IBM Leadership Competencies

I had referred to 11 IBM Leadership Competencies in my previous posts. Fortunately I had managed to get more details (below) of these competencies in Management and Organisational  Behaviour by Laurie J. Mullins – (2005)(Page 319-320). Hope this would give us additional insights to understand efforts taken by Mr. Louis Gerstner for the transformation of IBM during his tenure. [ IBM - List of Competencies page 210, Who Says Elephants Can't Dance? (2002) ]. This post will give us a complete picture of the significant role of competencies in organizational transformation. 

Focus to Win

Customer Insight

Outstanding IBM managers and senior professionals put themselves in the minds of the customer, and see customers’ needs and businesses, from the customers’ point of view. They focus on the unexpressed or future needs of the customer. Managers and senior professionals having Customers’ Insight go beyond IBM’s exemplary responsiveness to customer complaints or problems. They don’t just try to sell IBM products or services. They spend time with customers and others in the marketplace to understand the underlying, unmet needs that technology can address. On the basis of this understanding, they focus on new business opportunities for their area by finding a product or service that is quickly recognised as valuable to the customer. In support functions, outstanding IBM managers and senior professionals focus on understanding the real needs of their internal customers and on providing solutions that meet them.

Breakthrough Thinking

Outstanding IBM managers and senior professionals use their abstraction capabilities on focus on what is really important and to provide new insights on how IBM can win in the market-place. They are able to face complex issues in a quick and innovative way (they adequately process information and provide the right support to reach the prospected goals). They identify and develop new solutions. They explore the market, recognise trends, look for new ways to capture even the smallest segments or niches in which to concentrate their efforts and actions. They are interested in understanding how other areas of business interact with their own in order to exploit and develop new market opportunities or new ways of doing things.

Drive to achieve

Outstanding IBM managers and senior professionals are constantly looking for ways to make things better (e.g. do things faster, at lower costs, or higher quality). They set improvement and challenging goals for themselves and their areas and evaluate results to see how they (and their businesses) are performing. They act on their own initiative and take on responsibilities. They take calculated business risks to pursue challenging goals and to improve performance on the basis of an explicit cost/benefit analysis.

Mobilize to Execute

Team Leadership

Outstanding IBM managers and senior professionals create and focus on the sense of urgency to meet a challenge or to implement a strategy to reach their goals. They provide a sense of direction and purpose to their team and use ongoing and influential actions to encourage people to pursue that direction. Team leadership is critical to execution.

Straight Talk

Outstanding IBM managers and senior professionals candidly tell the truth and openly share relevant information with peers, managers and subordinates. They ensure the ‘whole’ story is told, not just their position. They act with integrity that is consistent with their beliefs, e.g. telling the truth when it is difficult or when such truth will be unwelcome. This leadership capability is essential to energise a team to quickly execute a new direction.

Teamwork

Outstanding IBM managers and senior professionals work collaboratively and co-operatively across organisational lines and with their own teams to serve the customer and win over competition. They can be relied on to actively support and enact team decisions or commitments to the team. They accurately and objectively represent their managers’ and peers’ perspectives to the team members. They foster teamwork by treating their own teams with respect and empowering them to make decisions without second guessing. They celebrate their team’s successes and encourage all team members to be accountable to each other, and to work in collaboration across organisational lines.

Decisiveness

Outstanding IBM managers and senior professionals make and act on tough decisions with the speed and sense of urgency needed to stay with or ahead of the market, competition and customer needs, or to improve the organisation.

Sustain Momentum

Building Organisational Capability

Outstanding IBM managers and senior professionals act to build the organisation’s longer-term ability to produce and sustain excellent results. They take control of the situation to improve it, and follow through in an influential manner. They proactively and quickly re-align the systems or processes of their own area. They ensure that the right people are in place and that effective networks across the organisation, correct measures and information are implemented and supplied to support the business strategy, not just for the sake of change.

Coaching

Outstanding IBM managers and senior professionals actively mentor or coach others in an individualised, one-to-one manner to build a strong team now and for the future. They take on responsibility to identify and to support the development of talented people and have a positive impact on the professional growth of IBM’s people. They enjoy seeing other people grow and move on.

