiveness is improved when both team and individual competency are recognized as significant and factored into the competency management process.

Should job roles descriptions include team responsibilities, skills and knowledge? The answer to this question may depend upon 1) how long the team member will serve on the team, 2) the percentage of his or her time spent in team meetings or addressing the team's interests, 3) whether or not the employee's competency in teams will be formally appraised, and 4) the policy of the member's home department if he or she serves on a team outside of the department. Employees who work on self-directed work teams may well spend most of their working day doing the work of the team. The team may be responsible for developing its own job roles descriptions, within the organization guidelines. Some of the dimensions of teamwork that might be considered in describing tasks, skills or knowledge are active listening, providing feedback, participation in meetings, problem solving and decision-making.

How should team competency standards and benchmarks be developed? Whether or not a competency manager will participate in the process or review the standards and benchmarks is an issue to be decided by the organization within which the team operates, but a Human Resources representative should be consulted when making such decisions. In general, the same principles apply to the development of team competency standards and benchmarks which apply to the development of standards and benchmarks for the positions of individuals. The standards and benchmarks should be realistic, clear, concrete, specific and particular, consistent, measurable and/or verifiable, and appropriate to the Level and proficiency of the position. Standards and benchmarks should be developed collaboratively involving all of those to whom the standards and benchmarks will apply, or a representative group if the number of positions affected is large. In addition to setting standards and benchmarks that address issues such as cost, timeliness, quantity, quality, independent initiative and customer satisfaction; team standards and benchmarks will also typically refer to skills that make employees effective team members.

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Who provides observation and feedback to team members? The ability to provide effective observation and feedback is critical to the success of every team. It is through this observation that areas in need of improvement are identified and through feedback that the team becomes aware of those needs. Whether the team is selfdirected and managing its own competency, or team members report to one or more competency managers, teams need to benefit from this observation and feedback in order to manage their group interactions and their work processes effectively on a daily basis. If the team has a formal reporting relationship with someone who is authorized to manage the competency of the team and its members, that person will be concerned with observing and giving feedback about the work-related behaviour and outputs of the team as a whole, as well as of individual team members. If the team members report to different competency managers, or if the competency manager is not present when the team does its work, the competency manager will need to establish its procedures and relationships for learning about the work the team is doing and how it is working together. These procedures should be developed in consultation with department heads and Human Resources representatives. The process could involve receiving input from the team leader, team members and customers of the team. If the team benefits from the services of an outside facilitator, it is probably not advisable for the facilitator to provide feedback to the competency manager so that the facilitator's impartial role will not be compromised. Regardless of whether team members report to Competency managers, the ability of team members to observe behaviour and give feedback to one another will be a factor in the success of the team in working together. This is especially true in the case of self-directed work teams in which responsibility for Competency management rests primarily with the team itself. Norms, standards and benchmarks and statistical data provide neutral frames of reference which make giving feedback constructive and safe. Another important source of feedback for teams is the team's customers. This feedback may come in a variety of forms: casual conversation, surveys, feedback cards, suggestion boxes, in-person interviews, telephone interviews and focus groups. Utilizing a combination of statistical data, customer feedback and team observation and analysis makes interpretation of problem indicators more accurate and occasions for praise and celebration more evident. It may not always be appropriate to give feedback in the middle of a group session. Similar issues of timing, place and appropriateness apply in teams that apply when giving feedback between an individual competency manager and an employee.

Experiencing the Competency Management Process in Organizations

Whose competency should be appraised? When the sole basis for appraisal is the Competency of individual team members, the incentive to work effectively with other team members may be missing. Some organizations have appraised team competency alone and not individual competency. However, the focus on team competency, without factoring in individual accountability, can have the effect of undermining a sense of individual responsibility. Since team effectiveness does depend, to some extent, on the efforts of its individual members, some organizations have found that it is worthwhile to appraise both dimensions: team competency and individual competency. There may be some question about whether competency on a team should be appraised formally at all. The answer may depend upon how long the team member will serve on the team and the percentage of his or her workweek spent doing the work of teams.

Who should appraise team competency? Ordinarily, the answer to this question would be the same as the answer to the question about who should manage team competency. However, in the case of teams, it is not uncommon for input into the appraisal to come from other team members, customers of teams, team leaders or sponsors, as well as a competency manager if there is one. Some organizations which appraise individual team member's competency permit team members to choose peers who will contribute to the appraisal process in addition to input from management and customers. Self-directed work teams are by definition responsible for managing their own competency, which includes self-appraisal. However, the extent to which they are responsible for evaluating their own competency varies. Responsibility for evaluating their work may reside with a competency manager in the early stages of team formation until the team develops the skills, knowledge and experience to appraise its own work competency. The responsibility for evaluating team competency may be delegated to the team by degrees as it matures. It is not unusual for the process to include management review as well. Some cross-functional teams are also self-directed, but the level and proficiency of self-direction may or may not include responsibility for evaluating team competency.

What to appraise? When work on teams is appraised, typically the effectiveness of work processes and their results are appraised as well as the ability of the team to work effectively together. These dimensions may be described as the work of teams and teamwork, and they may be appraised on an individual basis, on a team basis or both.

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Who is responsible for the development of team members' skills, knowledge and experience? Team members need to learn team skills as well as to continuously improve their technical and other work-related skills. Management, competency managers and team members typically work together to identify and provide for the education, training and development needs of team members. Departments in which self-directed work teams function will want to be aware of and anticipate the needs of team members and to provide a framework for considering requests for development. When members of cross-functional teams require education, training or professional development opportunities in order to support their competency, the appropriate source of funding becomes an issue. Should the employee's home department pay or should the team sponsor or some other source provide the necessary financial support? Authorization of release time will continue to be a matter at the discretion of the department head in consultation with Competency managers or other responsible parties.

Summary of the competency management process The competency management process begins with an analysis and description of the job roles. The Competency manager identifies essential functions in the job roles description and the strategic mission and goals of the department or organizational unit. Standards and benchmarks of minimum acceptable Competency are developed for the position with the employee. Additionally, standards and benchmarks for Competency that exceeds expectations may be set to encourage the employee to strive for even better results. Throughout the appraisal period (typically one year), the competency manager observes and provides behavioural feedback on the competency of the employee, thus focusing on helping the employee to achieve successful competency. At the end of the appraisal period, and in collaboration with the employee, the competency manager prepares, writes, delivers and then produces a final copy of the written competency appraisal. At any point in the process, the employee and competency manager may identify needs and create a plan for employee education, training or development in job roles- or careerrelated areas. The issues relating to competency management of teams and team members arise out of the variety of reporting relationships and degree of independent responsibility that teams exercise, as well as the need to reinforce team values and efforts without undercutting individual responsibility. Adaptations of the competency management process with

Experiencing the Competency Management Process in Organizations

teams in mind may be made which are consistent with the organization policy and procedures. As a manager, by following the steps outlined in this chapter, you will find that the competency management process fosters improved communication with your employees. You will also achieve better results for your organizational unit or department.

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12

Competency Based Performance Management System COMPETENCY

BASED PERFORMANCE MANAGEMENT SYSTEM—CBPMS

Meritocracy, the system we all support, to be able to succeed, requires all of us to develop an appraisal process that is objective, hence fair and acceptable. Whilst it is acknowledged that no appraisal system can be totally objective, we can surely attempt to minimize the element of subjectivity in it. The purpose of this book is to provide you with an overview, understanding and opportunity to practice the competencies and skills required for applying the performance management process effectively. By the end of this chapter you should be in a position to understand: �

Integration of the competency and PMS system with the overall vision and goals of the organization.



Understand the principles of Performance Management System and why they are important to be globally competitive.



Construct a performance appraisal system cutting across organizational member’s specifications.



Be able to apply goal-setting, coaching and evaluation techniques.



Have developed plans to implement the process with your subordinates.

What is competency based performance management? The electrifying pace of change faced by corporations today has not been seen before. The change does not confine itself to economics, political impact, information management or

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labour market in isolation or exhaustively. Change appears to have taken charge of running the business organization. The power and capabilities available to the corporation is competitively positioned for it to be leveraged and built or seems to be disappearing before our eyes. The complex business realities of the coming future will demand the ability to quickly and globally offer products and services to customers whose demands are never ending. Internal process will have to keep pace with this service demand. The challenge posed by this business upheaval would expect that competitiveness of the future world does not boundary base with technology, information and human resource. There appears to be a far-reaching and rapid integration of the business process to make the service to the customer happen. XEROX is looking at this integration process happen. Several initiatives involving design cycles focus quality, empowered employees, small and long term vendor team and human resource evaluation is taking place concurrently. With hierarchical management systems being replaced by networked, flexible and team based structures, with information available to all players in an equitable manner, with well trained employees dealing directly with a situation can now make decisions at the point of impact. The New World order has made this happen. �

Current problems had indicated need for competency-based performance management include the following: job performance standards and appraisal criteria are seen as an equal or unfair because one group of employees must achieve it a higher level then are the group of employees equal jobs to receive a good evaluation or reward.



Secondly performance appraisal is seen by managers and employees as autocratic paper at exercise but they do not take seriously because it has little impact on employee performance score development.



Thirdly, employees see nothing in the performance management system for them specifically as performance appraisals do not address their questions about skill development or career advancement.



The performance management system has little impact on actual management insider doesn't lead managers to do their jobs better ought to develop a proper feedback to the employees.



Additionally the performance management system does not reflect or reinforce the organizational strategy because it fails to focus employee behaviour on statistic directories such as quality of service.



Finally, performance ratings are invariably inflated.If 94 percent of the workforce is rated very good on a scale of one is to 5 employee ratings are not have a use for promotion decisions on succession planning.

Competency Based Performance Management System



Consequently mixed model performance appraisals plus competency-based performance management system could be inappropriate for several reasons:

PERFORMANCE (“pay for results”)

COMPETENCIES (“pay for skill”)



“What” of performance

“How” of performance



Quantitative tied to unit goals

More value added



Current time lines and

Perspective time lines



Performance

performance in present as well as future



Reward oriented

Development (behaviour change) oriented



Result oriented

Value oriented



Individual motivation subjective

Institutional motivation/objective



Isolated from main stream

Leads from business competency

Uncertain environments. In a rapidly changing environment where results are not an employee control hard results and objectives often rendered irrelevant by external events. In such situations, evaluation was based on whether employees did everything they could come up within a demonstrative of the right behaviours rather than achieving targeted results. The less control employees have over results, the more performance should be based on expression of competencies.

Qualitative imposes service jobs In transit no measurable outcomes; qualitative skills competencies are the best indicators of employee performance. The more subjective the job output put the more important it is the place competency behaviours.

The self-managing teams In teamwork and groups individual results and output may be less important in contribution to the group roses. In teamwork and corporation in competencies the ability to work well with different groups of people are increasingly important in the diverse workforce of the global

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organization. Even in technical professional individual contributions organizational citizenship behaviours predict superior performance. Job intended for development of future profits. The more a job organizational objectives of employees stress development of skills the more appraisal should be based on demonstration of improved competence.

Changing organizational strategy focus and markets. In the present day changing environment, an organizations employee's potential to contribute to discern in the future may be more important than their past performance, for example, the ability to sell a firm's new products in the European common market may be more important than sales of older products and domestic markets most performance management systems are past oriented. There are several steps involved in identifying and developing the competency-based performance management system. Identify competencies required for superior performance in percent of future charts. To add value a performance management system should motivate employees to do better than the current actual performance it's important to develop a mixed model performance management system for assessing both performance results and competency behaviours that the performance in the job. There is a necessity to train managers and employees and performance management including coaching for performance improvement. Performance coaching intern involves active in between manager employee orders for action low levels of competence. The employee identifying the desired level of competence year she wanted a lot of meters of the performance or career advancement goals. There needs to be an agreement on a contract to employee in manager on employee’s competence development goals and action steps year she will take retain them. In addition there should be help and support, which the manager should be willing to provide to the employee. The scorching approach to the principles of self-directed change that most other states only when they feel it is their own best interest to do so at the dissatisfied with their existing situation on level of performance. In addition that is also expected that they are clear about the desired situation on level of performance appear about action steps they can take to overcome the actual to the desired situation on the level of performance. Competency-based performance management systems shift the emphasis of appraisal of organizational results achieved to employee behaviours and competencies demonstrated. Diagnosis and problem solving approaches or performance tasks is formed. If results are not at the desired level given high piracy to the job tasks demonstrating these behaviours more often and developing these are but the season important attribute that employees need to demonstrate on the job. The addition of competencies to performance management systems

Competency Based Performance Management System

has important implications for management. Managers explicitly commit them-selves to provide employees with formal training coaching another competency development activities during the performance period. The most important factor in implementing the competencybased performance management system is training managers to provide the scorching a developmental assistance. Employee training also helps employees understand how the competency-based performance management system works what their role is how to assess themselves and how to contract for competency development activities with their managers. Competency based PMS follows two independent cycles, one involving the competency management process and the other dealing with the measurement and reward system, integrated at the performance management cycle. Essentially, strategic articulation drives key objectives, critical success factors, enables establishment of measures and objectives, necessitates the organizational members to plan and execute, systemically monitor and evaluate and as a consequence reward and coach. At the other cycle competency mapping process involves establishing the dictionary, agree on the assessment set, prepare worksheets, select assessment techniques and material, confirm linkages to critical HR processes, design and implement infrastructure, confirm the matrix of employee bands and link the overall effort to the critical success factors and benchmarks of the organization. At the integration the enabling infrastructure and enabling a performing culture support level the process. The parallel cycles is essential too keeping the integration between strategic orientation with the objectives of the firm at one level and at another level with the competency mapping necessary to make it happen. (Fig 12.1 and 12.2) In the organization building process several factors continue to play a critical role in an on going organization. One of the factors integrating the systemic HRD linkages is the People Evaluation and Development System (PEDS). In an unlinked platform PEDS is seen only in the context of goal setting, appraisals, goal evaluation, performance and review/feedback. Competence based Performance Management and Competence based Human Resource Management Competence and competency approaches allied to competence-based assessment and related pay are being used by a growing number of companies. Utilization includes applying national frameworks/such as the Management Charter Initiative in the UK, or internally generated organizational core competencies, generic and role-specific competencies and behaviourally anchored competencies. An important consideration is where the application of competencies fits within the performance management process. ROBERTS (1997) links competencies to the initial stages of the recruitment and selection process, which he contends should be ruthlessly streamlined if it is

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Competency Based Performance Management Program Link Critical Success Factors toOrganisational core competencies

ARTICULATE STRATEGY

ENABLING INFRASTRUCTURE

Confirm competency dictionary

ENABLING PERFORMANCE CULTURE LINK STRATEGY TO VALUE

Confirm Matrix of Employee Bands

Agree on Assessment Set

REWARD AND COACH

SET MEASURES AND TARGETS Performance Management Cycle

Design & implement infrastructure MONITOR AND EVALUATE

Confirm linkage to critical HR processes

Prepare Assessment Worksheets PLAN AND EXECUTE Select Assessment Techniques & Material

Figure: 12.1 Competency Based Performance Management Program to be effective. Among various suggested approaches, he includes: �

Definition of key competencies – personal attributes, knowledge, experience, skills and values—to meet the organization's long-term needs.



Combining a range of selection techniques and methods to obtain reliable data on all core competencies.



Feeding the information gained into the induction, appraisal and development of employees.

ROBERTS (1997:1) maintains that, 'Neither praise nor pay can motivate people to perform beyond their means, and the best training programme cannot make a silk purse of a sow's ear.' This reminds me of my experience as a young first-time training officer in the late 1970s. My manager introduced me to a model of what he considered HRM and HRD to be all about, and which is still with me today; as it is shown in Fig 12.2.

Competency Based Performance Management System

Obtain—— Train —— Re-Train —— Retain

Recruit Select Induct

Pay Rewards Motivation

Figure: 12.2 Combining HRM and HRD. In recruiting, if you are going to invest money in salaries and on-costs you need to get the recruitment decision right. If having recruited the right person you then spend money on training/retraining and developing the individual, the bottom line must surely be in retaining the skills and abilities you have invested in. If not, then you have not realized the full potential of your investment. A statement of the obvious perhaps and a simplistic view, but one which could suggest that performance management is a matter of common sense. In their pursuit of integrated performance management systems, are organizations perhaps over-concentrating effort on current employees and their performance, rather than concentrating effort also on a vision of recruiting future employees to identify and under-stand performance standards? Extending ROBERTS' competence approach to recruitment, does the competence approach lend itself to a competence-based model of performance management? HONEY (1997:33) identifies the pros and cons of such an approach: Provided that competencies are specific, unambiguous and written down, they are useful in helping everyone know what is expected of their performance. Competencies also have the potential to aid learning and development, but only if they are integrated into other key processes such as recruitment and selection, feedback and appraisal, coaching and mentoring and (the most contentious) pay. Without this integration there is a real danger that competencies are related to meaningless lists of words with no real impact. Fundamental changes in the Human Resources Management (HRM) processes are down the horizon: �

Hiring and recruiting focus has changed from short/long term job related search to medium term, person specific and appointments.



The corporate person of today is being demanded to gain knowledge and appreciate the corporate set up for its vision and business process than just profitability and bottom line.

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People development and motivational methods have changed for the average worker towards work, thought, the intellect and contribution.



Retraining, learning and business process training to keep pace with performance objectives have become fundamentals for management development.



Long term perspective and career context in the eyes of the individuals and the organization has significantly and permanently changed. The current visuals of pyramidal growth have been seen to be deceptive.



Long and short term remuneration and compensation is now a function of business goals and individual contribution.



Structures and organization design principles emphasis is on team structures with pre defined role demands.



Culture theorists are bringing in pay, performance and productivity linkages.



Unions and bargain able employees are receptive to performance orientation to the operative class.



Rewards and life style demands in the up market socio-economic world is keeping pace with the developed world.

A Model for Organization Performance—The Capability Building Cycle Performance management systems are based on the assumption that an organization's success is a result of adding together all the individual outputs. In an American Management Association film, a leading authority of the time suggests, "If person A and person B and person C do their jobs, the organization's results are A+B+C. Manage each individual's results, and you succeed. While it may have once been the case that this was true, current research indicates that an organization succeeds as a result of the interaction of people, not the simple adding together of results. The whole is not simply a sum of its parts, but in a well-managed workplace the parts interact to create successful organization. Similarly as in the case of the competency based performance management cycle that we saw earlier, at this point the endeavour is to support the strategic orientation at the competency mapping stage with that of the need for development plans and individual action steps for integrating the learning’s from assessment centre findings with that of a gap analysis and finally a development plan. (Fig 12.3) Capability Building Cycle.

Competency Based Performance Management System

Critical factors Driving Performance This input is Articulate Strategy obtained from initial part of PerforOrganisational core the mance Manacompetencies gement Cycle

Role Profiles

(a)

Longer term cycles

(k)

Short term cycles Do Individual Roll up IDPs Development short/long term (l) Plans plan

Data (j) Interpretation Administer Assessment (i) Trainassessee/ assessors

Development Intervention

(m)

Change Program

(n) (g)

(h)

Design & implement IT infrastructure

(b)

Capability Building (c) Cycle (d) (e) (f)

Confirm Matrix of Employee Bands Confirm competency dictionary Agree on Assessment Set Prepare Assessment Worksheets

Select Assessment Techniques & Material

Confirm linkage to critical HR processes

Figure: 12.3 The Capability Building Cycle.

Competency Based Performance Management at the core involves (CBPMS) 1. People are effective in a culture with a vision, a common purpose and a reason for existence. The importance of vision cannot be understated. The concrete possibilities that are thrown up in an open-ended vision statement are often missed for its dream like articulation. But in this dream like articulation are the power of people link, the bondage, the spirit and a super ordinate goal. A vision of the corporate that we would like our future generations of people to perform. At the minimum vision should encompass value based articulation to include long term business direction, focus on the core competence of the organization, concern for stakeholders and in particular customers and employees, performance standards and benchmarks and should be collaborative and supportive. Effective vision statements challenge and stretch the organization. The PMS linkages are evident in the individual/team goals that are congruent with the corporate vision. The will to perform is inspired by the cohesive and all pervading vision statement.

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2. Built into the organizational existence is the power of values. The thread of beliefs, norms, practices, concerns and goals shared, imbibed over time and used as a basic for shaping behaviour, the corporate invincible, the ethos so very fundamental for survival. JACKSON-FRIGON COMPANY (JFCI) has not only articulated values for the individual, it has gone a step further to speak of the JFCI Leadership Team values, be it freedom, stability, trust, loyalty, innovation, communication, profitable, growth, customer is right, emphasis on quality, wealth generation for the shareholder, contribute to society, teamwork and many more. They see it as an important step for achieving a competitive edge. 3. Values are possible in several forms but the core human values, although it exists in our soul, needs speaking. They could be respect, value and dignity for the individual, care in consonance with nature, trust, mutuality, openness and transparency, integrity, equality, work ethos, positive attitude and standing by people in good and bad times. The PMS linkage is soft yet far more powerful than many quantitative goals and tasks. The individual working in a value-based environment asks not for details of the things to be done. The teams do not seek role clarity; do not wait for work demands, things to arrive at their desks and so on. The binding values make many things simply unspoken, never dealt with happen all on its own. 4. At the operative level, starts the business mission and the strategic management, the core purpose of the organization, the clarity relevant for business goals, need for competencies, the direction to compete, the plans, aspirations, resource allocation, target setting and results. All with a measurable destination. The basics of planning deals with converting the vision, mission into operative plans at the top management level, at the management planning stage and into key tasks and core benchmarks at the operative stage. Planning establishes the journey and the milestones. It horizons for all, resources, time frames, environment scans, competitive challenges, critical paths, current state SWOT to enable universal understanding of where does the corporation stand today and where does it aspire to be. 5. Leadership works to create an atmosphere to perform, lead tasks, set standards and seek excellence in all times. Leadership would be an active process in CBPMS management, exhorting people to come and give their best, provide the framework for vision, work with the teams on mission and strategy and set the internal process for action planning, review, feedback and success parameters. The leader plays the pivotal role in the culture-building act. Much of CBPMS depends on the leader and the team processes that have set in the organization. The strategic plan, performance

Competency Based Performance Management System

Key success factors for developing and implementing a competency model... � An understanding of business A clear understanding of the strategic business priorities and what are the critical success factors for meeting those priorities. � Understanding link between business priorities and competencies Ability to draw a link between critical success factors and the competencies required for achieving those critical success factors. � Holistic perspective Appreciate the competency model and the Capability Building Cycle in conjunction with the Performance Management Cycle. � Proof of concept Access to sample competency, competency assessment, development plan templates, which have been administered successfully. � Executive level champion and a focussed committed taskforce Providing sponsorship to the initiative and setting up a team of key individuals with requisite experience and giving them definite responsibilities for the initiative.

Figure: 12.4 Key Success Factors for Implementing a Competency Model. goals, communication, change management, measurement methods, team working norms, policy framework, people building activities, technology process integration, information management, basic review and feedback are possibly the first few. The inspirational leader brings in conviction, commitment, competence and courage in facilitating change. CBPMS is not a one best solution. It is an important process to bring in flexibility and dynamism to performance. (Figures 12.4 and 12.5) 6. What is normally not included in the performance appraisal but is an important element of the CBPMS is the behaviour modification facilitating, creating and nurturing a culture which fosters sharing, trusting, collaborating and contributing towards the goals setting and achieving process. Culture and change management priorities involving CBPMS are many. The CBPMS method assumes knowledge worker, premium on the intellect, structures that are networked, flexible, diverse, processes that make management style easy to execute, open communication, close product-customer interface and teams as a way of working. The behaviour transformation and attitude building process involves induction/socialization training, process adaptation facilitation, system comfort, self motivation, on going learning and business connectivity in all decision making.

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CBPMS business intervention tool: The CBPMS process is a performance improvement process based on a joint problem solving approach rather than an evaluation and control system. It is a business intervention tool seeking to achieve a effective mix of organizational variables. The system should provide for internal systemic facilitation wherein the participants to the process see it as a dynamic on going database for achievements of results. The follow through for emphasis on corporate strategic plans and goals would help the individual and team goals to be integrated, congruent and on line. The system recognizes that solely quantified measurement qualitative performance indicators become relevant and imperative for a holistic view cannot assess performance. The relative importance of long and short-term goals is emphasized. More importantly given the changing economic circumstance several medium term strategies become performance factors. The result orientation necessitates priorities on the means, on how targets were achieved, with a special concern for teamwork. In several organizations team based result orientation is real and is concurrently rewarded. It is a process and not a system, owned by the doers and not by the administrators. The archaic forms of HR follow up for appraisals to be completed on time are presently seen only in traditionally poor internalization organizations. The end is always pre determined for clarity and credibility of the teams. The focus stated up Business Challenges

HR Challenges



• Acquire requisite talent in the

Need to shift from project mode to operations mode

• •

Compete with ‘centers of excellence’ Aggressive rate of growth required



Need to develop a brand by enhancing customer experience



Capital intensive business



Focus on generating revenues

shortest possible time

Compensation Challenges



Attract the best available cardiac doctors and nurses



Market competitive

– diverse skill sets – both global and domestic sources

• Clarify roles and performance measures

• Establish robust HR systems and processes to manage and motivate employees with wide spectrum of skill sets

• Build long term commitment to address retention challenges

quantum and structure



Aligned to diverse roles and skills



Drive performance



Manage compensation equity and costs



Build retention



Ease of administration

Figure: 12.5 Key success factors for an organization in a remuneration context.

Competency Based Performance Management System

front is meritocracy. High performing organizations do not mean high performing people or vice versa. There is a need to critically look at performance systems to reach a fair conclusion.

The people evaluation and development system process—CBPMS The CBPMS process at the operative stage involves defining the input, process, output, outcomes and feedback all in measurable terms. The measurement of performance is immediate for managing and sustaining a climate of organizational success. It follows to state that measurement presupposes improvement and the details of how well, how far, who did, why this way, why not, what if, what time frame and so on. The system measures performance, differentiates for blockbusters, sets challenging targets, offers opportunity for developing people, manages people moves and placements and finally acts as a credible backdrop for rewards. Time strategy will then be the timetable for blending the activities and operations of individuals and teams to achieve plans and goals.

What is Performance Management Supposed to Accomplish? The literature regarding MBO and performance management suggests a plethora of benefits and purposes that are designed to make organizations more effective. We can summarize them as follows:

Characteristics of an effective Performance Management Process Aligns individual performance with organisation strategy & business objectives

The existing PMP 7(Not for all departments)

Establishes goals at the beginning of the year to focus efforts

3

Clearly defines standards of performance

3

Provides a dependable measure of the current performance of employees

3

Provides an insight into future potential of employees

7

Uses balanced metrics which link to strategy & business performance

7

Utilises multi- rater feedback

7

Focusses on competencies that need to be developed / strengthened

7

Highlights fast trackers on the basis of their demonstrated ability to operate at a higher level

7

Figure: 12.6 Characteristics of an Effective Performance Management System to evaluate for competency based system readiness.

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Increases management control over work and results.



Increases management ability to identify or "red-flag" problems early.



Links employee objectives and functions to overall organization objectives, thereby creating a sense of contribution for the employee.



Motivates employees by allowing them input into and ownership of their objectives and standards of performance.



Enhances communications by ensuring there is clear understanding of management expectations about results.



Supports remedial action or disciplinary action because a breach of standards can be defined objectively and in a measurable way.



Provides a system where feedback can be given to employees on a more objective basis, and not on management's subjective criterion.



Provides objective criterion that management can use to make decisions regarding pay scale and promotion.

Provides a centralized record of performance for each employee. (Fig. 12.6) The CBPMS defines for both individual and team working: (Fig. 12.7) 1. Measurable, Evaluatable and Quantitative goals on the basis of measurability, with a deadline, with numbers to chase for. 2. Soft and Sensitive Qualitative goals as that which involves value addition, doing things differently, team spirit, organizational clarity, influencing the culture and climate of the organization. 3. Human Process and People management goals to involve value orientation, team building, learning, peer working, self management, cooperation & support, training/retraining and an overall responsibility towards people. 4. Architecture Management and Overall Systemic goals necessitate on going systemic improvements in process, methods and activities, new ways of working, simplification, make organization information friendly, bring in objectivity to the

Competency Based Performance Management System

performance orientation, developing sub teams, transfer success experience in a systemic form. 5. Rare and Unique goals make ordinary people do extraordinary things, stretches people to surpass their standards, make their presence invigorating, goals which are completely over and above the job role demands, creative, rare and requires the teams and individuals to work in an exceptional manner at all times. 6. Individual and Self appraisal to performing groups to recapitulate the correlation of work performance to results, focus on competencies and capabilities which were required to, undertake ones role, the learning necessities. 7. Critical competencies and skill attributes identification to match skills with person and job demands. To make learning and development activities a function of skills and competencies relevant to the incumbent and the job. To facilitate team members to bring up colleague laggards, train each other on functional skills, bridge skill gaps. These could range from work planning, people management and conceptual skills to

CORPORATE VALUES

CORPORATE GOALS

MISSION

INDIVIDUAL GOALS BEHAVIOUR PERFORMANCE

MOTIVATION Personal Aspiration Responsibility

SELF DEVELOPMENT

CP MODEL

Career Planning Performance Evaluation

MBO MODEL

Reward and Recognition

Competency Based Performance

Figure: 12.7 Competency Based Performance.

ON THE JOB EXCELLENCE

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business appreciation, technical skills, innovation and team working. Skill inventory is a sub set of the role demands and needs customization. 8. Overall comprehensive summary in a free form essay format to comprehensively analyze achievements, failures, means adopted, listing of key factors which facilitated or hindered success, 9. Team and individual strengths, weaknesses, areas for development with a focus on special assignments, self development activities, task force contributions, problem solving meetings and customer facilitation activities. 10. Future scenario setting and potential assessment in the short and long term to make early identification of high performers, tracking, monitoring inputs, bringing in mentors/role models, list of possibilities of growth, lateral movements, cross functional exposure, development of leaders for the future and planning for succession at various stages. 11. Performance review, feedback and counselling to conclude the process of the performing year in question with the superior playing a constructive role for development planning and improvement opportunities. A similar role for teams has become an important activity. The feedback process and method needs a special mention given the numbers involved with the superior for the performance measurement session. It is no longer one on one. It is one to many and care and climate is necessary to make the self managing teams continue to be effective and motivated. It is critical to focus on specific data facts, displayed behaviour, focus on critical incidents and make the dialogue meaningful and forward looking. 12. Overall ranking and tiering on a four-point scale to measure for capabilities ranging from outstanding to weak. The scoring pattern for self managed teams differs from individual evaluation patterns and keeps in perspective team purpose, mission objectives, predetermined goals, activity schedules, methods of measuring success, closure criteria, achievements and rewards. Team performance is a function of communication of goals, cooperation, effective coordination and concrete completion.

Focus on Results and There Will be No Problems Performance management assumes that if you focus on results, that you are much more likely to succeed. It makes sense set goals, reach goals and you get what is desired. The problem is that a sole focus on results neglects organizational and system issues that need to be in place

Competency Based Performance Management System

for the results to happen. Again, the assumption is that somehow if you are clear about results, effective systems will emerge magically to bring those results to reality, or that leadership will be effective. We know this is not true. While results ARE important, an examination of the process required to achieve these results may be even more important. Total quality initiatives have brought this to the forefront. North American companies, focusing on results, quotas and output have gotten skunked in the market place and one reason is that they have got been less able to provide the necessary conditions for quality output. There is an increased understanding that problems related to an organization's output are more often related to poor management of the systems, or the WAY work gets done, rather than problems with the people. In short, organizations set up barriers for the people to do their work. CBPMS is an adaptive integrated system available to organizations who wish to make the all pervasive components of the corporation, be it vision, values, mission, strategy, planning, leadership, behaviour, culture, team working, business results and performance evaluation work together. It is not a system in isolation of the business process and focus. In fact it is more of an on line people process symbiosis than several independent performance evaluation systems. The culture demands are specific. It calls for an organization where people can join in and given in their best, encourages people to express feelings, doubts, concerns, has a supportive-coordinate climate, can transact business on the premise of intellect and performing brilliance and the bottom line is performance in a culture which fosters meritocracy. The performance management process links goal setting and coaching for performance appraisal and career development as a continuous process. Its purpose is to develop people and improve performance through a clear understanding of goals and regular coaching as well as to provide honest and accurate formal evaluations to support rewards for performance practices. Managers and subordinates have a mutual responsibility for making the process work. The performance management process attempts to systematize good practice to ensure that what all managers aim for and achieve is what the organization requires.

WHY DO PEOPLE NOT PERFORM ON THE JOB? �

They don’t know what is expected.



They do not have the tools, space and authority.



They do not get a feedback about performance quality.

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They are punished when they do it right.



They are rewarded when they do it wrong.



They are ignored whether they do it right or wrong.



They do not know how to do it.

CHARACTERISTICS

OF

PERFORMANCE MANAGEMENT (FIG. 12.8)

The performance management approach has a number of characteristics, which differentiate it from conventional management-by-results schemes: �

It is a performance-improvement process based on a joint problem-solving approach rather than an evaluation and control system.



It places an emphasis on corporate goals and values with individual manager’s objectives being formulated as part of a cascade of integrated setting of goals and standards.



It recognizes that performance cannot be assessed solely by quantified measurement – qualitative performance indicators are given full recognition.



