Don't Waste Time and Money

Competency programs are well-intentioned, but ineffective. Here's a better alternative. by Marcus Buckingham Co-author of First, Break All The Rules (Simon and Schuster, 1999) and Now, Discover Your Strengths (Free Press, 2001) "What is the best way to increase each employee's performance?" During the past decade, many organizations have wrestled with this critical question and have emerged clutching long lists of behavioral competencies. Managers rate all employees on the competencies identified for their particular role, encourage employees to work on the specific competencies they lack, and then rate employees again next year. Although we understand why organizations would want a disciplined process to select, measure, evaluate, develop, and promote their employees, at The Gallup Organization, we don't recommend that executives build this process around competencies. Since competencies were first introduced 40 years ago, they have offered the promise of bringing order and focus to the development of people. Unfortunately, in the intervening years, they have failed to deliver on this promise. In this article we will explain why they have failed and present a radically different approach to increasing each employee's total performance. A failed military experiment In the late 1950s both the British and U.S. military happened upon the same idea for developing a perfect officer: define the behaviors expected of the perfect officer, measure each person on these behaviors, and then train each person to develop the behaviors he doesn't display naturally. The selection, measurement, training, and promotion systems were then revamped to accommodate this new, scientific approach to officer development. Forty years later, after many attempts to tweak, tune and redesign, both militaries independently decided to discard what had become known as the "Great Man" approach to leadership development, because it didn't work. By either military's measures of leadership, this approach didn't result in the development of better leaders. Ironically, just as its original designers were rejecting it, many business organizations began adopting the competency-based approach to developing people. Today, these competency-based performance management

systems tend to look something like this: First, the organization tries to define the behavioral competencies expected of each key role. Second, the organization designs interviewing systems to select employees who show evidence of these behavioral competencies. Third, once the employee is hired, the organization measures him on these competencies, using a 360-degree tool, a manager/self assessment, or some combination of both. His total score on these behavioral competencies is weighted and is then combined with other performance metrics to calculate his total performance rating. Fourth, the organization identifies which competencies he lacks. It labels these his "Areas for Improvement" or perhaps, his "Developmental Needs." Fifth, he and his manager design an "Individual Development Plan" which encourages him to "work on" and improve those competencies he seems to lack. Finally, the organization rates him on these competencies again next year. If he has shown some signs of improvement in his areas of weakness, he will be rewarded with a higher performance rating. This performance rating will be inserted into the organization's "Succession Planning System" to determine whether he is promotable and if so, how high.

