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A Competency Management System is used by companies to track and manage workforce skills. What are the top must-have features to look for?

Across the country, there’s been a measurable shift toward focusing on skills when making hiring and other workforce decisions. To reach a broader talent pool, an increasing number of employers are eliminating the college degree requirement in many of their job descriptions – relying, instead, on clear skills needed for the role. And to overcome bias in the workplace, business and HR leaders are moving to a competency-based approach to workforce management.

To support their initiatives, companies are turning to technology – specifically, to competency management systems – to help them track and manage the skills and competencies of their workforce. Quite simply, a competency management system is a system or software application designed to assess, analyze, track and measure the competency requirements of an organization and the competencies of its people – and to identify and prioritize skills gaps to be addressed.

Of course, not all systems are created equal. What are the top must-have features of a competency management system?

Competency Management System Feature #1:

Workforce Competency Tracking

This is a core feature of a competency management system. It’s the system of record for your essential skills and competencies. You’ll want to be able to name and define each competency. Then, be sure you can map your job descriptions to the required and desired competencies – including defining the proficiency level of each. (Most employees will need some level of communications skills, for example. But your communications leader must be highly proficient with both oral and written communications).

Track, too, the competencies of each employee – and changes over time – so you have an up-to-date snapshot of individual, team, and workforce competencies. Ideally, you’ll be able to store years of competency data – even after some employees leave – to provide insights into current and future strategic business decisions.

Competency Management System Feature #2:

Flexible Competency Models

Some systems come with a competency model baked in. Look for flexibility in the way competency models are supported and maintained, so you have control over the list of skills and competencies that are most important to your organization. As priorities change over time, you’ll want to be able to update the list.

If the system comes with a competency model, find out if you can customize it to meet the specific needs of your organization. Or, confirm that you can choose your own or a third-party model that’s the best fit for your company and goals.

Competency Management System Feature #3:

Skills Gap Analysis

To assess the skills of potential and current employees, you’ll want an easy-to-use online skills assessment to objectively assess each individual’s skills. When your competency management system has a built-in skills assessment tool, the results are stored along with the rest of your competency data – so you can confidently analyze skills gaps.

The best systems have flexible skills gap analysis tools, so you can understand skills strengths and gaps for individuals, teams, groups, and your whole workforce. You’ll want to be able to define the parameters of the analysis to inform a broad range of decisions.

Competency Management System Feature #4:

Custom Reporting

Some level of reporting is common among competency management systems. What we’ve found from our clients, though, is that there are many one-off questions or situations that are best supported with a custom report or set of reports.

Ask your system provider if your software can collect, store, manage, and report on massive amounts of competency data to help answer strategic workforce questions like these:

  • Which training was most effective for targeted skill-building?
  • Which leaders are most effective when working with hybrid teams?
  • Which of our current employees have the skills we need for a particular open job role? (Even if those skills are not required for their current job.)

Competency Management System Feature #5:

Integration with Other HR Systems

Most organizations have learning management systems (LMS) and other human resource (HR) systems that are separate from their competency management system. Those with the strongest competency management programs, though, are the ones where the competency management system is integrated with the LMS and certain HR systems.

You’ll want a competency management system that easily integrates with other systems. Look for systems that use an application programming interface (API) or web services to seamlessly exchange data between the systems or applications without any user involvement. Ask your software provider about their experience integrating their competency management system with other systems.

Competency Management System Feature #6:

Choice of Cloud-Based or On-Premise

Advantages of a cloud-based solution are many – including a fast set-up and low up-front costs. Still, some organizations prefer to license their applications and use their own in-house servers, to maintain greater control. Ideally, your provider offers both options, cloud-based or on-premise installation. Ask your vendor about their experience and support for each option.

Competency Management System Feature #7:

Individual Development Plans

National Institutes of Health define individual development plans this way: “An Individual Development Plan (IDP) outlines career goals within the context of organizational objectives. It is a developmental ’action’ plan to move employees from where they are to where they would like to be or need to be.” An IDP is meant to be revisited frequently to assess progress and confirm or adjust next steps.

A solid competency management system will help ensure that your employees’ IDPs are aligned with corporate goals. It will also track progress toward developing desired skills and proficiency, show where there are gaps, and help assess whether the IDP stays aligned with company goals that change over time – so employees are always developing skills for current and future success.

Competency Management System Feature #8:

Leadership Development and Succession Planning

If any of your leaders were to leave the company – or be promoted to new roles – which employees would be best suited to step in? What skills would those employees still need to develop? How well are they progressing on their own leadership development plans?

Your competency management system should be an essential tool to help you answer these questions and manage a successful leadership development and succession plan. Look for a system that supports a multi-level plan for each of your critical roles, including two or three levels before the senior leader, so your organization can fill positions at all levels when top leader(s) move on. Routine skills assessments are key to capturing and monitoring progress – and identifying areas where new development opportunities may be helpful.

Competency Management System Feature #9:

Performance Reviews

Aligning skills with company goals and priorities isn’t just for leaders. It’s important for all employees to have or build skills that help the company thrive. Taking a continuous approach (continuously managing workforce performance rather than once-a-year reviews) helps with alignment, communication, and productivity.

Your competency management system should be an essential performance management tool for your company. Rapid skills inventories and skills assessments, for example, can provide feedback to employees and managers about how well employees are prepared for their jobs today and their desired future roles. See if your competency management, too, can track how well employees comply with maintaining their professional credentials.

Competency Management System Feature #10:

Business Continuity Planning Support

Though many software providers overlook this use case, we’ve found that competency management systems can be essential tools for business continuity planning and support.

As our CEO, Tom Grobicki, pointed out in an earlier blog, “A good competency management system can also collect additional information that can be critical when the normal course of business is disrupted. This can be as simple as a daily ‘Are you available?’ status check or more complex information such as a list of vaccinations.”

When you have a current snapshot of which employees have what skills – and where they are – you can quickly identify employees who can step in when some leaders or other team members are unavailable due to a weather or health disruption.


For 25 years, we have experienced the power of a flexible competency management system as we work with small and mid-size enterprises using our own Avilar’s WebMentor Skills™. The one over-arching attribute that our clients say they appreciate is that the system caters to their needs and processes – not the other way around. When you’re creating your own list of must-have features, be sure you put your organization’s needs first (not the vendor’s).

If you’re interested in learning how a competency-driven approach to workforce management can advance your workforce management goals, download our Competency Management Toolkit to get started. Or contact us to find out how Avilar’s WebMentor Skills™ could be a fit.



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7 Ways and LMS Can Strengthen Your Competency Management Program
How to Choose Government Competency Management Technology