Professional Documents
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JMP
20,5 Towards a multidimensional
competency-based managerial
performance framework
380
A hybrid approach
Received November 2003
Revised November 2004
Mei-I. Cheng and Andrew R.J. Dainty
Accepted December 2004 Department of Civil and Building Engineering, Loughborough University,
Loughborough, Leicester, UK, and
David R. Moore
Scott Sutherland School, The Robert Gordon University, Aberdeen, UK
Abstract
Purpose – To report on the development of a new, more balanced approach to managing the
performance of key employees in project-based organizations.
Design/methodology/approach – Following the establishment of the role-based criteria for
performance excellence through focus groups and subsequent factor analysis, performance profiles of
a range of superior and average performing managers were compiled. These were based on
behavioural event interviews (BEIs) from which job, person and role-based aspects were derived. The
final performance model was validated through assessments with an expert panel of HRM specialists.
Findings – This research has developed and demonstrated the potential of a more holistic approach
to managing performance which includes reference to the job requirements, personal behaviours and
the role context. It was found to be particularly suitable to measuring managers’ performance in
dynamic team-based environments.
Research limitations/implications – The empirical work upon which the new performance
framework is based was derived from a limited study within two construction organizations. Future
work will explore the applicability of the approach within other organizations and industries.
Practical implications – Applying this framework to key HRM activities has the potential to
improve the ways in which companies manage, develop and retain their key managerial resources.
Notably, they should be able to engender a more participative, developmental approach to the HRM
function, thereby helping to ensure sustained performance improvements in the future and improved
resource usage effectiveness.
Originality/value – The paper presents the basis for a completely new performance management
paradigm which embeds managerial competence/competency in a way which more accurately reflects
the realities of managerial practice.
Keywords Performance management, Competences, Modelling, Managers
Paper type Research paper
Introduction
Devising more effective ways of managing the performance of key managerial
employees has become a cornerstone of organizational development in recent years.
Journal of Managerial Psychology As part of this movement, the establishment of the competence or competency of
Vol. 20 No. 5, 2005
pp. 380-396 individuals, within both their general contribution to the organisation and their specific
q Emerald Group Publishing Limited contribution in the context of their occupational role, is central to defining the
0268-3946
DOI 10.1108/02683940510602941 necessary routes to further development within the organization. Indeed, competency
assessment has been seen as an increasingly versatile and powerful tool to underpin Managerial
many contemporary human resource management (HRM) practices (Armstrong, 2003). performance
Such assessments can help to define job-role characteristics and desired levels of
performance and hence, can provide a basis for many aspects of the HRM function. framework
However, although the general use of the terms “competence” and “competency” is
fairly indiscriminate, there are important conceptual and practical distinctions to be
made that fundamentally effect their application within modern organizations. 381
Within traditionally structured organizations, performance management systems
tend to rely upon competence-based approaches where managers are appraised against
a range of technical job function requirements and in relation to outturn performance
criteria or metrics (Martin and Staines, 1994). Thus, it is focused more on the
performance requirements of job positions than on the jobholders themselves (Stuart
and Lindsay, 1997). Indeed, the underlying characteristics of jobholders are already
assumed to exist (Garavan and McGuire, 2001). In contrast, competency-based
approaches, where managers’ behaviours are utilised as the basis of performance
management and development activities, are less commonly encountered, although
they are more popular in the United States than in Europe (Garavan and
McGuire, 2001). This approach relies upon predominantly input-based criteria, with
a focus on person related variables that individuals bring to a job (Boyatzis, 1982;
Spencer and Spencer, 1993).
Bergenhenegouwen (1996) argued that in a managerial context, managers must
possess a range of personal competencies along with task-specific competences to
perform effectively. Many organizations therefore combine both personal competencies
and job-based competences, but most models do not necessarily balance these two
differing aspects effectively (Bergenhenegouwen, 1996). This is disadvantageous for
the organization as it delimits the potential of learning to correct any imbalance
between the two sets. Rather, a more robust hybrid approach that draws on the best
aspects of both approaches could offer a more effective and innovative performance
management paradigm.
This paper reports on research, which has developed a hybrid performance
management approach and its practical application within a dynamic industrial
context. The research examined the competence and competency requirements of the
project manager role in the construction industry, one of the most demanding
project-based industrial sectors. This offered a test bed to evaluate the practical utility
of a multi-faceted performance management approach for key management
occupations. Based on the empirical evidence gathered, the paper explores whether
such a hybrid approach could define a new and more robust methodology for
measuring and improving managers’ performance within the context of contemporary
organizations and business practices.
Methodology
The job role forming the focus of this study was that of the construction project
manager. This role was chosen for its complex, multifunctional nature and the many
dimensions and influences on performance that could be measured. Thus, the job role
has a broad range of discrete but mutually reinforcing competence, competency and
role requirements that could benefit from a multidimensional competency-based
managerial performance framework. The collaboration of two leading organizations at
the forefront of process improvement within the construction sector provided a source
for the data necessary for the work and ensured the practical utility of the managerial
performance framework within the industry context for which it was designed.