It's easy to see why this competency-based approach is proving so popular with Human Resources departments. Its explicit goal is to develop people. It imposes an ordered process on the department's vague charge to "build our human capital." It includes a measurement component (the 360-degree metric) so that each employee can track his progress. And finally, it allows the Human Resources department to position itself as a "strategic partner" to the business by identifying only those competencies that will, apparently, lead to a competitive advantage in the future. Unfortunately, as the British and U.S. militaries found, this competency-based approach to developing people doesn't deliver on its expressed promise. It doesn't measurably improve productivity, customer satisfaction, employee engagement, retention, safety records, attendance records, or any other real-world measures of performance. There are examples in the literature of employees who, having received low ratings from their direct reports/peers/manager on certain competencies, subsequently received higher ratings after they had "worked on" these areas for six months. However, these "improvements" do not show any link to improvements in the employees' real-world business outcomes. At best, these competency "improvements" are irrelevant; at worst, they are a sign that employees have spent too much time trying to eke out improvements in the wrong areas. Why are all competency-based approaches -- no matter how well-intentioned, designed, and executed -- so ineffective at increasing each person's total performance? Because they are founded on three flawed assumptions. As Peter Drucker once wrote in Forbes magazine: "Get the assumptions wrong, and everything that follows from them is wrong." The three flawed assumptions are as follows: 1. 2. 3. Those who excel in the same role all display the same behaviors. Each of these behaviors can be learned. Each of these behaviors should be learned, because improving your weaknesses leads to success. From research Gallup conducted for the book, First, Break All the Rules, we know that the world's best managers share none of these assumptions. In fact, in each case, they believe the exact opposite. 1. The best don't display the same behaviors Great managers do not believe that those who excel in the same role all display the same behaviors. Instead, they believe that those who excel in the same role all create the same outcomes, often using different behaviors. Take the leadership role as an example. The ideal that all leaders should possess the same set of competencies is enticing, but it is not borne out in the real world. Study any successful leader and you will not find a perfectly well rounded ber-executive. Instead, you will find an idiosyncratic individual who has made the most of his unique style of leading. We could quote numerous examples from today's business leaders, but perhaps the most compelling evidence for the power of idiosyncrasy comes from America's first four Presidents. George Washington's leadership style was to deliberately project an image of soundness and constancy, but he is not remembered as an inspiring visionary. In direct contrast, the second U.S. president, John Adams, was an inspiring visionary. He was so gifted a public speaker that he could hold a vociferous Congress in rapt silence for three hours or more. However, as his struggles following the end of the Revolutionary War revealed, he was at his best only when railing against a perceived foe. His successor, Thomas Jefferson, required no adversary to bring out the best in him. Sitting alone at his writing desk, he could conjure compelling word pictures from the blank sheets in front of him -- and yet he so feared public speaking that he changed the protocol so that all of his State of the Union addresses would be delivered to Congress in writing. James Madison was different again. He was a small man with a high-pitched voice, who consequently couldn't rely on inspiration to lead. Undeterred, he played to his strengths, opting for a more pragmatic, political approach, working the floor of Congress, building the alliances necessary to advance his agenda.

These great leaders did not share a common set of competencies, and no matter how much "leadership training" they received, they never would. The only thing these leaders had in common, other than a belief in the preciousness of individual liberty, was the outcome they created: a passionate constituency of followers. America's founders thus provide a lesson that all organizations can learn. Don't hold your leaders, or, for that matter, any individual in any role, accountable for perfecting the same set of competencies. Instead, hold them accountable for achieving the same outcomes, using whatever style fits their strengths. 2. All behaviors cannot be learned Great managers do not assume that all behaviors can be learned. Instead, they operate under the assumption thatwhile some behaviors can be learned, many others prove extraordinarily difficult to learn. Managers have only one thing to invest in each employee's success -- their time -- so they cannot afford to waste time trying to train an employee in behaviors that are virtually untrainable. As such, they must develop some way of distinguishing natural talents -- such as empathy, assertiveness, focus, or adaptability -- which are enduring and almost impossible to learn, from skills and knowledge -- such as how to check a guest into a hotel or how to explain the features of a product, or self-awareness -- which do improve with training, time, and practice. This separation of talents from skills and knowledge reveals to great managers where, how, and if they can help each employee increase her performance. For example, if they are faced with a salesperson who is struggling to make her quota, they know that either a lack of skills/knowledge, or a lack of talent, or a lack of all three, could be the source of a. the problem, and that the right course of action will vary according to the source: If the employee is struggling because, despite strong natural talents, she lacks the necessary skills or knowledge to do the job, the great manager knows that the best course of action is to keep training her and monitor her sales performance over time to see how this training takes. b. If the employee possesses all the skills and experience in the world, but lacks the necessary talents, the great manager knows that more training and more time will yield very little return. In this scenario, a better strategy would be to reposition this employee with different kinds of clients or with different team members so that her particular talents could be properly deployed. c. Finally, the employee might possess neither the skills nor the knowledge nor the talents needed for the role -- in which case, the great manager's only option is to move her out of the role for which she should never have been selected in the first place. These kinds of decisions are never easy, even for great managers. For managers who lack a basic language to distinguish skills and knowledge -- the "teachables" -- from talents -- the "unteachables" -- they are almost impossible. The competency-based approach lumps together talent, skills, and knowledge into broad competencies such as "Handles Change," or "Incorporates Diversity," or "Strategic Agility," or "Inspirational Vision," all aspects of which, they assert, can be learned with training and practice. This assertion is flawed, and as such, the competency-based approach leads managers to waste time trying to teach the unteachable. 3. Fixing a weakness doesn't lead to success Great managers do not assume that fixing areas of weakness will lead to success. Instead, they assume that weakness-fixing prevents failure. Only strength-building leads to success. Strength-building is the art of recognizing where each employee's areas of natural talent lie and figuring out how to help each employee develop the necessary skills and knowledge to turn those talents into real performance. It is the