Personal Dedication

Outstanding IBM managers and senior professionals act in ways that promote organisational goals and strategies. They align their personal needs, priorities and activities with IBM needs and goals – not with their own individual organisation. They support tough decisions made for the overall benefit of IBM.

The Core

Passion for the Business

Outstanding IBM managers and senior professionals are passionate about their business and winning in the marketplace. They are excited about what IBM technologies and services can do for the world. They are enthusiastic about how IBM serves its customers and wins over competitors. They embrace IBM’s purposes to move with the speed customers are expecting, providing them with leading-edge networks and technologies. And they want to ‘get it right’. Passion for the Business is at the ‘heart and soul’ of the model. It fuels Customer Insight, Breakthrough Thinking and Drive to Achieve, which energise them.

Competency-based Job Description

Once, I heard someone say, what is so important about the Job Description? After all, it's just a piece of paper & what difference does that make?

The Job Description can best be compared to a 'User Manual' which tells us 'how to' operate particular device or machine. It gives precise details about components, requirements, directions for effective and efficient use.

As they say 'When all else fails, read the instructions', and, 'When all else fails, and the instructions are missing - kick it'. In our case we can't kick it; hence a wise option is to 'read the instructions'. Let us see why a Job Description is so important.

As we all know the process involved for this is called 'Job Analysis' and theoretically the output is 'Job Description' and 'Job Specification'. [While the Job Description describes tasks to be accomplished, the Job Specifications lists the Knowledge, Skills, and Abilities (KSA's) needed to accomplish these tasks.] Though they are defined separately, however in practice, they are written in the same document under different headings.

In fact, there is no one right way or format for writing a job description. It is better explained by Crawford H. Greenwalt, President, E I DuPont, "...There are many ways in which a good job can be done - as many ways, in fact, as there are men to whom the task is given."

Due to various benefits and convenience many companies prefer computerized Job Analysis. There are many software's available for this process for e.g. Job Evaluation Manager (JEM) -Online tool (Haygroup), Talent | Reward (Towerswatson).

Following are four Principles of Job Analysis:

1. Analysis NOT List: The focus must remain on in-depth analysis of the Job and not just preparing a list of the tasks.

2. Jobs NOT People: The analysis must focus on the job and not on the jobholder's performance, style, character or career history.

3. Facts NOT Judgment: The focus must be on communicating the 'facts' as they are and avoid making any judgment about the job.

4. The Job as it is now: The job needs to be analyzed as it is now or is planned to develop over the next 1-2 years.

JOB DESCRIPTION - PURPOSES:

The main purpose (use) of the job description is to provide precise information to the Job holder, about his contribution for achieving organizational objectives. It is a fundamental tool for a Line Manager who can use it to ensure that his/her subordinates understand what they have to achieve and the criteria on which their performance will be measured. Beyond this main purpose, job description provides information to support other HR Processes; however it must be reviewed and updated periodically.

JOB DESCRIPTION & COMPETENCIES:

I have already covered the importance of competency models in my previous post. However, it is important to note the views of Mr. Dipak Kumar Bhattacharyya, in his book, 'HR Research Methods' (2007). He says, "The need to link the intellectual capital of the firm to the strategic objective is the order of the day. Firms have realized that unless they align themselves accordingly they will not be able to gain a competitive advantage: Thus, a competency-based approach is today used by a lot many organizations in achieving their strategic objectives.

Competency mapping, therefore, has now become essential for every organization to achieve excellence, gain competitive advantage, and renew them through proper restructuring."

In any Job Description, Key Result Area (KRA's) represents the "Output" of the job. And the knowledge, skills and competencies represent the "Inputs" of the job. Competency-based job analysis basically means writing job description based on competencies rather than just job duties.

The validated competencies can be taken directly from existing library in case the company has already adopted a competency model. Alternatively if the company is in the "process of developing competency model", then during the "data collection" phase (step no. 3 of process - as shown in previous post) various assessment methods can be used. However, "Behavioral Event Interview" (BEI) is given more importance by Haygroup. Other methods include Expert Panels or Focus Group and Surveys. These methods either can be used on their own or along with other methods for effective results.

A directory / library typically contain a list of approximately 15 to 20 tailored competencies. These competencies are key to high performance in the organization.

