Generally three approaches are used to create competency models. Given future business needs, particularly in industries experiencing turbulent change, still another approach is needed, one that is learning-based. Guidelines for those companies developing executive competencies are given.
Grooming and Picking Leaders Using Competency Frameworks: Do They Work?
An Alternative Approach and New Guidelines for Practice J O N P. BRISCOE
I I I ' l l never forget my CEO saying, 'Healthy 1 •companies do these things, and so should we.'" This is the w a y one woman described how her company began developing "competencies" to define successful executive performance. But does the use of a competency model really create a "healthy company'? Even those charged with developing and implementing executive competency frameworks don't agree on the answer to this question. One woman interviewed in our research to be presented here suggested that "HR people present competencies as the end-all and be-all for getting 'out of the fog.' I think they're necessary but not sufficient." But another interviewee had a more common response: "Even though the world is changing, there are some pretty steady leadership attributes." Just what is a "competency," and how can competencies be used to develop executive leadership? According to some early pioneers
DOUGLAS T. HALL
of competency research, "A competency is an underlying characteristic of an individual which is causally related to effective or superior performance in a job." Once competencies are developed, companies use them for a variety of applications. The two most common applications are executive selection and development. Competencies are typically placed in an organized framework or grid. This competency framework is then used as a guide for making hiring and promotion decisions. Competency frameworks can also be used to suggest developmental needs and potentially helpful experiences or training for executives or lower level managers who wish to become executives. In view of the current popularity of the competency approach, we think it is time to examine h o w organizations are developing competencies for executives. We will examine three current approaches, discuss
AUTUMN 1999 37
whether these approaches are advantageous or not, suggest an alternative approach, and provide guidelines for practice.
HOW AND WHY COMPETENCIES ARE B E I N G U S E D
Jon P. Briscoe is assistant professor of management in the College of Business at Northern Illinois University. He has been visiting assistant professor of management at the David Eccles School of Business at the University of Utah and research associate at the Executive Development Roundtable at Boston University. He received his Doctorate of Business Administration from Boston University and a Master's Degree in Organizational Behavior from Brigham Young University. In addition to executive learning and development, Briscoe's research focuses upon the expression and suppression of personal values in the workplace and the implications of such expression and suppression for leadership, and careers. He has consulted in the areas of executive development and strategy, independently and in association with Manus, a Right Management Consultants Company, and Orbis Learning Corporation. E-mail:
[email protected]
38 O R G A N I Z A T I O N A L DYNAMICS
In order to find out how and w h y organizations are using competency approaches, we looked at 31 leading North American organizations with strong involvement in executive development efforts. The directors of executive education and development were interviewed. In each case, the interviewees were familiar with their organizations' competency frameworks, and m a n y of the respondents had been involved in the development of those competency frameworks. (See Exhibit 1 for a list of participating organizations.)
A Recent Phenomenon One intriguing finding from our research is that use of competency approaches with executives is a fairly recent phenomenon. Of the 31 organizations that participated in the research, 29 of them were using a competency approach for some combination of executive development and selection. But of these organizations, only seven had been using competency applications with executives for more than five years; 12 organizations had been embracing executive competencies for only two years or less. The remaining 10 organizations using executive competencies had been using them between 2 to 5 years. Why have competencies suddenly become so popular with executives? We believe that the competitive demands placed on today's organizations have caused them to look at every possible area for improved competitiveness--including executive performance. As one woman who participated in the research said, "We had a growing awareness that we were expecting a great deal from our leaders." Competencies are perceived as an important tool in helping to define and improve superior executive performance.
Providing a "Common Language" While the disadvantages mentioned were quite varied, those interviewed agreed that the most important advantage of competency grids is that they give organizations a "common language" that line executives, highpotential managers, and h u m a n resources can use to discuss executive performance, selection, development and advancement. As Jane Rifkin of Lucent Technologies put it, "Competencies give us a common language with which to communicate what needs to be emphasized and de-emphasized." In addition to using common phrases and labels, there were other advantages mentioned to using a common leadership framework. Competency frameworks are largely systematic, giving a degree of sophistication and legitimacy to applications, such as succession planning, that has sometimes been lacking. As Rod Brandvold, former director of executive development for Northern Telecom, said, "Competencies provide a roadmap that lets people know 'what I have to do.' That's a very important employee service."
