business people looking at paper at an office table

What Is a Competency Assessment?

A competency assessment is a powerful tool used by organizations to evaluate a leader’s or individual’s skills, abilities, and knowledge compared against job requirements or expectations.

A competency assessment will:

  • Reveal specific competencies that are a strength.
  • Identify specific competencies that are skill gaps or need improvement.
  • Pinpoint training or development needs.

There are various types of competency assessments including:

  • Skill assessments (measure proficiency in a specific skill area)
  • Knowledge-based assessments (evaluate understanding of a subject matter or specific information)

Research shows that 70% of team members believe they do not have the skills to adequately perform their roles, so a competency assessment is an essential tool for organizations that want to better leverage their human capital and create conditions where leaders and team members can perform to the best of their abilities within their roles.

What Is the Purpose of a Competency Assessment?

Competency assessments provide organizations with objective data about leader and/or employee performance and potential. This information is used to make informed and targeted decisions about growth potential, training initiatives, development plans, advancement, and succession strategies.

Because change is constant, organizations need to stay consistently attuned to the current skill level of their workforce and how it may need to shift in order to achieve long term strategic objectives. This is why one of the top focus areas of Learning & Development programs across organizations is upskilling and reskilling leaders and employees.

Managers and organization stakeholders can leverage competency assessments to:

  • Discover skills gaps that need to be addressed.
  • Create customized learning objectives and experiences for each team member.
  • Identify the right candidates in the recruitment process.
  • Highlight areas for improvement during performance reviews.
  • Know how to leverage team members skills and knowledge to meet team and organizational goals.

What Are the Benefits of a Competency Assessment?

A good competency assessment will:

Strengthen learning and development ROI: Over 49% of businesses are increasing their L&D spending, but the effectiveness of L&D programs is just average compared to the investment. A competency assessment will target learning and development investment around the skills, abilities, and knowledge that leaders or team members need in order to be successful in their roles and drive results for the organization.

Support team member development and growth: A competency assessment gives managers a framework for supporting team member growth and development. It also helps managers understand what will be needed from their team members in the future so they can help team members reskill and upskill over time.

Design well-defined career paths: Those who feel that their skills are not being put to good use in their roles are 10 times more likely to look for new jobs. By using a competency assessment, new doors to career development opportunities will open as leaders become more aware of where team members excel, their opportunities for improvement, and how to help them advance in their desired career paths. When team members know how they fit and why they matter to the organization, they are more likely to be engaged and less likely to look for other career opportunities.

Eliminate silos between management and staff: Over 55% of organizations work in silos—a common workplace issue that many team members report as a main cause of workplace failure. Understanding the exact skill strengths and development needs through a competency assessment will create transparency and eliminate communication barriers between management and staff about development needs. The more that leadership takes the time to understand team member performance, the bigger difference this can make in better collaborations and productivity moving forward.

Prioritize L&D initiatives: When 72% of leaders “agree that L&D has become a more strategic function,” understanding how to prioritize initiatives is vital. A competency assessment provides the data to achieve that.

How Do You Complete a Competency Assessment?

Deploying a competency assessment involves three primary phases:

1. Competency

A competency framework or model that outlines all of the skills, abilities, and knowledge required for the role or competency topic area (skill or knowledge-based assessment).

Create the right model by:

  • Identifying the specific competencies for each role, skill area, or knowledge area.
  • Collecting data for each competency. This is to prove that competency is indeed critical for doing the job or job requirement well.
  • Aligning to the output of each role:
    • How does it impact team performance?
    • How does it impact the organization’s bottom line?
    • How does it elevate the learning and development of the individual?

2. Data Collection

The data collection phase entails:

  • Distributing the competency assessment.
    • Consider utilizing a software analytics platform to automate and streamline this process.
  • Comparing competency needs and requirements with the individual data results from the assessment.
  • Assessing the data results collected above to determine:
    • Where the individual or team is currently
    • Where your individual or team needs to be

3. Data-Driven Decisions

The final phase focuses on using the competency data collected to optimize performance. It involves:

  • Considering the type of learning and development programs/resources that need to be made available.
  • Considering the resources currently available in the organization.
  • Are there individuals and training resources/materials to begin training team members? What additional resources are needed?
  • Determining the immediate issues/needs to be addressed and the secondary development opportunities that can be addressed at a later time.

Upon completion of the competency assessment, your team should be able to:

  • Identify the strengths and development needs of team members.
  • Target needs and areas for development.
  • Execute individual learning plans.
  • Initiate career development discussions.

For more guidance, lean on CMOE to gain access to customized workshops and tools. Our team is here as a resource to help you leverage hidden talents and strengthen the skillsets of your workforce.