Many organizations define their strategy, then articulate it in actionable terms by formulating objectives, measures and targets, and may even align their entire workforce via personal performance management forms or personal scorecards. Yet, in spite of all the different elements of strategy execution in place, and that all strategic assumptions seem to make sense, results are difficult to come by, or maintain.
There I a reason for this: A surprising disconnect between the strategy itself and the development of human capital and related training plans to ensure employees are prepared for strategy implementation. Success depends on ensuring that strategic competencies are in place to support the objectives of the organization.
“Corporate learning and growth objectives relate to recruiting the best talent into the operating companies, operating an outstanding corporate university for internal training and education, providing varied career development opportunities for emerging leaders in the corporation, and sharing best-practice knowledge about similar processes throughout the operating companies. [However, t]he greatest payoff comes from an increased focus on strategic competencies.“ – Alignment, Drs. Kaplan and Norton
By strategic competencies, they mean the technical and behavioral competencies that directly support and impact the achievement of strategic objectives. They are not related to thinking strategically but to the clusters of jobs or “strategic job families” that wield the greatest impact on an organization’s strategy and are identified directly from it.
Before proceeding any further, let’s clarify what strategy is and what it is not. Strategy IS NOT everything that an organization does. However, strategy IS everything that an organization aims to do differently to gain a competitive advantage. Strategy does not replace “business as usual”, although in some cases it may disrupt operations and require a complete change of the business model. Strategy’s role is to add the competitive edge designed to make the organization grow and thrive.
Now, although the large majority of employees likely possess the necessary skills to ensure the business runs smoothly at best-practice level, experts estimate that 5–10% of strategic competencies, those related to strategic job families, are what significantly impact the strategy, and so prioritizing the learning of these is what guarantees the success of the strategy.
The end result of prioritizing the acquisition and development of strategic competencies is what Drs. Kaplan and Norton call Human Capital Readiness. So, let’s delve deeper into the process of identifying strategic competencies.
1. Identifying strategic processes
The starting point is always to articulate the strategy in terms of strategic goals and objectives. If the organization uses a Balanced Scorecard approach, the starting point should be the Internal Perspective. In both cases it is required that:
• Analyzed objectives have objective statements or definitions provided by the strategy team to ensure correct understanding of the scope and breadth of the objective.
• Information on the measures or KPIs be provided to yield a further level of clarification and depth.
• Additional work is carried out to identify the key strategic processes that directly impact the performance of each objective.
2. Identify competencies required to support the strategic processes
Once strategic processes provide enough granularity to analyze the required skills, knowledge, and attitudes or behaviors, a cross-functional team made up of members of the strategy and performance management team, human resources representatives and the objective owners should draft the competencies requirements for each process, analyzing:
• what knowledge is required to execute the process
• what skills are required to optimally carry out the different tasks
• what behaviors and attitudes are necessary to perform each job well
3. Cluster strategic competencies into profiles and match them to “job families”
Although some organizations prefer to identify job families first,
and then identify strategic competencies, this can pose some issues, as they might overlook certain competencies in order to fit the approved list of job. In contrast, if the competencies are matched to the strategic processes before being given names of existing jobs, the exercise is much more fruitful, ensuring that:
• All required competencies are identified for each strategic process
• All required competencies are mapped to strategic job families. The naming of the job families comes afterward, rather than forcing a tag and a clustering that might not be natural
• Overlaps in functions may be identified and weeded out
• Strategic jobs can be more tightly identified and, if necessary, priorities in business unit and individual performance shifted accordingly
4. Assess competency gaps
Once the job clusters and who in the organization performs them is delineated, the next step is a full assessment of the existing workforce against the strategic competencies. This assessment can take a variety of forms, from self-assessment to third-party assessment. However, it is important that the employees understand what is expected of them and that the reason for assessment is not punishment or retribution but to close any gaps in their knowledge and skills and ready them to better support critical strategic processes.
5. Define training plans
Once there is a clear understanding of where gaps exist, you are ready
to define training plans for each of the strategic job families. Generally, training plans tend to cover only formal training. However, formal training is costly, and, depending on the specificity of the competencies, may not be efficient due to lack of customization. Therefore, we recommend considering informal training—knowledge and skills that other people in the organization might have and can share, as well as on-the-job training, in which more experienced employees can help build skills in those less experienced.
Because individuals may have different skill gaps, it is important to realize that the strategic job families with their competency profiles will be a starting point for individual learning plans.
Some of the world’s most successful organizations have taken this approach, with notable benefits. The most obvious ones include:
• Increases in workforce efficiency
• Considerable improvements in business results
• The L&D function becomes a driver of growth that can demonstrate the impact of its spending across strategic indicators and through ROI
• As much as 40% of the current L&D expenditure can be trimmed down and reallocated to training programs that make sense for the organization
• L&D professionals can easily justify investments in certain programs
About us:
Clientoscope (www.clientoscope.com) relies on the skills and dedication of an international team of fully qualified freelance consultants with more than 15 years of experience to support you in growing your organization. Our solutions include: alignment of the different functions to your strategy to better support it, preparing your workforce to deliver the strategy by setting up in place personal performance and customized capability building mechanisms, as well as ensuring the consistency of the customer experience with your brand and strategic direction. We engage with our customers in a variety of formats, from expert advisory services, consulting and training to outsourcing and DOT (design, operate, transfer) services. If you would like to discuss with us about your needs, please get in touch at [email protected].