Competency models are pervasive in private and public sector organizations around the world. They cover a range of talent management practices, but the ways competency models are formulated vary considerably. The act of formulating competencies is a key part of talent management and should be supportive of the strategic intentions of the organization. There are myriad definitions for competencies. Two main traditions, the “McClelland” approach and the “Schippman approach, are somewhat at odds with each other but in practice start to fuse together.

McClelland sees a competency as any attribute (for example, knowledge, skill, motivation) that differentiates outstanding from average performance. The Schippman approach arises out of a frustration that many organizations find it difficult to substantiate who is an outstanding performer. A traditional alternative in talent management to building competency modeling has been “job analysis.” This is more focused on the content and requirements of a role.

Many competency models are developed in human resource departments with little relationship to the actual business. However, modern practice has more and more competency models embedded in strategic and business discussions. There are three fundamental approaches that are well established for formulating competencies using any definition: primary research, expert panels, and use of generic models or dictionaries. They are also not mutually exclusive but will depend on the specific intervention you want to create while remembering that the outcome of formulating competencies has to be more than merely a model.

Putting competencies at the heart of strategic discussions enables the talent manager to have a more profound business impact and competencies to endure in an organization. Credible talent management professionals shape the guiding principles and practices employed by organizations to attract, select, integrate, develop, engage, and deploy talent.