THREE A P P R O A C H E S T O DEVELOPING
COMPETENCY
FRAMEWORKS A central finding was that there is a variety of ways that competency models are created. This is in contrast to the widely held view that most competency models are based on research and behavioral data. The three major approaches organizations used were a research-based approach, a strategy-based approach, and a values-based approach. (See Exhibit 2.) T h e R e s e a r c h - B a s e d Competency
Approach Of the 31 organizations studied, 12 organizations used a research-based foundation for their competency framework. In this classic and perhaps most methodologically rigorous approach to competency development, pop-
DouglasT. (Tim) Hall is a Professorof Organizational Behavior in the School of Management at Boston University. He is also the Director of the Executive Development Roundtable and a core faculty member of the Human Resources Policy Institute. He has also served as Acting Dean and Associate Dean of Faculty Development and Faculty Directorfor Masters Programs at the School of Management. He has held faculty positions at Yale, York, Michigan State and Northwestern Universities, as well as visiting positions at Columbia and the U.S. Military Academy at West Point. At Northwestern, he held the Ead Dean Howard Chair in Organizational Behaviorand served as departmentchair. He is the author of Careers in Organizations and co-authorof The Career Is Dead--Long Live the Career, the Handbook of Career Theory, and other books on careersand management. He is a recipient of the American PsychologicalAssociation's GhiselliAward for research design and the Walter Storey Professional Practice Award from ASTD. He is a Fellow of the American Psychological A~sociationand a Fellow of the Academy of Management. He has also servedon the Board of Govemorsof the Centerfor CreativeLeaming. His research and consulting activities have dealt with career development, women's careers, career plateauing, work/family balance, and executive succession. He has served as a consultant to organizations such as Sears, AT&T, American Hospital Supply, General Electric, Borg-Warner, Price Waterhouse, Monsanto, Honeywell, Ford Motor Company, Eli Lilly, and the World Bank. E-mail: dthall @bu.edu AUTUMN 1999 39
ularized by the late psychologist David McClelland and the Hay/McBer consulting practice, executives are nominated who are perceived to be top performers. These executives are interviewed and asked to give behavioral examples or "critical incidents" that exemplify the keys to their success. Such behaviors are systematically analyzed and validated as consistent with superior performers (as distinguished from good performers). This process is usually labeled "behavioral event interviewing" (or BEI). A less rigorous approach is to simply interview or survey executives or human resource professionals on the executive skills critical to their current performance. One of the companies using a traditional 40 O R G A N I Z A T I O N A L DYNAMICS
research-based framework is PepsiCo, Inc. A representative from PepsiCo, Inc. participating in the research reported that while the company had used competencies for around 20 years at lower levels, interest in executive competencies "surged" about five years ago. The representative reported that the company was seeing massive growth at the time and wondered how it could sustain that growth rate. "Part of our limitation was people: How are we going to find and grow talent?" PepsiCo, Inc.'s challenge was seemingly not one of figuring out how to succeed but of supplying and developing even more executives capable of leading the ever-growing company. Therefore, the company took a primarily research-based approach in developing their competencies, trying to document the ingredients to the success their executives had enjoyed, and to profile those ingredients in a way that fueled future selection and development applications. In addition to analyzing successful behavior distinguishing high performers from less outstanding performers, PepsiCo attempted to look toward emerging skills by including executives in the analysis who were thought to represent good "future performers" based on current projections about the future. Because PepsiCo, Inc.'s common values were an important component of its strong performance, the analysis also surfaced "cultural competencies" representing PepsiCo, Inc. values and m a n a g e m e n t methods unique to the company and absolutely essential to success in that environment.
The Strategy-Based Competency Approach One company representative involved in the research said about her high-tech company, "We have a new vision every 12 months!" How does such a company whose challenges, strategies, and roles are changing so often benefit from a research-based competency framework? Another person, who initially considered the research approach and then became skeptical, stated, "Competencies based upon
EX.%~IBIT2: Approach
Research-Based
Strategy-Based
vaues-~.t
9
4
~
am, m ~
c.ompm~.s 2
Description
Competencies based upcm behavioral ~ e a r c h on high-performance executives
Competencies forecasted to be strategically important based upon an , ,~tidpated future
Processes used
Most rigorous approach Most common approach validates competendes by is to simply interview g p stop exo . ves from nominated as to anticipatedfuture superior-performing chaLlenges/opportunilies executives(Behavioral and the competencies Event Interviewing[BEll). assumed to be emerging Other approaches include in importance. Some simply interviewing executives companies u~liTe external or holding focus groups. consultants' competency Finally, some companies databases to predict .............. use generic "off-the-shelf' competencies generated by upon organizations that external consultants or have passed through other companies. shnilar strategic stages. Internal panels, scenario planning, futuristsand expert panels also employed
4
Competencies based formally or in~rmally upon organizational norms/ ,,cultural values
Combines one or more of three previous approaches
Approaches range from very careful and
Two or more processes reflecting some or all of the competency ai~roaches are used and fully developed intoa competency framework
processesinvolvingtop execulivesto simple "pronouncements" made by a singleC E O or lists generated by FIR committees.
by some ~ e s . Examples
• "Technico," with help of external consultants, nominates "superior"executives, deciphering and validating superior traits and behaviors and developing framework,
•"MultiCo" uses externsJ hal consultants to identify needed competencies to achieve organizational change based upon other companies' experiences. Futurists and internal/ external panels inform process.
