What Is a Competency Model?
A competency model is a framework that defines the knowledge, skills, abilities, and behaviors required for successful performance in a specific role, job family, or organization. While job analysis focuses on what tasks are performed, competency modeling focuses on how work is performed effectively. Competency models describe the underlying characteristics that distinguish high performers from average performers.
Competency models serve as a unifying framework across multiple HR functions. When the same competencies drive hiring decisions, performance evaluations, development plans, and promotion criteria, the entire talent management system becomes more consistent and aligned. The SHRM People competency domain addresses competency modeling as a key HR knowledge area, and SHRM's own competency model (the SHRM BoCK) is built on these same principles.
Types of Competency Models
Core Competency Models
Core competency models define the competencies expected of all employees across the organization, regardless of role or level. These typically reflect organizational values and culture: teamwork, integrity, customer focus, innovation, or continuous improvement. Core competencies establish a shared language and set of expectations that reinforce organizational identity.
Functional Competency Models
Functional models define the technical and professional competencies required within a specific function, such as finance, engineering, marketing, or HR. These competencies capture the specialized knowledge and skills that employees need to perform their functional responsibilities effectively.
Leadership Competency Models
Leadership models define the competencies expected of people managers and senior leaders. These typically include strategic thinking, decision-making, change management, team development, and communication. Leadership competency models often vary by level, with different expectations for first-line supervisors, mid-level managers, and executives.
Role-Specific Competency Models
Role-specific models define the competencies required for a single position or narrow job family. These are the most detailed and are particularly useful for critical or specialized roles where performance has a significant impact on organizational outcomes.
How to Build a Competency Model
Step 1: Define the Purpose and Scope
Before collecting data, clarify why you are building the model and how it will be used. Will it drive hiring decisions? Performance evaluations? Development programs? Succession planning? All of the above? The purpose influences the level of detail required and the stakeholders who need to be involved.
Also define the scope: are you building an organization-wide core model, a functional model for a specific department, or a role-specific model for a critical position?
Step 2: Gather Data
Competency models should be built on data, not assumptions. Common data collection methods include:
- Behavioral event interviews: Interview high performers and average performers in the target role. Ask them to describe specific situations where they were effective or ineffective. Analyze the interviews to identify the behaviors and characteristics that distinguish top performers.
- Focus groups: Bring together subject matter experts, supervisors, and incumbents to discuss the competencies required for success. Focus groups generate rich discussion and help build consensus.
- Surveys: Distribute competency questionnaires to a broader population to validate the importance and frequency of identified competencies.
- Job analysis data: Use existing job analysis information to inform the technical and functional competency requirements.
- Strategic plan review: Review the organization's strategic plan to identify future competency needs that may not be reflected in current performance.
Step 3: Define Competencies and Behavioral Indicators
Based on your data, define each competency with a clear name, a concise definition, and specific behavioral indicators that describe what the competency looks like in practice. Behavioral indicators should be observable and measurable.
For example, a competency called "Customer Focus" might include behavioral indicators such as: "Actively seeks customer feedback and incorporates it into service improvements," "Responds to customer inquiries within established timeframes," and "Anticipates customer needs and proactively offers solutions."
Most competency models include proficiency levels that describe performance at different stages of development, such as foundational, proficient, advanced, and expert. These levels help managers and employees assess current capability and identify development targets.
Step 4: Validate the Model
Validation ensures that the competency model accurately predicts job performance and is accepted by stakeholders. Validation methods include:
- Content validation: Review the model with subject matter experts to confirm that the competencies and indicators are accurate and comprehensive.
- Criterion validation: Correlate competency ratings with performance outcomes to confirm that the model predicts success in the role.
- Stakeholder review: Present the model to leaders, managers, and employees for feedback and buy-in. A model that is technically sound but not accepted by stakeholders will not be used effectively.
Step 5: Integrate and Communicate
Integrate the competency model into HR processes: use competencies in job postings, interview guides, performance evaluation forms, development plans, and succession planning criteria. Communicate the model to all employees so they understand what is expected and how competencies connect to career advancement. The Organization competency domain emphasizes the importance of aligning people systems to drive organizational effectiveness.
Using Competency Models Across HR Functions
- Recruiting: Use competencies to define selection criteria, write job postings, design structured interview questions, and evaluate candidates consistently.
- Performance management: Evaluate employees on both what they achieved (goals and results) and how they achieved it (competencies and behaviors).
- Development: Identify competency gaps through assessment and create targeted development plans that build specific capabilities.
- Succession planning: Assess potential successors against the competency profile for target positions to determine readiness and development needs.
- Compensation: Link competency development to career levels and compensation ranges, rewarding employees for building capabilities that the organization values.
A diagnostic assessment of your own competency knowledge can help you identify areas to focus on before taking the SHRM exam.
Start Practicing Today
Competency modeling is tested on the SHRM-CP and SHRM-SCP exams as part of talent management, organizational development, and HR strategy. Create your free account to access practice questions that test your understanding of competency model design, validation, and application across HR functions. Build the expertise that makes you a more effective HR professional.