Introduction: What This Is All About
Definitions
Competence is generally understood as the ability of an individual to perform up to defined standards. A person is competent if he or she is able “get the job done”.
Competency, according to Project Managers Competency Development Framework Standard, (PMI, 2002) is a cluster of related knowledge, attitudes, skills, and other personal characteristics that:
- - Affects a major part of one's job (i.e. one or more key roles or responsibilities)
- - Correlates with performance on the job
- - Can be measured against well-accepted standards
- - Can be improved via training and development
- - Can be broken down into dimensions of competence.
These basic definitions allow for setting a framework for defining, assessment and development of personnel capabilities required to achieve goals of the organization. This is true for both projects and operations. Besides, this definition is also true for organization as a whole, not only for a single employee.
A Competence management system therefore can be defined as a set of organizational policies and procedures designed to bring personnel competence in line with job requirements, both current and perspective. Some organizations consider this function to be part of the bigger Human Resource Management System, and there are good reasons for that as knowledge and skills management to be effective must be integrated with other essential HRM functions such as motivation system (compensation and benefits, and other components), performance appraisal, career planning, training and development, and others. And all of these bear sense when interlinked and determined by organizational set of goals (strategic, program and project goals and operational performance targets).
Challenge of the Times
The concept of project management maturity has been vividly studied and developed in the past decade (from CMM release in 1995), as numerous maturity models have evolved dealing with overall organizational project management maturity as well as its essential components (e.g. EVM maturity model, risk management maturity model, procurement process maturity concept, and others). And this is good. A competence management concept is even older, but there are several reasons to draw the attention of the project management community to it again.
Issue #1: Core Competencies
For each organization there is a set of core competencies that it possesses and exploits to make money. They are profit drivers and generally rest in main business process area. In the modern fast changing world a core competency can be defined as the one that can not be developed in the time frame from the moment an organization realizes the demand for it to the moment the competency is actually needed to perform in the changed environment. Technologies in many industries develop so fast that basic education is almost never sufficient for a person to perform up to the latest high standards that companies demand.
This forces people to go to extremes in self-education, and companies to develop advanced in-house training and development systems to ensure they always catch the train. Still organizations feel drastic lack for highly qualified competent human resources to match the ever-changing set and nature of required core competencies. The same speed of change forces companies more and more to view project management capability as a core competency, and this is why project management maturity models are so broadly discussed. Verdict: project management maturity is the metric of one of the most important core competencies companies strive to attain nowadays, if not the most.
Issue #2: Project Management Process Maturity and Competence Management
The modern project management maturity models including OPM3® address PM process in different ways providing guidelines for what organizations should be able to do to consistently achieve project goals and other relevant benefits, generally leaving out the question of how to integrate people's knowledge and skills into that system. In other words, there seems to be a gap between project management maturity concept and competence management bodies of knowledge.
OPM3® goes as far as several Best Practices devoted to the issue of competence management (those are BPs 1410, 5190, 5620, 6120 and some other). Yet the questions of what companies should do to be ready to go for Capabilities forming these Best Practices, and how this should be done, are left outside of the standard. This is not OPM3®'s (or any other maturity model's) shortcoming, it is just that this issue has to be studied.
Ultimately, it is always people who get the job done. This is why we see the challenge of the times in developing a view on what organizations should do to support their project management maturity improvement activities with relevant competence management process. The benefit would be core competencies (including project management capabilities) managed properly and adjusted to allow for organizational PM maturity development.
Competence Management in Multi-project Environment
Portfolio and Program Context Problems
All Best practices mentioned above are found in Portfolio domain of the Organizational Project Management Maturity Model (OPM3®) Capabilities Directory. And this is natural because most of the problems concerning systematic competence management arise and become critical when multiple projects are managed in a coordinated way to obtain additional benefits and meet strategic objectives. Additional problems compared to managing individual projects, arise:
First, human resources (especially high qualified key specialists) are very difficult to reassign from one project to another. This is because:
- - Key specialists generally are those who possess the bigger parts of corporate core competencies, and they are usually few and the most scarce resource;
- - The more complicated and/or unique the task or work package is the more unique set of competencies it requires to be done. Hence, the less specialists there are available in the company who can deal with the task in full;
- - When a key specialist possessing the unique set of competencies is half way through the task, it is extremely difficult for him or her to switch to another, even if it is the like task. The immersion in the problem is high, and if the resource is reassigned for another task the performance drops dramatically.
