Why competency models won’t help your business succeed

In this competitive economy, who succeeds by being merely competent? Travelers found a competent solution in taxis, and switched as soon as Uber offered something better. A slew of chat services offered competent office communications, and all are silent but for the crickets now that Slack has entered the market. No, the company that seeks to offer merely a competent solution will not be long for this world.

The same is true of talent.

Calling a colleague “competent” is a classic case of damning with faint praise. “Sure, Steve will never move the company forward, but he’s quite competent at collating a fax.” There are positions where competency will suffice, surely, but for the big hires, companies need candidates who are much more than competent. And to get them, businesses must scrap that annoying tradition, the competency model.

Developing competency models is often a time-consuming exercise to identify the obvious. Many of the competency models I have seen are just lists of generic positive qualities like “meets deadlines” or “treats others with respect.” Really? I figured we were looking for people who wasted their time and were snarky to others. Wishy-washy qualifications are no help to the company looking to enforce standards, nor to the current and prospective employees looking for guidance on how to succeed.

Some companies take the opposite tack, creating competency models that are unbelievably complicated. One of my client companies showed me a competency model with 49 items on it. Talk about over-engineering! How is a list like that going to be useful to solve the really important human capital challenges that many companies are facing? I understand the importance of specifying the skill set needed for each job. A beautifully precise job description with an accurate list of role requirements makes it infinitely easier to identify suitable candidates for an open position. But any company looking for one person to check 49 boxes will inevitably end up disappointed.

The biggest problem with competency models, though, is that some companies use them as a default solution to any talent management issue. Can’t find the talent you’re looking for? You need a competency model. Women aren’t getting promoted at your company? Try building a competency model. It’s not that competency models don’t have their place as a way of focusing on key factors for success. But they’re simply the wrong tool for tackling deeply ingrained problems. It may be soothing to list out all the attributes you need and want an employee to have, but building a competency model is often time-consuming, expensive and ultimately not all that helpful in solving the problem at hand.

Recently, I have found a fourth reason to distrust the competency modeling process. In several of my client companies, business leaders who are “competent” are being let go because their role demands more than competence — it demands excellence. I see this often when a company has experienced growth and success. The kinds of leaders who were adequate in the early stages of the company’s development just don’t have the level of skill to meet the demands of a larger, more complex organization. A common scenario is when a family business is sold to a new owner. Uncle Joe was fine when the company just needed a good accountant, but now that it needs a strategic financial leader, he isn’t a good fit anymore. These are often tough choices to make, because it’s not that the incumbent is incompetent. It’s just that competency is no longer good enough.

When a company is looking to expand fast, to be the best, to outpace its competition, to disrupt the industry, to create a new market, to do something that hasn’t been done before — competence won’t cut it. Instead of a competency model, such companies need a “remarkability model.” What are the experiences, skills, traits, and attitudes that the leaders need to be remarkable at? Many companies talk about hiring A-players. But what do those players need to earn an “A” in?

Defining your remarkability model should take less time than developing a competency model — after all, there are fewer things an employee can be expected to be excellent at, rather than just satisfactory. It also has the added bonus of exciting potential and current employees, giving them something to stretch for instead of just telling them to meet deadlines and be kind. And when it does come time to make hard decisions, employees won’t be left wondering why they were chopped for preserving the status quo.

If your company is well-established in a stable market and your strategy is to stay the course, then you may do fine with a competency model. But if you are in a demanding, fast-changing environment and your strategy is to break the mold — as is increasingly the case — it’s time to start thinking about your remarkability model instead of your competency model.

Want help developing your own model? Email me at ggolden@gailgoldenconsulting.com, and I’ll send you a few questions to get started.