It places as much emphasis on longer-term goals as on short-term objectives.



It places emphasis on how results are obtained, with special concern for human resources management and teamwork as well as the results themselves.



It is a two-way, participatory process, not a top-down procedure.



It is a process rather than system oriented, with the emphasis on the appraiser – appraisee/manager subordinate interaction.



It should provide for interaction with data across the chain of command.



It should allow for feedback mechanism to work all 360 degree of the management hierarchy.



Line management owns it, not by the human resource department. It is an integrated approach, balancing people (attitudes and skills) and process (procedural framework) factors to reflect the organization's culture.

Competency Based Performance Management System

Involving People in Goal Setting is Motivating Intuitively this is true. People do appear to want to have more control over their job tasks. Unfortunately, research suggests that this conclusion may be unwarranted. In Managing Organizational Behaviour (TOSI, RIZZO AND CARROLL, 1986) some interesting results were reported. In a study by CARROLL & TOSI (1973) results indicated that "subordinate participation in setting goals did not result in higher levels of perceived goal success nor in more favourable attitudes towards a superior or toward competency by objectives". It may be that in some situations, employee involvement is seen as positive and in others not so. Research aside; the simple act of involving employees in the setting of their objectives is not sufficient. This is because employees are still uninvolved in the setting of organization goals and objectives that, by and large, determine their personal objectives. For example, executive generally set overall goals for an organization and then individual employees are given some control of what they will do, personally to achieve these goals. If the overall goals make no sense to the employee, management is only offering a choice of doing one stupid thing or another. Let's make it concrete. Departmental executive determine that a particular branch “needs" to move to another building. The manager of that branch, using a performance management approach, allows employees to choose activities and set standards and schedules related to the tasks. Employees can pack files, communicate the change to clients, or choose from a number of tasks. So, while employees have control over the smaller tasks, they are NOT in control of the overall direction or decision. If the decision seems arbitrary, no amount of choice about tasks will convince an employee that they are in control, or contributing to a worthwhile task.

KEY ISSUES 1. Has the company implemented a HR system and process to manage people issues? 2. Is there top management commitment to appraising and developing people? 3. Are line managers adequately knowledgeable with management thinking? 4. Is there a felt need at the line management level the need for a development tool for people? 5. Is the company culture conducive for feedback, coaching and training? 6. Is there a budget of expenses for training and developing people?

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7. Does the company wish to integrate appraisals with career planning and succession systems? 8. Is there an HR audit system to measure effectiveness of HR systems and practices? 9. Is there a stated corporate vision, values and mission statement? 10 Are there valid reasons being articulated by the management in general by expressing the need for human intervention and management of human capital?

DO YOU HAVE A COMPETENCY BASED APPRAISAL SYSTEM? What kind of competency based appraisal system operates in your organization? (More than one of the following statements may apply). 1. A formal system that all managers are required to operate. 2. Reports to be written on all staff. 3. All staff to be offered an appraisal interview. 4. All staff to attend an Assessment Centre. 5. Periodic development Centres are conducted to map gap analysis. 6. All staff to be given an appraisal interview whether they want it or not. 7. Different systems operate at different levels. 8. I am appraised differently from my staff. 9. There is no formal appraisal system. 10. I am free to appraise as I think fit. Here are some of the reason’s for competency based staff appraisal. Whether or not you run such a system at present, which of them would you most look for in appraising your own staff. (Again, one or more of them may apply). 1. To agree on just what a person’s is job actually consists of. 2. To assess a person’s past performance in the job. 3. To assess future potential in the job.

Competency Based Performance Management System

4. To define competency. 5. To help understand competency as they relate to the job or role. 6. To pick out those worthy of promotion or special pay awards. 7. To identify individuals’ strengths and weaknesses 8. To identify difficulties that prevents people from working as effectively as they might. 9. To consider how individuals might benefit from training. 10. To influence their work by praise or advice 11. To enable staff members to put a point of view and influence my expectations 12. To ensure that I really do think systematically about each individual’s performance at least once a year.

Stages in Developing the Performance Monitoring and Reporting System (‘PMRS’)

Stage 1 Evaluate and Refine Review Mechanism and supporting definitions

Understand Current State Evaluate relevance to Lead and Lag Indicators

Stage 2 Develop PMRS Dashboards (Corporate, Functional and Unit)

Develop Functional Requirements Document and communicate specs.

Link Scorecards to Review Cycles

Develop prototype

Design ‘Review Mechanism’

Build and Rollout

Stage 3* Pilot Action Planning, Reward and Coaching

Training on use of Scorecard and Dashboard Handholding for Action Plan development Establish Reward & Coaching mechanisms Train the Trainers

Estimated elapsed time

Estimated elapsed time

Estimated elapsed time

Figure: 12.8 Performance Monitoring and Reporting System.

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What factors do you take into account in appraising staff? (Or what factors would you expect to take into account if you don’t run an appraisal system at present?) Tick as many as apply. Performance against objectives or targets previously achieved: �

Agreed with each staff member



Performance against objectives or targets imposed by management.



Standards of performance previously agreed with each staff member.



Standards imposed by management.



Critical incidents, e.g. typical successes or failures.



Personal qualities or attitudes or attitudes revealed in the person’s work.



Other people’s comments on the person.

Please tick either ‘YES’ or ‘NO’ YES

NO



Can you be sure you are appraising the individual’s performance rather than your idea of his or her personality?



Does your memory or record-keeping enable you to base the appraisal on the whole period under review rather than on the recent past or on a few outstanding but untypical events?



Does your appraisal system involve the filling in of one of more reporting forms?



If so, are you confident about what is required of you in filling in such forms?



Are you expected to interview your staff?



If so, do you feel sufficiently confident about such interviewing?



In general, do you feel you know all you need to know about the purpose and workings of your appraisal system?



If not, can you learn more?

Competency Based Performance Management System

PERFORMANCE APPRAISAL The Performance Management System is adopted from principle of “Competency by Objectives” (CBO). This method is followed because it increases objectivity in the appraisal system; it reduces bias, has a focus on behavioural aspects and is time bound. The Objectives The Performance Appraisal System provides an opportunity: �

For self-appraisal, to carefully ponder over one’s own contributions and achievements.



To management/appraiser for reviewing employees work performance against mutually set objectives.



To appraise for post appraisal discussions and guidance.



To appraiser for feedback and upward communication.



To identify training and development needs of the appraisee.



To recognize and reward meritorious performance based on objective criterion.



To identify employees having a potential to assume higher responsibilities.

You Can Measure Results Objectively and Meaningfully If you have ever tried to set meaningful standards of performance that are "measurable and observable" you will know how difficult it can be. If you have ever been involved in a performance dispute that goes to grievance, you will also realize how absolutely difficult it is to measure work, or document the findings. What people find is that the more precise the standard, and the more objective the standard, the more likely it is to seem silly, or not capture the essence of the task or objective. Let's look at an example. Consider the case of a person that processes driving license renewals, and deals directly with the public. This is a good example because it initially appears that one can set quantitative objective standards.

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Discussion between supervisor and employee results in the following initial standard. �

Process license renewal applications at an average rate of 20 per hour, with no errors.



Upon reflection the supervisor realizes that this standard does not account for customer satisfaction. Further discussion results in adding a “no complaints” clause, but it are somewhat complicated. Often irate customers will complain despite the best efforts of the employee. The employee is not willing to have his or her formal evaluation reflect things that are uncontrollable. A compromise is struck and it looks like this. Process license renewal applications at an average rate of 20 per hour, with no errors and generate no legitimate customer complaints regarding rudeness, non cooperative or poor service. Now we have a problem. By adding the clause regarding legitimate customer complaints, a new element has been added. Subjective judgement must be exercised. Now there is room for interpretation, and the manager is required to judge whether a complaint is "legitimate" or not. The standard is no longer objective. We could carry this example to the point where the standard resembles War & Peace, but the point here is that the more quantifiable and measurable a standard is, the less relevant it becomes. It is easy to measure the trivial, but it is very hard to measure what is important in an objective way. Even well written standards have an appearance of objectivity but require subjective judgements. This is problematic for performance review and disciplinary action. Many public sector managers have found that even when standards are in place, it is impossible for disciplinary action to occur, because the standards "violated" were far more subjective than they initially appeared.

WHY PERFORMANCE APPRAISAL �

Allows you to MEASURE performance.



Allows you to MERGE individual goals with corporate objectives.



Allows you to DIFFERENTIATE performance.



Allows you to FIX human problems that do not surface easily through coaching.

Competency Based Performance Management System



Allows you to BENCHMARK against best practices on people issues and concerns.



Allows you to CONSTRUCT ideal models for motivation and retention strategies.



Allows you to IDENTIFY AND BUILD competencies.



Allows you to IDENTIFY training needs.



Allows you to REDEPLOY personnel.



Allows you to REWARD performance.

COMPETENCY

BY

OBJECTIVES

Competency By Objectives (CBO) (Fig. 12.9) is a strategy of planning and getting results in the direction that management wishes and needs to take while meeting the goals and satisfaction of its employees. In its simplest form, it is blending individual plans and needs of managers towards a large scale accomplishment within a specific period of time. The primary purpose of such a strategy is to simplify and clarify the managerial processes operating within the firm. There are four basic ingredients to the CBO concept: Objectives: Time strategy, Total management and Individual motivation. A performance management system that is competency based system planned performance that has to do with defining job responsibilities and expectations and establishes goals and objectives for the performance period. What is CBO? • Competency By Objectives Competency by objectives (CBO) is a strategy of individual planning, establishing behavioural processes, mapping ability and getting results in the direction that is driven by organizational strategy, goals and objectives and needs to take into cognisance individual, team and organizational concerns, while meeting goals and satisfaction of its employees.

Figure: 12.9 What is Competency Based Objectives?

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Many organizations are becoming interested in management and appraisal of competence on behalf of performance. There are seeking more qualitative assessment of our oriented to the future and focused on development.

BASIC INGREDIENTS OF CBO �

Objectives

Objectives are events or accomplishments planned and expected to happen. They are job or organizational results to be arrived at. An objective might be to improve sales, lower costs, create new markets or reduce absenteeism. �

Time – strategy relevance

Time strategy is the timetable for blending the activities and operations of individual managers to achieve long and short-range sets of results. Achieving a reduction of operating costs of 10% within the next three operating quarters by all departments is an example of a timetable of co-ordination for collecting the contribution of each individual manager. �

Total management approach

Total management refers to formalized efforts to involve and coordinate the contributions of each individual manager towards a common goal. �

Individual motivation and drive

Individual motivation refers to the personal involvement and participation in the objective setting process. This involvement tends to generate a desire and willingness to achieve.

Operating principles of CBO 1. Unity of managerial action is more likely to occur when there is pursuit of a common objective. 2. The greater the focus and concentration on results one want’s is to achieve on a timescale, the greater the likelihood of achieving them. 3. The greater the participation of setting meaningful work with an accountability for a result, the greater the motivation for completing it. 4. Progress can only be measured in terms of what one is trying to make progress towards.

Competency Based Performance Management System

Behavioural indicators, benchmarks and goal setting • The most distinctive characteristic of CBO is the formulation of tangible, measurable, and verifiable competencies in key areas of performance. And defining behavioural benchmarks. • Establishing key goals and targets. • Formulating assessment sets to map competencies. • Define roles, key performance indicators and benchmarks. • Enabling processes that prepare individuals to fit in with corporate responsibility. • Establishment of central mission and long range plans, then department and individual objectives. • The long range plans of the organizations become the basis for short term goals. • The cascading process take place throughout the organization so that the objectives fit together to achieve the overall organizational objectives.

Figure: 12.10 CBO—Behavioural Indicators, Benchmarks and Goal Setting. The simple model of the CBO process is illustrated here: Generally, a CBO system includes the following components: �

Development of role & mission statement.



Helps define competencies and behaviours that effectively supports such competencies.



Establishing strategic goals/strategic plans.



Defining key result areas.



Establishing indicators or effectiveness, goals, or organizational objectives.



Establishing, or negotiating individual employee objectives.



Establishing performance standards for each objective.



Action plan for each employee.



Periodic measurement and assessment of status of each objective standard.

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What does CBO aim at? • Aims of CBO : To clarify and determine the most effective means of achieving profit and growth objectives. To enable behavioural processes to facilitate employee attitudes while performing their roles. To establish the extent of a person’s personal participation and commitment by defining and agreeing with him the key result areas of his job. To bring into the open those problems which a manager feels prevent him from being as effective as he could be so that he can take appropriate preventive or remedial action. Improve people’s performance by building on their needs, strength, successes rather than merely on their weaknesses and shortcomings. .

Figure: 12.11 CBO—Principles and Aims.

Th e Fo c u s o f CBO is: 1. To Predict and shape the future by developing long range objectives and strategic plans. 2. To accomplish results, not performing activities. 3. To improve individual competence and organizational effectiveness. 4. To drive employee behaviour. 5. Increase the participation and involvement of employees in the affairs of the organization. 6. To establish businesses processes that facilitate employee actions in synergy with their competencies.

Figure: 12.12 CBO—Driving Focus and an Agenda. �

Coaching/training to remedy deficits.



Some form of evaluation or assessment done formally and included in an employee's record.

Competency Based Performance Management System

Different writers use different terminology, or add, subtract or modify the sequence of steps. Some systems, for example, include the writing and maintenance of job descriptions; some do not do so explicitly. Within an CBO system the performance management process pertains to the management of individuals, beginning with the assignment of individual objectives through to the final, formal assessment process.

Performance Appraisal Elements: Three elements make up the performance management process: ORGANISATIONAL MISSION

SETTING OF JOB GOALS

SUBORDINATES'S PROPOSAL OF JOB GOALS BOSS'S REVIEW OF PROPOSED JOB GOALS

MUTUALLY AGREE JOB GOALS

POSSIBLE REVISION OF TARGETS

PERIODIC REVIEW OF PROGRESS

COUNSELLING, IF ANY

APPRAISAL OF PERFORMANCE

Figure: 12.13 Simple Model of The CBO Process

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HIGHLIGHTS OF CBO • Schedules “TIME” • Measures “PERFORMANCE” • Emphasizes “INDIVIDUAL” • Builds “COMPETITION” • Reviews “ABSOLUTE/RELATIVE” • Standards “FLEXIBLE” • Appraisals “OBJECTIVE”

BENEFITS OF CBO • OBJECTIVE rather than SUBJECTIVE. • PROFIT less of a HAPPENSTANCE. • APPRAISALS linked to COMPANY OBJECTIVES. • MOTIVATION for individuals to ACHIEVE.

Th e CBO P ro c e s s How is it done? 1. Develop clear, precise organizational objectives and define behaviours. 2. Development of individual objectives, competencies required to perform and achieve the overall organizational objectives. 3. A systematic performance measurement and review. 4. To take corrective actions whenever needed to achieve planned objectives. 5. A clear articulation of competencies required to perform a job. 6. The necessary training and development including competency upgrading method and process for individual employee.

Figure: 12.14 CBO—Process.

GOAL SETTING EXERCISE The underlying principle is mutual involvement and agreement in setting goals and performance expectations. Performance management differentiates between key goals and ongoing position responsibilities. The latter represents those tasks, which form the routine part of the job. Key goals focus on actions leading to continuous improvement in effectiveness and represent a few especially important activities to be pursued. Key goals may be team goals, which represent the integrated activities of more than one person. (Fig. 12.15 and 12.19) Equally important is agreement on work process expectations – in particular, human resource management and teamwork. These refer to how the work gets done. They are important because how the results are achieved will determine

Competency Based Performance Management System

whether the results have a lasting positive or negative effect on the organization in terms of building trust, co-operation and consistency of purpose. The way we work with each other probably offers the richest opportunity for improvement.

How to Establish Performance Measures and Goals How can an organization establish performance measures that make sense? There are many variations to the theme. This approach is only one of many. Which method you use will depend on your organization, it’s culture, and its mission. 1. Define Organizational Vision, Mission and Strategy The CBPMS (Competency Based Performance Management System) methodology, as with most performance management methodologies, requires the creation of a vision, mission statement, and strategy for the organization. This ensures that the performance measures developed in each perspective support accomplishment of the organization’s strategic objectives. It also helps employees to visualize and understand the links between performance measures and successful accomplishment of strategic goals. The key, as pointed out by KAPLAN and NORTON, is to first identify where you want the organization to be in the near future. Set a vision – a vision that seems somewhat out of reach.

Philosophy of CBO • CBO effectively links strategy, structure, processes and results and by involving processes it improves upon the Mbo system. • Drives behaviour while performing roles. • Builds attitudes and responses that are congruent with organizational norms. • Makes individual and organizational competencies and capabilities map with one another. • Not only a performance-evaluation procedure, but is also of general management philosophy. • Espouses a proactive, positive way to manage rather than a reactive way. • CBO makes results and process work with another. • Establishes time frames yet mandates behavioural considerations in obtaining results.

Figure: 12.15 CBO—Philosophy, Goals and Processes.

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In this way, “the Balanced Scorecard ... provides managers with the instrumentation they need to navigate to future competitive success.” (KAPLAN and NORTON) 2. Develop Performance Objectives, Measures and Goals Next, it is essential to identify what the organization must do well (i.e., the performance objectives) in order to attain the identified vision. For each objective that must be performed well, it is necessary to identify measures and set goals covering a reasonable period of time (e.g., three to five years). Sounds simple, however many variables impact how long this exercise will take. The first, and most significant, variable is how many people are employed in the organization and the extent to which they will be involved in setting the vision, mission, measures and goals. The CBPMS translates an organization’s vision into a set of performance objectives distributed among four perspectives: Financial, Customer, Internal Business Processes and Learning and Growth. Some objectives are maintained to measure an organization’s progress toward achieving its vision. Other objectives are maintained to measure the long-term drivers of success. Through the use of the BSC, an organization monitors both its current performance (financial, customer satisfaction, and business process results) and its efforts to improve processes, motivate and educate employees, and enhance information systems – its ability to learn and improve. Figure III-1 at the end of this chapter provides matrices used in the BSC methodology to help develop objectives and measures. The matrices are relatively straightforward and easy to understand. However, developing the contents of each matrix is the hard part. When creating performance measures, it is important to ensure that they link directly to the strategic vision of the organization. The measures must focus on the outcomes necessary to achieve the organizational vision and the objectives of the strategic plan. When drafting measures and setting goals, ask whether or not achievement of the identified goals will help achieve the organizational vision. Each objective within a perspective should be supported by at least one measure that will indicate an organization’s performance against that objective. Define measures precisely, including the population to be measured, the method of measurement, the data source, and the time period for the measurement. If a quantitative measure is feasible and realistic, then its use should be encouraged. When developing measures, it is important to include a mix of quantitative and qualitative measures. Quantitative measures provide more objectivity than qualitative measures. They may help to justify critical management decisions on resource allocation (e.g., budget and staffing) or systems improvement. An agency should first identify any available quantitative data and consider how it

Competency Based Performance Management System

can support the objectives and measures incorporated in the CBPMS. Qualitative measures involve matters of perception, and therefore of subjectivity. Nevertheless, they are an integral part of the CBPMS methodology. Judgements based on the experience of customers, employees, managers and contractors offer important insights into acquisition performance and results. For example, while an agency will usually need surveys to gauge some elements of customer satisfaction such as timeliness of service, process-oriented measures such as acquisition lead time or contract delivery time may be used as supplemental quantitative indicators – they help explain the underlying reasons for survey performance results. Achieving a balance among quantitative and qualitative factors (as well as among process-oriented and resultsdriven measures) is crucial in developing a valid CBPMS methodology. The evolution of all performance measurements should begin with an organization’s Strategic Plan. Figure, “Integrating Performance Measurement with Other Business Strategies,” is a model that depicts a timeline for the business strategies/processes and strategic events that could occur within an organization, and the integration of performance measurement (in this case, acquisition performance measurement) within the process. A synopsis of each follows: �

Strategic Plan. The Strategic Plan is a five-year Plan that extends (in the model) from for eg., FY 1997 to FY 2002. It is the one document that sets forth the overall direction, vision, and mission of an organization and recognizes the requirement to set performance goals and to identify measures to gauge progress towards these goals.



Performance Plan. To accomplish the Strategic Plan, an annual Performance Plan is developed. This plan defines the measures, activities and goals that, when taken together, indicate how well the organization’s overall goals are being achieved.



Budget Process. The budget defines the resources needed to accomplish the strategic goals. Within this process, senior acquisition managers (e.g., procurement heads) develop an acquisition budget strategy that is an integral step to strengthening budgetary requests and obtaining the resources to meet strategic planning and performance goals.



Procurement Performance Measurement Plan: By following strategic planning process, more and more refined performance measures are utilized. This Plan can be the document that provides the specific link to the Strategic and Performance Plans. The foundation of the Procurement Performance Measurement Plan stems from the goals, objectives and measures of the Strategic and Performance Plans.

Many models exist for translating the performance measures of the organization into an individual’s performance plan. One of our participating agencies is employing the model shown

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in “Competency based Management Framework” depicts how strategic initiatives can flow from the agency strategic plan down to an acquisition organization’s strategies and then into objectives, measures, targets and initiatives. This figure becomes the foundation for developing performance plans. “Employee Performance Management” shows how the performance measures, using the CBPMS framework, can be developed following the flow-down of strategic guidance from the agency level down to the individual acquisition official performance plan level. By tying an individual’s performance appraisal to the organization’s strategic goals, it helps employees understand the vision, mission and goals of the organization, and motivates employees to work as a team to support initiatives that directly relate to the corporate goals by rewarding them for organizational accomplishments and not just individual achievements. 3. Evolve with experience Finally, it takes time to establish measures, but it is also important to recognize that they might not be perfect the first time. Performance management is an evolutionary process that requires adjustments as experience is gained in the use of performance measures.



Performance and career coaching

The objective of coaching is to build skills and relationships in order to achieve continuous performance improvement. Therefore, performance coaching is appropriate for all employees regardless of their performance rating. This coaching must be a two way process and must emphasize and describe behaviour, not personality. Coaching is most effective when it occurs within a trusting relationship, and occurs frequently. Both goal setting and evaluation discussions are also coaching sessions and therefore a two-way process. Career coaching focuses on future goals of the individual and whether these goals are seen as realistic by management. The role of the coach here is to listen, amplify, explore and generally assist the employee in thinking through short and long-term goals. The role differs from performance coaching in that this discussion is a voluntary one whereas performance discussions are a requirement of the position. Good career coaching, like good performance coaching, is built on a relationship of trust and open communication, Fig. 12.16.

Coaching and Evaluation Can Co-exist Another important assumption is that a manager can evaluate performance, thereby affecting things like classification, salary and promotion, while at the same time function as a coach to improve performance. (Fig. 12.17)

Competency Based Performance Management System

Driving Learning—Coaching to build Competencies

Monitor Assess and Test for Competencies

Link Learning to Goals

IDENTIFY

PRODUCE RESULTS

Make Systems Facilitate Learning BUILD CAPABILITY Disseminate

Consolidate

Figure: 12.16 Coaching to Build Competencies. It is possible, but highly unlikely that a manager can fulfil both of these functions. Possibly if there is a high degree of trust between manager and employee, but that trust is hard to create. The reason is that it is rare for an employee to be completely open about his or her incompetence in a particular area, particularly when there is a possibility that the manager will a) record that incompetence for posterity; and b) use that information to make decisions about the future of the employee. Without the information from an employee, it is difficult for a manager to coach for improvement. Book learning suggests that an employee will self-evaluate, and in fact this is anticipated in some performance management schemes. There have also been suggestions that an employee will be tougher in evaluating him or herself than the manager might be. Do we honestly believe that each and every employee will work with a manager to improve performance, thereby exposing failures and inadequacies? It happens, but you can't count on it. A research study conducted by MEYER (1975) asked employees to rate themselves relative to their peers. Thirty-seven percent (37%) of accountants rated themselves in the top 10% Forty-six percent of a blue-collar group rated themselves in the top 10%. At no time did any significant number of people rate themselves as below average. Obviously you can't have 100% of people above average. Other studies corroborate this tendency for people to see themselves in a favourable light compared to others.

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Coaching Process Expectation Setting

Individual Development Plan

Coach and executive to determine their expectations from the program through written objectives and goals, responsibility charting, etc.

Executive to develop a individual develop ment plan, highlighting key goals/ expectations focusing on all round development

Meetings

Coach & executive to adequately prepare themselves for all meetings to derive maximum benefit/facilitate effective utilization of time

Coaching Process Progress Review

Self Evaluation

Review progress reports vis-a-vis the personal development plan and use the feedback to improve the relationship

Coach and executive to complete progress review reports at the conclusion of each meeting through evaluation sheets, feedback

Trust Building and Feedback Coach to follow trust building measures and work on providing constructi ve feedback and suggestions to tackleprotégé’s problems

Figure: 12.17 Coaching Process. We don't want to place too much emphasis on this research, but it makes the point that selfevaluation can be problematic. In addition, it is difficult to establish the degree of trust necessary for a manager to wear the evaluator and coach's hats.

APPRAISAL/EVALUATION Evaluation is inherent in the goal setting and coaching processes and provides the basis for development and reward. Therefore formal evaluation should be a routine, no-surprises culmination and review of past discussions. A formal evaluation should be a two-way future-oriented discussion about behaviour, and what can be done to improve it. Under the performance management process, formal evaluation is based on progress towards key goals, human resources management and teamwork and accomplishment of key position responsibilities.

Competency Based Performance Management System

The CBO approach to management is aimed at improving performance by defining behaviour, mapping competencies, establishing processes, evaluating means, focusing on the individual, eliminating or reducing impediments like inappropriate organization and managerial structure, inefficient controls, inadequate communication, vague or meaningless objectives, ill-defined accountabilities and authority, wasted resources, particularly human talent, lack of productivity, inappropriate performance orientation, low morale and apathy.

Figure: 12.18 CBO—Defining an approach. The following chart shows the features, advantages and disadvantages of different types of appraisals: �

Feedback on behaviour instead of personality;



Concentration on the future instead of the past;



An ethos of improvement instead of punishment;



Feedback based on precision instead of generalities;



Comment based on information instead of belief;



Securing of commitment instead of compliance;



Active support instead of directive;



Appraisal that is person-centered instead of form-centreed;



A process owned by everyone instead of administered by personnel;



A philosophy of how can we benefit instead of what can I get from you.

GOAL SETTING (Fig. 12.19) Three elements should be taken into account in determining performance. These are: �

Progress towards Key Goals / Objectives.

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People Management and Teamwork.



Achievement of Routine Job Responsibilities.

Type Line manager Appraisal

Self appraisal

Upward Appraisal

Peer Appraisal

Features

Advantages

• Mechanism to link • Clarity about what is individual goals and strategic expected of the individual direction and the manager • Focus on objectives and • Identification of targets performance priorities and • Can combine regular agreed actions informal review of performance with formal • Forum for between manappraisal to agreed timescales ager and employee • May include rating scales for • Potential to promote better comparison purposes understanding of shared objectives • Often used as preparation for • Can establish appraisal as a the line manager/subordinate two-way process appraisal • Best if individuals compare • Individuals take the lead in themselves against their own reviewing their own individual standards rather performance than others • Encourages individuals to • Works best when geared think about their performance towards motivation and and development needs in a development focused way • Individuals are most aware • The combination of of their own performance and are generally critically involvement and honest responsibility generates commitment to personally • Less subject to halo effect taking action and is consequently more discriminating • Appropriate in multi-level or • Has the potential to source appraisal settings establish understanding of • May take place in the shared objectives context of the subordinate’s • Appraisal seen as a twoappraisal way process • Individuals nominate their • Peers are likely to be own appraiser members of the same professional speciali• Allows choice of peers who zation or group are respected for relevant • Appraiser authority comes knowledge or professional from expert power not specialization position power • Relevant in situation where are knowledgeable • Peers their may be no immediate about specialist field and the manager in a position to contribution of the individual appraise

Disadvantages • Needs the commitment of both manager and subordinate to spend appropriate time on the process • Insufficient preparation by either manager or employee • Failure to follow up on actions agreed • Misuse of comparative rating scales • Lack of support and feedback skills by managers • Lack of objectivity on the part of the individual • Can be prone to either excessive or lenient self assessment • Individuals may think that they are going to be told about their performance by their manager, so why should they bother • Subordinates are likely to be reserved in making meaningful comment • Fear of retaliation if too honest • Needs careful control

• Appraises may choose a peer appraiser on the grounds of friendship or as a soft touch

Competency Based Performance Management System

Type

Features

Team Review and Appraisal

• Establishing team success and areas for improvement • Aids the team-building and objective-setting process • Encourages open and constructive comment among the team • Encourages cooperation among the team

Competency-based Appraisal

360 -Degree Feedback

Advantages • Complementary to individual performance appraisal • Gives opportunity for the team to discuss issues which may not have been previously debated by boss and subordinate

Disadvantages • Needs the willingness of all team members to participate • Team may be good at giving positive feedback but less so in giving negative constructive feedback

• Team members may be • Establishes commitment from the individual towards apprehensive about appraising colleagues team not just individual objectives

• Setting targets for the roles • Developmentally oriented • The nature and quality of the as specific objectives or other Directs attention towards competence statements and measurable objectives improvement of skills their fit with other • Behavioral descriptions of organizational initiatives the standards expected in • Does not deal with results fulfilling the role achievement • A a development plan • The expectations of specifying training, employees and the development and support relationship between • Concentrates on the towards achieving targets competence achievement and medium to long term and competences pay and rewards rather than the short term term • A system of periodic review leading to annual appraisal of performance against targets and achievement of competences • The focus is on development • Gives a comprehensive of skills and competences • Depends on the design of the indication of the totality which will improve questionnaire and how it fits of the individuals perfoorganizational performance with other organizational rmance and relationships performance criteria • Appraises may include either direct or other • Has the potential to managers, subordinates, overcome the bias of a • Depends on the peers or customers traditional one person top interpretation and skills of the down review or appraisal • Feedback is collected person giving the final systematically through • Peers and subordinates can feedback formally constructed have an impute to the process questionnaires and can view it as a process • Can include self-assessment which empowers them • Depends on the accuracy for comparison with the and quality of the ratings • Can be incorporated into views of others provided by all contributors other appraisal processes • May allow individual to • Seems to suit organizations choose who contributes where they need flexibility • Depends on the criteria for choosing contributors. Is the and teamwork within a less • Is essentially based on choice free or forced? hierarchical structure ratings which more often than • Concerns over whether feedback is used exclusively for development or is part of the normal appraisal process and if so whether it is linked to pay and rewards

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Type Line manager Appraisal

Self- appraisal

Upward Appraisal

Peer Appraisal

Features

Advantages

• Mechanism to link • Clarity about what is individual goals and strategic expected of the individual direction and the manager • Identification of • Focus on objectives and performance priorities and targets agreed actions • Can combine regular • Forum for between manager informal review of and employee performance with formal • Potential to promote better appraisal to agreed timescales understanding of shared objectives • May include rating scales for comparison purposes • Can establish appraisal as a two -way process • Often used as preparation for • Best if individuals compare the line manager/subordinate themselves against their own appraisal individual standards rather than others • Individuals take the lead in reviewing their own • Works best when geared performance towards motivation and development • Encourages individuals to think about their performance • Individuals are most aware and development needs in a of their own performance and focused way are generally critically honest • The combination of • Less subject to halo effect involvement and and is consequently more responsibility generates discriminating commitment to personally taking action

Disadvantages • Needs the commitment of both manager and subordinate to spend appropriate time on the process • Insufficient preparation by either manager or employee • Failure to follow up on actions agreed • Misuse of comparative rating scales • Lack of support and feedback skills by managers • Lack of objectivity on the part of the individual • Can be prone to either excessive or lenient self assessment • Individuals may think that they are going to be told about their performance by their manager, so why should they bother

• Appropriate in multi-level or source appraisal settings

• Has the potential to establish • Subordinates are likely to be understanding of shared reserved in making objectives meaningful comment

• May take place in the context of the subordinate ’ s appraisal

• Appraisal seen as a two-way • Fear of retaliation if too honest process

•Individuals nominate their own appraiser

• Peers are likely to be members of the same professional specialization or group

• Allows choice of peers who are respected for relevant knowledge or professional specialization

• Appraiser authority comes from expert power not position power

• Relevant in situation where their may be no immediate manager in a position to appraise

• Peers are knowledgeable about specialist field and the contribution of the individual

• Needs careful control • Appraises may choose a peer appraiser on the grounds of friendship or as a soft touch

Competency Based Performance Management System

Type

Features

Team Review and • Establishing team success Appraisal and areas for improvement

Advantages • Complementary to individual performance appraisal

• Aids the team-building and • Gives opportunity for the objective-setting process team to discuss issues • Encourages open and which may not have been constructive comment previously debated by boss among the team and subordinate • Encourages cooperation among the team

• Establishes commitment from the individual towards team not just individual objectives

Disadvantages • Needs the willingness of all team members to participate •Team may be good at giving positive feedback but less so in giving negative constructive feedback • Team members may be apprehensive about appraising colleagues

Competency-based • Setting targets for the roles Appraisal as specific objectives or other • Developmentally oriented measurable objectives • Behavioral descriptions of • the standards expected in fulfilling the role • Directs attention towards • A a development plan improvement of skills specifying training, development and support towards achieving targets • Does not deal with results and competences achievement • • A system of periodic review leading to annual appraisal • Concentrates on the of performance against medium to long term rather targets and achievement of than the short term competences 360 -Degreee Feedback





• •

The expectations of employees and the relationship between competence achievement and pay and rewards

• Gives a comprehensive indication of the totality of • Depends on the design of the the individuals performance questionnaire and how it fits with other organizational and relationships performance criteria • Has the potential to Appraises may include overcome the bias of a either direct or other traditional one person -top managers, subordinates, down review or appraisal • Depends on the peers or customers • Peers and subordinates can interpretation and skills of the person giving the final Feedback is collected have an impute to the feedback systematically through process and can view it as formally constructed a process which empowers • Depends on the accuracy questionnaires them and quality of the ratings provided by all contributors Can include self-assessment • Can be incorporated into other appraisal processes for comparison with the • Depends on the criteria for views of others • Seems to suit organizations choosing contributors. Is the choice free or forced? where they need flexibility May allow individual to and teamwork within a less choose who contributes • Concerns over whether hierarchical structure feedback is used exclusively Is essentially based on for development or is part of ratings which more often than the normal appraisal process not are aggregated to and if so whether it is linked represent an average score to pay and rewards

• The focus is on development of skills and competences which will improve organizational performance •

The nature and quality of the competence statements and their fit with other organizational initiatives

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GOAL SETTING AND BEHAVIOURAL MAPPING IN CBO • Maps “BEHAVIOUR” • Establishes “ PROCESSES” • Schedules “TIME” • Measures “ PERFORMANCE” • Emphasises “INDIVIDUAL” • Define “STANDARDS & BENCHMARKS” • Enables “ASSESSMENTS” • Builds “COMPETITION“ • Reviews “ABSOLUTE / RELATIVE” • Standards “FLEXIBLE” • Appraisals “OBJECTIVE”

Figure: 12.19 CBO—Goal Setting and Behavioral Mapping. Continuous improvement should be expected in each of the above important areas, and a high formal evaluation should reflect excellence in all three. Managers should therefore strive to clarify their expectations of subordinates in all three areas but must always ensure they are job-related.