•"Compuco" CEO assigns • "MarketCo" high-level executives simultaneously to lead interviews and conducts behavioral structured dialogue with event interviewing,
or aspired to, These values frame the developed competency approach.
and utilizes ext~ consultants to lm competencies of
combined in the competency fTamework which is matrixed around the core values of the company. o "Financeco" obtaim ~ developed list of "generic" competencies and uses them to develop a ~ framework informed by executive opiniom gathen~ from focus groups or interviews,
O'ProductCo" HR committee interviews~pxmps of executives as to opini0~ on future and strategic nseds and usesthese opinions to form competency framework.
AUTUMN 1999 41
current performance don't make sense if current performers don't have the skills you need." Still another executive development manager interviewed said, "When you start talking about competencies, the only person our executives can identify with is Jack Welch." What can competencies be based on when past superior behaviors exhibited by executives are not predictive of future competency needs, or when executives who emulate desired competencies are not found within the organization? An increasingly used alternative to research-based competencies is the strategybased approach. Here competencies are driven by the strategic direction of the firm. Nine of the organizations interviewed based their competency frameworks directly upon strategic directions and goals, while several others used strategic concerns indirectly to influence their competency framework. The efficacy of any such framework depends directly upon the accuracy with which a company forecasts the future, the appropriateness of the ensuing strategy to that future, and the degree to which inferred competencies in fact fuel strategic performance. Knight-Ridder, Incorporated provides a good example of a company benefiting from the strategy-based approach to developing a competency framework. As Rob Reed, who was director of training at Knight-Ridder at the time of the interviews, explained, "[When we started] we had no attraction to competencies. We did do performance reviews with attention to development and succession planning." What changed quickly, according to Reed, was the business environment Knight-Ridder faced in terms of competition and technology, representing a major shift. Suddenly, the journalistic skills that the company's management possessed were not enough to maintain the company's standing. As Reed put it, "Some of our strongest strengths turned out to be our greatest barriers." He pointed out that it needed broader management and leadership skills. But competencies based upon past performance did not make sense since current performers did not yet have the necessary skills. So the company took a strategy-based approach to developing competencies--or, as 42 ORGANIZATIONAL DYNAMICS
Reed said, "We looked at what we were messing with!" Of course the process was much more complicated than that. Using available data from performance reviews and new interview data from executives and strategic plans, Knight-Ridder developed management competencies that would help it get to where it needed in the unfolding future. With the help of Applied Research Corporation they were able to define competencies in part by looking at professionals working in other companies, who were facing or had faced similar challenges. Now, as Reed says, "Everything we do is created for a specific set of competencies and identified development needs. Our focus is on development."
The Values-Based Competency Approach Another alternative to traditional researchbased competency frameworks is the valuesbased approach, the use of idiosyncratic, normative, or cultural values to construct competencies. One way to use values to develop competencies is to simply base the competencies directly upon formal organizational values. This was the case in four of the organizations that were studied. In five other organizations, while the overall competency approach was not values-based, certain specific competencies within the framework reflected company values. One company, a long-time competency user, was continuously updating the more research-based competencies. At the same time, according to the h u m a n resource executive interviewed, the company would not change those competencies that reflected the firm's values. "These [values-based competencies] are nonnegotiable," he asserted. Values-based approaches do not necessarily reflect the formal normative or cultural values of the company. Sometimes an approach might reflect feelings or attitudes of a top executive though it is not developed in a systematic way. For example, one research participant said when his CEO was given the preliminary list of competencies developed
through literature reviews and benchmarking, he "looked at them for about ten seconds and changed them using his words and phrases." The company using the most impressive process to develop its values-based competency approach wishes to remain anonymous, so we refer to it here as "TechCo." As its director of executive development reported, the businesses making up TechCo. had used several versions of leadership competencies for years---with varying degrees of success. However when they recently assessed their leadership "warehouse" (i.e., bench strength), they found it was not as well "stocked" as they would like. "The people who on paper were supposed to be leaders weren't. On the surface the reported numbers looked quite good, indicating we had succession coverage for most of our top positions. But when we studied those numbers closely, we found a different story...that many people had been identified as leaders based upon a narrow set of standards for a specific part of the business or functional area, not corporate-wide standards. Our processes were not positioned where we needed them and not aligned for developing top leadership for the corporation." As TechCo. looked at its leadership situation, it had to consider whether yet another traditional research-based competency approach would be of most value in identifying the key leadership resources that would be needed. It ultimately took a different, values-based approach. Over several months, the company undertook an initiative to reflect upon what it was really looking for in its leaders and to determine the impact of its business units' competencies in developing the leaders of the corporation. "We were trying to determine who TechCo. leaders are, or what we want them to be, and fundamentally what leadership is all about at TechCo." What the director of executive development and colleagues did was to take a step back and look at the essence of successful leadership at TechCo. But they decided to do it not through strict external behavioral analysis but by having the top executives of the corporation define for themselves the cultural and leadership values that could be used to identify future leaders. These executive partici-