Company A was a privately owned contracting organization. Employing over 1,000 Managerial
people, it operated in all construction markets including product and component performance
manufacture, traditional building contracting and design/management services.
Company B was a Public Limited Company also employing over 1,000 people. The core framework
focus of this organization was building and civil engineering contracting. Both
companies operated throughout the UK through a divisional operating structure based
on service specialisation and geographical radius of operation. However, both had 385
centralised HRM departments, which co-ordinated the management of the performance
management systems used by the firms. Neither of the firms were implementing
integrated, multidisciplinary (task, role and person-focused perspectives) performance
management systems.
Development of a multidimensional competency-based performance framework
requires a methodology combining all three perspectives within a single analytical
framework. The research began with the establishment of the role-based criteria for
performance excellence (phase 1). Three focus groups were held in which a stratified
sample of managers ðN ¼ 20Þ ranging from first line supervisors to senior head
office-based managers were used as an expert panel to define the requirements of
performance excellence for the job role. These individuals all relied upon the outputs
from the project manager for the completion of their own job role. The focus group
discussions lasted for a period of between two and three hours, following which the
discussions were recorded, transcribed and then combined into a comprehensive list of
performance criteria. The full range of criteria were then listed and the original
participants asked to rate the importance of each criterion on a seven-point Likert scale
on an individual basis. The independence of the Likert responses ensured that any
influence over subordinates from senior managers during the focus groups was
minimised. Exploratory factor analysis was used as the data reduction tool to reduce
the number of indicators to a manageable and meaningful number of criteria expressed
as factors. In order to understand the underlying constructs of the variables, a principal
components analysis was performed with varimax rotation for eigenvalues greater
than unity.
Phase 2 involved the development of the micro competency model (the job-focused
approach) and macro competency model (the person-focused approach). The role-based
criteria for performance excellence developed in phase 1 were used to identify a group
of superior and a comparison group of average performers to form the basis of the
main data collection phase. A panel of HRM specialists, construction managers, project
managers and site managers from each participating company identified 24 superior
managers and 16 average performers. A variety of data were collected from a total of
40 managers’ interviews. First, a job-tasks interview was carried out. This asked the
superior managers to describe their job tasks and key responsibilities so as to identify
the micro competence(s). The second stage comprised a series of behavioural event
interviews (BEIs) to assess macro competencies (McClelland, 1998). BEIs were
conducted with both superior and average managers. They were asked to describe
critical situations encountered in their jobs. The interviewer then explored what the
situation or task was, who was involved, what the interviewee thought, felt and wanted
to do, what they actually did and what the result or outcome was. The interview lasted
from two to three hours. All interviews were tape-recorded and transcribed verbatim
for analysis.
JMP Data analysis proceeded in line with the two-stage interview process, with the initial
20,5 objective being the production of a micro competence model. The transcripts of the
24 superior managers’ job-task interviews were analysed using the QSR NVivo
qualitative analysis package. Each of the three research team members coded the
transcripts with the objective of identifying and coding the job tasks and key
responsibilities. The second stage of the analysis had the objective of producing a
386 macro competency model. The transcripts of 40 completed BEIs were coded against the
competencies contained within the McBer Competency Dictionary (Spencer and
Spencer, 1993). Each transcript was reviewed and passages were then coded to the
appropriate tree node(s). Each analyst independently identified similar patterns and
themes for each competency. Any motives, thoughts, or behaviours that matched those
provided by the McBer Competency Dictionary were coded and those absent from the
standard dictionary (which therefore are unique construction management
competencies) were extracted. It should be noted that the analysts were not aware of
the group placement (i.e. superior vs average) of any of the interviewees during the
coding process.
The interview coding was analysed statistically to see if the analysts reached an
acceptable level of inter-rater reliability. Examples of competencies were copied from
the transcript to a “dictionary” to provide customised examples of each competency
level coded. The dictionary was customised by tailoring the definitions of competencies
and competency levels to describe the data being coded and a behavioural codebook
was then developed. This coding process provided quantitative data that was used to
test the findings for statistical significance. The one-way analysis of variance
(ANOVA) was conducted to examine whether the differences among the competencies
of the two groups (superior vs average managers) were significant. Subsequently, a
forward stepwise logistic regression analysis was performed to create a parsimonious
model for the prediction of job performance.
The suitability and applicability of the role-focused and micro competence models
were examined by employees (senior line managers) and employers (HRM specialists)
from each participating company. To validate the macro competency model, a panel of
assessors (HRM specialists and senior line managers) with first-hand knowledge of the
performance and competencies of the candidates, were asked to select a second
criterion sample of managers (12 superior managers and eight average performers)
using the role-based criteria for performance excellence. Subsequently, the panel was
asked to rate the competencies of candidates by using criteria from the developed,
construction bespoke, behavioural codebook to see if the macro competency model
predicted the superior and average managers in the second group.
Results
The role-focused model
Principal factors extraction with varimax rotation was performed using SPSS.
The exploratory factor analysis resulted in 12 factors with eigenvalues greater than
unity being extracted, but the scree test suggested that a nine-factor solution was most
appropriate. Owing to the relatively small sample size, an inter-rater agreement was also
employed to help interpret the data and refine the factors. Along with the inter-rater
agreement, 43 performance criteria were identified which are summarised by nine factors.