Key Goals/Objectives Definition A key goal is a clear statement of what the jobholder wants to achieve within a stipulated time frame. It is a statement of intent – a firm commitment that some observable end result will be accomplished or contributed to in a certain period of time. As such, it goes beyond a routine responsibility; it represents an especially important goal, which will be more difficult to achieve, and will therefore lead to genuine performance improvement.

Characteristics Key goals generally have the following characteristics: �

Should be mutually agreed amongst the Boss and the Subordinate and should be linked to company & departmental objectives.

Competency Based Performance Management System



Are especially important goals, which represent stretch and continuous improvement beyond routine responsibilities.



Should be very specific, quantifiable and qualitative.



Can be short-term but should support long-term goals.



Must be consistent with the long-term aims of the company and with its mission & values.



Can be individual or team goals. Evaluation should reflect the individual’s contribution to the goals.

Benefits of Key Goals/Objectives Having a clear set of goals (as well as clear, ongoing job responsibilities) provides a number of benefits: �

Goals provide focus, priorities and effective time utilization.



Goals give you a reason for being – they justify your existence.



Goals help to clarify what needs to be done to make things happen.



Goals help you to learn and develop – you know how successful you have been and therefore how you can improve yourself.



Goals help you to organize yourself and your resources.



Goals help you to communicate to others what you want to achieve and how they can help.



Goal clarification is the very first step in the performance management cycle. It is the basis for effective coaching, sound evaluation, meaningful development and equitable reward.

People management and teamwork From an overall developmental perspective, people management and teamwork also forms an essential ingredient. As employees can be evaluated on their interpersonal skills, participative management skills and contribution to the team effort, specific goals should be documented for this purpose.

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Routine job responsibilities In addition to key goals and people management and teamwork, most jobs also have a number of other routine responsibilities, which demand varying proportions of the employee's time in the organization. It is important not to overlook these but they should not be confused with key goals and expressed as such.

SAMPLE PERSONAL ACHIEVEMENT PLANNING GOAL GETTING, PLANNING and REVIEW SYSTEM For the next __________ months, I went to achieve the following goals: Statement of Goal: 1. Is the goal personally important and meaningful to me, or have I selected it because I am required to do it? 2. Is the goal really an "achievement goal"? Do I want to improve some tangible results? 3. What have I achieved so far with regard to this goal-area? Or is it an entirely new area for me? 4. What is the probability of achievement? (Percentage-wise)? 5. Is my personal commitment to the goal very high, high, moderate, low and very low? 6. Is the goal realistic? Is it very difficult, easy, or moderately difficult? What is the probability of non-achievement? 7. What personal blocks can I identify which may come in the way of achieving the goal? 8. What can I do to overcome these personal blocks? What help can I get? What is my action-plan for getting help? 9. What situational blocks can I identify or anticipate, which may come in the way of achieving the goal?

Competency Based Performance Management System

10. What can I do to overcome them or by-pass them? 11. What help do I need? Who can help me on this? Am I willing to get help? What is my action-plan for getting help? 12. What "innovations" or "experimental activity" can I try to achieve the goal? 13. How will I know how I am doing? What feedback can I get and use to keep track of my progress? 14. What factors contribute to the probability of success? 15. What is the probability of failure? What factors will contribute to this probability of failure? 16. What plan of action have I devised to achieve the goal? Have I set a time and date for completion of each phase? 17. What will my feelings be when I succeed/when I fail? 18. After achieving this goal, what other achievement/goal will become important to me?

STEPS IN GOAL SETTING The company promotes a participatory goal setting process between Boss & Subordinate, which ensures that objectives are clearly defined, understood and committed by both the parties. Participative goal setting also helps to ensure that goals are established at the optimal level for motivating performance: challenging but realistically attainable – neither too easy nor impossibly difficult. Finally, and most importantly, participative goal setting increases personal ownership of the desired outcomes and the commitment to achieving them.

Five steps for participative goal setting: �

Relate individual goals to work unit and wider company goals.

Help yourself to see the big picture – the vision – how their work contributes to this. �

Ask for input.

Explain to employees that you need their input to make sure that goals are clear, relevant and set at an appropriate level.

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Discuss goals.

Jointly analyze to assess the level of difficulty and the resources needed. Work at a mutual agreement. �

Summarize to ensure clarity and commitment.

Make sure goals are clearly defined and understood, with clear agreement about the level of support required, milestones/checkpoints etc. �

Express your confidence; assure subordinates of your support.

Convey a sense of challenge and excitement – the contribution goal achievement will make to the activity as a whole and therefore the co-operation.

Criteria One helpful way to test the quality of a key goal is to use the SMART test: �

S Is the goal specific in that it clearly states the end result to be attained and can be differentiated from an ongoing responsibility.



M Is the goal measurable, either quantitatively or qualitatively? What are the indicators, which will signify that the end result has been achieved?



A Is the goal attainable – is it realistic and achievable in the time frame set with the resources available? Is there the right amount of stretch?



R Is the goal relevant – does it relate to the critical aspects of the work unit’s performance and therefore mesh with the ‘wider picture'?



T Is the goal track able – can feedback be provided on a regular basis to assess progress and determine any necessary corrective actions?

In Search of Results: Performance Management Practices: Key Performance Management Questions The following is a checklist covering the most important objectives, approaches and arrangements in relation to performance management. The checklist corresponds to the main issues addressed in the country chapters.

Competency Based Performance Management System

Objectives & Approaches, Focus Management and Improvement: Is the internal use of performance management, to support management and continuous improvement, a major objective? Accountability & Control: �

Is the external use of performance management, to increase accountability to responsible ministers or to the public, a major objective?



Savings: Are direct savings on the budget a major objective?



Approach Comprehensive: Is the approach to performance management comprehensive, i.e. covering different instruments and most activities or organizations?



Legislative: Is performance management based on specific laws or lower level legislation?



Ad hoc: Are ad hoc initiatives (related to specific problems or needs) an important part of performance management?



Top-Down: Are performance management initiatives imposed from the top?



Bottom-Up: Are performance management initiatives developed at the agency level? Do departments and central management units actively support such initiatives?



Institutional Arrangements Finance – Budget Departments: Do finance or budget departments have a role in performance management?



Other Central Departments: Do other central departments (administration, prime minister/cabinet, personnel) have a role in performance management?



Special Management Bodies: Have special management bodies or units been created to develop and implement performance management initiatives?

Performance Measurement Indicators: Are simple and transparent indicators used as performance measures? �

Measurement Systems: Are specialized systems used to measure performance?

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Qualitative Measures: Are qualitative, indirect measures used along with quantitative measures?



Processes (Activities): Are measures of processes, activities or new initiatives important in performance measurement?



Efficiency (Outputs): Are measures of outputs important in performance measurement?



Effectiveness (Outcomes): Are measures of outcomes important in performance measurement?



Service (Delivery) Quality: Are service quality measures important in performance measurement?



Financial Performance (Economy): Are financial measures (cost of inputs, etc.,) important in performance measurement?



Financial Management Accrual Accounting: Is accrual accounting used to improve cost information and the basis for performance measurement?



Cost Allocation: To what extent have systematic methods been developed to allocate costs to different outputs?



Integration of management systems: Are financial management and performance management systems coordinated or integrated?



Reporting Performance Information Public Availability: Is information on performance generally made available to the public and is it used to improve relations with the public?



Annual Reports: Is information on performance generally published in annual reports?



Budget Reports: Is information on performance systematically collected in relation to the preparation of the budget and published in relation to the budget proposal?



Performance Contracts: Are contracts, or performance targets set in contracts, publicly available?



Local Government Performance: Are indicators of performance of local government collected and published?

Competency Based Performance Management System

Service Quality Service Standards: Have service standards been used to define the level of service the clients are entitled to receive? Service Statements: Is the level of service and service quality declared to the public in simple service statements? Customer Surveys: Are customer surveys used to measure perceived quality? Quality Management (Systems): Are quality management systems widely used to improve the quality of public service? Performance Review Internal Evaluation: Are there specific methods or arrangements for the internal evaluation of agencies? Performance Auditing: Does a state auditing body audit the performance of agencies? Is the accuracy and relevance of performance information audited? Quality Monitoring Units: Have special quality monitoring units been created to monitor and evaluate service quality and performance in specific sectors? Program Evaluation: Are government program evaluated in a systematic way? Are the evaluations done on a regular or ad hoc basis? Use of Performance Information Performance Budgeting Performance Informed Decisions: Is information on performance actively used to improve the quality of decisions in the budgeting process? Performance Based Allocation: Are there sectors where allocation of resources is more or less directly linked to units of performance? Performance Pay Individual Agreements: Are there individual agreements where evaluation of performance has an effect on pay? Individual Performance Pay: Does evaluation of performance have an effect on the pay of individuals? Group Productivity Pay: Is the measured performance of organizational units or groups of staff used to pay bonuses to the staff? Results-Oriented Management Devolution & Autonomy Relaxation of Input Controls: Have input controls (limitations on the use of resources, allocation to specific expenditure items) been relaxed?

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Reduction of Process Controls: Have process controls (detailed rules on the process of providing services and operations of agencies) been reduced? Autonomous Agencies: Have (semi) autonomous agencies been established? Has more autonomy been granted to the existing agencies? Risk Management: Are managers entrusted to take and manage risks? Are there formal methods for managing risks? Management Reforms Benchmarking (Process, Results): Are processes or results of agencies benchmarked and is benchmarking used to compare and improve performance? Corporate & Strategic Planning: Is corporate and strategic planning a part of performance management? Performance Contracts: Are contractual arrangements used to set performance targets and grant more managerial autonomy to agencies? Market Testing – Contestability: Is performance management related to use of methods such as contestability, market testing, provider – purchaser splits or internal markets?

Competency Based Performance Ranking: Establishing Standards and Benchmarks TIER 1: OUTSTANDING �

Can do Boss’s job.



Unique/Rare achievements.



Task driven



High level of Internal/External credibility.



Excellent business approach.



Very Innovative.



A clear leader.



Overachieve goals.

Competency Based Performance Management System

Note: Extremely difficult to achieve. Only 10% of the population can get a T1. TIER 2: STRONG �

Achieved goals as planned.



Dependable performer.



Disciplined habits.



Can do more than one job.



Team builder.



Develops subordinates.



Problem solver.

Note: Only 20 % of the population gets a T2. TIER 3: CAPABLE �

Achieved relatively easy goals.



Hard working maintains current job well.



Boss dependant.



Needs guidance.



Limited initiative.



Not deadline driven.

Note: Majority of the population falls in this category. (Around 60%). These are the solid citizens of the organization. TIER 4: WEAK �

Goals not or underachieved.



Considerable areas for development.

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Low initiative.



Cynical.



Limited business appreciation.

Note: This category has around 10% of the total population. They need to improve in their jobs through rigorous training inputs.

Do’s and don’ts of effective competency based performance appraisal Checklist: performance review sequence The following is offered as a rough guide to the sequence of events, which a manager might wish to initiate in order to be fairly sure that nothing of importance in the performance appraisal process has been overlooked: �

Agree a time and date for the review well in advance.



Arrange for the location to be private and free from interruptions.



Set aside at least an hour and a half, and possibly two and half-hours.



Bring all relevant results and information concerning the appraisee’s performance in his/her area of responsibility.



Ask the appraisee to review his/her performance in the work situation point by point.



Ask the appraisee about any problems, which might affect performance.



Ask the appraisee about the implications of any problems or events, and their effect on the individual, the team and the work.



Ask the appraisee what needs to be done by either of them to help improve performance.



The appraisee should ask about anything which he/she feels is affecting his/her performance.



Agree the key result areas.

Competency Based Performance Management System



The appraisee should set/agree standards of performance for the next review period.



The manager should set/agree standards of performance for the next review period.



Agree for a future action.



Close with a firm date for the next interim review.

Sample: Peak performance pyramid (Fig. 12.20) OBJECTIVE: To lead trainees through building a mental pyramid signifying the building blocks of peak performance; to break down peak performance into smaller critical actions that facilitate control over one’s own performance PROCEDURE:

Show the overhead transparency, PEAK PERFORMANCE BUILDING BLOCKS. Read through the bulleted items, and then suggest a sports challenge such as putting a golf ball, serving a tennis ball, executing a back one-and-a-half dive. Review the bulleted items, this time relating each one to the sports challenge. Engage trainees in discussion about the small tasks that must be mastered on the way to that particular peak performance. Focus trainees’ thinking on seeing the small tasks as critical building blocks toward the peak. Change transparencies, now showing the PEAK PERFORMANCE PYRAMID, and hand out a paper copy to each trainee. Instruct trainees to identify their own sports, music, or job challenge to analyze according to this model. Suggest that trainees make notes on the pyramid ITSELF. When everyone has finished, facilitate a general discussion of his or her own personal performance challenge. Use questions such as these:

DISCUSSION QUESTIONS:

What are two critical first steps that must be mastered in your chosen peak performance?

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Can you break down these first steps into the individual tasks that make up each step? Can you estimate the time involved in mastering the “cues” associated with the building block of “Preparation”? What do you need to learn in order to succeed at this step? What are some of the kinds of cues you must master before you can continue on to peak performance? When do you think you can reach the top of your PEAK PERFORMANCE PYRAMID? Good teamwork required peak performance from each team member. Peak performance results when a person has control over every critical aspect of doing a task. Performance usually has a combination of motor skills and intellectual skills, all of which have to be learned flawlessly in order for peak performance to occur. Research shows that mastery of skills in a hierarchy contributes to the ultimate ability to pull it all together in peak performance. MATERIALS:

Overhead transparency, PEAK PERFORMANCE BUILDING BLOCKS. Overhead transparency, PEAK PERFORMANCE PYRAMID, and a paper copy of this transparency for each trainee.

APPROXIMATE: TIME REQUIRED

30 minutes.

PEAK PERFORMANCE PYRAMID

PEAK PERFORMANCE BUILDING BLOCKS

Seeing the big picture Perceiving sensory input Knowing the specifics Getting everything ready Doing it right with a coach Establishing the correct pattern of behavior Demonstrating consistent correct behavior over time

Competency Based Performance Management System

Self-appraisal Self-appraisal is an important feature of the performance appraisal system. It plays an important role in employee development. The following can be considered as the purposes of self-appraisal: �

To provide the employee an opportunity to recapitulate.



The various activities he has undertaken in relation to different functions associated with his role.



His achievement and failures with regard to this.



The capabilities he demonstrated and capabilities he felt as lacking in carrying out these activities and the various managerial and behavioural dimensions he demonstrated over the year.

PEAK PERFORMANCE PYRAMID

RELIABILITY PATTERN WITH COACH PREPARATION

SPECIFIES SENSES

BIG PICTURE

PERSONAL CHALLENGE (SPORTS, MUSIC, JOB)

Figure: 12.20 Peak Performance Pyramid.

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To identify his own development needs and plan for his development in the organization by identifying the support he requires from his reporting officer and others in the organization.



To communicate to his reporting officer his contributions, accomplishments and reflections to enable him to view his (appraisee’s) performance in the right perspective and assess objectively. This is a necessary preparation for performance review discussions and performance improvement plans.



To initiate an organization-wide process of annual review and reflection to strengthen self-initiated development for managerial effectiveness.

SAMPLE PERFORMANCE MANAGEMENT SYSTEM

BOTTOM LINE GOALS MEANING � � �

These are measurable goals. It has a time frame attached to it. It has a quantifiable aspect attached to it.

PURPOSE

EXAMPLES·

To achieve business driven budget targets in all areas of Marketing, Production, Engineering, Finance, QA, Materials, HR etc.

� � � � � �

Sales Targets. M/C Efficiency %. Training Man-days. Fresh Samples %.· Down Time. Quality Parameters.

Competency Based Performance Management System

� � � �

Number of People Hired. Delivery Schedules. Recovery of A/c Receivables. Reduction in Inventory Carrying Cost.

MIDDLE LINE GOALS MEANING· � � � �

Prevent any wasteful use of materials.· To manage & save within budget.· To utilize existing resources fruitfully.· To save costs in any area of operations.

PURPOSE

EXAMPLES·

To save in raw material, consumables, power, steam, leather, cast iron rejections, stationary, overtime, surplus, employee's etc.

� Cost saving by mixing different varieties of raw material to set standards outputs. � Saving in terms of paints, parts etc. � Savings in spare parts consumption's, stationary items, communication costs. � Savings due to rationalization of manpower.

RENEWAL & DEVELOPMENT GOALS MEANING � � � � � �

Training. Interpersonal skills. Participative management skills. Goal Setting, Counselling & Review. Team Building. Job Rotation/Enrichment.

PURPOSE

EXAMPLES

Hired & Trained & Counselled people. Absenteeism management, Attendance, Customer Orientation.

� � �

Training Man-days/Courses. Rotational assignments. Helping/Facilitating development of special skills.

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� �



Acting as a Trainer. Creating self managed teams, task forces & facilitating their success. Grooming for Succession Planning.

INFRASTRUCTURE GOALS MEANING �

To systematize work procedures.

INFRASTRUCTURE GOALS

MEANING To systematize work procedures. Work towards a paperless organization. Towards system friendliness. Improvise on a process to get better outputs by streamlining the process, eliminating unwanted processes and bring in new systems/procedures/checks/ balances etc.

PURPOSE Creating a new system, maintaining current system, implementing new procedures, documents policies. Train people on departmental system/ packages. Computerize manual work.

EXAMPLES • ISO 9002 documentation. • Creation of computerized systems. • Accounts receivables monitoring

system. • Budgeting/Monitoring & Review system.

Competency Based Performance Management System

� � �

Work towards a paperless organization. Towards system friendliness. Improvise on a process to get better outputs.

SPECIAL INTELLECT GOALS MEANING �

To create something new for the organization.

PURPOSE Goals which are completely over & above a job role. Creative, Unique, Showing total company interest and require working in an exceptional manner consistently all through the year.

THE

STAFF MEMBER'S INVOLVEMENT

A. What might your staff members be hoping to get for an appraisal? Might they hope? 1. For a chance to redefine their own responsibilities? 2. To find out how they are doing? 3. To discuss problems in the job situation? 4. To put forward ideas for improving their job? 5. To help define competencies as it applies to their job? 6. To get praise for work well done?

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7. To get constructive criticisms of weaknesses? 8. To agree on a plan for the year ahead? 9. To discuss the possible need for a change of job? 10. To make a case for extra pay or promotion? 11. To discuss training needs and agree action on them? 12. To learn more about you? 13. To learn more about the policies and problems of the department or organization? 14. To put forward their own suggestions for improving the effectiveness of the department or organization? 15. To seek counselling on matters that may or may not be closely connected with their job performance? Clearly, formal appraisal can give useful opportunities to the person being appraised as well as to the manager. But are people encouraged to make maximum use of this opportunity? �

For example, is staff in your scheme?



Aware of when the appraisal will be carried out?



Encouraged to prepare for the appraisal?



Asked to contribute some kind of self-appraisal?



Asked to make other comments or suggestions about their jobs or the work of the department?



Told what the appraiser has said about them?

Are staff interests/involvement �

Given the opportunity to comment on or contest the appraisal.



Involved in making whatever decisions may arise out of the appraisal.

Competency Based Performance Management System



Offered an interview with the appraiser and/or with someone more senior.



Shown and perhaps given a copy of any written report that results from the appraisal.

If staff members are not fully involved in each of the ways listed above, is there any compelling reason why not? Is it time the system was changed?

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13

Competency Driven Careers Changing behaviour effectively and carefully is a fundamental skill of line-manager and human resource manager. Leading, motivating, rewarding, organization development, management development and training are all examples of activities that have something in common: they are directed at behaviour change. In this article some fundamental techniques are discussed with which organizational behaviour can be changed responsibly. It also offers organizational scientists, like organizational sociologists, a possibility of looking in a new way at the wide diversity of theories that have been developed about the above mentioned subjects. A natural scientific approach that is firmly based on experimental and applied experimental research is probably more useful than the many and fashionable theories that overwhelm the field. There are some signs of a "paradigm shift" in organizational theory towards a natural scientific behavioural approach of organizational behaviour and career management. The technology of behaviour analysis, based on experimental tested learning principles, is already one of the major motivation and leadership approaches in the United States. Also in the Netherlands, this American based Organizational Behaviour Change approach gains recognition. This organizational application of behaviour analysis is called Career Management. These are reasons enough to dwell on a method that offers practical possibilities for (human resource) man-agers to accomplish responsible and directed organizational change and for organizational scientists to understand it. For the reader who feels uncomfortable in changing the behaviour of others and him, this contribution appears to be less interesting. Perhaps, however, we are able to influence him with the following citation of the famous psychotherapist ERICKSON: "People accuse me sometimes of manipulating my patients, in which case I give the response: Every mother manipulates her child, if she wants it to survive. Every time you enter a shop you manipulate the salesman to do what you ask. If you visit a restaurant you manipulate the waiter. And the teacher manipulates you to read and write. In fact: life is one big manipulation. The last manipulation is dying. That is also manipulation. They have to lower the coffin and remove the ropes – all manipulation".

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The realization that we are always influencing and "exercising control" leads to the advice to make the best of those. In the long run, if the approach will be further developed, there should be some ethical guidelines. Another reassurance can be that behaviours often connected with manipulation, like punishment, threatening, or a lack of honesty and openness, are not very effective, especially in the long run. Knowledge of the technology of behaviour change is the best guarantee against abuse. Dealing directly with behaviour is not the only method of approaching people in organizations. Especially cognitive and humanistic ("subjective") approaches are prominent in the organizational literature. In cognitive theories it is assumed that internal mechanisms (motivation, intelligence, creativity etcetera) determine behaviour. Humanistic approaches concentrate especially on the need of fulfilling human possibilities. The concept Human Resource Management fits in this humanistic tradition. We can speak more effectively about Behaviour Management. Motivation, intelligence and other "explanatory fictions" are not seen as causes of behaviour, lodging in a magical "conceptual nervous system," but as abstract descriptions of the behaviour itself. The factual causes of behaviour are not explained by those concepts, but to be found in the genetic 'layout', selected in the evolutionary environment at the one hand, and the environmental contingencies during the life of the organism at the other. Part of those environmental contingencies is the ever moving organizational context, in which the (HRM) manager and the organizational scientist play a part. To clarify how this moving context can be used, the following principles of behaviour are discussed: reinforcement, extinction, shaping, punishment and modelling. Main lines will be shown. Which offer a more elaborate description of the many other available techniques and principles. Next we will situate the career management approach within organizational sociological theory. Assumptions and Methodology of Career Management An excellent text is available wherein different sociological approaches of organizational behaviour are compared as they impact behaviours and consequently careers of individuals in organizations. They state that in order to understand a theory, it is necessary to know the "assumptions on which it rests". What kind of assumptions can be made? The authors discriminate between ontological, epistemological, methodological assumptions as well as assumptions about "human nature". What do they mean by these? Assumptions of an ontological nature concern the "very essence of the phenomena under investigation". Organizational scientists, for example, are faced with a basic ontological question: whether the 'organizational reality' to be investigated is external to the individual (imposing itself on individual consciousness from without) or the product of individual consciousness; whether 'organizational reality' is of an 'objective' nature, or the product of individual cognition; whether 'organizational reality' is a given 'out there' in the world, or the product of one's mind.

Competency Driven Careers

Associated with this ontological issue, is assumption of epistemological nature. These are assumptions about the grounds of knowledge – about how one might begin to understand organizations and communicate this as knowledge to fellow human beings. These assumptions entail ideas, for example, about what forms of knowledge can be obtained, and how one can sort out what is to be regarded as 'true' from 'false'. Indeed, this dichotomy of 'true' and 'false' itself presupposes a certain epistemological stance. It is predicated upon a view of the nature of knowledge itself: whether, for example, it is possible to identify and communicate the nature of knowledge as being hard, real and capable of being transmitted in tangible form, or whether 'knowledge' is of a softer, more subjective, spiritual or even transcendental kind, based on experience and insight of a unique and essentially personal nature. The epistemological assumptions in these instances determine extreme positions on the issue of whether knowledge is something which can be acquired on the one hand, or is something which has to be personally experienced on the other. A third assumption concerns human nature, in particular the relationship between human beings and their organizational environment. We can identify perspectives in organizational science which entail a view of human beings responding in a mechanistic or even deterministic fashion to the situations encountered in their organization. In this view human beings and their experiences are regarded as products of the environment; one in which humans are conditioned by their external circumstances. This extreme perspective can be contrasted with one which attributes to human beings who have a much more creative role: with a perspective where 'free will' occupies the centre of the stage; where man is regarded as the creator of his environment, the controller as opposed to the controlled, the master rather than the marionette. In these two extreme views of the relationship between human beings and their environment we are identifying a great philosophical debate between the advocates of determinism on the one hand and voluntarism on the other. While there are social theories which adhere to each of these extremes, the assumptions of many social scientists are pitched somewhere in the range between. The three assumptions outlined above have direct implications of a methodological nature. Each one has important consequences for the way in which one attempts to investigate and obtains 'knowledge' about the organization. Different ontologism, epistemologies and models of human nature are likely to incline organizational scientists towards different methodologies. What is regarded as science by the traditional 'natural scientist' covers but a small range of options? In this natural scientific view the organizational behaviour is treated as if it were a hard, external, objective reality, where the scientific endeavour is likely to focus upon an analysis of relationships and regularities between the various elements which it comprises. This perspective expresses itself most forcefully in a search for universal laws which explain and govern the reality which is observed. On the other hand, if one subscribes to the alternative view of social reality, which stresses the importance of the subjective experience of individuals in the creation of the organization,

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then the search for understanding focusses upon the way in which the individual creates, modifies and interprets the world in which he or she finds himself. This approach questions whether there exists an external reality worthy of study. In methodological terms it is an approach which emphasizes the relativistic nature of the social world to such an extent that it may be perceived as 'anti-scientific' by reference to the ground rules commonly applied in the natural sciences. In this brief sketch of various ontological, epistemological, human and methodological standpoints which characterize approaches to social sciences, we have sought to illustrate two broad and somewhat polarized perspectives. The assumptions of career management are found in its philosophy, called behaviourism. Man is regarded, like any other natural organism, as entirely the product of his environment, responding in a deterministic way to the external conditions to which he is exposed. In SKINNER'S work all reference to subjective states of mind are considered irrelevant indeed, counterproductive as far as scientific enquiry is concerned. As SKINNER has put it: "The practice of looking inside an organism for an explanation of behaviour has tended to obscure the variables which are immediately available for scientific analysis. These variables lie outside the organism, in its immediate environment and in its environmental history. They have a physical status to which the usual techniques of science are adapted, and they make it possible to explain behaviour as other subjects are explained in science". This approach to the study of organizational behaviour is very much geared to the use of experimental methods typical of those utilized in the natural sciences. He is committed to the view that one learns about phenomena under investigation by careful manipulation of particular stimuli in controlled situations in which all other environmental influences are either excluded or accounted for in some way. The study of organizational behaviour from this perspective is very much an activity aimed at the discovery and application of universal laws and regularities which underlie the science of man. These laws exist out there in the external world. The organizational scientist's task is to verify and apply them outside the laboratory in an organizational context. Consequently competencies follow through a three-step process from what could be called as transactional competencies, through to traditional competencies to more contemporary or transformational competencies. Careers to follow this pattern. While basics become relevant in early stages of ones career, specialized and advanced capabilities become an imperative stage from middle and top management.

Career Review Meetings The career review meeting brings together the main elements of performance management: it is the one occasion where a manager and subordinate have the opportunity to sit down

Competency Driven Careers

CEO

YEARS

Transformational Competencies (50%) (Strategy Alignment, Vision & Value, Core Competency, Competency Clusters, Advanced Knowledge, Innovative cultures, performance driven, applied behaviors, team working, alliance building)

FUNCTION SPECIALIST

TOP TOP CUTTING EDGE

CRITICAL COMPLEMENTRY

CORE

S P E C I A L I S T

Marketing

1 7

GROUP

GROUP

Human Resources

1 3

ENTERPRISE

ENTERPRISE

Finance and IT

1 0

PROCESS

PROCESS

Credit and Risk

7

TRAINEE

Traditional Competencies (30%) (Sufficient Knowledge, Skills, on the job capabilities, basic attitudes, effective communication, maintenance capable)

Transactional Competencies (20%) (Basic Knowledge & Skills)

TEAM

TEAM

SUB FUNCTION

FUNCTIONAL SPECIALIST

Branch Banking

SUB FUNCTION

FUNCTIONAL HEAD

Corporate

3

1

CROSS FUNCTION ORGANISER

FUNCTION

Model for Competency Driven Career Progression

Figure: 13.1 CBO—Model for Competency Driven Career Progression. together in a formal environment and agree on past and expected future levels of performance, and how the difference between the two is going to be tackled, Fig 13.1 and 13.2. A successful review meeting involves a realistic appraisal of current job performance, promotes the participation and commitment of the subordinate, and enhances the likelihood of their future improvement. It should be handled on a career-planning basis where the individual is keen to learn to build a career. It should demonstrate long-term learning opportunity.

Preparing for the career performance review Effective preparation lays the groundwork for the forthcoming meeting by setting the right tone, establishing expectations and creating a basis for the meeting.

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There are two key steps involved at this stage. First, set a positive and learning climate. Most people are naturally apprehensive about performance reviews. Some time before the meeting, you should plan to hold a brief, informal meeting with your subordinate to discuss the upcoming interview. During this you need to ensure that the subordinate understands the purpose of the session. Second, prepare exclusively and individually. You and your subordinate will have different perspectives on the issues under discussion and it is therefore important that you both prepare separately for the session. �

Review the subordinate’s main job responsibility.



Review their key performance objectives. ILLUSTRATION Treasury and International

1 2 3 4 5 6 1 2 3 4 5 6 1 2 3 4 5 6

Lev Competency els Proficiency Head Office usiness Strate y 5 Mastery Financial Acume 4 Expert ash Management 3 Proficient Leading People 5 Master omer Relationship 4 Expert roblem Solving 4 Expert Zonal Office 3 Proficient usiness Strategy 4 Expert Financial Acume 4 Expert ash Management 5 Master Leading People omer Relationship 4 Expert 4 Expert roblem Solving Branch Office 3 Proficient usiness Strategy 5 Mastery Financial Acume Cash Mana ement 5 Mastery Leading People 4 Expert omer Relationship 4 Expert roblem Solving 3 Proficient

Competency Drives Careers

Priority Sector

NPA Management

IT, MIS, SMS

Human Resources

Audit

Planning Research

Risk Vigilance Management

Credit

Head Office

Treasury and International

Priority Sector

Zonal Office

IT, MIS, SMS

Audit

Human Resources

General Operations and Corporate Services

Risk Vigilance Management

Credit

NPA Management

General Operations and Corporate Services

Branch Priority Sector

IT, MIS, SMS

General Operations and Corporate Services

NPA Management

Figure: 13.2 Competency Driven Careers.

Credit

Risk Management

Competency Driven Careers



Review the personal qualities required in the job.



Prepare an initial evaluation of present performance.



Identify possible causes of under performance.



Differentiate between job related and other types of issues to discuss.



Reiterate periodically mutual care and concern.

Ensure that there is no disturbance during the time of the discussion (Fig. 13.3).