Examples of such key specialists are: specialist in server configuration and tuning, leading engineer, technologist, and by the way – project manager! Without such a specialist, a project often cannot be successful. The demand for this sort of professionals in organization always exceeds “supply”, and these resources can nearly always be found on the critical resource chain. Another problem with them is that they are costly and often eager to leave the company having been offered more money or more challenging goal elsewhere. These issues are also being addressed by the Competence Management System discussed below.
Second, the more projects there are in program or portfolio and the more diverse their nature is the harder it is to find the optimum in human resource allocation. Functional managers of course help, but, because of “human nature” issues, the resource conflict resolving decisions are often far from perfect.
Third, the more people participate in projects the less a project manager is sure whom to bring on his project best. He simply is not sure of the competencies they possess and their overall competence.
Competence Management System Functions
The main functions of the competence management system are:
- Design and development of corporate competency model (structure and set of competencies)
- Core competencies identification and management.
- Design, development and administering of corporate competencies database.
- Job and project role requirements development using the corporate competency model.
- Implementing competency model into motivation system, performance appraisal system, training and development system, career planning system and, finally, project management process.
The competence management system should address all these issues and at the same time be consistent with the organizational project management maturity level the company demonstrates. Below we outline the concept of aligning competence management activities and process with project management function on different levels of PM maturity.
Competence Management Maturity Concept
In the effort to propose a model for competence management system maturity according to project management needs we chose Project Management Institute (PMI®) OPM3® concept as a basis because:
- - the standard offers not only the assessment tool but also guidelines to defining the steps the organization should make in order to increase its project management maturity;
- - OPM3® uses Best Practices and Capabilities as basic blocks to define project, program and portfolio management process, which is easy to understand and operate with.
- - OPM3® clearly and conveniently defines the four stages of process maturity which are universal for any domain and knowledge area.
We suggest that competence management process be analysed through the set of specific Best Practices mapped to the same four stages of process maturity: Standardize, Measure, Control and Continuously Improve. These Best Practices can be integrated by the organization into existing OPM3® structure or used outside the model but in conjunction with it. It depends generally on the way organization decides to utilize OPM3® and the existing level of human resource system maturity. This specific issue will be discussed in more detail in the presentation. We now also leave out the question of what Domain to map the suggested Best Practices (Project, Program or Portfolio) to, as we plan to develop this subject further in next papers.
Stage 1. Standardize
OPM3® suggests that project management process (here and below we will address project, program and portfolio management process as project management unless stated otherwise) standards are established on this stage. Also Best Practices are established to ensure competency requirements for project resources are defined (BP 1400). Common project management language is established. The organization defines its project manager's competency requirements (BP 1430). Also OPM3® suggests that career path for project roles are defined (BP 5620).
To meet project management requirements for this stage the following things should be done within competence management system to ensure projects get best available human resources for all types of work, not only project managers.
Best Practice: The Organization Identifies Competency Requirements for All Types of Project Work
| Capabilities | Description/outcome | KPI |
| Build Competency model | The areas and levels of competence are defined, which form the framework for competencies identification. PMCDF can be used or other HRM industry methodologies. | Competency model |
| Identify Competencies required in projects | This goes not only for specific project management set of competencies but also for those skills and knowledge that are necessary for the most important projects. These can be unique complex project as well as small but numerous projects of an organization of a project-oriented type of business. | Competencies directory with metrics |
| Build required competencies database | This allows for competencies to be described, stored, searched, analysed and managed. The structured and measurable competencies form the input to the assessment process on the Measure stage. Project resource plans are made with the help of the competencies database as each project task's human resource requirements can be formed from the set of defined competencies. | Competencies database |
On this stage organization achieves understanding of what competencies (and not only skills and knowledge) are needed by projects, incorporates competency model in project staffing process, develops the toolset for managing competencies and is ready to optimise human resources competence for project needs.
