Grace Smith
February 7, 2024

69% of surveyed HR professionals believe their respective organizations suffer from a skill gap. This means that their employees do not have the right skill set to do the job the company requires them to do.

Employees with the right skills and competencies that can help a company achieve its objectives is considered a utopian dream nowadays.

But it isn't something that is impossible. All you need is the right approach.

Defining organizational competencies and then leveraging them can help businesses...

  • Establish a clear vision and mission and strategically guide the company.
  • Identify and cultivate unique competencies, making the company stand out in the marketplace.
  • Create high value products/services for their customers.
  • Meet specific customer needs through focused innovation and development.

In this article, we'll discuss everything you'll need to know about organizational competencies. Here's what we'll cover:

What are Organizational Competencies

Organizational competencies refers to a company's ability to deliver value and compete effectively in the market. These competencies defines an organization's success and lays a foundation on which the organization's products/services and reputation is built upon.

These competencies can be categorized into two main types:

  1. Core competencies
  2. Distinctive or specific competencies
The two types of organizational competencies
The two types of organizational competencies

Core competencies can be defined as anything that your company does well. Core competencies are what a company does best and is central to its value proposition.

For example, consider a tech company like Google.

One of its core competencies is its search engine technology. This competency underscores Google's product and services as a key reason for its market dominance.

Distinctive competencies on the other hand, are something that only your company can achieve, and sets it apart from the rest.

They are unique to a particular company and are difficult for competitors to imitate.

Let's take Apple as an example.

Its product's design, aesthetic appeal, user-friendliness, and innovation is unique to Apple. It isn't something that their competitors can easily replicate despite having similar technological capabilities.

What are the Core Organizational Competencies

Core organizational competencies differ from one company to the other. But some are crucial and relevant everywhere. Let us take a look at what they are:

Core Organizational Competencies
Core Organizational Competencies

1. Outstanding customer service

Every company dreams of becoming the best service provider for its customers. And to achieve this, the company needs a set of employees who have the skills to provide excellent customer service.

So this is one of the biggest competencies an organization looks forward to developing in its employees. Proper training is definitely a step in the right direction. 

2. Innovation and creativity

How do companies gain a solid competitive advantage? By thinking outside the box, of course!

Employees who have a penchant for creativity and innovation are always an asset to the company. Organizations that wish to have a fresh take on things that happen around them must focus on developing the skills of creativity and innovation in their employees.

You can build this by providing an open space for employees to state their ideas, like a brainstorming session.

3. Change management

People who have this competency push their coworkers to look for new and different ways to deal with problems and take advantage of chances. This makes it easier for change to happen and be accepted at work.

4. Decision making

Employees can find and understand issues, problems, and chances by being able to make decisions. They use good methods to pick a course of action or come up with good answers and compare data from different sources to come to conclusions. They do things that are in line with the facts they have access to, the limits they face, and the likely outcomes of their actions.

Other Types of Organizational Competencies

There are 8 other organizational competencies you should be aware of. Each of them play a unique role in contributing to different aspects of organizational performance.

Understanding and developing these competencies can be a significant factor in achieving competitive advantage and long-term sustainability.

1. Team competencies

These competencies comprise of the skills, behaviours, and abilities necessary for a group of individuals to work effectively as a team.

Communication, conflict resolution, collaboration, and goal alignment are some of the team competencies that lead to improved teamwork and enhance productivity.

2. Individual competencies

These refer to the competencies like skill and ability, that enhances an individual's effectiveness at work.

Key for personal career development and growth, individual competencies include time management, technical skills, and emotional intelligence.

3. Management competencies

The competencies required for effective management - planning, organizing, leading, and controlling resources and people, are termed as management competencies.

They involve resource allocation, decision-making, and employee development, and ensure that teams and departments operate efficiently and are aligned with the organization's goals.

4. Leadership competencies

Leadership competencies are qualities that enable an individual to effectively guide others. It also includes vision-setting and strategic thinking among others.

They involve vision-setting, strategic thinking, and the ability to drive change. These competencies are crucial for senior roles, as they directly impact organizational direction and culture.

5. Cross-functional competencies

These competencies enable people to work and collaborate effectively across teams.

Some of them include teamwork, computer skills, facilitation, and planning. These competencies are important in carrying out tasks across different functions and departments.

6. Technical competencies

Technical competencies are the specific knowledge and skills required to perform certain tasks or roles.

Some of them include: Proficiency in specific software, technical writing, engineering skills, or financial analysis.

These competencies are often role-specific, and are critical for technical or specialized positions.

7. Adaptive competency

Adaptive competency refers to the ability to change or adapt in response to changing circumstances.

Resilience, flexibility, and the ability to learn and apply new information quickly are some of the adaptive competencies.

8. Innovation competency

Innovation competencies involves the ability to think creatively, develop new solutions, and drive innovation within the organization.

Organizations with strong innovation competencies are often industry leaders and pioneers in their field. Like we mentioned earlier, Apple and Google are good examples of companies with innovation competencies.

Organizational Competency Framework

An organizational competency framework is a structure or model that lays out the key skills and competencies an employee must have to perform their job efficiently in the company so as to reach the company's goals and objectives.