Conducting a career and performance appraisal interview The second step is conducting the interview itself. The most thorough preparation will be wasted unless the meeting is handled properly. Put the subordinate at ease. �

Set a constructive tone.



Clearly state the objectives of the session.



Ask at periodic intervals mutual understanding.



Make talking on sensitive easy and dignified.

The base of your constructive planning for the future is an evaluation of your subordinate’s present performance. �

Listen to the subordinate’s self-appraisal.



Present an evaluation of the subordinate’s present job performance.



Discuss areas of difference about present performance and work towards reaching an agreement.



Analyze the causes of inadequate present performance.



Help the individual construct a career plan.



Help the individual understand where opportunities can be found for development and learning.

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Start on a positive note – Stress on the good performance before reviewing performance on which the employee has fallen short of expectation.

Following up after the meeting As a result of the review meeting, the manager will have thoroughly reviewed the subordinate’s performance and will have identified specific career development action plans. �

Complete final documentation as agreed during the meeting.



Schedule as soon as possible any specific development activities called for.



Hold informal progress checks and counselling sessions throughout the year so that you both have an opportunity to discuss progress.



Give feedback to subordinates as it is needed.

After the prescribed form is complete in all respect, do return the completed appraisal form to the Human Resource Function for further necessary action.

Feedback �

Feedback should describe the “specific behaviour”, and should not be a value judgement on the person.



Feedback should be constructive, not negative.



Feedback should be factual, specific and accurate—not vague.



Feedback should be about behaviour the person can change, not about situations outside the person’s control.



Feedback should be prompt, but given in private.



Feedback should describe the consequences of behaviour in objective terms, not in reactive terms.



The way in which you give feedback determines whether it is accepted and acted upon.

Competency Driven Careers

Coaching Linkages Organizational change issues

Organizational Core Value and Dimensions

Coaching Need analysis HR Process Data like appraisal records, career plans, training records, Employee survey, etc.

Syngenta Competency model

Values, VI on and Mission

Coaching program design

Plan, implementation and check on the program Increased productivity Employee development Proactive communication Real time insue handling

Increased shareholder value Increased job satisfaction Overall higher ROCK

Successful rdlout

Figure: 13.3 Coaching Linkages.

Counselling and Coaching Counselling is concerned with the future goals of the individual. The role of the manager is to listen, amplify, explore and generally assist the employee in thinking through his/her short-and long-term goals.

The Role of the Manager The manager makes his or her contribution to the discussion in several distinct ways: �

Listening: The primary counselling skill. If you don’t listen, you will never know or understand the full range of issues that your subordinate wants to raise.



Providing information: You will inevitably have knowledge that your subordinate does not, regarding career paths within the company or particular selection criteria.



Structured advice to achieve specific goals: If the subordinate is clear what his or her short-term goals are in career terms, the manager can play a facilitator role, and help to clarify and structure the issues so that the steps to achieve the goals become clearer.

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Feedback about professional status: You may have information about how the subordinate is viewed elsewhere in the company in terms of potential, and your own opinion as a manager is obviously relevant. Remember, though, that this is not an appraisal meeting. It should be made clear that your own feedback is designed to help with career goals and is not related to evaluation.



Ideas and suggestions for development activities: Once you know where it is your subordinate wants to go, you can provide not only a sense of structure but a view on what kinds of activity or responsibility would stand him or her in good stead for any future role.



Working with the individual on these activities: If you can find a way to build them into day-to-day requirements of the job. If not, it may be possible to engage your subordinate into projects to which he or she can usefully contribute and which help to develop the knowledge and skills necessary to create career opportunities Fig 13.3.

360 degree Feedback (360 degree Review) 360-degree feedback is the most comprehensive and costly type of appraisal. It includes selfratings, peer review, and upward assessments; feedback is sought from everyone. It gives people a chance to know how they are seen by others; to see their skills and style; and may improve communications between people. (Fig. 13.4) 360-degree feedback helps by bringing out every aspect of an employee's life. Other types of appraisal may not reward cooperation with people outside their department, helpfulness towards customers and vendors, etc. This system also helps those who have conflicts with their manager. 360-degree feedback generally has high employee involvement and credibil-

Manager

Peers

Individual

Internal customers

irect report Figure: 13.4 CBO—The Management Network.

Competency Driven Careers

ity; may have the strongest impact on behaviour and performance; and may greatly increase communication and shared goals. It provides people with a good all-around perspective. “The systematic collection and feedback of performance data on an individual or group, is derived from a number of the stakeholders in their performance." To explain: the data collection is systematic, i.e., done in some systematic way via questionnaires or interviews. This formalizes people judgements coming from the natural interactions they have with each other. There is both a collection and a feedback process data is gathered and then fed back to the individual participant in a clear way designed to promote understanding, acceptance and ultimately changed behaviour. The performance of either individual or group can be measured. The process has recently been applied to groups or teams but can be an effective way of measuring interactions with in a team or team outputs and quality as perceived by the customer. The source of data is called the stakeholders in the participant's performance. Stakeholders are people who are both affected by the individuals or group's performance and deal with them closely enough to be able to answer the specific questions about the way they interact with the stakeholders. In addition to the traditional players in assessing performance H.R. people include people like reporting staff, fellow team members, members of a committee and also the internal customers. A final observation: the word 'performance's twice in the definition. However, we should be quite clear on the fact that it refers to the quality of a person's interactive processes or their behaviour, rather than the results they produce. Many organizations have developed sophisticated ways of measuring their success as corporate entities, the achievements of departments, and teams and the contribution of individuals, which demonstrate: �

The tendency when assessing individuals to look not just at results achieved – but how they were achieved.



The increasing emphasis by organizations on measuring employee opinions on a number of issues, such as communications or morale, achievement of corporate standards of behaviour or values.



The use of external measures by organizations to assess how others see them from outside, typically using market research or other forms of survey to assess customer satisfaction. Some asking for similar feedback from their suppliers.



The assessment of teams and departments by looking at what happens within the group-communication and decision making processes. This data is coupled with the views of internal customers and others on team quality and service.

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The increasing use of business excellence models as part of total quality movement and the need to have more precise, data-focused ways of measuring them.

Any or all of these circumstances may be suitable candidates for 360-degree feedback. In practice it is used to assess how teams interact with their members and customers, and how individuals interact with the stakeholders in their performance. Thus managers can be assessed in terms of the competencies they possess, or more specifically through the detailed behaviours which constitute them. Besides managers, power and value of 360-degree feedback has made engineers, pilots. Sales people, human resource professionals, customer service staff, secretaries and supervisors part of the assessment and feedback process. Many organizations have developed sophisticated ways of measuring their success as corporate entities, the achievements of the departments and teams and the contribution of individuals. Most companies are able to measure their success in terms of production, sales, profits, market share or return on capital employed. Departments whether line or staff, tend to be measured by the attainment of the strategic or short-term objectives such as annual targets, control or reduction of costs including headcount and implementing procedures for increasing the efficiency. Individuals have traditionally been assessed on a micro version of the above written points i.e., achievement of annual targets or other results. None of these issues is normally measured by the 360-degree feedback. Why do so when better ways already exist? Other types of measurement are emerging, for example: The tendency when assessing individuals to look not just at the results achieved—but how they were achieved. The increasing emphasis by organizations on measuring employee opinions on a number of issues, such as communications or morale. The use of external measures by organizations to assess how others see them from outside, typically using the market research or other forms of survey to assess customer satisfaction. The assessment of teams and departments by looking at what happens within the group-communication and decision-making processes. The increasing use of business excellence models as part of the total quality movement and the need to have more precise, data-focused ways of measuring them. Any or all of these circumstances may be suitable candidates for 360-degree feedback. In practice it is used to assess how teams interact with their members and customers, and how individuals interact with the stakeholders in their performance. Thus managers can be assessed in terms of the competencies they possess, or more specifically through the detailed behaviours, which constitute them. So, in addition to results and output there is now the opportunity, to measure how well managers communicate with other people. Not only that, a competency like communicating can be broken down in to very specific behaviours, such as listening, writing, giving presentations and influencing.

Competency Driven Careers

Treating behaviour at a detailed level enables the respondent to think about the participant's actions in very precise terms. It helps the participant to focus on the exact areas where they need to change. So far, 360-degree feedback has concentrated on people who are at the senior levels in the organization, for example: directors, managers and senior executives. However, as organizations are beginning to appreciate the power and value of such measurement, other jobholders are now finding that their behaviours are coming under the microscope: engineers, pilots, sales people and supervisors have all participated in this assessment and feedback process. The Managing Individual Effectiveness (MIE) system at BELLCORE is used for self-development. It gets feedback from peers, managers, subordinates, and the ratees themselves. According to a BELLCORE representative, the results are better working relations; better communications; more information on management performance and style; increased effectiveness and productivity of individuals and the organization as a whole; knowledge of training needs; a better grasp of organizational priorities; and greater employee input in designing self-development plans. The BELLCORE rep noted that, for success, expectations must be communicated clearly; employees must be involved early; resources must be dedicated to the process, including top management's time; confidentiality must be assured; and the organization, especially top management, must be committed to the program. This system requires third party, such as a consultant, to begin the process, which may take months to start up. A 360-degree feedback may be given directly to the employees, who have the option of discussing them with their managers; or it may be given to the managers for use in a feedback meeting. Whichever method is chosen, training for the managers and ratees is necessary. Some off-the-shelf survey forms include job analysis techniques designed to form KSAs (knowledge, skills and abilities required by a job) based on interviews, focus groups and questionnaires. These forms may help to kill two birds with one stone, by helping to create valid job descriptions and then providing feedback on performance. The KSAs required by a job may be determined using traditional job-analysis techniques; competencies required by the job; strategic goals of the organization; development theory; or personality theory (e.g., communication or leadership styles).

SAMPLE: DEFINING COMPETENCIES

CAREER DRIVEN

MANAGERIAL AND ENABLING

WORK PLANNING �

Ability to plan: Formulates plans according to individual and business goals.



Organize: Divides jobs into logical activities and sequences them in order of importance.

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� Execute: Works according to plans. Meet Deadlines: Follows a strict schedule and completes a job.

INITIATIVE �

Drive: High motivation for work and also encourage others to work towards a common goal.



Energy: Enthusiastic in workplace.



Self-starter: Does jobs proactively and seizes the opportunities.



Problem Solver: Identifies problem breaks it into constituent elements, identifies causeeffect relationship and implement an effective solution.

PEOPLE / SELF MANAGEMENT �

Team Player: Works in a team, supports and encourages team members.



Leader: Defines goals & standards of performance, delegates and allocates work according to abilities.



Develops Subordinates: Identifies, train and involves people in all activities.



Disciplined: Maintains decorum of the workplace, has respect for seniors and juniors.

COMMUNICATION �

Articulate: Can communicate (verbal & written) in a fashion which is understood & appreciated by people.



Persuasive: Sticks to a problem until it is resolved.



Supportive: Supports subordinates in their work.



Confident: Has confidence in his values and action.

CONCEPTUAL DEPTH. �

Vision: Can dream beyond the existing scenario.



Long range planning: Thinks of long term impact of actions or strategies of the present.

Competency Driven Careers



Versatile: Adjusts behaviour, strategies according to change in environment & circumstances.



Creative/Innovative: Goes beyond conventional thinking and produces imaginative or unique response to a problem.

OVERALL BUSINESS APPRECIATION �

Technical Basis: Appreciates the technologies of production, planning & control of the organisation.



Financial Knowledge: Has appreciation of the financial ratios and instruments.



Strategic Priorities: Has appreciation of situations and strategies based on those situations.



Customer Driven: Has a customer friendly approach to both internal & external customers.

Sample: Defining Career Driven Business and Functional Competencies Problem Solving Diagnostic Information Gathering: The ability to identify the information needed to clarify a situation, seek that information from appropriate sources, and use skillful questioning to draw out the information, when others are reluctant to disclose it. �

Identifies the specific information needed to clarify a situation or to make a decision.



Gets more complete and accurate information by checking the multiple sources.



Probes skillfully to get at the facts, when others are reluctant to provide a full, detailed information.



Routinely walks around to see how people are doing and to hear about any problems they are encountering.



Questions others to assess whether they have thought through a plan of action.



Questions others to assess their confidence in solving a problem or tackling a situation.

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Asks questions to clarify a situation.



Seeks the perspective of everyone involved in a situation.



Seeks out knowledgeable people to obtain information or clarify a problem.

Analytical Thinking: The ability to tackle a problem by using a logical, systematic, sequential approach. �

Makes a systematic comparison of two or more alternatives.



Notices discrepancies and inconsistencies in available information.



Identifies a set of features, parameters, or considerations to take into account, in analyzing a situation or making a decision.



Approaches a complex task or problem by breaking it down into its component parts and considering each part in detail.



Weigh the costs, benefits, risks and chances for success, in making a decision.



Identifies many possible causes for a problem.



Carefully weighs the priority of things to be done.

Forward Thinking: The ability to anticipate the implications and consequences of situations and take appropriate action to be prepared for possible contingencies. �

Anticipates possible problems and develops contingency plans in advance.



Notices trends in the industry or marketplace and develops plans to prepare for opportunities or problems.



Anticipates the consequences of situations and plans accordingly.



Anticipates how individuals and groups will react to situations and information and plans accordingly.

Conceptual Thinking: The ability to find effective solutions by taking a holistic, abstract, or theoretical perspective. �

Notices similarities between different and apparently unrelated situations.

Competency Driven Careers



Quickly identifies the central or underlying issues in a complex situation.



Creates a graphic diagram showing a systems view of a situation.



Develops analogies or metaphors to explain a situation.



Applies a theoretical framework to understand a specific situation.

Strategic Thinking: The ability to analyze the organization's competitive position by considering market and industry trends, existing and potential customers (internal and external), and strengths and weaknesses as compared to competitors. �

Understands the organization's strengths and weaknesses as compared to competitors.



Understands the industry and market trends affecting the organization's competitiveness.



Has an in-depth understanding of competitive products and services available within the marketplace.



Develops and proposes a long-term (3–5 year) strategy for the organization based on an analysis of the industry and marketplace and the organization's current and potential capabilities as compared to other competitors.

Technical Expertise: The ability to demonstrate depth of knowledge and skill in a technical area. �

Effectively applies technical knowledge to solve a range of problems.



Possesses an in-depth knowledge and skill in a technical area.



Develops technical solutions to new or highly complex problems that cannot be solved using existing methods or approaches.



Is sought out as an expert to provide advice or solutions in his/her technical area.



Keeps informed about cutting-edge technology in his/her technical area.

Result Orientation Initiative: Identifying what needs to be done and doing it before being asked or before the situation requires it.

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Identifying what needs to be done and takes action before being asked or the situation requires it.



Does more than what is normally required in a situation.



Seeks out others involved in a situation to learn their perspectives.



Takes independent action to change the direction of events.

Entrepreneurial Orientation: The ability to look for and seize profitable business opportunities; willingness to take calculated risks to achieve business goals. �

Notices and seizes profitable business opportunities.



Stays abreast of business, industry and market information that may reveal many business opportunities.



Demonstrates willingness to take calculated risks to achieve business goals.



Proposes innovative business deals to potential customers, suppliers and business partners.



Encourages and supports entrepreneurial behaviour in others.

Fostering Innovation: The ability to develop, sponsor, or support the introduction of new and improved method, products, procedures, or technologies. �

Personally develops a new product or service.



Personally develops a new method or approach.



Sponsors the development of new products, services, methods, or procedures.



Proposes new approaches, methods, or technologies.



Develops better, faster, or less expensive ways to do things.



Works cooperatively with others to produce innovative solutions.

Results Orientation: The ability to focus on the desired result of one's own or one's unit's work, setting challenging goals, focusing effort on the goals and meeting or exceeding them. �

Develops challenging but achievable goals.

Competency Driven Careers



Develops clear goals for meetings and projects.



Maintains commitment to goals in the face of obstacles and frustrations.



Finds or creates ways to measure performance against set goals.



Exerts unusual effort over time to achieve a goal.



Has a strong sense of urgency about solving problems and getting work done.

Thoroughness: Ensuring that one's own and others' work and information are complete and accurate; carefully preparing for meetings and presentations; following up with others to ensure that agreements and commitments have been fulfilled. �

Sets up procedures to ensure high quality of work (e.g., review meetings).



Monitors the quality of work.



Verifies information.



Checks the accuracy of one’s own and others' work.



Develops and uses systems to organize and keep track of information or work progress.



Carefully prepares for meetings and presentations.



Organizes information or materials for others.



Carefully reviews and checks the accuracy of information in work reports (e.g., production, sales, financial performance) provided by management, management information systems, or other individuals and groups.

Decisiveness: The ability to make difficult decisions in a timely manner. �

Is willing to make decisions in difficult or ambiguous situations, when time is critical.



Takes charge of a group when it is necessary to facilitate change, overcome an impasse, face issues, or ensure that decisions are made.



Makes tough decisions (e.g., closing a facility, reducing staff, accepting or rejecting a high-stakes deal).

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Self-Management Self Confidence: Faith in one's own ideas and capability to be successful; willingness to take an independent position in the face of any opposition. �

Is confident of own ability to accomplish goals.



Presents oneself crisply and impressively.



Is willing to speak up to the right person or group at the right time, when he/she disagrees with a decision or strategy.



Approaches challenging tasks with a "can-do" attitude.

Stress Management: The ability to keep functioning effectively when under pressure and maintain self control in the face of hostility or provocation. �

Remains calm under stress.



Can effectively handle several problems or tasks at once.



Controls his/her response when criticized, attacked or provoked.



Maintains a sense of humour under difficult circumstances.



Manages own behaviour to prevent or reduce feelings of stress.

Personal Credibility: Demonstrated concern that one be perceived as responsible, reliable and trustworthy. �

Does what he/she commits to doing.



Respects the confidentiality of information or concerns shared by others.



Is honest and forthright with people.



Carries his/her fair share of the workload.



Takes responsibility for own mistakes; does not blame others.



Conveys a command of the relevant facts and information.

Competency Driven Careers

Flexibility: Openness to different and new ways of doing things; willingness to modify one's preferred way of doing things. �

Is able to see the merits of perspectives other than his/her own.



Demonstrates openness to new organizational structures, procedures and technology.



Switches to a different strategy when an initially selected one is unsuccessful.



Demonstrates a willingness to modify a strongly held position in the face of a contrary evidence.

Sample Competency Based Career Review 1. Management Career Review Two copies of the competency based Performance Management System (CPMS) has to be attached for every employee working in a Business/Function. The first form is to be used for completion of the Performance Management Process. The goals, which you have already set for the performance year, in the new APMS, format should be completed. The guidelines for filling up the format detailed below. �

Career and Performance Management 1. The form is divided into parts. In the form for reviewing the past year’s performance it is essential that all parts of the form are completed in all respects and then returned to us to enable us to gather maximum information from the same. In the Goals form only Part A of the form is to be filled up for the year and returned to your SBU Personnel Head/or to corporate Management & Organizational Development (in case of Corporate Functions and Regional Offices). 2. Part A: Goals/Objectives: This part of the form is the goal setting part. This section has three self-inking copies, therefore only the first sheet needs to be filled in. The second and third copies are perforated. The second sheet is to be detached & forwarded to the Corporate Management & Organization Development Team and the third is for the employee’s reference. For the Performance Appraisal exercise for, we would request you to reproduce the goals that you had earlier set for in this section. For the Goal Setting exercise of the current year, goals need to be identified for all the employees concerned and written in the respective area provided. Please be as specific and clear as possible to avoid ambiguity and confusion at a later date.

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3. Part B: Self-Appraisal: This part is listing of the results achieved against last years goals/targets as seen by the concerned individual. There is now a provision for midterm appraisal, which has to be filled during the month of October for the next performance year. Please note that for the performance year, only the final review section is relevant. 4. Part C: Review Sheet: This part is a listing of the results achieved against last years goals/targets as seen by the immediate boss. There is again a provision for mid-term review as mentioned above. The SBU Personnel Head/Corporate HR head will facilitate both the midterm & final review along with the employee and the supervisor. 5. Part D: Competencies Scoring: This Part is an “Analysis of the employee on certain Critical Competency Attributes”. These attributes have been identified as being important to the company based on various discussions at the senior and top management level. Please note that this part has no bearing on the “Performance Tier” of the employee. The rating will serve as a critical input on the long term potential & development needs of every individual. While completing this particular section please do not compare individuals amongst each other. Try to review each individual again an absolute standard only. This part is to be filled in by the concerned individual, his/her boss and the departmental head. In case of matrix reporting relationships, the administrative & the functional bosses of the employee must fill in this section. Please ensure that all the attributes are rated and comments are given whenever possible to enable us to get a better understanding of the person. 6. Part E: Key Competencies/Strengths: This part is a listing of the three main strengths of the concerned employee as seen by him/her self, his/her immediate boss and the departmental head. We request you to fill in three strengths and be as specific as possible. As in the previous section, may we urge you to fill up this section without comparing between individuals? This section will enable us to form a database of the kind of skills we have available as a resource for various jobs in the organization. 7. Part F: Performance Review Discussion: This section is a documentation of key feedback given to the employee. The objective of including this section is to make the system of performance feedback transparent. Although it is intended that this section is filled up at the end of the year, we would urge & encourage continuous feedback to be sought & given, both formally and informally. Both the employee & his/her superior must sign as a token of having communicated & understood the critical aspects relating to the employees’ performance.

Competency Driven Careers

Process Implementation Guidelines 1. Part G, H & I are confidential: In this part we urge you that on no account should the contents of these three sections be discussed with the employee. 2. Part G: Short/ Long Term Potential (Confidential): This part is a brief description of the short/long term potential of the concerned employee. Please state the potential you believe that the concerned employee has and the likely jobs he/she can hold in the near future. Be as specific as possible as this enable us to identify internal personnel for new jobs, projects and promotions. This part is to be filled in by the Departmental Head in consultation with the concerned employee’s boss. In case of matrix reporting, both the functional & the administrative heads would have to fill in their comments. 3. Part H: Overall Summary (Confidential): This part is an overall summary of the performance of the concerned employee. Be as elaborate as possible and state all factors that will enable the concerned people to take as objective a decision as possible on the tier of an individual. This part has to be completed by the concerned employee’s boss and reviewed by the departmental head. Again, in case of matrix reporting, both the functional & administrative heads would have to fill in their comments. 4. Part I: Overall tier (Confidential): This part is the overall tier of the employee. We would urge you to kindly use only the data mentioned in Parts A, B, C, F and H of the form and do not use the data as given in part D, E, G of the form. This is to be completed by the Departmental Head in consultation with the concerned employee’s superior. The tier would have to be jointly arrived at by the functional & administrative heads in case of matrix reporting. 5. Part J: Key Training / Developmental Inputs: This part is in duplicate with self-inking sheets. The second sheet is to be detached and forwarded to the Corporate Management & Organization Development Team, to enable us to plan the next training calendar. A list of suggestive training program is given behind the first sheet. This is also to be filled in by the employee, his/her boss and the Departmental Head/Final Reviewer and the SBU Personnel Heads/Corporate M&OD head. We would urge you to spend as much time as possible in listing down all the training needs/areas for development of the concerned employee. This helps us in identifying training programs that can help the concerned employee attain his/her full potential. Please note that one must focus on those training needs that you feel need to be addressed during the current review period.

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Important points to be remembered while completing the competency based performance appraisal 1. FORCED RANKING: The overall tier would be arrived after forced ranking. To reiterate the T1-T2-T3-T4 should not exceed 10–20–60–10 per cent respectively. This should be ensured in total for each business/department/region. 2. POSITION EVALUATION: For the purpose of promotion we would be circulating the position evaluation form with a detailed note on its usage. It would be our endeavour to see that employees are transferred on promotion. To help assist you in the movement of employees on promotion or on lateral basis a career-planning matrix. 3. JOB MOVES: It should be our endeavour to look at the whole textile business as one talent pool and inter intra SBU movements on promotion and on lateral basis should become a reality. 4. CAREER PLANNING PROGRAM: From the corporate we would identity the top 100 performance and a career tracking would be initiated for these star performers. 5. GROWTH POLICY: Along with the position evaluation form we would also be circulating promotion policy guidelines that would assist you in making your promotion recommendation. 6. LEADERSHIP DEVELOPMENT PROGRAM: We should also along with the performance appraisal exercise identity leaders showing potential to become business managers in grade G1 and above. Such identified leaders can be put through a special training program, job rotation etc., to equip them to take on leadership roles in future.

Competency Driven Careers

7. ON THE JOB ROLE MOBILITY It should be our endeavour to whenever possible to allow employees to do acting assignments to give them exposure for handling a job of higher responsibility.

Important points to be remembered while completing competency based goal setting exercise �

Be specific i.e., State the machine, product etc., to add more clarity. For example DO NOT SAY – To increase the speed of the machine by 1000 rpm. Instead SAY – To increase the speed of the Ring Frame machine form 12000 rpm (Average speed for FY 2002–03) to 13000 rpm (average speed for FY 2003–04).



Specify the time frame either in terms of a period or a specific date. For example DO NOT SAY – To develop a system for packing and storage of finished products. Instead SAY – To develop a system for packing and storage of finished products by 20th December 2003.



Be clear about the standards. State as far as possible the old standards (actual results achieved in the previous year) and the new standards (proposed to be achieved in the previous year) For example, DO NOT SAY – To reduce and breaks by 50%. Instead SAY – To reduce end breaks in 20’s count yearn on Ring Frame form 5% to 2.5% (in both cases average over the year).



As far as possible do not use currency terms. Instead use other units. This allows the goal to be totally in your control and not dependent on inflation. For example DO NOT SAY – To reduce the consumption form Rs. 1.2 crores to 1.1 crores. Instead SAY – To reduce the consumption of ABC chemical from 20 grams per square meter (actual consumption in FY 2002–03) to 18 grams per square meter (consumption in last six months of FY 2003–04).



Ensure that the goals are growth oriented but at the same time be realistic and achievable.



Be sure that the goal is in the right place i.e., Quantitative, Cost Saving, People, System and Unique and also focuses on what has to be done. For example DO NOT SAY – to reduce twist variation. Instead SAY – To train 20 workers on the aspect of correct operation of the TFO machine by 1st February 2003 to ensure that twist variation is reduced.

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Learning from Processes involved in Competency Based Career Management System Is it possible that traditional career management programs cause problems for an organization? The answer is a resounding yes. The career management system conveys to people in an organization how work is to be performed, and communicates, often unintentionally, values and organizational culture. More specifically traditional career management systems can foster a lack of collective responsibility for the achievement of organizational goals, encourage competition rather than cooperation, and can impede the development of effective teamwork. Just as important is that traditional career management purports to empower employees, allow self-control and self-evaluation, allow participation and involvement, and increase the meaningfulness of work. More often than not these results do NOT occur, resulting in a reduction of the credibility of the manager, and subversion of the manager' s ability to lead.

The Message: You Are Responsible For Your Work Since we live in a very individualistic society, it is not surprising that we eagerly embrace the idea that each person should be both responsible and accountable for his or her work. I am sure you agree with this viewpoint. Career management is designed to enhance this personal responsibility. At the same time, it implies that you are not responsible for the work of others, OR, by extension, the work that is done by others that is important to the organization. Career management, by focusing on individual responsibility, reduces an employee's responsibility to the organization, and to activities that are not "his or her job". This is no trivial or philosophical issue. Again, if we look at the research about successful innovative organizations we find that a distinguishing characteristic is that employees feel a strong responsibility for almost everything that goes on. They want to be involved, they contribute ideas, they function in a team context because they see the achievement of overall organizational objectives as more important than the achievement of their own objectives. They see the forest AND the trees. Let's illustrate. A receptionist is responsible for answering a phone within some specific standard. Other employees do not have this responsibility. Unfortunately, there are occasions when the phone rings and the receptionist is otherwise engaged with another client, phone or other important task. It is not uncommon for either employees who happen to be in the area to ignore the ringing phone, because it isn't part of their jobs. This response is common, and often occurs unconsciously.

Competency Driven Careers

The result is that the phone goes unanswered, or the receptionist must do some juggling that may result in someone getting upset. The point is that while career management systems don't tell others NOT to answer the phone, the career management system doesn't encourage them to do so. Because that function "belongs" to someone else.

The Message – Compete For Resources In a career management system the employees are evaluated based on the achievement of their objectives (and standards). The payoff for employees is to get their things done, at times, competing for resources to the detriment of the achievement of other people's objectives. In the government organization where I worked it was common for a person working on a project re, hoard books and materials needed to complete their objectives, often without telling anyone they had done so. Things just disappeared, sometimes for months at a time. The hoarder benefited by making sure that his or her objective could be achieved, while others suffered because of this very shortsighted approach. It happens more often than you think, and it results from the emphasis on individual achievement rather than corporate results. Career management systems tend to send the message implicitly. Nobody intends it. The Message = Work As A Team But You Get Hung Modern managers are realizing that teams are important to the achievement of organization objectives because many tasks are too large or complicated for one person to handle. So they encourage people to work in teams. Usually, though, a manager committed to career management will want to designate one person to be both responsible and accountable for the project, a team leader if you like. As one manager put it, "I want to know who to blame if this goes screwy". Now this sends some messages. It says to the team leader that he or she is to harness the energy and skills of the team, but if the team fails, the team leader hangs. This encourages the team leader to revert to individual mode when the team is not succeeding. It is not uncommon for a team leader to end up doing a great deal of the work, thereby negating the purpose of the team in the first place. A second message is sent to team members who are not uniquely responsible for team outcomes. A team member is less likely to commit to the team if it is clear that there is only praise or blame for the team leader. In the situation where a team member must choose between working to achieve a team goal, or working to achieve a personal objective that he or she is responsible for, the choice is clear. The team will suffer.

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Traditional career management does not encourage a focus on cooperation, teamwork and the "big picture". It has a tendency to fragment an organization or to use ROSABETH MOSS KANTAR’S terminology it causes segmentation.

Message: Let's Pretend The truth of most workplaces is that the manager has the ultimate power to make workrelated decisions. This is simply the way we set up organizations. The best career management systems encourage employees to be involved in decisions that involve their objectives and standards and many managers make a special effort to make use of this input. They solicit, they encourage, they do all manner of neat things to tell employees that their ideas are important, and that employees can and should control their own work That' s nice, but it doesn't wash. Employees know that if push comes to shove, it is the opinion of the manager that will win out. Despite the fact that the manager encourages the employee to self-evaluate, the employee allows that the manager will make the final assessment. What good career management systems involve is getting everyone to pretend that this is not so. The message is: Let's pretend that we are equal in power and control and pretend that our inputs carry equal weight, and if we sell career management as a participative process, sooner or later the employees will realize that it isn't quite so participative as it seems. This engenders a great deal of cynicism and accounts for the fact that in many organizations, employees see career management as unpleasant and negative. No amount of dressing up changes the reality of the power imbalance. Now, employees recognize the legitimacy of the manager's position. The power imbalance is not the problem. The problem is pretending that decisions and evaluations are made on the basis of equal power. This pretending causes erosion of trust and manager credibility, as the employee, who may have initially bought into the career management system, finds that it is the manager's opinions that will prevail.

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14

Competency Linked Competitive Remuneration MAKING

PAY COMPETITIVE

Over the years, organizations have, either explicitly or implicitly, sometimes by default, recognized the fact that the key to achievement of the organizational purpose is the human resource. If this resource is treated as an input resource in the overall organizational processes, there is a resource cost attached to it. The economics of demand and supply and the theories of price elasticity would definitely apply to the human resource. What complicates the management of the human resource is that to this economic theory, one has to superimpose the complex theories of managing human behaviour. Designing and managing a competency compensation system is therefore a management exercise that involves economic, financial expertize and mastery of knowledge of human behaviour. Organizations must reward employees because they are in turn looking for certain kinds of behaviour: they need competent individuals who agree to work with a high level of performance, loyalty and ground level commitment. Individual employees, in exchange for their commitment, expect certain extrinsic rewards in the form of performance pay promotions, salary, fringe benefits, perquisites, bonuses, or stock options. Individuals also seek the intrinsic rewards such as feelings of competence, achievement, responsibility, significance, influence, personal growth and meaningful contribution. In today’s world competency compensation systems cope with paying for risk of continuing to be employable. The competency based Compensation philosophy Fig. 14.1 that continues to guide us, is to pay for performance and the job. It will be the endeavour of the company, in the area of competency based Compensation, to benchmark against the best paid multinationals in the country rather than to benchmark and consequently restrict us to the Region cum Industry trap. The company in its evolution to become a true multinational in all aspects would also pay attention to this very vital aspect of employee motivation. The competency based Compensation is structured in such a manner that it takes care of aspects like quality of life,

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Paying for past Competency

Paying for future sucess

Paying for contribution Results

Competence

Figure: 14.1 CBO—Competency pay and paying for contribution. asset building and social status. The job value is established on the basis of the institutionalized Position Evaluation System, which in a quantitative and qualitative manner captures the intrinsic value of the job. The Performance is evaluated on the basis of the Performance Management System [PMS], which establishes the job performance that is linked to the concept of Pay For Performance. The focus is and will continue to be skewed in favour of proven performance and increasingly towards group performance, evaluated on the basis of business performance.