For each competency we require:
-   A definition
-   A business rationale (why it matters to the business)
-   Levels of demonstration, with behavioral indicators

The Panel identifies the 8-10 key competencies required which are important for achieving success in a particular position (Position Level and Functional / Technical Competencies). The 'Core competency' is also identified in the process. For e.g. "Passion for the Business" [ IBM - List of competencies page 210, Who Says Elephants Can't Dance? (2002) ].  And finally specify the 'levels' of demonstration of each competency which is required.

Example:

Self Confidence                      Level 4
Achievement Orientation         Level 3
Transparency                         Level 5
Service Orientation                 Level 3
Teamwork & Collaboration       Level 4

Prof. / Dr. David McClelland had already stated the importance of competencies compared to intelligence. Where competencies are more likely to contribute towards the achievement of success in a particular job. In fact, they are perceived as predictors of superior performance. Hence, a competency based job description can be used in various HR processes, especially to distinguish the "best from the rest".

BENEFITS / ADVANTAGES:

1. Communicating competencies: A Job Description can be an important tool for effectively communicating needed 'competencies' to employees. i.e. which competencies are important for achieving success in a particular job. And the needed 'Level' of each competency. 

2. Facilitate processes integration: Since the Job Description is an important document that facilitate executing various HR processes as shown in the above image. Competency-based Job Description provides 'Lingua Franca' (common language) to integrate these processes. ( For strategic HR, the lingua franca is competencies - The Art and Science of competency Modeling - Kornferry Institute [pdf] )

3. Measurable competencies: Since job competencies are always observable and 'measurable' behaviors comprising part of a job, they provide a sound basis for Performance Management, Training & other HR initiatives compared to tasks and duties. Needless to say, “What gets measured gets done” as correctly said by Peter Drucker, in fact, there is similar quote by Lou Gerstner "people don’t do what you expect but what you inspect".

4. Provides Strategic approach: Designing competency-based Job Description is more strategic approach since it provides a direct link to business goals and organization strategy. Mr. Jeffery S. Shippmann, very clearly explain it in his article, "The Practice of Competency Modeling" [pdf] (Personnel Psychology 2000)

He says, "Competency approach typically include a fairly  substantial effort to understand an organization's business context and competitive strategy and to establish some direct line-of-sight between individual competency requirements and the broader goals of the organization".

5. Assessment & Development: As researchers have advocated the use of the competency-based approach for assessment and development purposes. Such job description would facilitate the process of Training Need Analysis and provide concrete basis for designing training and development strategies. Similarly, it may benefit to other HR Processes such as HRP, Career Planning and Succession Planning.

6. Predictive HR Analytics: There is a vast amount of data being collected during Job Analysis and Competency development process. In the advent of HR Analytics, a competency based job description would certainly provide a sound basis to facilitate predicting future success. Here competencies can play an important role since they consider other aspects such as Belief, Interest, Values, Self-image, Traits and Motive; apart from Experience, Qualifications, and skills. Typically underlying elements of competencies which are less visible ( "Ice-berg Model" ) but they largely direct and control surface behavior.

PRECAUTIONS :

However, according to Mr. Frederick Morgeson there are two possibilities that affect the analysis. ( "Self Presentation Process in Job Analysis" [pdf] Journal of Applied Psychology 2004)

1. Normally respondents give higher ratings for competencies.  Employees tend to inflate their job during the process of interview since the result has direct impact on job grade, compensation and employee status. The purpose of the analysis (e.g., strategic clarification vs. organizational restructuring) is also likely to exert a strong influence on employee response.

2. Respondents give lower ratings for entry-level competencies. For example, we tend to use lower 'levels' of particular competency for the entry-level job (Trainee, Junior Associate) compared to senior positions.

To sum it up, the competency-based approach certainly helps to enhance performance, manage change and drive cultural transformation, while at the same time empower and motivate the employees.

I would like to conclude with another approach in addition to Job Description, by designing 'Job families' & 'personal scorecards' for every employee. Robert Kaplan & David Norton have articulated the significance of this approach in their book - "The Execution Premium" (2008). It says,

“we have described how to identify strategic job families. ... They create the differentiation in the strategy for sustainable competitive advantage. ... the HR processes eventually need to ensure that all employees have competency development programs in place that will give them the knowledge, skills, and values they need in order to achieve the targeted performance on their personal scorecards."