pants were energized by the process, and the director of executive development pointed out how crucial it was for them to own it. The final version of their competencies used the executives' exact language. Having developed the leadership profile, those top executives then engaged in a process of personally deciding how it would be applied and made most useful for the company, with the help of HR. It is not hard to see how successful companies can benefit by making sure current and future executives are inculcated with the company's values, so necessary in ensuring that executives' business and technical competencies are effectively utilized in a particular company's culture. There were some other organizations in the research with excellent records of performance who were rethinking their traditional competency approach and considering a values-based approach, some in very dramatic ways. Interestingly, most of the organizations considering such an approach were among those who had used executive competencies for several years. Recent adopters tended to gravitate to more of a research-based approach. It is too early to tell if this is a postcompetency approach trend, but such efforts may represent an emerging "back to basics" method for companies that have not been satisfied with a purely analytical or technical approach to competency development.
C O M P A R I N G THE THREE COMPETENCY APPROACHES: ARE WE T O O H A R D O N SOFT APPROACHES? A curious finding of the research is that no matter which of the three methods was used to identify competencies in a given company-research, strategy, or values--most interviewees seemed to treat their company's competency model as though it were research-based! In other words, most company representatives used language similar to the research-based definition in discussing how their organizations defined competencies. But even though people used scientific language in discussing AUTUMN 1999 43
their competencies, when they described the specific activities and procedures that were used to come up with the competencies their company settled on, it was the researchers' conclusion that they were not always in fact employing a research-based method. To us, this overuse of research-based language seemed to reflect a general bias against values and strategically defined competencies, with more favorable feelings toward behaviorally defined research-based competencies. Perhaps the perception is that using more scientific language in the competencies creates an impression of legitimacy. It may be that without a rigorous language for describ44 ORGANIZATIONAL DYNAMICS
ing competencies, competency frameworks are perceived as "soft" as other HR applications have been labeled. The irony here is that basing competencies on strategy or values has certain advantages over traditional research-based frameworks. Strategy-based methods, for example, are potentially more business-relevant and generally more flexible than research-based models that can take years to create, with rounds of behaviorally based interviews, meetings to test and refine the competencies, dealing with resistance to psychologists, often followed by another long period for developing applications (e.g., selection protocols,
training programs). But to the degree that they are treated like the research approach, strategy and values-based methods lose some of their inherent advantage over the classic approach to competencies. It takes time to go through processes that create an appearance of research, such as interviews and meetings to "validate" the model with managers, and at the same time the company loses the advantage of simply saying, "These are the qualities we expect in our managers, based on our company's commitment to these basic values," or, "These are the competencies that will be essential for our managers to have if they are to provide strong leadership in moving our company in this strategic direction." Each of the major competency approaches has advantages and disadvantages (see Exhibit 3), and companies would be wise to weigh these before they employ a given approach. We now look in depth at potential advantages and limitations of each of the three major approaches.
ADVANTAGES AND L I M I T A T I O N S OF R E S E A R C H BASED COMPETENCIES The key advantage of having a research-based foundation for competencies is that the resulting competencies are related to validated behaviors empirically correlated with successful performance within a particular organization. This scientific flavor seems to add a feeling of legitimacy for many. One interviewee whose company used a strict research-based approach reflected this sentiment when she said that research-based competencies have "face validity with line management. We can translate a vision into concrete behaviors that are more predictive of success than other competencies." Another built-in advantage of researchbased approaches that involve behavioral event interviewing is that those interviews involve executives heavily, and their involvement often leads to greater enthusiasm for the competencies later. The databases developed from such interviews are unparalleled in their ability to provide specific behavioral examples that can be used to guide selection and development.