Remuneration and Motivation There is no doubt that motivation is the crux for good performance, but there is no clear cut answer to the question of how to motivate. The previous pages gave a glimpse of the answer through various theories and practices. Money is a factor in motivating people and this section concentrates on this. Money is important! This is, perhaps, saying the obvious. But it still needs to be said, for a perusal of the previous section may give the impression to the contrary, at least judging from MASLOW'S concept. Refreshing as it is, if the theory was completely valid then, at least in affluent countries, economic incentives should have lost all their force. This, we know is not correct. According to PETER DRUCKER (1974) 'there is not one shred of evidence for the alleged turning away from material rewards... Anti materialism is a myth, no matter how much it is extolled.' In fact, they are taken so much for granted that their denial may act as a de-motivator. 'Economic incentives are becoming rights rather than rewards. There is no doubt that we live in a money-motivated world. Any amount of human relations cannot compensate for a lack of monetary reward. If the reward is right, good human relations will give that extra zest to a team, motivating them to try even harder. Good human relations cannot compensate insufficient monetary reward.

Competency Linked Competitive Remuneration

Even dedicated footballers do not think of playing for England, they merely pay 'lip service' to it. Cricketers and rugby players no longer play for their own country but opt for the 'highest bidder'. Professional tennis players have refused to play at Wimbledon, the 'Mecca' of lawn tennis, because the rewards were not attractive. It is no different in the industrial world. Strikes for better salary and rewards do still occur. All this despite the claim of psychologists that security is the prime need of a person, as indicated in the previous section. Has the sense of values changed with time? But we are not concerned here with the philosophical angle, but with hard facts of life in a commercial world. Self-motivation can go only so far and it needs to be constantly reinforced by rewards. In particular, merit must be measured and rewarded regularly, if it is to be encouraged and sustained. The 'gold banana' in FOXBORO has its origin in just an ordinary banana that one of the pioneers could muster on the spur of the moment when he discovered extraordinary performance by one of the employees.

Evolution of Compensation Strategy Throughout history, employers have been challenged with attracting, retaining and motivating employees. From the simplest barter systems of centuries past to the current complex incentive formulas of today, the organizational premise has been the same: Provide productivity and results to our enterprise and we will provide you with something of value. In their simplest forms, compensation and benefits have involved cash or commodities, and that still is true to a large degree today. The employee provides a service and the employer provides cash compensation and/or a benefit of value to the employee.

A Historical Snapshot In the earliest years that the fields of compensation and benefits were recognized as professions, practice was based largely on formulas that served the entire employee population in an organization. Salary structures were just that – rigid and highly controlled – and benefits programs were designed as a one-size-fits-all answer to a homogenous work force. In the 1970’s and 1980’s, organizations recognized that strategically designed compensation and benefits programs could give them the edge in a rapidly changing environment. Organizations were responding to: �

Global economic development and the emergence of multinational firms.



A much more competitive business environment.

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Diversification of the work force to include workers who didn’t fit the sole breadwinner, head-of-household model of the ‘50s and ‘60s.



New government mandates related to the employee benefits.



Rapidly rising benefits costs that prompted flexibility in programs to reduce the costs.

Suddenly, the relatively simple compensation and benefits programs of the past were requiring consideration of their strategic impact and relationship to one another. Integration became a key, and compensation and benefits professionals emerged as critical strategic partners in their organizations’ leadership—a position still occupied by leaders in the field today. Throughout the past decade, the profession has continued to mature. Increasingly, it has become clear that the battle for talent involves much more than highly effective, strategically designed compensation and benefits programs. While these programs remain critical, the most successful companies have realized that they must take a much broader look at the factors involved in attraction, retention and motivation. And they must deploy all the factors— including compensation and benefits—to their strategic advantage.

A New Premise: Total Rewards Total Rewards is simple in concept and at best complex in its execution. Yet, organizations that understand the concept as it affects their industry and competitive environment—and deploy critical factors to their strategic advantage—will be the clear winners in the battle for talent. Total Rewards has three main components: �

Compensation.



Benefits.



The Work Experience.

Compensation and benefits are the two core components of Total Rewards. In every organization, there is some overlappping of these components; the degree of overlapping depends on organizational culture and program design for the intended impact. Each area has a distinct and unique body of knowledge. Individually and jointly, these components can offer tremendous strategic advantage and impact. The third and overlapping component of Total Rewards is "The Work Experience." Whereas compensation and benefits have clearly defined bodies of knowledge that are maintained by well-established professions, "The Work Experience" includes the many elements of

Competency Linked Competitive Remuneration

rewards that are important to employees and employers today but many times are less tangible. They overlap, relate to and sometimes integrate with compensation and benefits. And while they always have existed in organizations, these elements traditionally have not received attention as important components of the entire attract-retain-motivate proposition. Yet, recent research consistently demonstrates that employees place high value on matters related to the total experience of working. The five key components of "The Work Experience" are: �

Acknowledgment, appreciation and recognition—such as service, spot and achievement awards; feedback; and other initiatives that achieve the desired result of fulfillment in employees.



Balance of work/life—such as family programs, financial/health counselling programs, convenience services, employee activities, non-traditional work arrangements, and other factors that contribute to a perceived higher quality of life.



Culture—such as leadership, diversity, organizational formality, opportunity for innovation, and degree of employee communications.



Competency development—such as learning opportunities, coaching, mentoring, feedback, opportunities for career advancement and education opportunities, and core performance areas during each performance cycle, all managers will set performance goals in three CORE areas:

1. Organizing competencies These definitions are based on research on the most successfully performing managers and organizations. Competencies focus on levels of behaviour that are expected to demonstrate on the job—HOW you achieve results. Each management employee should identify and be measured on between five and eight competencies during the performance cycle.

2. Core competencies Just as there are Core Performance Areas that are applicable to all System/organization university managers, there are also Core Competencies that are universally applied across the System/organization. Core Competencies extend from the System’s philosophy, and reflect the desired work culture.

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They are intended to describe essential behaviours that ALL managers, regardless of position, should demonstrate in the performance of their duties to foster System/university success. The core competencies are: �

Results Orientation.



Customer Service Orientation.



Valuing Diversity.



Continuous Improvement.



Teamwork and Collaboration.

3. Job Specific Competencies Fourteen additional competencies have been provided that could be selected to reinforce important behaviours that support effective performance in a particular job. Management employees and their supervisors should select one or more of these additional job-specific competencies to evaluate how work is performed. The additional competencies are: �

Analytical Thinking.



Change Leadership.



Conceptual Thinking.



Developing One Self and Others.



Flexibility/Adaptability.



Impact and Influence.



Initiative.



Interpersonal Understanding.



Organization Awareness.



Relationship Building.

Competency Linked Competitive Remuneration



Self-Confidence.



Strategic Orientation.



System Thinking.



Team Leadership.

Core and Job-Specific Competencies With these measures, the focus is on HOW results are achieved, or the application of skills and behaviours. Core Performance Results Areas and Competencies provide for continuity throughout the System, and Job-Specific Performance Areas and Competencies provide for appropriate flexibility for unit/team/individual goals and objectives. Let’s examine each of these performance measures in a more detailed format. �

Environment—such as the job (content, variety, context, tools, clear line of sight, stretch yet attainable objectives), the place (the physical work environment) and the company (products, markets, organizational stature and success – the opportunity to work for a thriving company).

Collective Impact of the Components The components are not exclusive. They overlap, put pressures on one another, work synergistically with one another, and sometimes integrate. Collectively, they help drive organizational performance. And that’s the key: Their collective impact can vary dramatically, especially in today’s competitive and quick-changing environment. For instance, an organization’s heavy emphasis on cash compensation—at the expense of benefits and "work experience" elements—in an industry that attracts workers who place more value on flexible working arrangements and non-traditional approaches could impede that organization’s success. Equally impeding, an organization’s lack of appropriately prioritized work experience elements could result in Total Rewards dollars and other initiatives losing their impact for large segments of the work force. Gaining a competitive edge involves selecting and arranging the elements in a way that capitalizes on your organization’s uniqueness. While the design of most compensation and benefits programs can be replicated, the proprietary value of your organization’s Total Rewards approach comes from the work experience elements you select and how they interact with compensation, benefits and the complete Total Rewards model.

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Overlaying Factors Overlaying the Total Rewards model are two key factors: �

Internal Influences: your core ideology, funds available, internal organizational culture and its desired behaviours, business strategies, and competitive environment—what makes your organization "tick" and behave the way it does.



External Influences: the economy, business environment in general, government mandates, labor pool and other forces largely beyond your organization’s control.

While there are common influences for all businesses and within certain sectors of the economy, each organization has unique circumstances that will influence its Total Rewards decisions. This is your organization’s focal point of strategic advantage.

Deploying Total Rewards The Total Rewards model can be deployed in the following ways�

First, identify the unique external and internal influences for your organization.



Secondly, inventory all the possible individual elements of Compensation, Benefits and The Work Experience and weigh the importance of each relative to the influences identified above.



Thirdly, assess the Total Rewards mix of your current organization both in terms of dollars and people dedicated to these today.



Fourth, listen to your employees and employment candidates regarding the relative importance of various rewards elements.



Fifth, map the interrelationships of the components as you consider individual programs in each area and the Total Rewards "package" that will be the unique competitive advantage for your organization. What is your aspirational strategy compared to where you are today?



Finally, create the "mix" of the components that most effectively ensures the behaviours and culture to achieve your ultimate business strategy.

The Total Rewards model takes on many shapes and sizes. In a core compensation model, each component can play a bigger or smaller role in the entire package and can relate to the other components in different ways.

Competency Linked Competitive Remuneration

What’s the total picture of your organization? Heavy concentration on cash compensation and benefits, and few components of The Work competencies and Experience? Equal emphasis on compensation and benefits, along with some other components? Heavy concentration on The Work Experience, with little attention to compensation and benefits. Central to any remuneration system is the assumption that the provision or withdrawal of certain types of remuneration can be used to reinforce the behaviour of employees concurrent with the objectives of the organization. In addition to the provision of remuneration in the form of a basic wage or salary and associated remunerative benefits, it is becoming increasingly common for organizations to provide an additional aspect of remuneration related to the performance of an individual, work group or organization—performance and competency related remuneration (PCRR), Figure 14. 2. In the modern commercial world, with high levels of competition and technological advances, it is clear that if organizations are to survive, they must ensure a high level of organizational performance. Whilst organizational performance can mean many things, it is must commonly Business Objectives and Desired Culture

Total Reward Opportunity

INDIVIDUAL

Compensation

Capability

Develop Attract and retain; improve individuals; align with individual performance organizational needs

Cost of Doing Business

GROUP

Recognition

Reinforce the process, after the fact

Group Incentive

Project Team Incentive

Improve Engage and organizational involve performance; employees; measure and measure and reward reward project organizational results unit

Results

Business Results

Attributed to Plan

Figure: 14.2 Performance and Competency Related Remuneration (PCRR).

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interpreted as meaning financial performance which can be measured in terms of profitability, turnover, return on capital and capital growth. Organizational performance can be measured in terms of: �

Financial performance.



Customer service.



Quality of product and service.



Efficiency/productivity.

Systems of PCRR (figure 14.2) attempt to improve organizational performance by: �

Rewarding those employees whose performance is assessed and benchmarked to a competency standard. Such an approach communicates to the individual (or group) that there to the work of the organization is highly valued. The overall message is simple—improved performance results in improved remuneration. Essentially, workers should feel that their remuneration in relation to their effort, performance and contribution is fair when compared with the remuneration and work performance of their colleagues. An improved behaviour that drives performance receives better remuneration.



Motivating all employees to perform well. Whilst the principle of rewarding high performers may well reinforce their behaviour, it is important to motivate those employees who are not performing so well. Good PCRR systems must not therefore concentrate only on employees who are only performing well, but must also consider the motivation of other employees—all employees must be encouraged to improve their performance.



Supporting a performance oriented approach to work. PCRR systems are based on the output from work rather than the effort put in by individuals, as for example; in a reward system based on the amount of time employees spend at work. Employees are encouraged to concentrate on the standard of the end product rather than the input or effort.



Encouraging the use of work systems appropriate to the organization. By establishing a correlation between remuneration and the performance of individuals or groups, different work systems can be emphasized. For example, work systems based on individual performance (personal initiative and contribution) or work systems based on collective performance (teamwork and co-operation).

Competency Linked Competitive Remuneration



Promoting forward planning and objective setting. The central feature of many systems of PRR is the assessment of performance based on the achievement of previously established plans and objectives. This management technique therefore encourages individuals and groups to plan their work activity and achieve predetermined objectives.

Competency Based Remuneration as a HR Strategy Competency based remuneration management can be described as a human resource management strategy aimed at achieving business objectives through improved individual and organizational competency based remuneration. It is the systematic approach to the management using competency-based remuneration, goals, measurement, feedback and recognition as a means of motivating them to realize their maximum potential. It embraces all the formal or informal methods adopted by an organization and its managers to increase commitment and individual and corporate effectiveness. Developed through the 1980’s, competency based remuneration management has become yet another trendy management practice, joining other management initiatives such as competency based performance related remuneration (PRR), management by objectives (MBO), quality circles, total quality management, empowerment and so on. The apparent increase in popularity of competency based remuneration management technique can be attributed to two main causes: �

Since the early 1980’s, organizations have experienced a continually increasing level of market competition. As a result, it has become imperative that if organizations are to survive and prosper they must ensure high levels of individual, group and corporate competency based remuneration. Managers have, thus, introduced management policies, which are likely to have a significant impact on all aspects of competency-based remuneration within the organization.



The changing management culture from a position of controlling workers towards a process of securing employee commitment. The cooperation of the employees towards the corporate objectives is more likely to be secured if the employees are made to feel part of the organization and therefore committed to its success.

Importance of the competency based remuneration management system: �

Improve individual and organizational performance in line with business goals.



Identification of training and development needs.

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Increasing employee involvement and participation within the organization. �

Establishing a foundation for the correlation between the performance of the individual and their remuneration. � Encouraging open communication between managers and employees. � To act as a base for the assessment of potential career development and succession planning.

Competency based remuneration management system In order to be effective, competency-based remuneration management systems must be part of the philosophy, culture and values of the organization and should focus the attention of both employer and employee on improved individual and organizational competency based remuneration. The focus should be on the holistic, systematic, cyclical and continual process involving identification of corporate and individual goals and the subsequent review and evaluation of how far these targets have been achieved. The Institute of Personnel Management (IPM) has identified five key features of an ideal competency based remuneration management system, which can be incorporated into a competency based remuneration management cycle. �

Corporate objectives established and communicated to all employees—Before it is possible to identify competency based remuneration targets for the employees, it is necessary for the management to be clear about the direction and vision of the organization and ensure that it is effectively communicated to all employees.



Identification of group and individual competency based remuneration targets—Once the corporate objectives have been established, it is necessary for these objectives to be translated into group and individual performance targets. In order to successfully achieve the corporate objectives, each individual employee, in addition to being aware of the mission of the organization, must know what the requirements or targets are for their own individual and group performance.



Formal review of performance and progress towards targets—In this stage the competencybased remuneration of each employee is assessed to determine whether or not they are progressing towards their performance targets. This element of the cycle is essentially a competency-based appraisal. If it is established that the employee is working satisfactorily and does not require any managerial guidance or intervention, the most appropriate course of action would be to praise the employee, give him recognition for high competency based standards and some form of reward.

Competency Linked Competitive Remuneration



Implications for management policies—If the competency based of the employees is not in line with the corporate objectives of the organization, it would be necessary for the managers to review their management policies.



Evaluation of the effectiveness of the competency based management system in relation to corporate objectives—Once the competency based management cycle has reached this stage, it will be necessary for the management to evaluate how effective the system has been in contributing to or achieving the corporate objectives. The intention is to highlight any problems in relation to the competency based management system with the objective of amending it as necessary to ensure its success in the future.

Implications for management policies on account of competency based pay action steps Once the work performance of the employees has been assessed, there are likely to be implications for a number of management policies. Overall, the management of performance should be considered as a holistic concep, and organizations are likely to have a range of management policies in operation at any one time aimed at improving individual and organizational performance. Such policies include: �

Scientific management.



Reducing worker fatigue.



Human relations management.



Management systems.



Work design.



Performance related remuneration.

1. Design an Effective Competency Based Compensation Program As a business transforms, the need for implementing or revising a compensation program increases. In order to design an effective compensation program four important support tools should also be in place: a. A strong business strategy, including a workforce management plan; b. A performance management system;

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c. An organizational chart depicting each job position; and d. Each job position having a job description. e. Effective competency mapping system. A compensation program is more than a system designed to increase the wages provided to workers. It is a way of aligning the current business situation with the appropriate pay technique(s) to ensure that business objectives continue to be achievable. A compensation program is complex in that it has multiple goals such as attracting, retaining, motivating and rewarding employees. A compensation program is successful if it has a significant or proven impact on operational performance. Simply put, the dollars a business invests in the compensation program must be less than the dollars the business would lose through reduced productivity, high turnover, unnecessary or duplicate training costs and high absenteeism. As business situations change, the compensation program should also transform to maintain or improve operational performance. Fast response and quick adaptation are absolute necessities as new business situations evolve. The days of designing a compensation program to provide individuals with a method of receiving additional compensation have ended. A compensation program is not just a tool used to answer what person X gets for doing job Y when they have a performance measurement of Z. It is a tool to answer how person X affected the company's bottom line, thereby receiving N based on current business conditions. 2. Deploy a Compensation Specialist on the job A compensation specialist should assist your business in better understanding: a. How each pay technique works, b. What business situations lead companies to consider a particular technique, c. What conditions are important for each technique to succeed, d. The risk of using each technique, and e. The cultural considerations involved in pay techniques. Here we would highly recommend using a compensation specialist or consultant to assist with your decision-making and eventual development of your company's compensation program. Human Resources Departments now have smaller staff, have replaced specialized expertize with the do-it-all generalist, and are outsourcing certain business functions. These conditions increase the need for hiring consultants. Consultants will assist your business with exercising sound professional judgement when designing and implementing compensation

Competency Linked Competitive Remuneration

programs and the tools surrounding its effectiveness. A consultant also counsels businesses on the benefits and drawbacks of being internally equitable and externally competitive with their compensation programs based on the organization’s maturity level. 3. Establish the need for Pay-for-Knowledge Pay Programs Two vital reasons necessitate these programs: 1. Technological Innovation In an ever-modernizing world, skill-sets required of workers have changed dramatically. As technology leads to automation of more tasks, employers combine jobs and confer broad responsibilities on remaining workers. These technological changes have fostered increased autonomy and team-oriented workplaces. A demand for customized products also necessitates these changes. To be successful, companies must have customer service associates who maintain a current knowledge of these programs as well as the skills needed to match service plans to suit their client’s requirements. 2. Increased Global Competition To sustain competitive advantage, companies must provide their employees with leading-edge skills and encourage employees to apply their skills proficiently. 4. Demonstrate the advantages of Pay-for-Knowledge Programs To Employees Pay-for-Knowledge can provide employees with both, job enrichment and job security. Employees will be more motivated to perform jobs that contain a high degree of core characteristics such as skill variety, task identity, autonomy and feedback. Creation of flexible workers would obviously lead to increased job security. To Employers These programs can lead to enhanced job performance, reduced staffing and greater flexibility. As employees learn more about the entire product-process, quality of both, the product and its delivery, often improve. Such companies can usually rely on leaner staffing because of multi skilled employees. Also, these programs provide companies with greater flexibility in meeting staff demands at any particular time.

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5. Highlight the disadvantages of Pay-for-Knowledge Programs �

Hourly labour costs, training costs and overhead costs can all increase.



These programs may not mesh well with existing incentive pay systems. When both the programs are in operation, employees may not want to learn a new skill when the pay increase associated with it is less than an incentive award, employees could earn based on skills they already possess.

6. Link Pay-for-Knowledge with Competitive Strategy 6.1 Lowest-Cost Competitive Strategy Reduction in output costs per employee is the prime aim. These systems are appropriate when the training employees receive enables them to work more productively with fewer errors. Over time, productivity enhancements and increased flexibility should far outweigh the short-run costs if a company ultimately provides exemplary service to its customers. 6.2 Differentiation Competitive Strategy Creative, risk taking, open-minded employees are the standard here. These systems are appropriate when employees are organized into teams that possess some degree of autonomy over the work-process. New technology allows product customization, which requires with sufficient technical skills and imagination to tailor products and services to customers’ needs, as well as interpersonal skills necessary to provide good customer service.

Competency based compensation structure The competency based Compensation is structured around five basic components. These are: �

Consolidated salary [cs].



Comprehensive perquisites [cp].



Retrials.



Fringes and loans and.



Competency awards & individual performance award program.

Competency Linked Competitive Remuneration

Consolidated Salary: This component is fixed on the basis of many factors of the employee like qualification, institute passed out from, vintage, years of experience, performance, cost of living etc. This is the component on which the retirals are calculated. The CS is revised every year along with the Annual Management Remuneration [AMR] that is effective from 1st July every year. Comprehensive Perquisites: This component is provided by the company to make the competency based Compensation as tax effective as possible to the employee and at the same time is in line with the permissible tax laws of the country. Typically this amount varies according to the grade and has no connection to the CS. The system works on a menu card\ cafeteria basis, under which the employee can claim legitimate tax-free reimbursements by submitting bills\receipts for the various components, up to the limits prescribed as per policy. The flexibility provided by the policy, makes CP an allowance which you can take as taxable also, as well as a provision by which the unutilized limits can be carried forward to the next financial year. There are three Retiral schemes in operation, all of which are managed by the company’s own trusts. These are the Provident Fund [as per the relevant Act] where the contribution is 12 per cent each, by the employee as well as the company. As already indicated all the retiral scheme operates with the CS as the base. The superannuating scheme operates with the company funding the contribution. The contribution varies according to the grade and starts with a minimum of 4.58 per cent of the CS and goes up to a maximum of 15 per cent of the Consolidated Strategy. The superannuating scheme is also managed by a company trust. The gratuity scheme operates as per the Act governing the payment of gratuity and the benefit is grade related and starts from a minimum of 15 days salary for every month worked, which goes up to a month’s CS. The minimum qualifying criteria is as laid down under the Act and is minimum 5 years of continuous service in the company. FRINGES AND LOANS: These are benefits which are grade linked and the emphasis on the fringes and the loan program is to allow the employee to enjoy a life style of a superior nature and simultaneously advance capital to the employees at concessional rates of interest, with easy pay back terms, so that assets are created in the employee’s name, without the loan repayment being too stiff on the pockets of the employees. These are discretionary in nature. The loan program is for housing, vehicle and general purpose. There is a hard furnishing program, appliances program, car scheme, company house or company\personal leased housing scheme, club membership, credit card and company provided telephone at residence. Competency Awards & Individual Performance Award Plan: The emphasis on meritocracy is reemphasized through the CA & IPAP program, which rewards meritorious performance through a cash award. The quantum of the CA & IPAP varies according to the grade and CA & IPAP is paid only to those employees who are tiered as per the competency based performance management system as “Top 1” or “Top 2” performer i.e., an OUTSTANDING or a

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Significant Level of Changes in Pay and Reward Policies

(8)Perquisites (2)Performance and Pay Adjustment (3)Pay & Grading Structure (1)Bonus and Incentive Plans

(6)Share Schemes

(7)Terms & Conditions (5)Benefits (4)Job/Role Evaluation

UK Survey 1998

Figure: 14.3 Significant Level of Changes in Pay and Reward Policies. VERY GOOD performer. Also taken into consideration while deciding the recipients under this program, is the performance of the employee’s department and also the business. Thus IPAP not only rewards individual excellence but also takes a holistic view of the performance of the department as well as the business, Fig 14.3. A competency compensation program is therefore the fine art of balancing the extrinsic reward element in the overall reward management exercise of all human resource systems. To gain an insight, into the scheme of rewards and influencing human motivation towards desired behaviour and ultimately satisfaction, it would be worthwhile studying ED LAWLER’S Expectancy Theory Model, which states that human behaviour is a function of effort to performance expectancies; performance to reward expectancies; perceived attractiveness of rewards. To this we must add the implementation dimension: (Fig. 14.4) Peer equity and parity across board, in several situations, peer definitions cut across organizations and move into the realm of classmates, equivalent talent sources, market comparisons not industry relevant, etc. Organizational ability and willingness to pay and benchmark: Basic definitions of the competency compensation survey group influences the performance to reward expectancies.

Competency Linked Competitive Remuneration

Corporate philosophy and culture, both inherited and desired, become relevant for the competency compensation plan. Cultures oscillate between take home competency compensation, to perks, benefits, facilities, retirement advantages, severance pay, variable pay, ownership options, risk sharing, rewards etc. Several aspects of the culture become significant and dynamic in the competency compensation plan. Team working, emphasis on sales versus production, supply chain considerations, conflict management issues, tolerance for ambiguity etc. Hiring and attrition in industry: This is a critical strategy in the competency compensation planning. Where do we hire out talent from and where do we lose our talent. What is our target market for hiring talent and leaders for the company? Where do we receive the right resources? Corporate strategy Fig 14.8 and short, medium, long term business plans perhaps are the single most important influencer of the competency compensation philosophy. Business plans determine the ability and the willingness. In our opinion, in today’s context many organizations simply do not have a choice. Talent does not come cheap, provided they are available to the organization looking for them. Organizations look at talent manage-ment in more than a today’s perspective. Institutions like HINDUSTAN LEVERS and CRITICAL DIFFICULTIES WITH PAY REVIEW AND PERFORMANCE MANAGEMENT SYSTEMS TOWERS PERRIN STUDY



LACK OF GOOD APPRAISAL PRACTICE

57%



INSUFFICIENT MERIT BUDGETS TO DIFFER

50%



UNWILLINGNESS TO DIFFER BY RATES

44%



LACK OF MGL TRAINING

38%



LACK OF ACCOUNTABILITY IN MG SUPERVISORS

38%



LACK OF MGMT OWNERSHIP

30%



WEAK /DILUTED LINKS TO PAY

29%



COMPLEX ADMINISTRATION

29%



LACK OF EMPLOYEE UNDERSTANDING

27%



RESULTS NOT JUSTIFYING EFFORT

24%



NOT SUPPORTING CULTURE AND VALUES

14%

Figure: 14.4 CBO – Critical Difficulties with Pay Review and Performance.

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CITIBANK have clearly articulated goals in competency compensation planning of their desire to nurture and retain talent with a tight fit competency compensation program apart from their several culturally proactive policies that attract and retain this talent.

Competency compensation models philosophy Having now understood the position of a competency compensation system in the organizational reward systems, let us now examine the philosophy behind designing a robust competency compensation system. To do that, we must articulate generic organizational objectives in contemporary organizations especially in the human resource areas. a. Leanness and effectiveness—small numbers, best talent, high performing. b. Character, commitment and loyalty—perceived equity in reward systems, early growth needs, punitive differentiation on performance basis. c. High growth orientation—merit, meritocracy, risk orientation, peak performance. d. Continuous learning and development—individual and organizational learning. e. Perpetuity—sustaining partnerships in relationships, managing youth, short span of careers, mindset for fast track growth. f. To fulfill these organizational objectives and their implications on the human resource, the competency compensation system must in turn have the following characteristics: COMPENSATION FOR DELIVERY CRITICAL RESEARCH QUESTIONS • DOES INDIVIDUAL PERFORMANCE PAY DIRECTLY IMPACT ON ORGANIZATION PERFORMANCE? • IS THERE A LINKAGE BETWEEN INDIVIDUAL GOALS AND ORGANIZATIONAL GOALS FOR A DIRECT REWARD CONNECTION? • WHAT HR PROCESSES AND SYSTEMS ARE ESSENTIAL FOR A PERFORMANCE PAY SYSTEM? • HOW DOES TEAM REWARD LINK WITH INDIVIDUAL PERFORMANCE?

Figure: 14.5 CBO—Compensation for delivery: critical research questions.

Competency Linked Competitive Remuneration

l. Must be attractive enough for hiring, retaining and motivating the best available talent to continuously perform on a sustained basis. 2. The system must be equitable and must be seen to be equitable. A lot of competency compensation systems that have been designed with the fairest of intent, when administered, leave perceptions that do not fulfill this criterion. 3. While being equitable, individual and team performance has to be triggered for continuous improvement and therefore, performance has to be rewarded. 4. To ensure the objective of organizational learning, individual learning that would translate itself into organizational learning has to be incentives. 5. To focus on short and long term earning. 6. To help build net-worth and demystify psychological compulsions of burnout, stress, plateau and doped. 7. To address the individual needs yet suitably moderate to create a corporate competency compensation philosophy or policy. 8. Manage with resilience peaks and troughs in business cycle and performance. CHANGING EMPHASIS IN REWARD STRATEGY: TOP 5 BUSINESS PRIORITY 7. Reward and Retain Best Performers 6. Archieve/Maintain Market Competitiveness

5. Pay for Individual Performance 4. Link Pay to Organization Success 3. Control Fixed pay Costs 2. Pay for Future Competencies 1. Reward Productivity/Quality

Figure: 14.6 Changing Emphasis in Reward Strategy: Top 5 Business Priority.

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g. Make competency compensation budget and disbursement in the same currency and exchange rate as is applicable in the business plan and budget. This is to offer the fairness that if your sales and profit budgets are in US$ denominated targets, then the competency compensation plan/budget as well as its disbursement should be in the same currency. h. Finally, to ensure the organization’s objective of perpetuity, the competency compensation system must facilitate lifestyles of employees. i. Having said all this, we must therefore reinforce the fact that generic organization objectives have been used in adopting the philosophies of competency compensation that have been stated above. It is important to understand that like all organization systems and processes, the competency compensation system must reflect the organization’s culture, engender the values and adopt the practices that the organization cherishes. (Fig. 14.6)

Designing competency compensation systems Base Pay and Position Evaluation: The first aspect that the competency compensation system has to address is the economic theory of reward for a particular job or role value. Conventionally base pay reflects the job value for the position, level, skill and parity. Within the organization structure, there are many positions, each of which are expected to deliver a certain set of results. Each of these positions calls for a set of skills, knowledge and experience base. The exercise of determining the pay for the position calls for an extensive study of the market forces, which determines what the industry is paying for a particular job. The terminology used here is “position evaluation’, which simply stated implies what to pay for a job that gives a particular result or a set of outcomes and demands a particular knowledge level, a skill set, competencies and an experience profile. However, the base pay does not ensure the outcome that is desired from the job incumbent. That is, the presence of a base pay does not ensure the organizational objectives of effectiveness, growth, or value addition. By itself, the base pay ensures the objective of attracting talent and arriving at peer equivalence. In contemporary competency compensation systems, the rate of growth of the base pay has been diminishing according to many surveys. This statement should be read in the context of the developed world where a large number of tax effective allowances/reimbursements are not credited. Base pay largely reflects competency compensation for the job/skill performed with remaining components being benefits, perks, bonuses and stocks. Some proactive Indian/MNCs have commenced this practice. Competency Awards: In the present environment that is constantly changing, organizations have to resort to several adapting strategies to cope with accelerated rates of learning that is

Competency Linked Competitive Remuneration

demanded. This means hiring specialist talent that brings in a new dimension of organizational competencies, or doubling up of employees to manage new venture areas. During the process of dynamic consolidation, these actions are short-term while adding significant value to the organization in the short run. “... the rate of growth of the base pay has been diminishing base pay largely reflects competency compensation for the job/skill performed with remaining components being benefits, perks, bonuses and stocks”. In reality, when the organization needs specialist talent to cope with a new competence area, or an existing employee is called to double up, there is a dilemma. The potential employee perceives the new venture area as a risk because the organization has no performance history in that area and the organization itself cannot venture into the new area without the best available skill-set. The conventional job value related base pay approach would not serve the purpose in such a case. An approach to counter this dilemma is the concept of ‘Competency Awards’, which is a short-term, high value pay for the added competency that the employee brings in. After the implementation of the new venture area is consolidated, the other reward systems would take over. The ‘Competency Awards’ also serves to reward the employee within the organization who has doubled up to manage an additional role. In effect, ‘Competency Awards’ is an element of competency compensation for the specialist roles of higher ‘risk’ in the organizations and one which serves to bring out the employees from their ‘comfort zones’ to drive into new areas of performance. Incentivising performance: Merit increase and performance awards: To make this human talent perform, and on a sustained basis, there has to be a mechanism that rewards performance. The next aspect therefore, that the system addresses, is that of meritocracy distinguishing and rewarding performance. As CHARLES HANDY wrote, the new organization equation for success is that profit and productivity are best created by half the workforce, paid twice as well and producing three times as much. Translated into practice, this means that a mechanism for differentiating and rewarding performance through competency compensation has to be built in. This gives rise to merit increments and performance-linked awards. Merit and meritocracy has another element built in. What is the organizational model that determines merit and what is this meritorious behaviour. If, for example, team performance, is what will determine organizational success and individual performance is rewarded, then the organizational objective would be defeated abinitio. Therefore the schemes of rewarding merit must be designed based on the definition of merit in the organization’s objectives. For example, one luxury car dealer in Texas has created a team based reward program in which pay is largely determined by customer satisfaction. Creating lifestyles: One of the trends of current work-life is the amount of time and effort that the employees have to invest on the workplace. Long work hours are therefore a reality in today’s times. In doing so, the employee diverts a lot of time and effort from the pursuits of

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creating lifestyles. The organization has to recognize and aid the effort of creating a lifestyle for the employee. Translated into competency compensation practice, this means, evolving benefit schemes such as asset building schemes and the ‘non tradable’. A large number of young professionals including business school graduates have shown greater preference for competency compensation that includes some amount of lifestyle benefits. Some of the contemporary practices in the creation of lifestyles include: �

Asset building through soft-loan options.