[Inputs taken from Haygroup - Job Analysis - Training Material]

COMPETENCY BASED INTERVIEW - ASSESSMENT

[Image source: Google Image]

While going through SHL - "2013 Global Assessment Trends Report", trends reflected that 'Creating / implementing Competency Model (s) was ranking at number eleven (11) in list of 'HR Priorities - 2013'. And only one-third of respondents indicated that Competency Models are used effectively in their organizations.  Now, that was an unexpected finding, considering the fact that Competency Development and Management is an integral part of strategic HR initiatives. In fact mission critical for successful strategy implementation for any organization. ( 'The Execution Premium' by Robert S. Kaplan, David P. Norton )

It also reminded me of a well-known quote, "Most of us spend too much time on what is urgent and not enough time on what is important" by Stephen R. Covey.

As a matter of fact it was Hay Group that assisted Mr. Lou Gerstner Jr. Chairman & CEO, IBM (1993-2002) in developing eleven "IBM Leadership Competencies"  ( Leadership Run Amok, HBR - June 2006 ).  Importance of this initiative is underlined by the fact that it was part of the largest turnaround strategy of corporate history, successfully headed by Mr. Gerstner.

I would like to refer to his remarkable comments in the book ( Who Says Elephants Can't Dance? 2002 )

" Specifically, people wanted to know how they could make it into the SLG (Senior Leadership Group) one day. Our answer was to create a set of common attributes that we wanted all of our leaders to have, and to formalize them as ' IBM Leadership Competencies'." ( p. 210 List of 11 competencies) (Details of these competencies available in the book Management and Organizational Behavior by Laurie J. Mullins 2005)

Leadership performance within IBM was assessed in line with these eleven competencies. As stated by him,  "The competencies became the basis for evaluating every executive in the company. It did not take long for people to realize that this was going to be how you got ahead in the new IBM."

It is important to note that he personally advocated and promoted this initiative. He spent three days in the training session for this initiative along with his team of 300 selected Executives within IBM. He wanted his Executives to adopt and display behavior in line with his turnaround strategy. And he successfully implemented this change management process. He further states that " Although I actively promulgated the principles and built our management training and evaluation around the Leadership Competencies, the new ways of doing things were much less codified than what they had replaced. That was how I wanted it to be and it did produce a marked change in our leadership's behavior and focus".

The competency-based methodology was pioneered in late 1960's by Dr. David McClelland, Founder of Hay McBer Company, also Psychologist at Harvard University. Subsequently many others had also contributed for the development of Competency-based HRM. It was primarily focused on an assessment of employees, not just on the basis of intelligence, but on the basis of a set of competencies. Competencies are the knowledge, skills, behaviors, and attitudes that lead to high performance.

TYPES OF COMPETENCIES:

Three types of competencies are specified by Korn Ferry Institute in the white paper, 'The Art & Science of Competency Modeling' (2010) 1) Core Competencies 2) Position Level Competencies & 3) Functional Competencies.

1) Core Competencies: These are set of critical competencies that result in shaping organizational capabilities and required culture to achieve strategic objectives.

2) Position Level Competencies: These are competencies which are critical for success in relevant position i.e. Individual Contributor, Manager or Executive.

3) Functional Area Competencies: These are competencies which are most critical for different functions within an organization. For e.g. Creativity - more important for Marketing and less important for Finance.

[ Image source: "The Art and Science of Competency Modeling" 2010 The Korn/Ferry Institute ]

Some authors have also defined other types of competencies, such as Organizational Competencies, Technical Competencies, Behavioral Competencies, and Management Competencies etc.

COMPETENCY LIBRARY:

There are many institutions which have already designed set of universally applicable competencies; for e.g. Hay Group, Center for Creative Leadership ( CCL) , Lominger / PDI ( Kornferry) , DDI, SHL - CEB, Kenexa. Different experts may call the competencies by different names or differentiate them on the basis of different levels. However, the content and essence of these competencies is essentially the same. These Competency Libraries are updated and validated periodically, and hence are the better option than developing our own library. In addition certified professionals bring in value-added assistance and support throughout the implementation process. The success of the Competency Model and the entire initiative hinges on competency  library, in terms of quality of its contents. Hence, it deserves special attention and care in the decision-making process.