Of course, a research-based foundation to developing competencies is not immune to criticism. The basic debate is around how accurate and how comprehensive competencies are, no matter how carefully they are developed. After spending four years as part of a group carefully developing research-based competencies, one of the research participants commented: "It's the best shot at defining competencies we can come up with right now. [However] I still don't know to what extent we should be betting the farm on competencies--I still don't know to what extent it should be guiding transformation." Some of those executive development professionals with whom we talked felt that researchbased competencies predicted success but argued that they were easily derived. Discussing how his company's competencies were developed, Val Markos, director of executive development at Bell South Corporation, said, "We're not talking heavy research, and I feel this is the right way to go. Competencies, if they're the critical short-list of competencies, hit you in the face." Some of those advocating this simpler approach have concerns about the potentially heavy costs related to research-based competency development in terms of time, money, and labor. And what about competencies that are not easily identified through scientific approaches? Are there not important competencies that cannot be measured or observed reliably? One person we interviewed from a highly respected company remarked, "The intangibles are not always identifiable." Executive success stories are replete with depictions of leaders doing extraordinary and unpredictable things that do not necessarily surface in the traditional method of identifying research-based competencies. Probably the most common criticism is that traditional research-based competencies practically (and by definition) focus on past or, at best, current behavior of executives to develop future competencies. For years it has been suggested that those planning for management's needs and development should focus on the future. But we cannot be assured in all organizations that behaviors exhibited by today's top performers will be equally effective in the future. The future is characterized by rapid change and this "permanent AUTUMN 1999 45
white water" quality and its ambiguous nature prevent us from knowing if current exemplary performance will be congruent with the requirements for future performance.
ADVANTAGES AND L I M I T A T I O N S OF STRATEGY-BASED COMPETENCY F O U N D A T I O N S The obvious advantage of a strategy-based approach is that it allows organizations to position themselves and their leadership for the future even in situations where that future is less than certain. As at Knight-Ridder, Incorporated, a strategy-based foundation is advantageous for pursuing a change strategy, especiallywhen an existing competency approach is not in place. This allows executives to focus upon learning new skills. For companies in rapidly changing environments, a research-based approach would rarely be warranted and a strategy-based approach would seem to be a more realistic response. A representative from a company that was developing executive competencies for the first time illustrates this approach: "We went through interviews and analysis with senior people, in focus groups, and asked what's the strategy, whaf s most important, what are the obstades." Of course, the inherent strength of the strategy-based approach---the ability to respond to an u n k n o w n future---is also its source of potential weakness. The accuracy with which the future is predicted and prepared for will assuredly impact the effectiveness of any strategy-based approach. Strategy-based approaches have come a long way in forecasting emerging and future competencies. With the rapidly changing environment, companies and consultants have adapted the research-based approach to be useful for companies pursuing a strategy-based competency framework. Processes have been developed that combine several relevant groups such as managers, academics, concerned stakeholders, and others to carefully project what future skills might be needed within the context of the company's strategy. For most companies pursuing a strategy-based 46 ORGANIZATIONAL DYNAMICS
competency approach, the interview or survey techniques also remain but now, in addition to asking about current and past exemplary performance, executives or other "knowledge leaders" are asked to outline the company's strategic direction, strategic challenges, and their roles and associated skills in the change.
ADVANTAGES AND L I M I T A T I O N S OF VALUES-BASED COMPETENCY APPROACHES It would seem that a values-based competency framework could potentially be very effective. Company values may provide stabih'tyand a consistent approach to conductingbusiness, learning, meeting customer needs, and leading that is able to weather and even proactively shape trends in the business environment. Well-regarded examples of this approach are Hewlett-Packard and Johnson & Johnson, whose values have been lauded as contributing to their success, particularly their adaptability in difficult industries. Part of using a values-based approach seems to be trying to simplify competencies with the idea, that as one research participant put it, "The shorter the competency inventory, the more likely the competencies are to be used." A human resource executive from a wellmanaged company turning to a values-based approach from a strict, research-based approach, described how "competencies and the modeling process became an end instead of a means to an end, and the outputs got lost...now, the culture and our values drive the competencies." One limitation of a values-based approach is that methods for establishing a values-based framework do not necessarily reflect a systematic process that comes more naturally to a research-based approach attempting to reflect a scientific method. Organizations using a valuesbased approach in developing competency frameworks would be wise to ensure that the process they use is well thought out and reflects a systematic approach. Pure values-based approaches have the apparent flaw of not being research-based.