The first factor was labelled “Team Building” and explained 22.36 per cent of the variance;
the second factor was concerned with “Leadership” and explained 17.71 per cent of the Managerial
variance; factors 3-9 were concerned with “Decision Making”’ (11.10 per cent of the performance
variance), “Mutuality and Approachability” (8.19 per cent), “Honesty and Integrity”
(7.03 per cent), “Communication” (5.32 per cent), “Learning, Understanding and framework
Application” (4.73 per cent), “Self-Motivation” (4.10 per cent) and “External Relations”
(3.93 per cent). The nine factors extracted therefore accounted for 84.45 per cent of the
variance in responses. The details of the constituent indicators of each of the nine factors 387
extracted can be found in Dainty et al. (2003).
for the total sample of 40 managers. The resulting parsimonious model accounted for
66.90 per cent of the variance in job performance.
The resulting logistic parsimonious regression equation is as follows:
1
ProðsuperiorÞ ¼ self2controlþ1:79 team leadershipÞ
:
1 þ e2ð29:08þ2:40
Validation results
HRM specialists (employer’s perspectives) and senior line managers (employee’s
perspectives) confirmed the suitability and applicability of the role-focused model and
the micro competence model. The resulting full macro competency model was
validated by a second criterion sample. The t-test results show that superior managers
were significantly higher than average managers on the 12 distinguishing
competencies previously identified (Table III).
For the parsimonious model, the scores of self-control and team leadership
competencies were put into the model to assess the probability of an individual being
a superior performer. The results show that the model misclassified 4 of the
Discussion
Elkin (1990) suggests that human resource management practitioners face a dilemma;
on one hand, the underlying macro competency/person-focused approach seems
390 removed from the everyday reality of most jobs and the need to demonstrate
immediate benefits from training and development. However, adopting a micro
competence/job-focused approach is normative and geared towards the development of
“identikit” managers (Mangham, 1990). Thus, a sole focus on either competence or
competency-based systems is unlikely to yield rounded, technically competent
managers with the ability to move organizations forward. There is, however, no
intention here to assert that all managers should aspire to become superior performers.
Rather, the suggestion is threefold. First, managers may, in appropriate circumstances,
be encouraged to develop a level of performance, which is superior to their existing
performance in order to contribute to the achievement of a superior organisational
(rather than superior individual) performance. Such a scenario would equate to that
faced by a transitional or transforming (moving forward from a transactional to a
transformational culture) organisation. In such a case the emphasis is on incremental
performance improvements by many individuals as a means of gradually building a
transformational culture. Secondly, a strategy of supporting the development of a core
of managers with the objective of raising their performance to a superior level may be
appropriate in dealing with expansion of an organisation’s area of activity. An example
would be engaging in new activity with regard to what D’Herbemont and Cesar (1998)
refer to as sensitive projects and which have particular demands for project manager
behaviours not demanded by “normal” projects. Thirdly, that in extreme cases the
so-called neutron-bomb approach may be exercised. In this scenario, there is a rapid
and complete displacement of one management culture by an “improved” culture
which drives the organisation forward in a quantum leap. Such an approach requires a
speedy (rather than gradual) development of superior performance in a selected group
of managers. The required speed of this development will place demands on the
selection process so as to identify managers who are already close to the required level
of performance.
The extent of differentiation regarding performance development outlined above
suggests a need to add a consideration of a third dimension, one with an emphasis on
the role rather than the job or person-centred issues. This research has developed and
demonstrated the potential of a more holistic approach to managing performance,
which focuses on the job (micro competences), the person (macro competencies) and the
role (performance excellence in the social contexts). This hybrid approach represents a
Predicted
Average vs superior
Observed 0 1 Percentage correct
Conclusions
The whole issue of competence/competency, a subject at the centre of the debate over
management development, comprises a semantic minefield in which the terms are
used to mean fundamentally different things. This research has explained how the
confusion has come about and proposed a new approach to both establishing what
competence/competency is and developing guidance for use in practice. Bringing
together and integrating the three models provide a more rounded solution, especially
for dynamic and changing industries such as construction. However, measuring
achievement against behavioural competencies is difficult and would require an
attitudinal sea change within industry. It remains to be seen whether the industry is
prepared for such a fundamental shift in approach. It has been suggested that those
planning for management’s needs and development should focus on the future (Briscoe
and Hall, 1999) and it is vital that the lists of competencies and competences must be
reviewed frequently to reflect the best estimate of what the future will require with
regard to competences and competencies.
This research has demonstrated that a hybrid, multidimensional managerial
performance framework can be developed and thereby address some of the criticisms
of traditional approaches to managing performance. Notably, it has provided
important insights into employee perspectives on their vocational roles. These can be
compared with employer’s assumptions of key job, person and role responsibilities
JMP and so should inform the development of future occupational standards for the
20,5 construction management function. These insights should also provide a deeper
understanding of the conflicts that emerge between managers and organizations in the
definition of vocational achievements and so will be relevant to academics working in
the HRM and industrial relations fields.
394
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