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Defining the needs of your organization in the future is an incredibly hard thing to do.
Whilst roadmaps have been a key part of business planning for decades, fundamental elements of workforce planning change so fast in the modern world of work that even simply looking into the interim future and pulling apart the skills your people will need in order to align with your overall key business outcomes is a challenging process.
This means that the skills that firms currently consider to be business critical will inevitably change and shift, and with no structure in place to ensure that they’re constantly developing along with the needs of the business, whole workforces will fall behind.
This is why, when looking to define future capability needs, HR should turn to a tried-and-true method – the capability development framework (or CDF). With a robust CDF, HR can assess where their skills development is currently failing, and plan to build better future capabilities.
What is a capability development framework?
In essence, a capability development framework is a structured approach that helps organizations define and cultivate the skills, knowledge and behaviors necessary for their employees to meet business goals.
This framework serves as a guide for various aspects of workforce management, including recruitment, job design, career planning, succession planning, performance development practices, learning and development and workforce planning.
It’s important to understand that simply hiring talent with currently necessary skills to carry out their roles is not a long-term strategy. Inevitably before long the skills that these individuals possess will be redundant, and with no way to upskill with relevant abilities, orgs will fall behind competitors.
Why building capability is key
Building capability within your organization is absolutely fundamental. Through capability building, internal knowledge grows, staff are more skilled and agile, customers get better service and engagement increases.
According to McKinsey data, organizations exposing at least ten per cent of their employees to capability-building programs were twice as likely to improve their OHI scores over organizations that didn’t. Firms that did so saw an average rate of improvement of nine per cent versus no improvement at all.
Skills that firms currently consider to be business critical will inevitably change and shift, and with no structure in place to ensure that they’re constantly developing along with the needs of the business, whole workforces will fall behind
Organizations that included upward of 30% of their workforce in formal capability-building programs improved their OHI scores by an average of 12%. They enjoyed total returns to shareholders 43% above benchmarks after 18 months.
This is why a massive 80% of business leaders now say capability building is extremely or very important to the long-term growth of their companies - up from 59% before the pandemic.
Here's a breakdown of key components and why they matter:
Recruitment: A capability framework assists in defining the skills and competencies required for specific roles within the organization. It guides recruiters in assessing candidates based on the desired capabilities, ensuring that new hires align with organizational goals.
Job design and role descriptions: The framework helps in designing roles that align with organizational objectives by specifying the necessary skills and competencies. It aids in creating detailed and accurate job descriptions that reflect the capabilities needed for success in each role.
Career planning: Employees can use the capability framework to understand the skills and behaviors required for advancement in their careers. It facilitates discussions about career paths and development opportunities, fostering a more engaged and motivated workforce.
Succession planning: Identifying and developing talent for future leadership roles is crucial for organizational continuity. The capability framework assists in identifying potential successors by outlining the skills and competencies needed for leadership positions.
Performance development practices: Managers can use the framework to set performance expectations based on specific capabilities. Regular performance assessments can be aligned with the framework to identify areas for improvement and development.
Learning and development: The framework serves as a roadmap for designing training programs and initiatives. It helps prioritize learning objectives and resources, ensuring that employees acquire the necessary skills to excel in their roles.
Workforce planning: As the business environment evolves, workforce needs change. The capability framework aids in anticipating and addressing these changes. It supports strategic workforce planning by aligning the skills and competencies of the workforce with the organization's long-term goals.
How to develop an effective CDF
Firstly, it’s important to note that a CDF is only effective if it’s tailored to the specific needs of the organisation. Each business has drastically different requirements, so whilst the basic outline of a CDF can be similar, the outcomes must match the requirements of the business.
A CDF will be as unique to a business as their key objectives. With this in mind, here is a five-step strategy for developing your own tailored CDF.
1. Define roles, responsibilities, and ownership:
Identify process owners who volunteer time for end-to-end activities in capability development and framework maintenance.
Process owners, drawn from cross-functional teams, should manage process maturity, align with business processes, and take responsibility for aspects like process mission, KPIs, stakeholder engagement, and investment maturity.
2. Select key traits for owners:
Choose process owners with traits like subject matter expertise, a positive influence on others, an aptitude for process thinking, and the ability to analyze key metrics.
Look for individuals who are affected by poor processes and stand to gain from improved outcomes, ensuring a people-focused transformation.
3. Outline the purpose and vision:
Define the vision and purpose of the framework, emphasizing operational performance in the name of business success.
Consider public sector frameworks, like the NDIS workforce capability framework, as blueprints for optimal job performance, aligning organizational objectives with performance indicators.
4. Develop a comprehensive communication plan:
Communicate openly with all business levels about the changes, emphasizing transparency.
Connect high-level organizational changes to day-to-day activities, explaining the need for new role descriptions and the benefits of capability building.
Utilize supporting resources, such as user guides and frameworks, to help employees understand and apply capabilities in recruitment, onboarding, self-assessment, and professional development.
5. Prioritize and implement with a focus:
Decide on the scope of changes—organization-wide or department-specific—and prioritize capabilities based on risk and future importance.
Implement capabilities through training and development initiatives and workforce planning.
Establish a capability academy for sustainable learning, co-owned by HR professionals and department leaders.
Assess capabilities through impactful metrics, prioritize sustainability, and align program design with business needs.
Leverage data for informed decision-making, ensuring it is timely, shared across teams, and presented visually for effective analysis.
It’s clear that businesses are currently in a state of flux. With swiftly emerging technology and changing customer expectations, it’s harder than ever to maintain consistency and gain market share.
80% of business leaders now say capability building is extremely or very important to the long-term growth of their companies - up from 59% before the pandemic
However, fundamentally ascertaining your own internal capability, and ensuring that your skills are future-ready are the only ways that businesses can meet the challenges of tomorrow head on, and with the resource to not only survive through uncertainty, but actively thrive.
Key takeaways for HR:
Businesses are facing future uncertainty that challenges internal skills capabilities.
To combat this, businesses can utilize capability development frameworks, to truly scrutinize their own development and ensure they are future-ready.
McKinsey data states that organizations exposing at least ten per cent of their employees to capability-building programs were twice as likely to improve their OHI scores over organizations that didn’t.
Firms that did so saw an average rate of improvement of nine per cent versus no improvement at all.
Organizations that included upward of 30% of their workforce in formal capability-building programs improved their OHI scores by an average of 12%.
They enjoyed total returns to shareholders 43% above benchmarks after 18 months.
80% of business leaders now say capability building is extremely or very important to the long-term growth of their companies - up from 59% before the pandemic.
To develop a CDF, you must assess key objectives, define roles and responsibilities, develop a comms plan and implement with utilize the metrics at your disposal.