AN UEAlU,Y ~ R "
OF
ATILT
attempts tO get at those areas for external candidates." The
technical skills and knowledge, as well as management
EXHIBIT 4: AT&T'S LEADERSHIP MODEL
Results
A
mance). This leadership model is envisioned at AT&T as a pyramid, as shown in Exhibit 4, Self Awareness is defined as follows: =Has mature insight into own skills, beliefs and motives resurdngin confldent, wise and courageous behavior." This metacompetency is defined operationallythrough descriptors as:
/
~ X
Manifestation of What's Learned
/ Workplace \ / Behavior k ~ - ~
u~ =:
/ __ Competencies
=~
//
Has a realistic and accurate self.view.
•
N I Learned Management/Leadership Skills N ~ { ~
ow,e e \
PersonalCompetencies
Is willing to speak the truth and advocate positions even when unpopular. Responds genuinely and consistently to people and situations without hidden motives or artificial tactics.
// .~
• SelfAwareness
• Openness to Learning
Purpose. Vision.Values, Business Strategy
)
Enable Learning \ \ ),.
Source: Laurie Hutton-Corr
Recognizes and uses own ability to affect complex business problems and difficult people issues. Ftemainsfocused on the most important needs of the business in times of stress and hardship. ;and uses the lessons of experience and personal interaction as opf Seeks feedback from others that leads to changes in own behavior. Keeps current in areas important to the business. Is open to and invites ideas, new information, and diverse perspectives. Responds to criticism and negative results by seeking to understand the lessons to be teamed. Reflects on own experience in ways that create insight and improve effectiveness.
AUTUMN 1999
47
They are not necessarily built upon behavior, although company values around performance may reflect informal or organizational-level learning regarding effective behavior. If a company's values are not adaptive to the emerging business challenges or to superior executive performance, then the competency framework may be ineffective.
A NEW APPROACH TO DEVELOPING COMPETENCIES: C O N T I N U O U S LEARNING A N D METACOMPETENCIES Our view of the competency models that we now see in practice is that they are too complex and can become mired down in overly detailed competency definitions. As an alternative, we propose a new focus u p o n continuous learning. A continuous learning approach to competency development would focus primarily on helping executives "learn h o w to learn." It would emphasize those executive attributes and skills that would help the individual in: (1) becoming aware of the need for new competencies on an ongoing basis in rapidly changing environments; (2) knowing how to develop those new competencies himself or herself; (3) transferring that learning and associated competencies (via responsive HR systems) to other executives in the organization where appropriate; and (4) institutionalizing learning wherever possible in the organization's culture and systems to increase organizational learning and adaptability. While no companies currently rely upon such an approach, early visionaries are seeing that a continuous learning approach will be crucial to their companies' future success. Consider the following quotes from some of those we interviewed: "Traditional competencies are not adequate, high performance is not adequate--we are leaning toward identifying and fostering 'learning skills. '" "I have reservations about competencies. The environment is very rapidly changing. Beyond those competencies related to somebody's ability to learn, you'd end up with a competency that would 48 O R G A N I Z A T I O N A L DYNAMICS
be outdated in a few years." "We have talked about competencies so much that we use it to describe a list of skills... "I would label the next thing "metacompetencies.' Maybe this laundry list is the wrong approach." These practitioners are not alone in their emerging insight into learning as a powerful anecdote to the challenges of a rapidly changing environment. More than a decade ago, Warren Bennis and Burr Nanus found the personal quality most needed in running an organization was personal learning in a study of 90 renowned leaders from various fields, including business. Morgan McCall has theorized that the "ability to learn" may be a more important predictor in successfully selecting high potential managers for international leadership roles than how well those managers currently exhibit the actual skills they will need later.