Club memberships.



Asset lease options, home furnishings.



Property owning options.



Company paid holidays at international locations, e.g., a holiday cruise on QE2.



Premium schooling for employee’s children.



Housing at elite locations.



Farm houses, beach resorts, holiday homes.



Entertainment vacations, e.g., a visit to Disneyland.



Timeshare holidays (including RCI membership).



Usage of the corporate jet.



Home office.



Holiday caravans.



Active participation in cultural and arts societies and many more.

Perquisites, benefits and fringes: On the need hierarchy of every employee is the esteem and the social need of the facilities that come with ones’ advancement in career and in life. To fulfill this need, the competency compensation program has to create perquisites and benefits. An observable trend of these benefits is that visible nature of benefits increases with career advancement and gives the employee something to strive for. Some of the benefits and perquisites include: �

Provision of a company car, family car.



Reimbursement of a chauffeur’s wages.

Competency Linked Competitive Remuneration



Reimbursement of entertainment bills.



Leave travel reimbursement.



Reimbursement on attire provided the culture necessitates uniform executive attire.



Scholarships for employees children.

Nurturing learning: With the increasing importance of augmenting intellectual capital within the organization, individual learning has to be encouraged and incentives. A good competency compensation plan fulfills this objective in ways ranging from reimbursement of books, subscription to educational periodicals, CD ROMs, Internet connections on the one hand to sponsoring employees for short terms and long term education in prestigious universities on the other. Employees are also encouraged to take training programs within the organization as well as guest lectures at universities. This fact is reflected and rewarded through the performance appraisal system, which incentives sharing of learning. Employee partnerships—stock options, phantom stock options: Organizations increasingly need to have employees with an entrepreneurial spirit. From the organization’s point of view, the entrepreneurial spirit would ensure greater contribution from the employee through diverse ideas, complete ownership for the role and the organization, higher element of calculated risk taking and higher commitment. From the behavioural perspective, entrepreneurship has several intrinsic rewards like fulfilling of esteem needs and moving towards self-actualization. From the economic perspective, the extrinsic reward for entrepreneurship has been profit. An organization that expects entrepreneurship from the employee has to create this extrinsic reward system of sharing returns with select, committed employees. The mechanism of ‘stock options’ fulfills this need. Select employees in the organization are rewarded through company shares. The benefit to the employee is that an asset is created whose asset-value at any point in time, is the market capitalization; plus the ongoing revenue reward of dividends. To the organization, this is a mechanism of creating a new stockholder, whose interest in organizational success is enhanced by virtue of such status, thereby incentivising employees to perform and ensuring entrepreneurship and commitment. Extended versions of this concept could include partnerships in a backward integrated unit, a suppliers company etc. Facilitating life planning: A good human resource philosophy intends that the employee during his/her work life contribute with the security of a sound future and without the worries of being left high and dry at the end of the career. Beyond the age of retirement, the only element of the human resource strategy that would impact the individual, is the kind of retiral benefits that the competency compensation plan provides. While statures around the world provide for some pension, social security benefits and retirement schemes, good organizations have come to terms with the fact that only the bare minimum of retirement benefits would not serve their utility with good talent. Some organizations have designed

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superannuating schemes that are well above the minimum statutory norms. These schemes complemented with the asset building programs ensure life planning for the employee. For example, a pension plan, which offers a superannuated employee, last drawn salary as a pension for the next 25 years.

Evolving futuristic competency compensation plans The workforce in organizations is shrinking with each employee expected to add a distinct value to the business. Added to that is the increased emphasis in technology, quality and service, which results in the business world changing from a mechanized workforce to the knowledge workforce. The knowledge workforce is expected to take decisions, respond instantaneously and take risks. This behaviour has to be rewarded differently. Performance is no longer a lifelong contract of commitment, but one that has to be continually reinforced. (Fig. 14.7) Changing organization structures also necessitate changing competency compensation practices. Some of the implications of the futuristic structure on competency compensation ESSENTIAL COMPETENCIES & REWARD : INSURANCE COMPETENCIES Customer Service Orientation Problem Identification Initiative Tolerance for Stress

REWARD REINFORCERS 360 Degree for Pay Increase Bonus for C Satisfaction Non Cash Awards/Recognition Market Rates for Pay Increase Flexibility of Package/Broad banding

Communication Work Standards

Open & Simple Reward System Employee Assistance Program Pay Equity and Monitoring

Teamwork/ Cooperation Planning and Organization

Team and Individual Bonuses Celebrate Successes

Maximizing Performance Decision-Making

High Variable Pay Element New Performance Mgmt System Bonus at all Levels

Leadership Delegation and Follow Up

Even Higher Variable Pay Increase Open Communication of Results Catch People Doing it Right

Figure: 14.7 Essential Competencies Reward: Example—Insurance.

Competency Linked Competitive Remuneration

are as follows: �

Networks of competencies: For a network or a team based structure to succeed, it would demand sharing of rewards and therefore the creation of team-based reward programs.



Lean organizations and strategic outsourcing: Based on a pure economic evaluation, an organization has to prioritize the building of ‘owned’ human assets and skill sets and the leveraging of competencies available with specialist individuals or consulting firms. In the contemporary cost environment, the organizational priorities would be for ‘owning’ customer focused and service skills and hiring most of the value-adding specialist skills.

One of the objectives of association with these specialists and consulting firms would be rapid absorption of a higher knowledge technology. In such a scenario, the competency compensation system would have to address the absorption of specialist skills and the delivery of customer value by the employees. This learning has therefore to be incentives. Virtual organizations: In high technology areas like software development and I.T., where specialist skills are leveraged without the physical need for people coming together at an ‘office’ the creation of a home office is facilitated. This provides integrated rewards of flexhours combined with the facilities like home computer, fax, telephone, modem and internet connection. Competency compensation zones and tailored competency compensation: Like the business organization where the need of the hour is flexibility and mass customization, to cater to the top class skilled human resources, the competency compensation plan of the future will have to be customized to individual needs. This plan would work as follows: There would be zones or bands of competency compensation, reflecting total cost to companies for different competencies. The employee would choose from a laundry list of options like base pay, retirement benefits, asset options, benefits, perquisites and lifestyle options. The competency compensation manager would act as a consultant in aiding the employee choose from amongst the various options available, and thereafter delivering the plan in a tax effective manner to the employee. This, perhaps, is the most effective system for competency compensation management going forward. With the emphasis on increasing resource productivity that will continue into the organizations of tomorrow, the competency compensation plan will continue to come up for debate for increasing cost effectiveness. The only constant in the organizations of tomorrow will be the continued struggle for a cost versus benefit in competency compensation programs.

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STRATEGIC APPROACH ADOPTED IN SUCCESSFUL PERFORMANCE PAY PLANS RANK ORDER : GLOBAL STUDY

1. SENIOR MANAGEMENT SUPPORT 2. CLEAR/AVAILABLE PERFORMANCE MEASUREMENT SYSTEM 3. CLEAR PLAN OBJECTIVES 4. STRATEGIC BUSINESS GOALS REFLECTED IN BONUS 5. PERFORMANCE APPRAISAL 6. CLARITY OF ORGANIZATION STRUCTURE 7. QUALITY INITIATIVES 8. TEAM BUILDING 9. QUALITY CIRCLES 10. STRONG EMPHASIS ON COMMUNICATIONS.

Figure: 14.8 Strategic Approach in Pay Plans: Global Study. Modern day competency compensation policy would radically change the way we currently pay for performance.

Chapter

15

Development Centres and Managerial Evaluations WHAT

IS DEVELOPMENT MANAGEMENT?

As a manager your job is to get results; specifically to get results through others. Let us see what a manager does to achieve this. He generally performs the following tasks as his day-today activities. The manager leads, manages, plans and budgets. He counsels people, motivates them and disciplines them. He hires them and sometimes also fires them. He writes proposals and reports, gives presentations and conducts meetings. And most importantly he solves problems and makes decisions. These things are alone not important. They are only important to get results. They are just a means to the end. They are just the things a manager needs to do to get results. But that does not mean that if a manager does these things properly he will manage to get results. He should plan all these activities with the end in mind. And this is what the development management allows the managers to do. Development management is a technique for beginning with the end in mind. There are three important areas that are covered in development management. These are shown in the diagram below, Fig 15.1. �

Key result areas They deal with the outcomes or results managers are responsible to achieve.



Key development indicators They are the measures or gauges that are used to find out how well a manager has performed to achieve these results.

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Competency Based HRM

Key Results Area

Development goals

Key Development Indicators

Figure: 15.1 Development Management. �

Development goals Development goals are the tools you use to achieve these results.

Advantages of development management �

People believe that they have stake in the organization.



People feel motivated because they know where the organization is moving.



Infighting and politics ceases to exist.

Definitions of ‘key result areas’ and ‘key development indicators’ Key result areas deal with the end and not the means to them. The word ‘key’ signifies the vital few results that are important. The results are the things that are intended consequences of the things you do. The word ‘areas’ means that the results could be made up of clusters of related but specific results. There is no strict limitation but as a thumb rule the managers should have no more than four to five key results areas. (Fig. 15.2) Key development indicators as defined earlier are the gauges that are used to measure the achievements of an organization. KDI’s can be classified into two types. Direct Development Indicators are a direct measure of the results. For example, if the profitability is a KRA, profit can be classified as the Direct Development Indicator. These are the areas that are quantifiable in nature.

Development Centres and Managerial Evaluations

Key Development

Direct Development Indicators

Indirect Development

But many a times measuring the development can not be that simple to be measured in terms of direct development indicators. Many a time non-quantifiable parameters could also be the development areas. For example brand loyalty. In such cases we have to go for Indirect Development measures. For example if a manufacturing company wishes to measure its development. For this one the obvious key result area could be ‘Sales’. Now Sales can be measured in terms of revenue over a given time or units sold. Each brand manager might use a different measure out of these but nevertheless they both are directly linked to the KRA and that is sales. But sales may not be the ideal way to measure the development. It is important that the sales are made profitably. Hence KRA could be identified as ‘Profit’ and the development indicators could be Annual sales at annual gross margin or Absolute annual profitability. Similarly there could be other KRAs like market share, expansion of the organization reach in new geographical territories. But continuing with the sales example we can see that the sales cannot be made by the manager himself; he will definitely need to recruit, hire and retain a highly motivated world-class sales team. This could be identified as his KRA too. But there is no direct way to measure whether or not our team is world class or not, so in this case a set of indirect measurements can be identified as the development indicators. These development indicators could be in terms of sales achieved per sales rep or sales as percentage of payroll expenses or amount of sales training provided to each sales representative or retention of best sales representatives and attrition of low performing sales representative. Thus if the organization has best sales people on its roll, it pays them well and keeps them motivated and happy. Though the indirect measures go pretty close in identifying the thrust areas, it is often very difficult to decide upon the indirect measure. This is because the indirect measures come into Corporate and unit objectives Individual objectives

Action plan

Feedback

Review

Core values

Figure: 15.2 The Linking Pin—Objectives to Development Mechanisms.

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picture when we are dealing with the intangible areas like people or knowledge or competence. It is important to remember that a successful measurement system provides a balanced view of the organizations operations. No single measurement can ever be a true indicator of the development. Even the most talked about measure, the bottom line is just like that.

Requirements of Key Development Indicators: There is a tendency in the organizations to ‘engineer’ the numbers. This is done to impress the internal and external development evaluators. By having an all-round approach to development measurement and control, these kinds of malpractices are discouraged. But many a times it is also true that people do not do this deliberately. Sometimes people themselves don’t know the true development evaluation criteria. Earlier this was not a problem because the industries were manufacturing industries and people were working there as an individual. But now by the growing stress on service related industries it is difficult for them to exactly know what is expected out of them. Also the work that people do is no more of individual nature but it is increasingly becoming team centric. The all-round development management system allows them to know what they are doing and what they need to do in order to reach there. They can actually see the contribution that they are making to the teams and hence the organizations. It is also important that the Key Development Indicators keep up with the time. They should not be only static in nature and should take into consideration the trends that are observed in various parameters. Often key performers concentrate on the effects. It is like advising a batsman by watching his average go down or go up. But what the player needs so as to improve the development is the timing of the shots, gaps that he can or cannot explore while hitting the balls. Similar things happen in the organization. Hence it is important that the development indicators are selected in a right manner. For example, we have already seen that to measure the sales effectiveness the indirect measure like Hiring/ recruitment, retention of the highly motivated and world class sales force could be a much better development indicator than the direct measurements like just the sales figure, profitability etc. The key development indicators should be directly linked to the Vision, mission and values of the organization. If any of these components change it is important that all the development indicators be revisited and analyzed again to arrive at the correct development indicators in the new context. It is not advisable to follow the same set of development indicators just because someone else in the past designed and/or followed it.

Development Centres and Managerial Evaluations

What is mentoring? Mentoring is the process of shaping competencies or behaviours by providing feedback, usually to subordinates or even peers, about how to achieve the best in life. In their capacity as “mentors”, the HR coach may work with every manager and supervisor at all levels. The HR coach is slightly better off to blend politically deft observations with a frankness that will help the managers develop their capacity to lead people and personally excel. 1. Starting points for coaching & mentoring The coaching or mentoring solution used by an organization must be carefully chosen. It depends on a combination of the results hoped for, the people involved, the resources available and the organization's starting point. The pressures, opportunities and changes facing the organization right now can define the starting point. For example coaching & mentoring can be used to great effect by organizations which are experiencing any one of the internally or externally driven environmental conditions featured below: Cost cutting. Culture change. Mergers & acquisitions. Expansion. Need for flexibility. Multi-skilling. Change of core business. Need for enhanced performance. Strategic alliances. 2. Business coaching & mentoring Organizational development, changes brought about by mergers and acquisitions as well as the need to provide key employees with support through a change of role or career are often catalysts, which inspire companies to seek coaching or mentoring. At one time coaching and mentoring were reserved for senior managers and company directors, now it is available to all as a professional or personal development tool. Coaching and mentoring are also closely linked with organizational change initiatives in order to help staff to accept and adapt to changes in a manner consistent with their personal values and goals. Coaching & mentoring,

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both of which focus on the individual, can enhance morale, motivation and productivity and reduce staff turnover as individuals feel valued and connected with both small and large organizational changes. This role may be provided by internal coaches or mentors and, increasingly, by the professional coaching agencies. Coaching and mentoring programs generally prove to be popular amongst employees as coaching achieves a balance between fulfilling organizational goals and objectives whilst taking into account the personal development needs of individual employees. It is a two-way relationship with both the organization and the employee gaining significant benefits. There is also an increasing trend for individuals to take greater responsibility for their personal & professional development and even those who are employed in large organizations are no longer relying on employers to provide them with all or their career development needs. There has been an increase in the number of individuals contracting coaches and mentors on a private basis. Some are looking for a career change, but many are also seeking to maximize their potential with an existing employer or achieve greater balance with their work and home lives. 3. Executive Coaching & Mentoring There is a great deal of overlapping between business and executive coaching or mentoring. Many people will offer either service, but there is a growing body of professionals in the UK who are calling themselves executive coaches and mentors and are differentiating themselves in the marketplace. The key differences between business and executive coaching and mentoring are that executive coaches and mentors typically… �

Have a track record in professional and executive roles.



Work exclusively with the ‘high-flyers’ or with those who have potential to be a high flyer.



Work at board or CEO level within high profile or ‘blue-chip’ organizations.



Offer total confidentiality.



Work with potential 'captains of industry' and high profile business leaders.

4. Competency Coaching and Mentoring Many coaching clients will seek coaching or mentoring for performance enhancement rather than the rectification of a performance issue. Coaching & mentoring have been shown to be highly successful intervention in these cases. When an organization is paying premium rates for development services, performance is usually the key payback they are looking for. Even if an executive or manager receives support in balancing work and home life, it will be with

Development Centres and Managerial Evaluations

the aim of increasing their effectiveness and productivity at work and not for more altruistic reasons. Performance coaching derives its theoretical underpinnings and models from business and sports psychology as well as general management approaches. (Fig. 15.3) Competency skills coaching have some commonalities with one-to-one training. Skills coaches & and mentors combine a holistic approach to personal development with the ability to focus on the core skills an employee needs to perform in their role. Competency skills coaches & mentors should be highly experienced and competent in performing the skills they teach. Job roles are changing at an ever-increasing rate. Traditional training programs are often too inflexible or generic to deal with these fast moving requirements. In these instances one-to-one skills coaching allows a flexible, adaptive ‘just-in-time’ approach to skills development. It is also possible to apply skills coaching in ‘live’ environments rather than taking people away from the job into a ‘classroom’ where it is less easy to simulate the job environment. Competency skills coaching programs are tailored specifically to the individual, their knowledge, experience, maturity and ambitions and are generally focused on achieving a number of objectives for both the individual and the company. These objectives often include the individual being able to perform specific, well-defined tasks whilst taking in to account the personal and career development needs of the individual. One-to-one skills training is not the same as the ‘sitting next to Nelly’ approach to ‘on the job training’. What differentiates it is that like any good personal or professional development intervention it is based on an assessment of need in relation to the job-role, delivered in a structured (but highly flexible) manner, and generates measurable learning and performance outcomes. This form of skills

Develop Competence

Develop the top team

Promote shared values

Organizational Need

Integrate newcomers

Improve change management skills

Re-energize plateau staff

Align staff with organizational goals

Change attitudes and behaviours

Figure: 15.3 Competency Coaching Skills and Mentoring.

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training is likely to focus purely on the skills required to perform the job function even though it may adopt a facilitative coaching approach instead of a 'telling' or directive style, Fig 15.3. 5. Personal coaching & mentoring Personal or ‘life coaching’ is growing significantly in the UK, Europe and Australia. Personal coaches may work face-to-face but email and telephone based relationships are also very common. These coaches and mentors operate in highly supportive roles to those who wish to make some form of significant change happen within their lives. Coaches offer their clients a supportive and motivating environment to explore what they want in life and how they might achieve their aspirations and fulfill their needs. By assisting the client in committing to action and by being a sounding board to their experiences, coaching allows the individual the personal space and support they need to grow and develop. The coach's key role is often is assisting the client to maintain the motivation and commitment needed to achieve their goals. In many cases personal coaching is differentiated from business coaching purely by the context and the focus of the program. Business coaching is always conducted within the constraints placed on the individual or group by the organizational context. Personal coaching on the other hand is taken entirely from the individual's perspective.

What are development goals? Development goals are how you turn intentions into action. The dictionary meaning of the development goals is ‘the end to which the design tends’. To develop this concept let us go back a bit to the vision and mission of the organization and then link it to the development goals. The vision that any company has is just like a destination. The vehicle that the company uses to reach this destination is nothing but the mission. The values of the company give a broad direction to journey. The organization should strive hard to reach the destination but never by compromising on the values. The distance covered in the direction of the destination could be the ‘key result area’ for the organization and the speed of travel, stoppage times, and breakdowns could be the ‘key development indicators’. And the development goals will be the path or the road that the organization takes to reach the destination. That is the goal or intention expressed by the organization to make a positive change in the direction of the longterm vision and mission of it. Goal setting is both a discipline and a skill. Like any other skills this takes time to master. Here are some of the guidelines for goal setting: �

When the managers set the development goals for the first time they suffer from a traditional problem and is often an over estimate of what they can accomplish in the short term and an under estimate what they can achieve in the long term.

Development Centres and Managerial Evaluations



While setting a goal it is important to make sure that the development goals are challenging. If the development goals are not challenging then they are not development goals but they are just activities, for example getting a project through bidding process is hardly a goal but completing that project in lesser time or saving ten percent of the project costs is surely achieving a goal.



The development goals should be time bounded. The development goals without the deadlines could just be wishes. Because the deadline spurs the people involved into action so as to achieve the goal.



There must be obstacles between the present state and the goal. If there are no barriers between the present state and the goal then the goal would be nothing but some other form of the present state. In fact the greater the obstacle, more one exerts oneself to achieve them and hence brings out the real development.



Many a times lack of knowledge is given as a tame excuse for setting easy development goals. But as one progresses further in achieving them, things start becoming more clearer.



But at the same time development goals need to be believable (tough challenging). Unrealizable development goals set not only result into failure to achieve them but also hamper the motivation levels in the organization.



The development goals must be worthy of the time, energy, emotion and resources one expends to achieve them. It must be measurable, both in terms of the time, energy, resources that have gone into it and in terms of the value that they bring about.



And as discussed earlier the development goals should be in line with the mission, vision and the values of the organization. Achieving the development goals must result in achieving the ‘key result areas’ and they must be reflected in the ‘key development indicators’.

This completes the goal setting process. After the key result areas, key development indicators and the development goals have been laid down, it is important that these are shared with the team. Then follows the action plan to travel on this path. But at the same time it is necessary that the team also contribute in the process of setting the goal because unless they participate in this process, they do not feel motivated enough to work towards them. Here’s a step-by-step guide to get the team to do it.

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Call a meeting to discuss the ‘key development areas’, ‘key development indicators’ and the ‘development goals’. Take time explaining what they are and how they work.



Take inputs of the team about the organizational development goals. Call a follow up meeting to discuss these suggestions. By doing this, the team gets motivated to participate in the whole process of development management.



Develop the plans to attain the development goals. Also monitor whether due to changing environment you need to modify these plans or the development goals themselves.



Decide upon the rewards for the team on achieving the development goals.



Finally, review the KRAs, KDIs (Key Development Indicators) and the development goals on a regular basis.

Development Management in Employee Perspective Till now we have seen how the development management can be used to improve the business processes and to achieve success in moving towards the mission and vision of the organization. Now we will concentrate our effort on development management in to effectively utilize the human capital that the organization has. We will not discuss the exact development management framework for the employee development management because this framework will vary from industry to industry and also from organization to organization. But nevertheless we will discuss how to arrive at the framework in detail. First of all let us define the development management in the HR perspective. (Fig. 15.4) Development management can be defined as the ongoing communication process that involves both manager and the employee in: �

Identifying and describing essential job functions and relating them to the mission and development goals of the organization.



Developing realistic and appropriate development standards.



Giving and receiving behavioural feedback about development.



Writing and communicating constructive development appraisals.



Planning education and development opportunities to sustain, improve or build on employee work development.

Development Centres and Managerial Evaluations

The essence of the development management system in an organization is to recognize the importance of the employees towards achieving the organizational objectives. The basic requirement for this is that the employees’ personal development goals should be perfectly aligned with the vision, mission and the values of the organization. The proposed conceptual framework also underscores the vital role of education, training and development in the envisioned successful organization. In this organization, continuous learning is a prerequisite to successful job development and organizational effectiveness. Employees must be able to learn work, developing effective technical and people skills in order to assume new responsibilities, and keep pace with and anticipate the changing nature of work and our workplace. For development managers and employees, responding to these changes requires the ability to learn, adapt to change, solve problems creatively and communicate effectively in diverse groups. In addition, employees must take personal and proactive responsibility for their careers to ensure future employability and advancement. The realities of the contemporary workplace will continue to challenge existing paradigms and should be considered in managing the development of employees in a dynamic working environment. 1. The framework: Going by the framework of the development management system, we will first identify the Key result areas, Key development indicators and Development goals for employee development management and then dwell upon each of them in detail. 2. Critical Development Focus Areas: For employee development management the key result area could be like: �

Reinforce good development.



Improve unsatisfactory development.



Foster a spirit of cooperation and teamwork.

3. Key Development factors: The key development factors would be some things that can be measured over the time period. Hence they would include: �

Management of the Attrition rate of the employees (Direct).



Improving Efficiency of the employees at the departmental levels (Direct).

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Observation & Behavioral feedback

Development standards and proficiency levels Of Development

Job Description & Strategic Plans

Development Appraisal

Competency Development

Figure: 15.4 Five Stages of Development Centres. �

Morale and motivational aspects, How proud the employees are about the organization (Indirect).



Motivation of the workers (Indirect).

4. Development goals: Development goals should include the action plan that we are going to follow to achieve the success in the Key Result Areas. For achieving all these benefits of HR development management we recommend a five fold strategy and that is indicated in the diagram 15.4. The five stages are followed in specific order as indicated by the arrows. 5. Job description: It is necessary that even before the employee is hired the job description is kept in mind and published with the invitation for the applications. This is important because the job description specified before the job starts becomes the job content afterwards. Writing a job description is a process of systematically collecting, analyzing and documenting the important facts about a job. The job description provides a basis for job-related selection procedures and development standards.

Development Centres and Managerial Evaluations

The job description specifies: �

The specific job functions and tasks which are essential or otherwise.



The percentage of time typically to be spent performing each function.



The skills, knowledge and abilities required to perform the job successfully.



The physical and mental requirements of the position.



Special conditions of employment.



The level of supervision received and exercised.

6. Business Development Planning: A strategic development plan is composed of an alignment with organizational direction mission statement, identified development objectives, goals related to the organization's mission, as well as strategic initiatives necessary to accomplish each goal. The mission statement describes the fundamental reason that your organization or department exists. The development goals identify the results that will further that mission, and strategic initiatives set out the specific steps that must be taken to achieve those results. It must be appreciated that the strategic planning is the perpetual process and the plans need to be updated from time to time. Individual employees will each make a contribution to the realization of development goals and may be responsible for accomplishment of specific strategic initiatives in support of those development goals. To ensure that initiatives are completed, those responsible for particular strategic initiatives are usually named and due dates are specified. The annual development goals and strategic initiatives for which the employee has responsibility should be clarified to the employee while describing the position, setting standards of work development, giving behavioural feedback about development, doing the annual development appraisal and planning for employee education, training and development. This helps in keeping the work force focused towards the ultimate organizational objectives. 7. Development plan to enable achieving levels of proficiency: The development standard provides a benchmark against which to evaluate work development. While the job description describes the essential functions and the tasks to be done, the development standard defines how well each function or task must be performed in order to meet or exceed expectations.

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Standards of development are usually: �

Developed in collaboration with the employees who do the tasks or functions.



Explained to new employees within the first month on the job.

For example the standard development can be calibrated in five stages as described below: E = Effective: Development is effective and is consistently outstanding. A = Adequate: Development is adequate. C = Consistent: Development consistently fulfills expectations and at times exceeds them. N = Necessary: Development does not consistently meet expectations. C = Critical: Deficiencies should be addressed as noted in the development appraisal. These development standards are applied at the beginning of the appraisal period and the development is reviewed at the end of the period. 8. Developing the Levels of Proficiency: When development standards are in place, both manager and employees will know what the expectations are for the development of essential functions and related tasks. This common understanding provides the basis for ongoing behavioural feedback and development counselling between appraisals as well as for the formal development appraisal process. One of the approaches for developing the standards is the directive approach in which the development manager writes the standards, in consultation with management and the Employee Relations representative for his or her department. Then the development standards and proficiency levels are shared with the employees affected for their information and any questions they might have are addressed. Another is a collaborative approach in which employees work with the manager to develop the development standards for their positions. While it is a legitimate option to develop the development standards and proficiency levels without employee input, the benefits of a collaborative approach are important. Both the development manager and the employee bring valuable information to the process and the end result is more likely to be supported by everyone involved. The development manager, however, should make the final decision about the appropriateness of the development standards and proficiency levels in consultation with management and the Employee Relations consultant for your department. Mutual agreement with the

Development Centres and Managerial Evaluations

employee about development standards and proficiency levels is preferable, but may not be always possible. But mutual understanding and recognition of the development standards and proficiency levels goes a long way in successful implementation of the employee development management system. In the collaborative process of developing standards for a task or function, all the employees whose work will be evaluated according to those development standards and proficiency levels should be included. If the task or function is unique to one position, then the employee in that position in the development process should be included. If more than one employee performs the task or function, all employees whose job description it includes should be involved. For the sake of fairness and consistency, it should be considered to collaborate with other units in the department if employees reporting to different development managers perform the same tasks or functions. Before the team meets, it is necessary to explain to everyone involved exactly what development standards are, why they are important, and how they will be used. It should be confirmed that the employees understand the process and solicit their comments and questions. It should be made clear to them that the team should work together to develop standards for their positions and that their recommendations and concerns will be considered seriously. Also it should be explained that it is the manager’s responsibility to make the final determination about the appropriateness of the development standards and proficiency levels. 9. Writing the development standards and proficiency levels: All the participants in the development standards and proficiency level writing process should have access to the following documents: �

An up-to-date copy of their job description.



A copy of the department mission and development goals.



The form for the development appraisal model used in the department.

This will cover any scope of negligence from the employees on account of ignorance. It may be appropriate to define development standards and proficiency levels that apply to an entire essential function, though typically development standards and proficiency levels are developed for related tasks. It is not necessary to write a development standard for every task in a job. Only those that are most important to the position should be considered with the top most priority. The behaviours and results that would constitute the minimum acceptable and expected development for the task or function should be explicitly stated. Development that satisfies those development standards and proficiency levels should be awarded with proper ratings.

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Development standards and proficiency levels should be written in clear language, describing the specific behaviours and actions required for work development to meet, exceed or fail to meet expectations. Following is the dos and don’ts list for the managers for developing standards: 1. Describe development expectations in terms of timeliness (deadlines, dates), cost (budget constraints, limits), quality (subjective and objective measures of satisfaction), quantity (how many), customer satisfaction, independent initiative demonstrated and any other relevant verifiable measure. 2. Specify the acceptable margin for error. Ideally perfection should not be the standard even for the highest grade. Having the perfect outcome in the list of development standards and proficiency levels might detract the employees from even having a shot at the top of the ratings. 3. Refer to any specific conditions under which the development is expected to be accomplished or development assessed. Statements like the following refer to the conditions under which the task or function is done: 1) with training from XYZ, 2) using job aids, 3) assuming all required information is received on time from department, 4) assuming [this task] is performed N% of the work day. Written development standards and proficiency levels may also be developed for the general categories to be evaluated, like: initiative/innovation, teamwork/collaboration, leadership, decisionmaking, etc. These development standards and proficiency levels should be developed for these categories with the particular position as well as the needs of the organization in mind. 10. Guidelines for Development Standards: The following guidelines should be kept in mind when writing development standards and proficiency levels: �

Development standards should be related to the employee's assigned work and job requirements. This helps remove any confusions and burdens that might be there in the employee’s mind.



The reporting systems should be adequate to measure and report any quantitative data achieved by the employees.



Quantifiable measures may not apply to all functions. Describe in clear and specific terms the characteristics of development quality that are verifiable and that which would meet or exceed expectations.

Development Centres and Managerial Evaluations



Accomplishment of organizational objectives should be included wherever appropriate, such as cost-control, improved efficiency, productivity, project completion, process re-design, or public service.

11. Checking the development standards and proficiency levels with the standards After the development standards and proficiency levels have been written, they should be checked against the questions in the following list: �

Are the development standards and proficiency levels realistic? Development standards and proficiency levels should be attainable and consistent with what is necessary to get the job done. Development standards and proficiency levels for development that meets expectations represent the minimum acceptable level of development for all employees in that position.



Are the development standards and proficiency levels specific? Development standards and proficiency levels should tell an employee exactly which specific actions and results he or she is expected to accomplish.



Are the development standards and proficiency levels based on measurable data, observation, or verifiable information? Development can be measured in terms of timeliness, cost, quality and quantity.



Are the development standards and proficiency levels consistent with organizational development goals? Development standards and proficiency levels link individual (and team) development to organizational development goals and should be consistent with these development goals. The success of the University's and department's missions depends on this strategic connection.



Are the development standards and proficiency levels challenging? Development standards and proficiency levels may describe development that exceeds expectations. Recognizing development that is above expectations or outstanding is crucial to motivating employees.



Are the development standards and proficiency levels clear and understandable? The employees whose work is to be evaluated on the basis of the development standards and proficiency levels should understand them. Development standards and proficiency levels should use the language of the job.

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Are the development standards and proficiency levels dynamic? As organizational development goals, technologies, operations or experiences change, development standards and proficiency levels should also evolve.

12. Observation and behavioural feedback Observing employee development and offering behavioural feedback about what the development manager sees should be a routine part of the employee development management. Behavioural feedback is most effective in reinforcing or improving work development when the employee has confidence in the basis of that behavioural feedback. And the development manager, will be more confident when giving behavioural feedback based on information that he can support. Hence it is important to first gather as much information as one can and then packaging it in such a way that it brings about the development without hampering the organization’s health. 13. Observing Employee Development From the standpoint of development management, observation involves noticing specific facts, events, or behaviours related to work development and the results of work development. Observations are the raw data upon which effective development behavioural feedback may be based. It must be appreciated that the purpose of observing employee behaviour and the results of work development is not to use it as a yard stick against them but it is to identify and describe it in order to help the employee be successful and continue to develop his or her skills, knowledge and experience and hence making the organization more efficient and effective. When observations about the results of employee development, the output employees generate and the impact of their work are made, it is advisable to gather additional information to make both praise and constructive behavioural feedback more effective. Observations should be the basis for behavioural feedback, and may also suggest actions that might be taken to support, develop or improve development. Behavioural feedback based on observed or verifiable data is more likely to influence employee behaviour than behavioural feedback that cannot be supported by firsthand information. For the development manager it may not be always possible to observe employees at work, but he should build occasions to observe their development into his workday and consider it as his duty. In that way, he can provide opportunities to understand what the employees do, to talk with and get behavioural feedback from them, to see employees as they perform at their best and to recognize areas in which their development could be improved. But this would be an ideal situation for the busy development managers of today. There has to be a way to ‘observe’ (and not monitor) the development

Development Centres and Managerial Evaluations

of the employees when the manager cannot be physically present. This can be achieved by the following methods: When the manager is not present physically he should develop the processes or the mechanisms that would help him ‘observe’ the development. The processes developed should be open, fair and understood by everyone. Some of the processes that can be useful in observing the development are given below. The list is just an indicative list and is not exhaustive. Every manager should understand the working environment of his organization and modify the following processes or should develop his own processes for observing the employees. �

Evaluate the output and products of the employee's work.



