I’m often asked, “How do companies use competency models? I think we need them, but what can I do with these models?”

Well, my answer revolves around two trends plaguing organizations today: 1) the looming skill gaps, and 2) waning employee engagement. Not surprisingly, both of these issues lead to lack of workforce retention. Here’s the good news: competency models have the ability to address all three of these stumbling blocks.

Competency Models Aid Recruitment (and Retention)

Competency models enable better recruiting to take place in organizations. Consider a scenario in which a hiring manager asks various candidates for a front line manager position: “Give me an example of how you would facilitate career development in your team.” If you have a competency model for “facilitating career development” that outlines what that skill looks like at various levels of proficiency, you can better judge their answers.

The hiring manager can identify what skill gaps exist among the candidates being interviewed, for example, and compare them. More importantly, they can determine the risk, training, and duration required to close any gaps and fill positions. In other words, competency models help ensure that the best candidates are selected—and will be more likely to stay.

Competency Models Support Onboarding (and Retention)

A competency model can help new hires become familiar with the nuances of their jobs. It can help them gauge their skill level against the model and determine any gaps they need to close to be successful. When mapped to learning opportunities, competency models enable your new hires to own their professional development—and their ability to close those skill gaps—so they can immediately begin their journey toward competency and skill proficiency.

Competency Models Close Skill Gaps and Boost Individual Skill Development (and Retention)

In essence, competency models provide each person with a road map for how to be great. They communicate what someone in a particular role needs to do to not only perform specific tasks, but also to achieve the mission and strategy. When embedded into a competency assessment tool—after a self-assessment—a competency model provides each person with a baseline that pinpoints any skill gaps and recommends development activities.

In this way, the competency model can intrinsically drive achievement motivation. That is, competency models enable autonomy/self-direction, mastery, and purpose—all of which Daniel Pink explains are the key motivators for most people in his book, Drive: The Surprising Truth About What Motivates Us. What’s more, research shows that the more competent people become, the more engaged and satisfied they become. And, yes, that leads to retention.

Competency Models Reinforce Career Planning (and Retention)

Just as competency models enable people to self-assess against the skill requirements for their current job, they also help employees assess their skills for roles they may want to pursue. The inability to own their professional development is often cited as a primary reason people leave an organization, and competency models enable people to take a leading role in their own career development.

Competency Models Bolster Coaching (and Retention)

Competency models, when used in conjunction with a competency assessment tool, enable managers to be more effective coaches—regardless of their coaching experience because the model eliminates coaching guesswork. It makes every conversation and touchpoint more productive, allowing managers to leverage strengths, take actions to close skill gaps, discuss perceptual differences, and prepare employees for future job roles.

The quality of one’s manager, as well as the manager’s ability to have great conversations and provide development opportunities, is another core reason people remain in jobs and engaged with their work. Conversely, when a manager can’t do this well, people leave. When you give a manager a roadmap—the competency model—you drive skill gap closure, engagement, and retention.

Competency Models Open Doors to Mentoring (and Retention)

If you enable people to assess themselves against competency models, you can uncover pockets of skill-based strengths across the organization. How does that help? Well, rather than having 10 people who can serve as mentors, you can establish that almost every person has at least one skill in which they excel. If you have the ability to identify these people, and pair them temporarily with others who have skill gaps in those same areas, then you can literally apply mentors on an organization-wide scale. For people who serve as both mentors and mentees, the process is highly engaging, which increases the likelihood that they will stay with the organization.

Competency Models Help Communicate Organizational Culture

There are two places where we can weave culture into competency models:

1. the description of the task or skill 

2. the behavioral examples.

First, you must use language and examples that demonstrate what is important in the organization. Next, you need to make your competency models accessible. When employees conduct self-assessments, the process reinforces the skills, behaviors, and culture that are important to the organization.

Competency Models Facilitate the Development of L&D Action Plans

When people assess their skills against the competency model, the organization is also conducting real needs analysis. The results of these assessment help the L&D function uncover specific learning opportunities it should develop and deliver to employees. This information aids in budget planning and scheduling—eliminating waste that typically exists using traditional evaluation methods, such as interviewing leaders.

Bottom line: competency models have the potential to close skill gaps, increase employee engagement, and increase retention.

To learn more about developing competency models in your organization, listen to this recent webcast Develop An Actionable Competency Model in Weeks with Cheryl Lasse.