PUTTING IT INTO PRACTICE: ADAPTABILITY A N D IDENTITY AS KEY LEARNING METACOMPETENCIES What would this continuous learning approach to competency development look like in practice? Hall has proposed the concept of a metacompetency--a competency that is so powerful that it affects the person's ability to acquire other competencies. An analogy would be reading; once a person has the ability to read, all sorts of other learning that are communicated through the written word become accessible to that person. In particular, Hall has proposed that two key metacompetencies related to career development are identity and adaptability. If a person has adaptability, he or she is able to identify for himself or herself those qualities that are critical for future performance and is also able to make personal changes necessary to meet these needs. But adaptability alone is not enough. The person also has to change his or her awareness of self, so that he or she internalizes and values that change. Thus, the second metacompetency is identity: the ability to gather self-related feedback, to form
accurate self-perceptions, and to change one's self-concept as appropriate. Adaptability without identity can be mindless reaction to the environment, with no self-direction. Identity changes without adaptability would be very self-aware inaction. With adaptability and identity change, the person has learned how to learn. How would one define and develop these two metacompetencies? Adaptability learning competencies would include behaviors that would demonstrate: • Flexibility, • Exploration, • Openness to new and diverse people and ideas, • Dialogue skills, eagerness to accept new challenges in unexplored territory, and • Comfort with turbulent change. There are already many things that companies do to provide adaptability experiences to their managers, and simply refraining them in this way would be helpful. For example, diversity training can heighten adaptability, as can international assignments. Managing a major change process, leading a turnaround, or launching a start-up venture are business assignments that demand and develop adaptability. Identity learning competencies would involve behaviors related to: • Self-assessment; • Seeking, hearing, and acting on personal feedback; • Exploring, communicating, and acting on personal values; • Engaging in a variety of personal development activities and being willing to model this personal development activity; • Rewarding subordinates for personal development work; • Being open to diverse people and ideas; • Actively seeking out relationships with people one sees as different, in which one is being stretched to learn; and • Being willing to modify self-perceptions as one's abilities, roles, and other personal qualities and situations change. What drives identity changes? As an
executive moves to higher levels of responsibility, he or she must learn to change the basis of his or her self-identity away from individual contributions as the basis for self-esteem and toward defining personal value and esteem through the accomplishments of subordinates. This change in the basis of personal identity is an incredibly difficult form of identity learning, especially in professionally based organizations (e.g., technology-based businesses or financial services). Yet it is essential for personal and corporate growth and adaptability. Self-assessment and personal development programs, such as the Leadership Development Program or Leadership at the Peak at the Center for Creative Leadership, provide significant identity learning. Executive coaching and 360 degree feedback are other popular ways that companies are providing identity learning for their managers and executives. One company that we studied has already taken a bold step toward this in one of its divisions. The company reports that in that division, the managers designed their new competency system around just two skills: (1) the ability to learn from experience, and (2) potential for long-term growth. For another, more specific example of how an early adopter of metacompetencies is defining and envisioning them, see the discussion of AT&T in the accompanying box.
P R O P O S E D G U I D E L I N E S FOR PRACTICE
One clear finding emerging from our research is that the use of competency frameworks in the selection and development of executives is alive and well. When asked, "Do you expect to continue to rely upon competency approaches as much in the future as you do at present?", not a single respondent indicated he or she would use them less. In fact, 14 organizations surveyed said they would be using competencies "somewhat more" or "substantially more." Furthermore, only four of the respondents could envision any other approach to executive selection and developAUTUMN 1999 49
ment replacing their reliance on the competency approach in the future. However, based on our critical analysis of the current state of the competency practice, we would argue that several improvements are necessary to meet future demands. In that spirit, we offer several recommendations to help companies improve their executive competency applications:
their application. As one person interviewed said, "We're very good at designing but wickedly weak at implementing." Competency frameworks have a lot of"face validity," and developing them is apparently engaging to their creators, if not fun and exciting. But all of the work in development is wasted if it not actually used in improving selection, development, and other applications.
Be strategic and clear about which competency method you are using, and use it to its fullest advantage. One way companies could improve their competency frameworks is to be strategic and clear about the foundation their competency approach is based on. The traditional research-based competency approach is not right for everybody--different frameworks are appropriate for different companies. And these different approaches can be combined, by design, and with awareness, into hybrid approaches that produce the most beneficial possible competency framework for a given company.
Remember that the competency framework should provide a common language. Competency frameworks need to be simplified to increase their use. The easiest way to do this, no matter which foundation is used to develop the framework, is to use the executives' language in defining competencies. It not only makes the competencies more familiar to their ultimate end-users but provides involved executives with a sense of pride and ownership. This in no way has to change the raw behavior or values associated with a competency, but it invites executive participation and enthusiasm on a greater level. After all, as much as predicting success, if not more, competencies' value is in providing the entire organization with a common language. And this final pair of guidelines relate to h o w you can use competencies to manage change most effectively:
Value your values. As discussed in this report, using values to inform competendes is not only "all right" but may be reinforcing the greatest advantage some companies have--their culture. Yet many companies' competencies that are in fact values-based are cosmetically shaped to appear more researchbased. As reviewed, research-based competencies are no panacea and their predictability is less than fail-safe when future-based competencies are targeted. As one consultant interviewed stated, "Treating it as a science can lead to overzealousness." There would seem to be power in unabashedly proclaiming a values- or strategy-based competency approach as a few companies have. The following two guidelines relate to how you apply your competency framework: Don't let the means become the end: Apply your model. A competency model by itself has no value. Too many companies interviewed admitted that they had spent a disproportionate amount of time on developing competency frameworks but very little on 50 O R G A N I Z A T I O N A L DYNAMICS
Take account of the future. This recommendation sounds too obvious. Even so, many of the best U.S. companies develop their competencies as if the next five years can be navigated the same w a y as the last five were. For an increasingly small cross-section of industries, this may be true. When developing or revising competency frameworks, companies may want to consider using consultants to identify executives and others outside their companies and even outside their industries who already exhibit some competencies that seem to be growing in importance. This, in combination with using futurists, databases and companies' own "advanced" executives and professionals, appears to be a better w a y to get at future competencies than only asking current executives to speculate upon the company's future.