Have a routine one-on-one meetings with the employee and include discussions of development.



Periodically review and discuss with the employee the standards of development for his or her job and your own expectations.



Ask your employee to do periodic reports and share them with you for discussion.



Obtain behavioural feedback from customers – in writing when ever possible.



Do brief stand-up check-ins or phone calls.



Ask an appropriate person who is present day-to-day to serve as a work leader or give the person authority to act in your stead, and ensure that everyone understands the person's role.



Perform routine spot checks of the employee at work.



Ask for confidential evaluations of employee development by peers (or direct reports of supervisors). This process should be clearly understood by everyone and applied fairly to all.

14. Behavioural feedback Behavioural feedback may be defined as "information about past behaviour, delivered in the present, which may influence future behaviour." Behavioural feedback is influential. During the development appraisal period, behavioural feedback about development should be provided regularly. When employees receive behavioural feedback that is timely, frequent and specific they are more likely to understand what is expected of them, to repeat successful development and to improve their work when necessary.

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Behavioural feedback that describes observed or verifiable behaviour and facts is different from behavioural feedback that evaluates the person based on assumptions, interpretations, generalizations and judgements about what the behaviour or facts mean, for example: 1. That was a very poor report. I wish you were more committed to doing a good job. 2. Your report was not formatted according to standard practice and the content was based on data that is a year out of date. Note that in statement #1, the speaker has judged the employee as lacking commitment, and the statement about the report being "poor" is evaluative without being helpful. Statement #2 tells the employee exactly what needs to be improved without judging his or her character or motives. Employees' development is more likely to improve when asked to do something specific differently or in better manner rather than asking them to be different or better. People become defensive when they feel judged, and are more likely to accept behavioural feedback that is behavioural. It may seem like just a matter of words and both the things indirectly meaning the same thing but the words only play an important role in hurting the employee or bringing about the development out of him. Hence the packaging of the behavioural feedback is as much important as the content is. Behavioural feedback consists of statements about any observed or verified behaviour related to development standards. If the employee does not understand what you expect or what the development standards and proficiency levels are, clear messages about those expectations and development standards and proficiency levels should be given, understanding should be ensured by conformation from the employee, and then the employee should be given a chance to improve. 15. Guidelines for giving behavioural feedback 1. Behavioural feedback should be based only on specific, observable or verifiable, data and information, and should be delivered as close to the event or behaviour as possible. Example: I noticed that you arrived at 8:30 on Monday, Tuesday and Thursday rather than at 8:00. 2. After describing the observations to the employee, ask for his or her input before deciding what the behaviour means. For example, it might have been observed that an employee has been arriving late over a period of days. Before deciding that the employee is being irresponsible, more information should be obtained. You may find that there is a valid reason for the behaviour or there are other factors that would contribute to your understanding. Hence even when a clear-cut indication about the development has been obtained it should be compared with the other relevant information. For example, if the employee comes late, it should be noted whether this a

Development Centres and Managerial Evaluations

regular phenomenon or only this week this has happened, also have all the other employees staying in the same locality been late, then it could be the problem of the transport systems. Hence it is important to get to know more. Example: I'd like to talk with you about the reasons for your late arrival. 3. Discuss the impact of the development or its consequences, but never make threats or promises of promotion. When an employee understands the impact of development, he or she will know why it is important. Example: As a result, other staff had to leave their work to cover our service desk. Communicate by words, body language and tone of voice that the intention is not to hold him prey but it is to be helpful when giving behavioural feedback. The goal of behavioural feedback is to reinforce or redirect development so that the employee can be successful. Examples The behavioural approach to behavioural feedback is valuable when describing development that needs to be improved, because the employee learns which specific behaviours to change rather than receiving general comments that don't give much information. Compare the following statements. 1. This was not your best work. 2. This project was completed three weeks later than you originally estimated and the result is that our client is thinking about bringing in an outside consultant next time. What will it take to deliver on time in the future? Statement #1 is vague and does not tell the employee what the specific development problem was. Statement #2 gives the employee a more complete picture of what needs to be improved and the importance of improving development. It also enlists his or her support in improving future development. Behavioural feedback is also valuable when giving behavioural feedback about successful development. Compare the following statements: 1. Terrific job! 2. Everyone on the team appreciates the way you facilitated this meeting. You identified the areas in which we were confused, you summarized to help us stay on track, and you maintained your neutrality. As a result, we were able to come to a decision today rather than haggling over details for another week.

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When such a behavioural feedback about successful development is given in specific behavioural terms, the employee knows which behaviours to continue or repeat. Behavioural feedback about development in need of improvement is best delivered in private to avoid embarrassment to the employee. It may be argued that the successful development behavioural feedback should be given in the public so as to portray this development to others but many a times people are also embarrassed when behavioural feedback about successful development is given in front of others. Also others in the group may be hurt and be discouraged by such act. Behavioural feedback is more effective if the manager knows and respects the preferences of his employees. Notes that are made or records that are kept about employee development should also be phrased in behavioural terms. Statements that would imply subjective judgement or prejudice about the employee’s personality, character, or motives should be uprightly avoided. Employees should be encouraged to keep records of their own accomplishments. The development manager and the employee should exchange development-related information throughout the review cycle. At these discussions, sufficient time should be given to discuss accomplishments, needs for further training, and any problems or concerns. If there are development problems, meetings at regular intervals for the purpose of providing behavioural feedback on development should be scheduled. This practice will ensure that issues are addressed promptly and a problem-solving approach is fostered between the development manager and employee. 16. Development appraisal Development appraisal is a process of summarizing, assessing and developing the work development of an employee. In order to be effective and constructive, the development manager should make every effort to obtain as much objective information about the employee's development as possible. The following are the steps recommended for the development appraisal process. The preparation process involves review and data gathering, holding a preliminary meeting with the employee, and employee preparation of a self-appraisal. The following steps are suggested to the development manager: �

Before meeting with the employee, review his or her job description and work record for the review cycle. Review your observations, notes, and the previous development appraisal. Obtain development behavioural feedback from people with whom the employee has worked (including direct reports, if appropriate). This is an important information to have when evaluating customer service and teamwork aspects of the

Development Centres and Managerial Evaluations

employee's job. Where customer service is a key part of the job, behavioural feedback from customers may also be solicited. Locate and have ready any supporting information. If during the review cycle, the employee reported to more than one development manager, it is appropriate to consult with the other development managers for input into the appraisal. Before including any information in an appraisal that indicates there was a development problem, ask the previous development manager if the information about the problem has been shared with the employee. �

Give the employee advance notice of the development appraisal so that he or she has the chance to review and prepare.



Hold a preliminary meeting with the employee in private. The first meeting should take place before you write or deliver the formal development appraisal.

At this meeting, either explain or review what will happen during the appraisal process and review the development appraisal model used in the department. Do this even if you have appraised the employee's development in the past. With the employee, review his or her job description and the department's strategic development goals. Discuss and decide which essential functions and strategic initiatives (for which the employee is responsible) should be app-raised for the period. Some functions or initiatives may not have figured prominently in the employee's role for the appraisal period, and appraisal in those areas may not be necessary or significant. �

Conclude the meeting by scheduling a second meeting. Invite the employee to prepare a written self-appraisal, if one is used in your department. A self-appraisal may be used as the basis of discussion during the formal appraisal process. You have the option of 1) receiving the self-appraisal at the preliminary meeting, so that you will have it prior to preparing your draft; or 2) receiving the self-appraisal at the time you review your draft with the employee, for purposes of comparison and after discussing it with the employee, you may use the self-appraisal to inform the final version of the appraisal. The self-appraisal is a valuable tool which is used to discover the employee's perspective on his or her development for the review cycle, as well as to identify interests related to development goals and career development initiatives.

The expression of a point of view phase of the development appraisal process involves completing the form or the Development Appraisal Models used by the department, and writing the supporting comments. In writing the development appraisal, and for each essential function, task, annual goal or strategic initiative to be appraised, these three questions should be considered: 1. How does the level of development compare with the development standards for this function, task, goal, or initiative?

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2. How was the level of development confirmed? What did you see the employee doing? What do analytical reports or work products show? 3. What were the consequences, results and impact of the development? A three-step procedure is recommended for writing the comments in the development appraisal. �

Record the ratings that have been arrived at through the development standards.



The behaviour or incidents that have observed or verified that led to this appraisal should be described.



The impact or consequences of the behaviour should be stated.

The comments in draft form should be prepared to discuss with them during the formal development appraisal meeting with the employee. In this discussion with the employee and review of his or her self-appraisal, new information, or be reminded of previous information may be learnt, which might cause the manager to revise his assessment. The final draft should be prepared and given to the employee after the formal meeting and discussions have taken place. Planning the development appraisal meeting contributes to the success of the process. Below are some guidelines that should help the manager in accomplishing the development goals of the formal development appraisal meeting. �

Prior to the meeting, review your written appraisal of the employee's development. Review your notes covering the last year and the evidence in support of the rating you gave.



Plan your discussion. Objectives for the discussion include: �

Reviewing, discussing and confirming understanding of the essential functions listed on the job description, annual development goals and development standards and proficiency levels of work development.



Recognizing strengths and achievements.



Confirming previously identified functional areas needing improvement and establishing agreement about how improvement is to be accomplished.



Identifying areas in which education, training, or other development opportunities are needed and a strategy for developing skills, knowledge or abilities.

Development Centres and Managerial Evaluations

Discuss and confirm understanding and agreement about the steps the employee will take to accomplish self- development goals, as well as how you or the department will help. �

Plan to meet with the employee in private.



When you meet, carefully review his or her self-appraisal. Discuss the areas of agreement and difference.



Review your draft of the Development Appraisal and supporting comments with the employee. Discuss the employee's strengths first, covering each point in detail. This sets a positive tone to start the discussion.

Previously discussed areas needing improvement should also be discussed. The employee should be asked for suggestions about how he or she will improve development and at the same time new ideas for improvement should also be suggested. Consider whether anything raised in the employee's self-appraisal sheds new light on your assessment, and be prepared to modify your appraisal if appropriate. �

Show your interest in your employee's progress and your willingness to take up the discussion again any time. Close the appraisal when all points have been covered and the employee has had the opportunity to provide input.

If any changes are to be made to the appraisal, those changes should be discussed and a date should be agreed upon by which the final draft of the appraisal will be prepared and the appraisal will be signed. After necessary changes have been made, the employee should be given a chance to read, comment (if he or she would like to) and sign the Development Appraisal. The employee should be assured that that his or her signature indicates that he or she has read the appraisal and that a discussion has taken place. It does not signify that the employee agrees with the appraisal. He should be given a chance to attach his views about the appraisal with the actual appraisal and sign the views in his presence so that environment of mutual understanding is developed. A copy of the final signed development appraisal should be given to the employee for his or her records. He or she can also use it as a guide for improving development and for professional development. The development appraisal process is intended to break down barriers and maintain open communication, creating an atmosphere that allows a candid approach to discussions of development. During the new review period, the development manager and employee discuss the employee's development on an ongoing basis until it is time for the next written appraisal. This communication is part of the ongoing process of observation and behavioural feedback.

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By following the steps that are discussed above by the time the manager writes the development appraisal, he will have the resources he needs to do an effective job. He will have a clear and current job description and development standards in place. He will have a supportable basis for making your appraisals. He will have documented the employee's development and given a clear behavioural feedback about the development over the course of the appraisal period. He will have provided the employee with opportunities to improve development when necessary. There will be no surprises about development problems. At the time of the development appraisal, both he and the employee will discuss what the process will involve and you will invite the employee's input.

Development Centres An important component of the development management process is development of employees' work-related skills, knowledge and experience. The development process offers another opportunity for the manager and the employee to work collaboratively to improve or build on his or her development and to contribute to organizational effectiveness.

Continuous Learning Development of employee skills, knowledge and experience is essential in today's rapidly changing workplace. In order for the organization to remain competitive and to retain its reputation for excellence, employees should have up-to-the-minute information and the ability to use new technologies, adapt to organizational change, work in flatter organizations in which cross-functional skills and knowledge are required, and work effectively in teams and other collaborative situations. Employees, too, recognize that it is essential for them to continue to learn so that they will be effective in their current jobs and able to move into other positions or accept new responsibilities as circumstances demand.

Preparing the Plan (Figures 15.5 and 15.6) There are four principal occasions when preparation of a development plan might be considered: 1) after definition or review of development standards, 2) as a part of the ongoing process of observation and behavioural feedback, 3) as the final element of the development appraisal process, 4) when an employee initiates a request for education or development opportunities. At any of these points in the performance management process, you may discuss training, education or development opportunities with your employee. Identify the specific steps to be taken and document a strategy for accomplishing these objectives.

Development Centres and Managerial Evaluations

Individual Development Plan Participant 1 DEVELOPMENT INTERVENTIONS S.No.

Competency

1

Problem Identification, Planning and Resource Mobilization

2

Conceptual and Analytical Thinking

3

4

Environment Scanning and Trend Analysis isciplined and Deadline Oriented

Benchmark

Actual

3.67

2.9

4

3

3

2.71

3

2.71

3

2.9

5

Leading Change

6

Influencing Others and Building Working Relationships

3.67

3.33

Networking and Information Management

3.67

3.4

7

Projects

Training Coaching

Figure: 15.5 Individual Development Plan. That documentation should include: �

A description of the specific steps to be taken.



The names of those who will assist the employee.



End dates for the completion of the plan's objectives.



A statement of how successful completion of the plan's objectives will be appraised.

The section for future plans and actions at the end of the Performance Evaluation Form may be used to describe plans for performance or career development, or an attachment may be provided. Enter a description of the objectives, the names of any resource people or groups who will be involved in their accomplishment, and the estimated completion date.

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Below is a list of examples of activities that could be considered appropriate for employee development. The list is not exhaustive, but represents many of the most commonly used methods: �

Staff Education and Development classes.



Participating in the Staff Affirmative Action programs.



On-the-job training cross training.



University course work Extension course work or certificate programs.



Course work from external providers, schools, etc.



Attending or participating in institutes or conferences.

Individual Development Plan Status/ Learning & DevelopDevelopment Competency ment Strategies and Desired Completion Date Alignment Goal Outcome Measures Completed Resources

Individual Development Plan

Figure: 15.6 Individual Development Plan.

Development Centres and Managerial Evaluations



Membership in professional organizations.



Participation in professional organizations.



Coaching or consulting.



Writing professional articles or books.



Individual career counselling.



New employee orientation.



Working with a mentor.



Management development programs (Management Skills Assessment Program, Middle Management Advance, etc.).



Attending teleconferences.



Internships.



Self-study or reading assignments.



Computer-based training.



Participation in the projects.



Membership in campus organizations (e.g., staff associations).



Participation on teams, task forces, or committees.

Performance development plans should be considered with the needs of the organization and the needs of the employee in mind. Ask yourself, "What are the new functions that this unit will need to perform in the near term and over the next two to five years? What knowledge and skills will employees need to develop in order to perform these functions?" Doing an assessment of your unit's future goals and objectives will enable you to identify development opportunities for your employees that will also benefit the organization. Development options that improve employees’ effectiveness in their current jobs are called "positionrelated." Development opportunities for career advancement within the University are called "career-related." Activities, not job or career-related, which employees undertake out of personal interest are not included in a performance development plan. When you support and encourage the growth and development of your employees, you build employee motivation and commitment to the organization, and you improve morale. The unit, the department and the organization would benefit when the employee succeeds in developing new skills, knowledge or experience.

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In most cases it is up to your Department Head to decide whether the employee may reasonably be expected to complete the proposed activity successfully and to authorize activities in which the following might be necessary: �

Flexible or alternate work schedules.



Leave without pay leave at full or partial pay.



Full or partial payment of fees and expenses.



Temporary or part-time reassignment in another department.

Some of the factors that may be appraised in deciding whether to authorize an employee’s participation in a particular activity are: �

The employee's need for training.



The employee's career plan.



The needs and strategic goals of the organization.



The affirmative action objectives of the organization.



The resources of the department.



The advantages of one type of training over another.



The training needs of other department employees.



The effect of the determination on workload and other employees.

At any of these points in the development management process, issues like training, education or development opportunities can be discussed with the employee. Identify the specific steps to be taken and document a strategy for accomplishing these objectives. That documentation should include: �

A description of the specific steps to be taken.



The names of those who will assist the employee.



Last dates for the completion of the plan's objectives.



A statement of how successful completion of the plan's objectives will be appraised.

Below is a list of examples of activities that could be considered appropriate for employee development. The list is not exhaustive, but represents many of the most commonly used

Development Centres and Managerial Evaluations

methods: �

On-the-job training, cross training.



Attending or participating in institutes or conferences.



Membership in professional organizations.



Participation in professional organizations.



Coaching or consulting.



Writing professional articles or books.



Individual career counselling.



New employee orientation.



Working with a mentor.



Management development programs (management skills assessment program, middle management advance, etc.).



Internships.



Self-study or reading assignments.



Computer-based training.



Participation in projects.



Participation on teams, task forces, or committees.

Considerations Development plans should be considered with the needs of the organization and the needs of the employee in mind. The manager should ask himself, "What are the new functions that this unit will need to perform in the near term and over the next two to five years? What knowledge and skills will employees need to develop in order to perform these functions?" Doing an assessment of the unit's future development goals and objectives will enable you to identify development opportunities for the employees that will also benefit the organization. When the manager supports and encourages the growth and development of his employees, he builds employee motivation and commitment to the organization, and improves morale. The unit, the department and the organization benefit when the employee succeeds in developing new skills, knowledge or experience.

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Some of the factors that may be appraised in deciding whether to authorize an employee’s participation in a particular activity are: �

The employee's need for training.



The employee's career plan.



The needs and strategic development goals of the organization.



The affirmative action objectives of the organization.



The resources of the department.



The advantages of one type of training over another.



The training needs of other department employees.



The effect of the determination on workload and other employees.

Development Manager's Responsibilities As mentioned above, effective preparation of development plans, with and for the employees, requires the ability to assess the needs of the employee and the organization. The manager should help his employees to set career development goals that are consistent with their skills, knowledge, experience and interests by providing behavioural feedback based on your observations and assessment of their abilities, readiness and potential. The assessment should be based on his actual experience and observation of employee development and behaviour rather than on assumptions and personal biases. Sustainable organizational change only occurs when the people in the organization change their beliefs, attitudes and behaviour. Changes in beliefs, attitudes and behaviour only occur across the organization when the organization’s leaders first consistently display them. But the organization's leaders are constrained from changing both by the existing corporate culture and by their own habitual ways of thinking and behaving. Mentoring for Change supports change leaders by helping them sustain their vision, values and new behaviours and resist the pull to revert to their habitual behaviours. Individual development is a specialist form of management development and education. It is particularly suited to senior executives who have risen above the scope of formal management development program and require highly focused development and support tailored to the particular challenges facing them in their business. Individual development stimulates and manages the individual growth necessary to deliver business performance beyond

Development Centres and Managerial Evaluations

present levels and beliefs of what is possible by helping executives: �

Build a solid personal foundation and demonstrate strong confidence in self and others.



Develop their personal vision and uncover their value priorities.



Think strategically and inspire shared vision, mission and values.



Determine appropriate goals, strategies, tactics and action plans.



Enhance their management and leadership skills.



Identify their personal winning strategies.



Uncover self sabotage, recognize repeating patterns and introduce change to interrupt habitual responses.



Elicit high commitment to personal change and development.

Being mentored can therefore be a challenging and stretching experience, inviting executives to draw on and develop hidden personal resources and qualities. And it can be an exciting, stimulating journey of self-discovery and development, which opens up new opportunities for personal fulfillment and achievement. Organizational Development is delivered through individual programs of development work with senior executives. The program promotes major organizational change by developing the personal vision, confidence and competence of the executives concerned. At the outset, clear personal goals for the program are agreed which are aligned with the objectives and vision of the business so that the executive's personal development directly impacts on the organization's performance. Organizational development programs are designed to: �



Improve business performance by creating personal stretch goals in line with corporate objectives. Support and accelerate personal and organizational change.



Make change work by sustaining commitment to the corporate vision in a critical mass of senior managers.



Help manage the downside risk of change and maintain performance during periods of rapid change.

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Remove obstacles to any successful change by predicting and managing personal and organizational regression.



Promote balance and provide a stable base during the periods of major organizational and career changes.



Support executives in making the transition to new roles and cultures.



Increase organizational awareness through providing a flow of valid operational data for senior executives.



Create a positive climate for change.

Organizational development is typically used to support the change to a new organizational culture and to develop levels of performance and behaviour beyond existing norms. Within this, executives take advantage of the opportunities provided by mentoring in a wide variety of ways. One senior technical expert, realizing that his promotion prospects as a manager were becoming limited, used it to develop his interpersonal and people management skills and is now in charge of a £15 million unit; another executive used it to support him in raising the commitment of a group of under performing staff; a CEO used mentoring to help him and his management team to become champions of the organization's vision by developing their leadership skills and aligning the team's and the organization's values. Development managers support career development when they inform an employee about options for and possible barriers to career movement. For example, he may tell his employees about upcoming positions or openings for which they may be qualified, or about budgetary constraints that may inhibit career options or development opportunities in the unit or department. The manager should refer his employees to others who can assist them in achieving development goals. As a development manager, it is his responsibility to be aware of the appropriate referral sources both within and outside of his department. He may refer employees to books, journals, professional associations or other sources of information. You may also put them in touch with people who might be willing to serve as mentors or with those who might provide an information interview in which employees can learn more about a field or position from someone who is currently working in that area or capacity. The development manager should encourage his employees to focus on clear, specific and attainable career development goals. He should share his knowledge and experience with his employees. Typical questions that employees might have are: 1) what is required to move to the next logical position, 2) what are the chances for advancement in this department, 3) how to be mobile within the organization, 4) how to qualify for training and development opportunities, and 5) who to contact for further information or career counselling. He should

Development Centres and Managerial Evaluations

provide guidance to his employees about steps they might take to improve existing skills and knowledge or develop in new functional areas. Development managers should support employee development when they assign the employees roles or tasks that challenge them and provide the opportunity to grow. He should base his decisions about development options and opportunities on a careful assessment of the employee's readiness to accept additional or new responsibilities or challenges. He must consider delegating a responsibility that is currently, his own, which is appropriate to the employee's classification and development. He should provide on-the-job training and refer employees to classes, workshops and other learning and development opportunities, and recommend employees to serve on committees, task forces or cross-functional teams.

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16

Competency Driven Culture: Driving Businesses to Lead and Manage Change CULTURE Culture is an often used (mostly abused), term in contemporary society. Culture is not easily defined, nor is there a consensus among scholars, philosophers and politicians (nor, probably, among the rest of us) as to what exactly the concept should include. The English word "culture" is similar to words in other Romance languages, and indeed the concept has a similar history in many Western countries. In other parts of the world, however, the elements of learned behaviours and meanings systems, which we identify as representing something called “competency driven culture”, might not be grouped together the same way. In the United States of America, competency driven culture is talked about in terms of the “American way of life”, and the “American Dream” which is said to define the standards achieved by following in the “way”. In the East, we have the Japanese with their “Bushido”— the code of the samurai. To the Japanese, “Bushido” represents all the cumulative aspirations and learning of centuries of the people of Japan. Thus, competency driven culture, as I understand it is the combination of the value system and behaviour pattern of a group of individuals as shaped by both experience as well as circumstances. This combination is usually unique to groups, as they exist in unique environments. Thus we say that competency driven culture is a set of learned behaviours as well as value systems. The emphasis in the above statement is on the learning aspect of behaviour. Thus it naturally follows that something that is learned is also almost always taught. The teaching in this case may occur in terms of the situation creating learning in members of the group, or they may be taught directly by elder members of the group who have been in certain situations, which has shaped their respective behaviours. This teaching is a crucial aspect of competency driven culture that cannot be ignored under any circumstances. This learning was imparted in different ways in different societies. In the early parts of civilization, in ancient and medieval times we see that the imparting of cultural heritage was mostly oral in nature. Examples of this can be found among the

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bards of medieval Europe, the Americas as well as in Africa. However in certain societies where the written word was prevalent we see behaviour patterns being passed down to generations in the form of books and testaments, examples of which include kingdoms in the Indian subcontinent, China and Japan. Competency driven culture (Fig. 16.1) evolves as mentioned above, out of several factors and is based on learning. This learning is imparted in the form of stories, decrees and “tradition”. Thus it is theoretically a dynamic entity. A change in the environment, situation or experience of a group of individuals is supposed to drastically alter the competency driven culture of that particular group or groups in direct interaction with the said experience. This can be demonstrated with the example of the caste Hindus. I refer to the period of the birth of the Buddhist as well as Jain way of life and their rapid expansion into the hearts and minds of the people of the subcontinent. The main reason for their spread was purported to their advocacy of nonviolence and their respect for all forms of life. This message caught on with the mainstream Hindus and many converted. To stem this tide, Brahmins, who formed the upper echelon of the caste – based Hindu society decided on change of their own code and “competency driven COMPETENCY AGREEMENT P E R F O R M A N C E R E V I E W

Context � Culture � Management style � Structure Content � Procedures � Guidelines � Documentation Process � Objective setting � Feedback/review � Counseling/coaching

P E R F O R M A N C E P L A N

MANAGING COMPETENCY THROUGHOUT THE YEAR

Figure: 16.1 Competency Driven Cultures.

Competency Driven Culture: Driving Businesses to Lead and Manage Change

culture” and started advocating vegetarianism. This marked a significant shift in their palate and consequently their culture. However, it is now observed that groups hold on to culture and tradition as banners of their independence and individual identity rather then a dynamic reference to their combined learning. This has given rise to several instances of atrocities across the world. We see cultural imperialism in the former Yugoslavia – where it took the form of ethnic cleansing which caused the death of scores of people and displacement and misery of thousands of others. We see several conflicts based on questions of cultural identity and machismo. The entire question may be based on the same set of experiences, yet their interpretation based on perception may bring to head several bloody conflicts. The case of the shia-sunni conflict across Pakistan is a case in point. Though they are both sects of the same religion and share a common history and have a largely common cultural background, there still erupted bloody feuds between them due to their varied perception of historical figures and events. Thus we see that competency driven culture can be seen on the whole as a sum total of the learning of a group of individuals. These cultural experiences imbibe a certain value system in the group. These values then become a system of traits in these people; an example of this can be seen in the Israelis who through their perseverance have turned their desert homeland into an exporter of fruit and other products. Further hostile neighbours and the Mediterranean surround them. This has caused them to include conscription into their constitution and this has led to further development of a competency driven culture of self-sufficiency and independence.

Corporate competency driven culture We see that in this era of globalization, multinationals and monolithic organizations such as GENERAL ELECTRIC and GENERAL MOTORS are themselves considered similar to nations in their own right. These organizations, due to their sheer size and history have developed a competency driven culture of their own. The competency driven culture of these organizations has been shaped by the history of their respective experiences as well as the leaders who dominated the policies and work. In simple terms, organizational culture is "the way things work around here". Culture can perhaps best be understood as overlapping webs or patterns of widely shared and deeply felt values and assumptions that are shared across an organization, which drive behaviours and performance levels. In general terms, corporate culture is the look, the feel, the atmosphere of the organization and the people within it. It is based on people’s perceptions and assumptions of how things get done within that particular organization.

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A company’s culture is greatly influenced by the management team within the organization as they set the policies and practices for the organization. However, all employees within an organization contribute to an organization’s competency driven culture. One can gauge an organization’s culture by judging the age of the organization and assessing the organization’s history. Insight into each of these will shed some light on the type of management structure and competency driven culture of that organization. Corporate culture is the series of employee beliefs, attitudes and modes of behaviour that collectively define a company's character and which determine its ability to achieve optimal operational efficiencies and sustainable growth. Effective corporate competency driven cultures have several traits. High levels of employee productivity, creativity and commitment mark them. These in turn drive increased quality, innovation and profitability. Ideally, all leaders strive to develop competency driven cultures that generate these beneficial results. But dynamic competency driven cultures don't just emerge by themselves. The people charged with ensuring a company’s strategic and financial success must actively forge them. We see that corporate competency driven culture is thus not something that is simply born or grown overnight but a process of development within an organization, much like that of society as a whole where culture is shaped by the active participation of individuals. Just like social cultures, the corporate culture is also shaped by events, situations and actions of leaders, stories and legends built around the leaders. Thus we have the legend of JACK WELCH hanging heavily in almost all reference to GENERAL ELECTRIC. The idea of corporate competency driven culture was not given a lot of thought earlier, and it was considered adequate that an individual joining the organization was qualified in terms of his academics to be part of an organization and hold a position of responsibility. Over a period of time, the idea of culture seems to have become top friend for Human Resources managers as they go to recruit talent for their respective organizations. Today organizational “fit”, a synonym for cultural synchronization is what is being looked for in a candidate as well as his academic qualification. Thus we see competency driven culture playing a predominant role in the life of an organization and its running. There are many claimants to organizational cultural values of honesty, discipline and integrity however few survive the rigors and temptations of recession and performance enhancing practices. Enron is a case in point. It was long considered to be a pillar of solid “American Values” of honesty, integrity and success. However when it came to adhering to the code that they set for themselves, they couldn’t resist the

Competency Driven Culture: Driving Businesses to Lead and Manage Change

temptation to fudge their performance and its related numbers. The competency driven culture that pervaded the organization was that of deceit. That is what eventually came through.

Change “The only thing constant is change.” In a world that is becoming increasingly smaller, with the ensuing telecommunications and internet revolutions bringing information and people closer together, this statement is now truer than it ever was in the past. Change for competency-based performance is not just difficult to cope with, but also extremely difficult to identify as well. Transformational impact for competency-based performance is said to be a difference of a frame of reference. Change for competency-based performance is making something different than it was. In many instances, the outcome remains the same, but the process is changed. What one may see as a momentous change in perspectives and perception may turn out to be nothing more than a passing fad, while what we may dismiss as a fad may revolutionize industry or for that matter society as a whole. As managers it is important that we are not only able to identify and recognize change for competency-based performance, but also learn to cope with the change for competency-based performances and their ensuing results. The change for competency-based performance that is taking place may be fast – paced and dynamic or it may be subtle and may take a long period of time to manifest itself. Either way it is important to recognize its symptoms and address our misgivings as well as learn to adjust to the changes. The adjustment to changes in the environment and the macroeconomic sphere is crucial in that at times, if one are unable to cope with the changes, it may result in the extinction of the stand or for that, matter your organization. A classic example of this sentiment is seen in the French Revolution of 1789. The aristocracy and royalty of the French state were so out of tune with the scenario that they completely failed to see the signs of the revolution. When peasants approached MARIE ANTOINETTE saying they don’t have bread to eat she apparently told them to have cake instead. This famous quote demonstrates how out of sync with the people’s feelings, aspirations and conditions the royal family was. This failure to recognize transformational impact for competency-based performance and sow the seeds of revolution being planted cost many aristocracy and the royal families their lives. In business organizations, the effects of ignoring transitions from current to desired for competency-based performance or for that matter not adjusting to it may not be so bloody, but they are not any less dramatic. Change for competency-based performance has become a necessity of organizations seeking to survive globalization and internationalization as well as a fluid and ever – dynamic business arena.

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How is change for competency-based performance recognized? More difficult than actually coping or adjusting to transitions from current to desired for competency-based performance is the fact that before anything can be done about it, change for competency-based performance has to be identified. There are two major categories of change. One type of change is rapid and manifests itself suddenly. The situation having changed is easily distinguishable from the situation preceding it. This type of transitions from current to desired is easily identifiable. Further since it is so easily recognizable, it is more easily coped with. It may also be possible in certain cases to preempt this type of change and actually anticipate and prepare for it. A case in point would be transitions from current to desired in government policy due to a change in government. Opinion polls, gauging of general public sentiment through the media may give an indication to the change that is on its way. This change can then be prepared for and steps may be taken to reduce its disruptive effect on the policies of the organization. The other type of transitions from current to desired change for competencybased performance is the gradual and slow moving change that becomes apparent over a certain period of time. This type of change is very difficult to detect and counter or prepare for. This transitions from current to desired change occurs slowly and may take several years to manifest itself. Though this type of change does produce symptoms of the change that is going to take place, these might be subtle in nature and indeed misleading to many of those who seek to interpret these symptoms. A case in point is the effect of global warming and the subsequent climate change that it will result in. The symptoms are there for all to see. Yet they are slow to manifest themselves, thus making it impossible even for scientists to agree amongst themselves as to, not only what effect global warming will have on us, but also whether global warming is actually taking place or not. Thus the key to adapting and adjusting to change lies first in having identified the change.