The important question here is that whether these competencies are suitable or can be customized according to strategic requirements / cultural norms of our organization. In fact, some experts say that organizations should not “plugin” ready-made competencies from an existing library unless they truly reflect the company’s culture, business strategy and unique market dynamics. Please note what Mr. Dave Ulrich and Mr. Norm Smallwood state in their HBR-July 2007 article 'Building Leadership Brand'. It says, "...vanilla competency models generate vanilla leadership.... Expanding the competency model to include an external focus allow companies to offset that risk, by enabling them to tailor their leadership model to their own requirements".

PROCESS FOR DEVELOPING COMPETENCY MODEL:

1. Establish the performance criteria.
2. Identify people for the criterion samples.
3. Collect data through behavioral event interviews (BEIs) or other assessment methods.
4. Analyze data and define the competencies.
5. Validate the model.
6. Design applications.

These are six stages in the process of developing Competency Model according to working paper, prepared by Hay Group - "Using Competencies to identify High Performers" - 2003. Each consultancy has their own process which is more or less the same.

INTEGRATED APPROACH:

While designing business strategy, Competency Models become a valuable tool for defining critical skills required for achieving success.  Simultaneously it also facilitates the integration of talent Management and other HR processes within an organization. ( e.g. Recruitment & Selection, Career Planning, Succession Planning, Training & Development, Management Development, Performance Management, Compensation & Benefits, and Workforce Planning ) Effectively designed models are capable of delivering expected transformation in organization culture. ( Strategy-driven Talent Management 2010). A transformation that Mr. Gerstner completed successfully, hence he says, " I came to see, in my time at IBM , that culture isn’t just one aspect of the game—it is the game."

Software implementation can be a wise option to ameliorate the burden while simplifying the entire process. There are many software’s available for implementing competency framework while ensuring integration with other Talent Management initiatives. [ERP : Taleo ( Oracle), Success Factors ( SAP), & Workday. Standalone : Saba, CornerstoneonDemand, Halogen Software, Sum Total, Lumesse, & Peoplefluent] They provide an effective solution in association with above-mentioned companies. Especially by capitalizing on their expertise with competency libraries  (e.g. DDI, PDI, Lominger) and latest research & development in the field.

COMPETENCY- BASED ASSESSMENT:

Now the big question is 'where to begin'? Here I would like to refer to remarks made in the white paper 'The Art and Science of competency Modeling' - Kornferry. It says, "Processes that are widespread and well-implemented may be a harder place to start because of the change management involved. Take interviewing and selection, for example. If the current state is decentralized and mostly managed by the individual hiring manager, offering a competency-based selection process not only adds science to the process but it makes it easier for those hiring managers. Identify the greatest need and begin there - other talent management practices will follow."

Besides it makes more sense to recruit or select for the Competencies that are being developed, rather than to train people for them in the short term. A competency-based selection process help organizations by providing a framework to consistently hire, develop and promote top performers. When you employ the process turnover drops, Individual and Group performance improves and your organization builds a strong & agile workforce that can solve problems, change with the times, and meet organization-wide goals. It reminds me of a remarkable quote by David Ogilvy, he summed up the importance of careful hiring when he wrote, “If each of us hires people who are smaller than we are, we shall become a company of dwarfs. But if each of us hires people who are bigger than we are, we shall become a company of giants.”

I have managed to design a Competency-based Interview Assessment Form. There are 78 Competencies based on which we can assess employees for selected 8 competencies relevant to the position. You can download the same using link provided below. Or send an email to vijay.bankar@gmail.com and I will forward it to you immediately. It can be used either for recruitment of employees or it can be used for employee assessment - for selecting employees for Leadership roles / promotion. Please note that the assessment form is being developed based on conceptual understanding. However, so far, it has not been administered on employees. Please do provide your valuable feedback.

As my previous post, I would like to conclude with a quote:

Jack Welch said that the core competency of GE is not making some product or GE's ability to grow at a double-digit rate: "GE's core competency is the development of people. In the end, great people make things happen. Involving all of them is really the answer."

... The Jack Welch Lexicon of Leadership, 2002 - Jeffrey A. Krames