In other words, it is a set of skills or competencies that a company expects its employees to have in order to do their jobs efficiently.

A company clearly communicates to their employees what is expected of each of them. It gives the employees a clear idea of what they should do in order to excel at the workplace.

Do you know what that clarity leads to? Better employee engagement!

Employees who have a clear idea of what they should do and what is expected of them tend to work more productively and in a much more engaged manner.

So, an organizational competency framework has more purposes than one. Some examples of the same are:

  • Resilience
  • Innovation
  • Teamwork
  • Integrity
  • Customer centricity
  • Problem-solving
  • Strategic perspective

Now, these are just some general examples of organizational competencies because they differ hugely depending on the nature and culture of the company. 

Developing an Organizational Competency Framework

Creating an organizational competency framework is a critical step in ensuring that your workforce is aligned with your company's strategic goals and operational needs. This framework serves as a blueprint for what skills, behaviors, and attitudes are valued and required across the organization.

But how do we put it into action? Here’s how:

Step 1: Identify the core competencies

Start by identifying the core competencies that reflect your organization’s strategic objectives and cultural values.

These are broad areas of expertise or behavior that are essential for your organization's overall success and competitiveness. Core competencies might include areas such as leadership, communication, innovation, customer focus, and teamwork.

Step 2: Identify skill gaps

Now that you know what kind of a future you plan for your company, analyze your employees and identify any possible skill gaps. You can make use of 360 assessment surveys for this. 

Use ThriveSparrow for running these surveys, as the platform combines 360 degree feedback, organizes and categorizes each competency, empowering both managers and employees to identify hidden strengths and pinpoint areas of improvement easily.

ThriveSparrow's Competency Summary
ThriveSparrow's Competency Summary in Group Reports helps both managers and employees pinpoint and address areas of improvement.

With the competency summary, you can identify your employees' skill gaps and train them to fill or address those gaps. Moreover, Gap Analysis helps an employee perceive their strengths and weaknesses better.

ThriveSparrow's GAP Analysis
ThriveSparrow's GAP Analysis allows for quick identification of performance comparisons across competencies.

Use ThriveSparrow to identify your org's competencies with ease and improve them with visually-organized data.

Step 3: Involve important stakeholders in the process

The development of a competency framework should be a collaborative effort involving key stakeholders from various parts of the organization.

This includes leadership, HR professionals, and representatives from different departments or teams. Their insights will ensure that the framework is comprehensive, relevant, and aligned with the actual working environment and challenges.

Step 4: Map competencies to specific roles and levels

Once the core competencies are established, the next step is to map these competencies to specific roles and levels within the organization.

This involves defining how each competency applies to different job functions and what proficiency levels are expected at various career stages.

This specificity helps in creating clear career paths and development plans for employees.

Step 5: Develop behavioral indicators

For each competency, develop behavioral indicators that provide concrete examples of how the competency is demonstrated in work situations.

These indicators should be observable and measurable behaviors that illustrate the competency in action. Behavioral indicators help in evaluating performance and guiding development activities more objectively.

Step 6: Ensure alignment with business strategy

Your competency framework should be closely aligned with your organization's business strategy.

This alignment ensures that the competencies support the company’s short-term and long-term objectives and address critical areas for success. Regularly review and update the framework to reflect changes in strategy or market conditions.

Step 7: Implement and communicate the framework

After developing the competency framework, the next critical steps are implementation and communication.

Ensure that all employees understand the competencies, their importance, and how they are applied in the organization.

Incorporate the competency framework into HR processes such as recruitment, performance management, learning and development, and succession planning to embed it into the organizational culture.

Step 8: Monitor, evaluate, and update

Finally, establish mechanisms to monitor the effectiveness of the competency framework and evaluate its impact on organizational performance and employee engagement.

Solicit feedback from employees and managers, and be prepared to make adjustments to the framework as needed. An effective competency framework is dynamic and evolves in response to organizational growth and external changes.

Developing an organizational competency framework is a strategic initiative that requires careful planning, stakeholder engagement, and ongoing management. When executed well, it provides a solid foundation for aligning employee behavior and skills with the organization's strategic goals, enhancing overall performance and competitiveness.

All You Need is the Right Outlook

Getting your core organizational competencies sorted and implementing a solid plan to fill in the skill gaps is a step in the right direction. Moreover, identifying and developing organizational competencies helps bridge the skill gap and enhance employee engagement.

Everything starts with your employees, so conduct employee engagement surveys and feedback surveys with the help of ThriveSparrow at the right intervals, and get the best results.

ThriveSparrow emerges as an indispensable tool in this process, particularly in competency assessment. This platform streamlines the evaluation of your workforce's skills, pinpointing areas where development is needed and aligning competencies with your organizational goals.

By leveraging ThriveSparrow's insightful analytics, HR professionals and managers can make data-driven decisions, ensuring that employees not only possess the skills required for their current roles but are also equipped for future challenges.

Simplify the complex task of competency assessment, and cultivate a highly skilled and engaged workforce with ThriveSparrow.