Change for competency-based performance management Definition (Change for competency-based performance management): The making of transitions from current to desired change for competency-based performances to a method or system in a planned and managed or systematic fashion. To bring order to a messy situation, not pretend that it’s already well organized and disciplined. A method of problem solving moving from one state to another – from the problem state to the solved state. The organization may be profoundly affected by change for competency-based performance. The impact may be on different aspects of the organization. It may show up on your balance sheet or it may show up on your sales figures or for that matter it may be shown in the

Competency Driven Culture: Driving Businesses to Lead and Manage Change

turnover – rate of your organization. These are some of the few areas by which we may identify that we may be the victims of transitions from current to desired change for competencybased performance rather than the drivers of change for competency-based performance. It is thus essential for people in the organization to recognize and take adjusting action towards competency cultures change taking place before the organization becomes a victim of change. Change for competency-based performance may affect organizations in different ways. An adverse effect may see the organization’s output dropping; sales lagging, accumulation of inventory, high employee turnover rate, and etc., on the other hand, change for competency-based performance may be very good for the company. A company that has adapted well to competency cultures change and its different aspects may reap benefits in terms of higher productivity, better top lines, attraction of top – notch talent across the globe, etc. Typically, the concept of organizational change for competency-based performance is in regard to organization-wide change, as opposed to smaller changes such as adding a new person, modifying a program, etc. Examples of organization-wide change might include a change in mission, restructuring operations (e.g., restructuring to self-managed teams, layoffs, etc.), new technologies, mergers, major collaborations, "rightsizing", new programs such as Total Quality Management, re-engineering, etc. Some experts refer to organizational transformation. Often this term designates a fundamental and radical reorientation in the way the organization operates. Competency cultures change for competency-based performance should not be done for the sake of change – it's a strategy to accomplish some overall goal. Usually organizational change is provoked by some major outside driving force, e.g., substantial cuts in funding, address major new markets/clients, need for dramatic increases in productivity/services, etc. Typically, organizations must undertake organization-wide change to evolve to a different level in their life cycle, e.g., going from a highly reactive, entrepreneurial organization to a more stable and planned development. Transition to a new chief executive can provoke organization-wide change when his or her new and unique personality pervades the entire organization. Change for competency-based performance needs to be managed in order to derive maximum benefit from new opportunities and to avoid reactive situations. The faster the speed of performing and assessing change the more difficult and stressful it is to manage. The skills and style of managers become increasingly important. Typically there are strong resistances to change. People are afraid of the unknown. Many people think things are already just fine and don't understand the need for change. Many are

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inherently cynical about change for competency cultures, particularly from reading about the notion of "performing and assessing change for competency cultures" as if it's a mantra. Many doubt there are effective means to accomplish major organizational change for competency cultures. Often there are conflicting goals in the organization, e.g., to increase resources to accomplish the change yet concurrently cut costs to remain viable. Organization-wide change for competency cultures often goes against the very values held dear by members in the organization, that is, the change may go against how members believe things should be done. That's why much of organizational – change for competency cultures literature discusses the need for changes in the competency driven culture of the organization, including changes in members' values and beliefs and in the way they enact these values and beliefs. The response to competency-focused performing and assessing change by an organization gives the measure of the strength of the organization. The response to change shows the tendency to think along certain lines depending on where one is situated in the organization. A person’s placement in the organization typically defines the scope and scale of the kinds of changes with which he or she will become involved, and the nature of the competency focused changes with which he or she will be concerned. Thus, the systems people tend to be concerned with technology and technological developments, the marketing people with customer needs and competitive activity, the legal people with legislative and other regulatory actions, and so on. Also, the higher up a person is in the hierarchy, the longer the time perspective and the wider ranging the issues with which he or she must be concerned. For the most part, competency focused changes and the driving desired levels of competency change problems they present are problems of adaptation, that is, they require of the organization only that it adjust to an ever-changing set of circumstances. But, either as a result of continued, cumulative compounding of adaptive measures that were nothing more than band-aids, or as the result of sudden competency focused behavioural changes so significant as to call for a redefinition of the organization, there are times when the changes that must be made are deep and far-reaching. At such times, the design of the organization itself is called into question. Organizations frequently survive the people who establish them. AT&T and IBM are two ready examples. At some point it becomes the case that such organizations have been designed by one group of people but are being operated or run by another. (It has been said of the United States Navy, for instance, that “It was designed by geniuses to be run by idiots.”) Successful organizations resolve early on the issue of structure, that is, the definition, placement and coordination of functions and people. Other people then have to live with this design and these other people are chiefly concerned with the means. Some organizations are designed to buffer their core operations from turbulence in the environment. In such organizations all units fit into one of three categories: core, buffer and

Competency Driven Culture: Driving Businesses to Lead and Manage Change

perimeter. In core units (e.g., systems and operations), coordination is achieved through standardization, that is, adherence to routine. In buffer units (e.g., upper management and staff or support functions), coordination is achieved through planning. In perimeter units (e.g., sales, marketing and customer service), coordination is achieved through mutual adjustment (see THOMPSON). People in core units, buffered as they are from environmental turbulence and with a history of relying on adherence to standardized procedures, typically focus on “how” questions. People in buffer units, responsible for performance through planning, often ask “what” questions. People in the perimeter units are as accountable for performance as anyone else and frequently for performance of a financial nature. They can be heard asking “what” and “how” questions. “Why” people generally ask questions with no direct responsibility for day-to-day operations or results. The group most able to take this long-term or strategic view is that cadre of senior executives responsible for the continued well-being of the firm: top management. If the design of the firm is to be called into question or, more significantly, if it is actually to be altered, these are the people who must make the decision to do so. History is replete with examples of organizations, which have dealt with behavioural change in their own way. Some of these responses were successes considering that they managed to adjust themselves to the changing environment and thus eventually succeeded in adapting to behavioural change.

Competency focused behavioural change management—It starts at the top Competency focused behavioural change is a common occurrence in business today. Because of this, it is important that one possess strong competency focused behavioural change management skills if one wants your business to be a success. Competency focused change management skills include leadership development (to get people to believe in you), marketing and sales abilities (to promote your case for change), and communication skills (to help build support for the decision to change). It will also help if you know a little about the stages people go through psychologically when they are dealing with behavioural change so that you are able to tell if you have managed a successful transition or if there are additional problems that you need to address. �

The first thing you will want to focus on is your leadership ability. Companies continue to make the mistake of focusing too much on business processes and not enough on good, strong examples of leadership. To be an effective leader in the competency focused behavioural change management process, it helps if you:



Set an example. As the top person in your business, others look to you for direction, not only in terms of business needs, but also related to behaviour, ethics and standards. If you want others in your business to undergo behavioural change, you must set an example for them to follow.

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Eliminate perks. Perks suggest division and hierarchical thought processes. By eliminating or reducing your own perks, you show your desire to level the playing field.



Walk around and talk to people. The old school of business management promoted the idea that the top person was off limits, enclosed in his or her own glass tower. Leaders of today interact more with their employees. They manage by walking around and getting to know their employees and learning about the problems they are facing on a day-to-day basis.



Be genuine. As a leader of competency focused behavioural change, it is important to be as real and honest as possible in your interactions with others. Let others get to know you. Being a leader doesn't mean hiding your emotions. By interacting with employees on a one-to-one basis, you will build a rapport and trust with them.



Have passion. To be a strong leader, you must have passion around your vision. Without it, you will soon find yourself facing a burnout. Leadership is tiring and saps your energy at a very high rate so make sure you are passionate about what you do.

Building your ability, as a leader is the first step in the competency focused behavioural change management process. Once employees believe in you and trust what you're doing, you can then begin your campaign for change. Your campaign for change should target the different "groups" within your business and outline for each the reasons why a change is necessary. For instance, the board of directors will want to know what the long-term effects of the behavioural change will be. Similarly, your employees will want to know how they will be personally effected by the changes you are proposing. Once a competency focused behavioural change occurs, it is very important to communicate on a regular basis with all affected. Let your employees know what is happening. If your communication skills are weak or you don't have a formal way of letting your employees know what is happening, set one up before you hit this stage of the impacting behavioural change process. By keeping everyone informed, you reduce the chances of low productivity and low morale that often accompany unaccepted impacting change. It is important to realize that although you can use techniques to smooth the impacting internalized change transition process, you will never be able to completely jump from one way of doing something to another without experiencing at least some resistance. Why is this? Well, people adjust to impacting change at different rates. Its just part of human nature. To reduce your frustration with this process, it helps to know the six phases people go through whenever they are experiencing any type of change, be it personal or professional. �

Anticipation. People in Phase 1 are in the waiting stage. They really don't know what to expect so they wait, anticipating what the future holds.

Competency Driven Culture: Driving Businesses to Lead and Manage Change



Confrontation. At some point, people reach Phase 2 and begin to confront reality. At this stage, they are beginning to realize that the internalized change is really going to happen or is happening.



Realization. Once the impacting internalized change has happened, people will usually reach Phase 3 – the stage where they realize that nothing is ever going to be as it once was. Often times, this realization will plunge them into Phase 4.



Depression. Phase 4 is a necessary step in the impacting change process. This is the stage where a person mourns the past. Not only have they realized the change intellectually, but also now they are beginning to comprehend it emotionally as well.



Acceptance. Phase 5 marks the point where the person begins to accept the impacting change emotionally. Although they may still have reservations, they are not fighting the change at this stage. Usually, they are beginning to see some of the benefits even if they are not completely convinced.



Enlightenment. In Phase 6, people completely accept the new impacting change. In fact, many wonder how they ever managed the "old" way. Overall, they feel good about the change and accept it as the status quo from here onwards.

It is important to note that people in your organizations will proceed through the different phases at different rates of speed. One person may require two months to reach Phase 6 while another may require twelve. To make things even more complex, the cycle of impacting change is not linear. In other words, a person does not necessarily complete Phase 1 through 6 in order. It is much more common for people to jump around. One person may go from Phase 4 to Phase 5 and then back to Phase 2 again. That is why there is no easy way to determine how long a internalized change will take to implement. However, by using the skills we've outlined above, you increase your chances of managing the institutionalizing of change as effectively as possible.

Nature of an organization and impacting change An organization is an entity in itself and thus it feels the effect of impacting change as profoundly as an individual in society may feel the impact and pressure of impacting change. For an individual, it is relatively easier to deal with change and its ramifications as compared to an organization. This is because an organization is composed of several individuals who in turn have a different perception of change and may respond to it in their own way and would want the organization to respond to change in their particular way or method. This causes

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complications within the organization. The essential element required for an organization to respond positively to impacting change is that the culture of the organization must be such that it drives people to positive thinking and acceptance of driving change for competency cultures. The competency driven culture of an organization is a very essential driver of change and its eventual acceptance or rejection and consequent success or failure of the organization. The culture is the essential backbone of the organizations ability to cope with driving change for competency cultures and its consequences. There are essentially two ways in which an organization interacts with driving change for competency cultures. It may be the driver of institutionalizing of change or it may react to change that is brought about in its environment. The 3M corporations is a very good case in point of an organization leading change. The method adopted by the organization essentially reflects one of the ways the competency driven culture of an organization can be developed to lead and initiate driving change for competency cultures. In the international arena we see the example of 3M (MINNESOTA MINING and MANUFACTURING) corporation. It was originally a mining and manufacturing company. However it saw the institutionalizing of changes taking place in the market worldwide and saw that there was a heavy growth opportunity in the media sector and that of communications. Thus it went ahead and sold off its mining and manufacturing business and got into the media segment. The company not only succeeded because it changed its business, but also because it brought about a radical paradigm shift in its management thought process. It adopted innovation as the vehicle for its growth and expansion. This proved to be beneficial in the long run as this brought about a cultural shift in the organization towards innovation and development. Some of the policies implemented by 3M corporations are as follows: �

15 Per cent Option: Many employees have the option to spend up to 15 per cent of their workweek pursuing individual projects of their own choice. There is no need even to disclose the project to a manager, much less justify it.



30 Per cent Rule: Thirty percent of business unit revenues must come from products introduced in the last four years. Business unit bonuses are based on how successfully each manager achieves this goal.

Competency Driven Culture: Driving Businesses to Lead and Manage Change



Dual-Ladder Career Path: There are two career ladders: A technical career ladder and a management career ladder. Both allow equal advancement opportunities, thus enabling employees to stay focused on their research and professional interests.



Seed Capital: Product inventors typically request seed capital from their business unit managers to develop new product ideas. If the manager refuses funding, inventors can take their ideas to any other business unit within 3M. If none of the business units will support the proposal, employees can approach the corporate office for a Genesis Grant. This grant awards employees up to $50,000 to conduct independent research, product development, and test marketing in areas of emerging technology. About 90 such awards are given each year. After securing seed capital, the product “champion” assembles a venture team to develop the product. Members of the venture team are not assigned; the champion must recruit them.



Tolerance for Failure: If the venture does not succeed, the team members are guaranteed their previous jobs. Company culture emphasizes that a failure can turn into a success; there is no punishment for a product failing in the market. 3M has developed a series of legends around famous failures that have subsequently created breakthrough products, perhaps most notably the weak adhesive that became the foundation for Post-it notes.



Rewards for Success: As the venture achieves certain revenue goals, the team members receive raises, promotions and recognition. One such recognition is the Golden Step award. This award is given if a new product is launched and reaches a revenue goal of $2 million in the US or $4 million worldwide. Another recognition is the Carlton award, honouring technical employees who have made major contributions to 3M through fundamental technical innovation. The Carlton Award is considered very prestigious—the “Nobel Prize” of the 3M community. After the new product exceeds a cutoff sales target, a separate department is created. After another cutoff, a separate business unit is formed. Business units are split up once they reach a size of approximately $200 to $300 million. Each business unit is run as a profit centre. The product champion is given the opportunity to head the new business unit. Business unit managers are required to know the names of everyone who works for them. In general, nearly all-3M employees are entitled to the profit-sharing plan.



R&D Spending: 3M spend approximately 6–7 per cent of sales on research and development and has consistently increased R&D spending over the last two decades. The R&D spending of 3M is, on average, twice that of a typical manufacturing company.

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Three-Tiered Research: Business unit Laboratories: Focus on specific markets, with near-term products.



Sector Laboratories: Focus on applications with 3-to-10 year time horizon for product viability.



Corporate Laboratories: Focus on basic research with a time horizon of as many as 20 years.



Technology Forums: 3M supports formal and informal forums for sharing knowledge. Scientists from different laboratories are part of the Technical Council, which meets periodically to discuss progress on technology projects. In addition, scientists present papers in the Technology Forum, an internal professional society at 3M. Other mechanisms for technology sharing include extensive email directories, sharing of new products introduced by a business unit in the annual in-house trade show, and awards for successful sharing of new technology between business units.



Customer Contact: Scientists regularly meet with customers to learn how they use 3M products. Customers are also frequently invited to participate with 3M scientists in sessions aimed at generating product ideas. Thus we see that a major corporation like 3M pre-empted driving lasting change for competency cultures and adapted to it before it overtook them. This was a major achievement for a corporation of that size. The usual response to changes by any organization is to resist it.

The initiative to driving a lasting change for competency cultures starts from the very top. In an organization that is intent on leading driving change for competency cultures, it is essential that the top hierarchies of the organization recognize and accept that driving change for competency cultures is inevitable and it is the only path to prosperity if not survival. There are several ways in which the top management of an organization may be able to drive change rather than react to it. This essentially deals with changing the cultural ethos of the organization, from a rigid hierarchy where every employee is treated as a cog in a giant machine to an organization that is essentially a family, where everyone feels they are an indispensable and irreplaceable part of the whole design of things. There are some principal “best practices” that are considered essential when we talk of organizations driving change for competency cultures. Some of these may be listed as under: �

Spurring innovation. To innovate successfully, you need four things: an entrepreneurial or inventive spirit, a willingness to commit resources to innovation, methods to follow, and the right type of organization. In terms of that organization, make sure

Competency Driven Culture: Driving Businesses to Lead and Manage Change

you are able to reach your customers, serving, them in a manner that is satisfactory to them and competitive in the marketplace. �

Value driven change for competency cultures and value (trust and respect) people. You have to have a competency driven culture that nurtures innovation, gives people the freedom to follow good ideas (and make mistakes), and encourages a healthy flow of information around the company.



Cross-functional teams. Include designers and representatives from manufacturing, marketing and finance in the creation of new products at the beginning of that process rather than have them come into the process later, undoing the work already done by others. Also, make sure that your customers and your suppliers contribute to the development of your new products.



Portfolio of products. Balance your portfolio of projects so that the portfolio ranges from blue-sky R&D to product extensions and from low risk to high risk. Fill your pipeline from beginning to end with new products so that you can produce a cadenced flow of introductions. Let your new products cannibalize your existing products. Develop platforms of new products that can be the basis for a family of extensions. Use a systematic process to identify the most promising R&D projects and to prioritize them.



Step up the pace. Use concurrent engineering to speed development of new products. Use speed to create value for your customers and to differentiate your products or services. Anticipate a market demand so that you are ready to serve that demand as and when it arises. Make your production processes as flexible as possible to adjust rapidly to changes in demand. Spend enough time and money on preparing for the production and marketing of your new products, so that their introduction won't be delayed. Differentiate between speeding product development (which is always an advantage) and speeding product introductions (which may not always be desirable).



Redefine quality. Focus your effort to improve quality on what really matters to your customers. Periodically revise your targets upwards to meet the rising quality expectations of your customers. Use statistical tools of quality improvement and give your people the training they need to use them. Make your pay and incentive plans and encourage your people to improve quality.



Extended corporation. Have important, sound reasons for going into a partnership, such as gaining entry into a new market, bringing new products into your market, or

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gaining new technology. Outsourcing should not be approached as a device to save money; it probably won't. Outsource to improve an activity rather than to reduce cost. Give the activity to another company for which that activity is their core activity and you will get three times the innovation you will get by keeping the activity in-house. �

Breadth versus depth. On the one hand, from the perspective of trying to learn what it will take to succeed in the 21st century, given the research underlying their book, if marketed properly, Driving Change will probably be for the 1990s what The PIMS Principles: Linking Strategy to Performance by BUZZELL AND GALE was for the 1980s. On the other hand, as a teacher of new product development, I noted that the principles Wind and Main listed are "obvious." Thus, I started wishing for depth (how to) rather than breadth (should). For example, I wished they told me how to speed up new product development activities rather than tell me the fact that "the successful firm will win with speed."

These kinds of changes can only be brought about in an organization if the organization is essentially and ready culturally to accept and drive changes. There are several ways in which an organization can build a competency driven culture that drives change. The “action – plan” for leading and driving lasting change can be summarized as follows: �

Establish a Sense of Urgency. Examine market and competition realities. Identify and discuss crises, potential crises, or major opportunities. Eliminate obvious examples of corporate excess (i.e., company planes, catered lunches). Change won't occur where there is complacency.



Create the Guiding Coalition. Pull together a group with enough power to lead the transitions and urge them to work together as a team. No one person has the credibility, expertise, or skills to provide the necessary leadership alone.



Develop a Vision and Strategy. Provide a vision that gives the change effort direction and motivates people. Set stretch goals achievable through great effort. Give clear focused goals, yet be vague enough to allow for individual initiative and flexibility.



Communicate the Transitions Vision. Use every vehicle possible to get the message out: Big or small meetings, memos and company newsletters, formal and informal interactions. Communicate the vision in terms that will be understood in a fiveminute discussion. Make sure the behaviour of key players in the change program consistently and constantly reinforces the vision.

Competency Driven Culture: Driving Businesses to Lead and Manage Change



Empower Broad-Based Actions. Change those systems or structures that seriously undermine the vision. Emphatically encourage risk taking and non-traditional ideas, activities and actions.



Generate Short Term Wins. Plan for visible performance improvements and early evidence that sacrifices are worth it. Recognize and reward people who make wins possible.



Consolidate Gains and Produce More Transitions. Use increased credibility to change all systems, structures and policies that don't fit together and don't fit the transformation vision. Reinvigorate the process with new projects, themes, and change agents.



Anchor New Approaches in the Corporate Competency Driven Culture. Firmly anchor changes into the cultures by making sure that employees see how new approaches to satisfying customers, improving productivity, etc., are linked to improved results. Also, be sure to alter promotion and succession to reflect the new vision.

The other type of organization is the one that may not have leading transitions as an aspect of its culture, but it has the ability to cope with renewal better than many organizations can and this in turn gives it the ability to compete effectively and successfully against its competitors. This essentially involves the following. (N.B. the list mentioned below is inclusive and not exhaustive): �

Openness: There must be a degree of freedom and openness within the organization for it to effectively drive a change. There must be a level of comfort between employees and the management that in turn builds a level of trust for the management in the hearts and minds of the employees.



Communication: A certain amount of trust must pervade the organizational structure of a company that wants to drive renewal. Honest and open communication channels can only bring this about. To many organizations, communication implies the periodic and dry performance reviews or a suggestion box that is hardly dusted if ever considered by the management. The kinds of window dressing that these organizations indulge in are detrimental to their development of a competency driven culture of change and success.



Openness and communication are linked in such a way that the degree of one determines the extent of another, i.e., the communicative strength of the organization determines how open the organization will be.

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Structure: The structure also plays an important role in the shaping of a competency driven culture of revitalization within the organization. A large and multi – tiered structure may cause the people within the company to feel intimidated which in turn may inhibit their ability to drive change. Thus the structure should be as flat as possible. This brings the individuals and management together.



Decentralization: This is an important part of building an organization that thrives on change and drives it. It is very closely related to the structure of the organization and the way the hierarchy is in the company. The concept of decentralization not only refers to the appropriation of blame but of the devolution of both responsibility and authority. Authority can be devolved but not responsibility. It is only by constant delegation and devolution that a competency driven culture of decentralization and revitalization can be built. The essential premise of decentralization lies in the fact that an organization that is lean and decentralized can respond to various changes and challenges faster than a monolithic structure.

Thus we see that essentially the capacity to lead or follow change can be planted and developed within an organization. The main initiative towards building change and its cultural aspects must be lead from the very top. It is the responsibility of the management to take the initiative to reassure and lead the employees on a path of change and its acceptance. Personal change and building change management programmes help individuals and teams to adopt new ways of thinking or perceiving. Organizational building change requires rethinking from four fundamental perspectives: People, processes, systems and structures. Reorganizing structures, systems and processes can be difficult enough, but change management success lies beyond these. It’s the personal change of attitude, the team climate, the organizational ethos, the mindset, the spirit . . . the psychological atmosphere that will make the ultimate difference. Change involves translating these intangible aspects of competency driven culture into practical reality to increase commitment at all levels. For organizations to work efficiently and effectively, their people must see a common, values-driven goal. We know that. We also know that for those introducing personal and professional change, the goals sound legitimate and the change feels exciting. We sometimes forget that those receiving the change can see and feel differently. For people to listen, really listen, business plans must be founded upon confident, inspiring and shared corporate vision. Objectives must be unambiguously communicated so that people can run with them—fully, willingly and enthusiastically.

Competency Driven Culture: Driving Businesses to Lead and Manage Change

One model involving a five-phase transformation framework combines task and relationship aspects of personal and professional change. It helps you to prioritize goals to allocate resources and project manage your changes successfully and cost-effectively. It integrates outputs and competency driven culture through inspiration and aspiration to get results through people. Proven in public and private organizations, this results-based and pragmatic framework is for those leading competency driven culture personal and professional change for competency-based performance and for those implementing it. This is the underlying premise on which ABB, the engineering multinational (with a presence in 100 countries worldwide), took up a program of restructuring and decentralization and devolution in the 1980’s. This led to a great amount of resistance within the ABB group. However the management was able to press ahead with the restructuring plan and there were massive personal and professional change for competency-based performances in the entire structure of the organization. The hierarchy was cut drastically, and responsibility was devolved from the centre in Sweden to their subsidiaries and branches that were spread across the globe. Finally… Let us dispel a few common myths about personal and professional change: Myth #1—Things will calm down. Organizations tend to think that if they can just get through the present period of turmoil, all will settle down. Actually, the world has never been very calm, and it looks to remain chaotic in the coming years. Myth #2—Planning can fully prepare us for personal and professional change for competency-based performance. Organizations desperately want to predict the future, often creating five-year plans to prepare for a future that will little resemble the one being planned for. Myth #3—We can control personal and professional change for competency-based performance. Judging from the number of books and articles on the topic, managers like reading about personal and professional change. But can you control personal and professional change? Certainly not on the macro level. The prudent manager looks at what they can control, but also tries to prepare to manage and govern their organization in a dynamic world in which no-one knows for certain what is going to happen tomorrow, let alone in five years.

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Index ability tests 221 achievement 28 affiliation 28, 29 annual review period 345 appraisal criteria 360 aptitude tests 209 assessee 148, 162, 186 assessment centre 143, 144, 146, 147, 149, 150, 151, 152, 153, 154, 155, 156, 160, 161, 162, 163, 167, 177, 210, 221, 229 assessment centres 302, 304 assessment group discussion 291 assessment methods 207 assessment set 169, 177 assessment techniques 152 assessment work sheets 170, 178, 179 assessors 148, 149, 153, 162 background investigations 158 BARS scales 89 base pay 470 behaviour 30, 31, 32, 33, 34, 35 behaviour mapping 400 behavioural 120, 126, 130, 133, 134, 135, 335, 336, 337, 495 behavioural classification 152 behavioural consequences 32 behavioural event interview 17, 218 behavioural event interview 17, 218 behavioural indicators 72, 176 behavioural skill parameters 170 behaviourally anchored rating scales 81, 83 behaviour-based interviews 238 behaviour-based value-statement 135 behaviour-based vision 135 behaviour-driven 237 benchmarking 184 benchmarks 170 benefits 472 business competencies 44 Business games 158 business mission 368

career and performance appraisal interview 427 career and succession planning 103 career coaching 392 career development 510 career management 422, 424 career performance review 425 Career Review Meetings 424 Case Study Method 198 CBO 468, 395 CBO – Behavioural Indicators 385 CBO process 385, 388 CBO system 385 CBPMS 359, 369, 372, 375, 391, 392 change 517, 518, 519 change for competency-based performance 519 classification 18 coaching 429, 392 coaching to build competencies 393 coaching mentoring 481 communication 53 compensation 449 compensation specialist 462 competence 20 competence based human resource management 363 competence based Performance Management 363, 367 competence management 13 competencies 13, 14, 15, 16, 17, 20, 21, 64, 104, 120, 133, 137, 172, 308, 424 competencies reward 474 Competency 11, 12, 13, 14, 15, 22, 169 competency appraisal 321, 340 competency appraisal Forms 345 competency awards 470 competency based appraisal system 378 competency based career 441 competency based compensation 449 competency based compensation program 461 competency based HR system 64 competency based human resource (CBHRS) 183, 184, 185, 186

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competency based human resources management 102 competency based interview strategies 233 competency based management system 461 competency based objectives 101 competency based pay 461 competency based performance 359, 360, 362 competency based performance appraisal 410 competency based performance management program 364, 389 competency based performance management system 359, 360, 362 competency based PMS 363 competency based remuneration 459, 460 competency based selection 205, 211 competency based selection process 205, 211 competency based selections 222 competency by objectives 383 "competency by objectives" (CBO) 381 competency by objectives (CBO) 383 competency classification 139 competency cluster 21, 87 competency coaching 482 competency coaching skills and mentoring 483 competency compensation 468 competency compensation plans 474 competency compensation systems 470 competency contract 338 competency cultures 519 competency dashboard 159, 160 competency definitions 52 competency development 45, 57, 61 competency development plan 345, 346, 348 competency development processes 4 5 , 5 7 , 61 competency dictionary 169, 170, 172 competency driven career 421 competency driven careers 421 competency driven culture 513 competency driven cultures 516 competency drivers 116, 117 competency frameworks 23, 24, 25, 27, 86, 101

competency interview questioning 247 competency interviews 241, 246, 248, 253 competency management 7, 14, 23, 24, 352 competency management methods 80 competency management process 319, 322, 323, 325 competency management process definitions 321 competency management processes 348, 356 competency management system 64, 141 competency managers 354, 356 competency mapping 15, 16, 28, 33, 36, 122 competency mapping results 170 competency mapping system 67 competency models 89 competency objective 13 competency pay 450 competency principle 40 competency proficiency levels 163, 164 competency profiling 75, 90 competency related remuneration (PCRR) 457 competency skills coaching 483 competency standards 327 competency standards and benchmarks 321, 353 competency-based performance 518, 519, 531 competency-based selection system 207 competency-based systems 106 competition 1, 5, 119 complete personality typology 17 continuous learning 346 contribution-related pay 103 core competence 9, 24, 26, 40, 119, 123, 124, 125, 133, 136, 325 core competence behaviours 135 core competencies 120, 123, 124, 125, 126, 127, 453 core human values 368 core strategy 119 core values 120, 127, 128, 135 core-competency model 90 corporate strategy 8 counselling 374, 429 creating lifestyles 471 criterion measure 13 criterion references 39 critical and inbasket incident process 200

Index

critical competencies 56, 373 critical incident interview method 80 culture 513 culture fit and values inventories 157 data integration 153 demonstrated measurement 14 demonstration 196 development appraisal 498 development centre 149, 150, 488 development centres 477, 502 development goals 484 development management 477 development managers 510 development standards 492, 493 dictionary 169 direct statement 89 discussion debate 192 drafting exercise 209 employee bands 169, 173 employee partnerships 473 enabling competencies 44 executive coaching & mentoring 482 expert panel 82 experts panels 16 facilitating life planning 473 fact-finding and analysis exercises 158 fairness 154 feedback 374, 428 formal style 62 formative and summarize assessment 19 fringes 472 generic dictionary scales 174 goal 13 goal setting 377, 395, 400, 403 group discussion 156, 291, 293, 294, 295 group discussions 208 In-Basket 156 incentivising performance 471 individual competency 130 individual competency maps 180 individual development plan 503 integrity tests 158 interpersonal competencies 58 interview simulation 156 interviews 208, 233, 234, 237, 239 in-tray exercise 209

job analysis 151 job competency 13 job evaluation 15 job performance standards 360 job roles description 324 job roles description & strategic plan 324 job simulations 157 job skills 127 job specific competencies 454 job suitability analysis 18 key development indicators 478, 480, 484 key result areas 478 knowledge and skills tests 157 knowledge worker 113 leadership 91 leadership 91 learning 184, 473 learning organization 22 level and proficiency 331 levels of proficiency 490 lifelong learning 17 like scales 83, 84, 88, 89 list of competencies 51 management problems (or analysis) 157 managing change 111 managing knowledge 112 managing performance 109 managing talent 108 mapping competencies 106 mapping process 169 mentoring 481, 482 meta and sub competency proficiency levels 181 meta competencies 36, 86 meta competency 35, 36, 37, 87, 169, 171 motives 22 multiple assessments 152 norm referencing and criteria referencing 19 open style 63 organizational competencies 60 organizational surveys 16 organizing competencies 453 outcome measure 14 output measure 14 overall ranking 374 people competencies 75 people competency 127, 136

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performance and competency related remuneration (PCRR) 457 performance appraisal 360, 361, 369, 381, 382, 387, 410, 413 performance assessment 18 performance development plans 505 performance management 371, 376, 388, 404, 405 performance management system 360, 361, 362, 363, 371, 381, 383 performance measures 391 performance media 18 performance monitoring and reporting system 379 performance ratings 360 performance review 374 performance skills 128, 133, 134 perquisites 472 personal coaching & mentoring 484 personal competencies 58 personal development plan 339 personality questionnaires 221 personality tests 209 physical-abilities tests 158 political style 62 position evaluation 470 positive reinforcement 32, 33 power 29 power of values 368 presentation 189 presentation and report writing 156 professional competencies 54 proficiency 52 proficiency levels 56 proficiency levels 56, 164, 166, 493 qualifications screens 157 rank order 17 rating scale 296 reading/programmed grammed instruction 202 recording behaviour 153 reliability 69 repertory grid 83 repertory grid system 17 reports 153 reward strategy 469 role play 194 role profile 178 role profiling 16 role-play exercises 158

scanning 7 selection assessment centre 302 selection centre 208 selection centre procedures 208 selection process 206 self- and peer-assessment 20 self-appraisal 342, 355, 373, 413 self-assessment 170 self-concept 29 self-directed work teams 355 self-managing teams 361 simulations 152 skill 29, 47 skill Analysis 239 skill attributes 373 skit psychodrama 201 standards and benchmarks of competency 326 starting points for coaching & mentoring 481 strategic feedback 184 strategic management 368 strategic plan 325 strategy 120, 122, 122, 129, 135, 136, 140, 142 structured interviews 157 styles 61 systems of PCRR 458 talent measures 157 task analysis 80 team competencies 59 team competency 350, 355 technical competencies 43, 44 technical knowledge 127, 128, 130 test 298, 299, testing techniques 297 the capability building cycle 366, 367 the laissez faire style 63 thematic analysis 136 threshold scales 82 tiering 374 total rewards 452, 456 transformation 1, 94, 96, 97 validation 55 validity 69, 154 what is CBO 383 work experience 453, 455, 456, 457 written tests and exercises 209 360° multi-rater feedback 16, 430, 432