Include learning metacompetencies. Executive competencies appear to be entrenched. Their current surge in popularity seems to stem from their perceived ability to make sense out of qualities executives and managers need to perform strongly in the current chaotic environment. They provide comfort through their perceived sophistication and connection to corporate core competencies. But comfort and a common language will not alone be enough to sustain competency use. Despite its best efforts, no company is smart enough to anticipate every possible competency executives will need in the future. The 31 organizations participating in the research took an average of 4.1 years to revise their competency frameworks, far too long to keep up with many of the unfolding business and leadership challenges encountered by today's organizations. It would seem wise to equip executives themselves with
learning "metacompetencies" that will help them develop the "just-in-time" competencies they will need in order to adapt to ongoing, short-term challenges and the personal competencies that will help them endure and lead through multiple waves of change. In closing, then, it seems clear that competency frameworks must be reliable and flexible as a guide to executive selection and development in the increasingly turbulent environment of the future. For the creation of the flexible, adaptable organization that will become the norm in the 21st Century, we will need to identify and develop metacompetencies, such as adaptability and identity, that will enable executives to learn how to learn, independently and continuously.
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SELECTED BIBLIOGRAPHY
Continuous learning competencies for organizations and individuals are described in more detail in Douglas T. Hall and Jonathan Moss, "The New Protean Career Contract: Helping Organizations and Employees Adapt," Organizational Dynamics, Winter, 1998, 22-37. The classic definition of competencies used in the first part of the article is adapted from CompetencyAssessment Methods: History and State of the Art by Lyle M. Spencer, Jr., David C. McClelland, and Signe M. Spencer, (Boston, MA: Hay/McBer Research Press, 1996). These authors emphasize the research-based approach. Another important work that should be consulted in understanding the research approach is The Competent Manager: A Model for Effective Performance by Richard E. Boyatzis (New York: John Wiley & Sons, Inc., 1982). Joseph A. Raelin and A. Sims Cooledge discuss whether generic competencies can be successfully adapted in one specific organizational context in "From Generic to Organic Competencies," Human Resource Planning, 1996, 24-3. The original research report from the first author upon which this article is based is Competency-BasedApproachesto Selectingand Developing Executives: Current Practicesand Suggestions for Improvement(Boston, MA: Boston University Executive Development Roundtable, 1996). Competencies at the executive level have become important in step with competencies at the organizational level. C. K. Prahalad and Gary Hamel discuss such competencies in "The Core Competencies of the Corporation," HarvardBusinessReview, May-June, 1990, 79-91. The useful metaphor of "permanent white water" we borrowed to typify the
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emerging organizational context was coined by Peter B. Vaill in Managing As A Performing Art (San Francisco: Jossey-Bass, 1989). Two useful sources suggesting processes for intelligently engaging the "whitewater" are B. Scheider and A. M. Konz "Strategic Job Analysis," in Human ResourceManagement, Spring, 1989, 28 [1], 51-63, and two Harvard Business Review articles by Pierre Wack: "Scenarios: Uncharted Waters Ahead," September-October 1985, 72, and "Scenarios: Shooting the Rapids," November-December, 139. Connections between executive learning and formal organizational succession planning processes are examined in Douglas T. Hall, "Dilemmas in Linking Succession Planning to Individual Executive Learning." Human Resource Management, 25 (2), 235-265. Ways of linking executive learning to corporate strategy are described in Douglas T. Hall, "Executive Careers and Learning: Aligning Selection, Strategy, and Development," Human ResourcePlanning, 1996, 14-2. Warren Bennis and Burt Nanus describe the importance leaders give to learning in Leaders: The Strategiesfor Taking Charge (New York: Harper & Row, 1985). The competencies that will be demanded in the new economy are described in Douglas T. Hall and Associates, The Career is Dead - Long Live the Career (San Francisco: Jossey-Bass, 1996); Morgan McCall, High Flyers: Developing the Next Generation of Leaders (Boston: Harvard Business School Press, 1997); and Michael B. Arthur and Denise M. Rousseau, The Boundaryless Career:A New Employment Principlefor a New Organizational Era (New York: Oxford University Press, 1996).