It is also important that OPM3® Best Practices addressing project training process be implemented (BP 5200, 5210, 5300) in accordance with the developing competency management process.
Stage 2. Measure
According to OPM3® the organization regularly assesses project performance of individuals and project teams (BP 2120) on this stage. The main task of the competence management system now is to provide tools for this assessment and built a feedback process to introduce corrections and updates to competencies database. The result is the ability to replenish the database with information on the availability of required competencies within organization and define critical resources – the key specialists discussed above. The Pareto rule works here as well as always, and we may presume that 20% of all project participants perform 80% of the project work (or at least generate 80% of value). Hence focusing on their competencies and availability promises to be most cost effective.
Best Practice: The Organization Identifies Critical Project Competencies
| Capabilities | Description/outcome | KPI |
| Perform Assessment | Assessment of staff members against competency requirements is performed. Inputs to this process include project results, team and individual project performance, 360-degree assessment and other techniques. | Assessment results |
| Identify critical human resources | This is done by analysing project plan execution data obtained from project and functional managers, and project resource levelling process reviews. All this will show what particular individuals rest on critical resource chains most often. | Key project members identified |
| Identify critical competencies | Bringing together the above listed two capabilities it is possible to determine what competencies are critically important to the organization. | Critical competencies identified |
| Update competencies database | Provided that assessment process is in place, the competencies database can and must be updated after each project or major phase is completed. It is updated with information on what people (and therefore competencies) were demanded and used on the project, and which of them were not sufficient in quantity or quality (competence). | Database updates |
The main result of this stage of competence management maturity development is that organization is able to identify the very specific scarce competencies resting with particular individuals. Practice shows that unique competencies are found out on this stage that do not fit in the competency model well. Then it must be revised.
OPM3® suggests that career paths for project roles must be established on the previous stage (Standardize). We only partially agree with that because there can't be efficient career planning system without consistent performance appraisal process in place, otherwise any promotions can be made only by subjective mutual agreement between an employee, his supervisor and HR executive. We suggest that assessment process be a prerequisite for consistent career planning implementation.
To get on to the next maturity stage it is also vitally important that motivation system in organization recognizes project work results and career paths for project participants.
Stage 3. Control
On this OPM3® model maturity stage process controls are established and executed to control the stability of the process. Motivation for project goals achievement and teamwork is enhanced. This is the stage where significant and valuable support to the PM process can be made by competence management system. The focus we suggest is on critical human resources (key specialists) bearing critical and sometimes unique sets of competencies. The purpose of this focus is to create a consistent and stable system of critical competencies being shared and multiplied in organization.
Best Practice 1: The Organization Considers Key Specialists as Competency Drivers
| Capabilities | Description/outcome | KPI |
| Competence Centres are established around Key Specialists | Each Key Specialist bearing unique and valuable set of competencies is considered as the Competence Centre, and a specific competence management subsystem is built around him/her as an individual. | Competence Centres established |
| HRM system components are fine tuned for Key Specialists | To be able to get most out of Key Specialists as individuals they have to be invested into. Individual development and motivation schemes need to be developed. They include: - career path, comp&ben, status, recognition, development program - additional responsibilities and individual assessment program |
Individual development schemes established for Key Specialists |
Best Practice 2: Critical Competencies Are Managed Through Competence Centres
| Capabilities | Description/outcome | KPI |
| Priority candidates for critical competencies development are selected | The goal is to use the competencies database and assessment data to pick out staff members with competencies as close as possible to the “critical sets”. So they become the priority target for personal development. | 1. Promising candidates selected 2. Training needs defined. |
| Key Specialists are engaged in knowledge and skills management process | Key Specialists are placed in the environment where they both must and are willing to share knowledge and skills. They: - participate in in-house training programs development - consult on training materials development - conduct seminars and training events for promising personnel chosen for priority development - coach chosen staff members |
Appropriate metrics |
| Key Specialist project loads controlled | The amount of time a Key Specialist spends on project work is coordinated with Competence Centre development plans. | Key Specialist's individual project assignment plans |
| Key Competencies are revised on a regular basis | The new project data results in the list and contents of critical (key) competencies revised, some Competence Centres being terminated and new Competence Centres Created. | Competence Centres directory revised |
More detailed view on the processes forming Competence Centres Management subsystem can be obtained at Exhibit 1.
