If developed and implemented effectively, a well-defined competency framework can help organizations:
- Find and keep the best people;
- Enable better employee performance, and
- Improve business results.
(Noonan, 2012)
Most often large companies with Human Resource departments embark on developing ineffective competency models that are overly complicated and detached from the business.
A small business can identify core competencies needed in each position to achieve its strategic goals. A few examples include:
- Position descriptions that outline the range of authorities delegated to the employee and encourage taking initiatives in the responsible areas to improve business results.
- Engaging the employees to develop competencies in all areas via a mentoring role.
- Developing appropriate reward systems with a focus on strategic goals that many employees can achieve.
- Sharing the improved business results as well as communicating deteriorating results with employees to offer a transparent view of the company.
Definition of Roles
A small business owner can quickly become fully consumed in his new enterprise. The time commitment to being your own boss often becomes 100% of every day. Balancing the various roles may result in favouring certain familiar tasks and allowing other tasks to slide. Having technical skills in the business may naturally draw the owner to doing technical work while purchasing supplies, paying suppliers or remitting taxes may be postponed with potentially disastrous results. Today, the small business entrepreneur must recognize when critical parts of the business are being overlooked. Fortunately, experienced bookkeepers are readily available to handle routine administration tasks..
In The E-Myth Revisited (1995), Michael E. Gerber states that one way for the small businessman to look at the enterprise is to recognize three key roles: the Entrepreneur, the Manager, and the Technician. To be successful is to be able to do all three roles when needed. The entrepreneur will look ahead, create new processes, and new products. The manager will deal with the employees, customers, and suppliers to keep the business moving forward. The technician will fill current orders without significant innovation.
The E Myth Revisited is a worthy read for any small business owner. The case study “All About Pies” simplifies the challenges of running a small business by breaking down each aspect with excellent examples. It further develops the idea to document the business process like a franchise to gain the consistent customer experience and build repeat business. The author has several small business books available through his website. The concept of core competencies and a documented business process for each activity will allow new employees to train quickly and provide consistent service to the customers. With these tools in place, promoting employees will be significantly smoother.
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Activity: Definition of Roles
Consider your strengths from the SWOT analysis you completed in Preparing to Purchase a Business.
- Are you more like an entrepreneur, manager or technician?
- How can you move from one role to another?
- In which area are you least comfortable?
- How can you re-inforce the skills in your weak area?
One of the most powerful ideas in The E Myth Revisited is that you can learn to identify a weakness and strengthen it. Often, hiring individuals with specific skill sets will resolve shortcomings.[/info]