art of crafting each employee's expectations so that each is encouraged to use and hone her natural talents, the art of job-sculpting, of "going from the player to the plays," as it were, rather than the other way around. It is even the art of helping some people develop their natural talents to such an extent that their areas of weakness become irrelevant. For example, great managers recognize that an employee with a natural talent for networking can strengthen this talent to such a point that she never runs into conflict, thus making her weakness in "conflict resolution" a non-issue. Likewise, great managers know that another employee, who is a poor networker, can be encouraged to strengthen her subject matter expertise to such a point she doesn't need to network: people simply seek her out. Great managers understand that this kind of strength-building, with its aim of elevating each person's performance to its highest possible levels, given her natural talents, is what real development is all about. The competency-based approach, in contrast, aims much lower. By labeling an employee's weaknesses her "areas for improvement" or her "developmental needs," it encourages her to focus most of her energies on improving in these areas. On the surface, there is nothing wrong with telling an employee, "You must try to be a better listener," or "Don't let your emotions cloud your judgment," or "Maybe you can find a partner to help you with your PowerPoint presentations," or asking, "Have you tried using a time-management system?" However practical these suggestions are, they will never enable the employee to excel. They are designed to plug a gap, and although gap-plugging serves an important function, it is, at bottom, a remedial function. It will only do what all remedial interventions do: it will prevent failure. In short, the competency-based approach, with its inherent emphasis on fixing weaknesses, substitutes damage control for real development, and thus leads all employees away from the true path to individual excellence: building their strengths. The strengths-based approach Using the great managers' assumptions as our guide, Gallup recommends a different approach to increasing each

person's total performance: Don't try to identify the competencies required for each role. Instead, identify the outcomes expected of each role. Don't try to select people based on whether they possess the required competencies. Instead, identify the natural talents common to the best in each key role, and design interviewing systems to select people who possess similar talents to your best. Don't measure each person on the required competencies. Instead, measure each person on the required outcomes. Don't identify which competencies each person lacks. Instead, identify each person's areas of talent and nontalent. Don't encourage each person to improve in his areas of non-talent. Instead, encourage each person to strengthen his talents with skills and knowledge, then find ways to manage around his areas of non-talent. Don't label each employee's weaknesses his "areas for improvement." Instead, apply this label to his areas of talent. A person's greatest opportunities for improvement lie in his talents, not his weaknesses. And finally, don't rate each person next year on whether he has improved on the required competencies -- this is

mere mimicry. Instead, rate each person on whether he has improved on the required outcomes. This is real performance. Capitalize on uniqueness

Today few disagree with the truism, "Our people are our greatest asset." Today however, few organizations remember that each of these people is enduringly unique. Regardless of role, or race, or sex, or age, each individual employee possesses a unique complement of talents -- each is driven by unique motivations, each relates to others uniquely, each thinks in his own unique fashion. Confronted with this enduring uniqueness, your organization faces a choice. Either you can fight against it, by trying to train every salesperson to sell in the same way, every manager to manage in the same way, every leader to lead in the same way. Or you can choose to capitalize on this uniqueness, first by identifying each person's talents, then by building these talents into strengths. The competency-based approach chooses to fight against it and thereby condemns the organization to waste its most precious resource. The strengths-based approach makes the opposite choice. It chooses to capitalize on uniqueness, thereby freeing the organization to deploy each person's individual strengths with discipline, efficiency, and power. Copyright 2003 The Gallup Organization, Princeton, NJ. All rights reserved. Reprinted with permission. Visit The