Exhibit 1. Competence Centre Model.
Competence Centres Management subsystem therefore executes the following functions:
- - Competence planning that allows future projects to be supplied with human resources bearing required competencies.
- - Key Specialists' skills, knowledge and attitudes retaining and analysis.
- - Training and coaching aimed at Key Competencies development involving Key Specialists.
- - Designing special motivation programs for Key Specialists who share knowledge and train other employees.
- - Analysing time sheets and other project reporting data to locate Key Specialists, and incorporating them into competence management system via personal development programs.
- - Determining competencies no longer needed by organization to free or retrain relevant personnel.
- - Producing inputs for corporate knowledge management process.
This process results in critical complex competencies being located with particular individual project members (Key Specialists), analysed in competencies database and transferred (or replicated) to other staff members. The result is more human resources bearing (in part or whole) critical competencies which leads to less resource conflicts and higher quality project deliverables.
One more benefit can be obtained for program management. To increase efficiency of human resource rotation between projects in a program the competencies database must be extensively used. This allows for project managers to be aware and confident of the available resource pool and competencies, and realistically estimate inevitable trade offs.
Stage 4. Continuous Improvement
On this stage according to OPM3®, problem areas are assessed, process improvement recommendations are collected, and process improvements are implemented. In connection with the Competence management maturity Concept we suggest that competence management process be continuously improved the way OPM3® suggests all other core project management processes should be improved.
Exhibit 2. Competence Management cycle.
Best Practice: The Organization Consistently Improves the Competence Management Cycle
| Capabilities | Description/outcome | KPI |
| Identify Competence management Cycle root problems | The organization identifies root problems during execution of the Competence Management Cycle process. | Problems identified |
| Competence management Cycle improvements implemented | The organization executes continuous efforts directed towards Competence Management Cycle process improvement. | Personnel assigned to process improvement activities |
| Competence management Cycle improvement integration | The organization integrates Competence Management Cycle process improvements with systems that standardize the improvements. | Competence Management Cycle process improvement data |
The main elements of Competence Management Cycle can be observed on Exhibit 2.
Conclusions
Above we have briefly discussed what specific competence management activities and process can be developed and implemented to enhance project management capabilities on four maturity stages. Yet some important issues were left unstressed.
First, the proposed system fits best companies that are in hi-tech business and/or are project-driven. The value of competence management system in such companies is highest, though other companies can also benefit a lot. The larger is the company and the more complex and distributed (cross functional) the projects are the higher (generally) are the benefits.
Second, main human resource management functions such as regular performance appraisal, motivation system, recruitment, career planning, training, and development must be present and relatively well developed.
Who knows, may be there will come a day when human resource management maturity model will emerge and be brought into correlation with OPM3® or other project management maturity model…
Third, there is always the strategic issue. As we know, the main purpose of OPM3® standard is to help organizations translate strategy into successful outcomes, consistently and predictably. Yes, projects and well developed project management process are the main tools for that, but what about translating strategy into the right people?
Jim Collins in his remarkable research book “Good to Great” (2001)names such a strategic growth phenomenon as Level 5 Leaders (those who “build enduring greatness through a paradoxical blend of personal humility and professional will”). Those are not only ultimate pros in management; they are also individuals with extremely developed paradox trait named above. Collins insists that the vast majority of talented and hard-working managers can become Level 5 Leaders through the other four levels (Highly Capable Individual, Contributing Team Member, Competent Manager and Effective Leader) and lead their companies to long-term success. And they even do not necessarily have to be CEOs.
We feel that sound-built and devotedly developed competence management process focusing on the most valuable asset of any organization – its best people – can be a perfect catalyst for Level 5 leaders' growth in your company.