Core Competencies, Expectations and Career Path for an ...

1 Many organizations do not have competency mod-els or Career development paths for their costestimating or other cost engineering staff. Amodel helps employees understand the skillsand performance required for each position in alternate careerpaths and allows them to proactively participate in managing theircareer development. Using models, supervisors can more effec-tively lead and manage staff performance in a way that links tooverall company strategies and supports improved organizationaleffectiveness. This paper provides some background, discusses thebasic principles of competency and Career development model-ing, highlights some useful industry references, and provides anexample competency model for cost estimating : THE PROCESS INDUSTRIES' FAILURETO INVEST IN HUMAN CAPITALIn our work with many process industry owner companies, wehave only seen a handful that have any competency or careerdevelopment models for cost estimators or any other cost engi-neering discipline.

2 Worse, their investment in human capital inany form during the last 20 years has been abysmal. In the nameof re-engineering and cost "efficiency" during slow times, theprocess industries have downsized, outsourced, cut benefits,reduced training and travel, and cut back on professional devel-opment ( , aace 's membership was declining until recently).By cutting personnel costs with minimal regard for what compe-tency and performance capability they were cutting, companieslost cost effectiveness. Now, oil, gas, mining, metals and other industries are plan-ning a tsunami of capital investment in new and expanded facili-ties. But the only human capital they have to deal with the grow-ing wave is a handful of experienced baby boomers nearing retire-ment; many of whom are overworked and poorly motivated tolead or train new recruits. The potential recruits are turned off bythe dead end image of instability the industry one should be surprised by the human capital in 1997, a director of Towers Perrin's oil and gas practicewrote, To succeed during the next decade, oil and gas companiesmust replenish the intangible assets that re-engineering hasdestroyed [12].

3 At the time, the destructive trend was already 15years in the making. In the same year, the Construction IndustryInstitute (CII) provided owners with a competency evaluation toolthat went unused [2].Predictably, the outcome during the last decade has beenworse project control and capital project cost performance asreported in surveys by Pathfinder Inc. and empirical studies byIndependent Project Analysis, Inc. [5, 8]. Now, with the newsurge of capital spending coinciding with a surge of retirementsand a weak competency base, some fear what has been called aperfect storm of disaster projects [3].The good news is that process industry companies are nowhiring as evidenced in the aace website's growing positionsoffered listings. Another sign of owner interest is CII's competen-cy toolkit update in 2005 [2]. Yet, hiring is not easy for these com-panies; one major chemical company manager remarked, Weforgot how to recruit.

4 But, somehow companies do have torecruit, resurrect old training programs, renew Expectations ,develop competencies and Career paths, and motivate and revital-ize their organizations, and do it , consultants and retired or near-retired babyboomers will play heavily into this regeneration of competency asthe void becomes undeniable. Also, aace international , like theIrish monasteries preserving cultural treasures through the darkages, has been toiling to not only preserve the profession's knowl-edge, but to advance competency development while much of theindustry forgot , management is still wary of increasing head-countand "overhead" spending; they demand that investment in humancapital be cost effective. And re-engineering in some form willcontinue. Globalization will keep it coming. These will in turnrequire increasing staff performance. The authors believe compe-tency and Career development models help companies meet theseperformance , competency development dovetails with processreengineering when done right.

5 In the past, reengineering was aguise for downsizing. However, it has yielded some great process-es, , total cost management [9], front-end loading, etc., andthese are ready to finally bear fruit when supported by competen-cy development. Future re-engineering efforts need to be coupledwith developing organizational competency. Industry must offerreal Career opportunities, and quit expecting software and flowcharts to deliver effectiveness on their aace international competencies , Expectations and Career Pathfor an Estimating ProfessionalMr. John K. Hollmann PE, CCE and Mr. Bruce G. Elliott, CCCBASICS OF COMPETENCY MODELINGC ompetency modeling came out of the human resourcemanagement (HRM) world. It is not our intention to describe allthe HRM methods and models in depth; there are other sourcesfor that. For example, this article refers frequently to the Society ofHuman Resource Management glossary[15]. Our purpose is tohelp cost engineers understand the basics of competency model-ing and provide some references and examples, so they can betterwork with management and their human resource departments todevelop and apply and Lucia provide a good definition of competen-cy models: a descriptive tool that identifies the skills, knowledge,personal characteristics, and behaviors needed to effectively per-form a role in the organization and help the business meet itsstrategic objectives [11].

6 Their definition suggests that for best per-formance a model not only identify the skills and knowledgeneeded for a job, but define the expected levels of performance. Itgoes further to suggest that the model tie skills and knowledge toorganizational roles, and tie everything back to business objectivesand , most companies stop at just listing skills and orduties for given jobs; they only ask, What does this person or posi-tion have to do? Their purpose is to just hire folks like always andget on with the work. For that, all they need is a job posting; to filla hole on the roster. That approach does not get things done anybetter, faster or at lower cost than before-but, in a downsizingworld, managers rationalize that its not my job to worry aboutthat or I don't have time for anything more. Of course, whenbusiness is expecting better results, it's easy to see the wrong-head-edness of the how can you move beyond job postings?

7 Figure 1 illus-trates a path from simple job postings and status quo performanceto robust competency and Career development and improved per-formance and effectiveness. The basic job posting only describesthe nature of the work, the duties and responsibilities it entails,and basic skills, must be able to perform risk analyses, andemployee characteristics education level, desired. Unless thejob posting is derived from a competency model, it does not usu-ally consider how the job or posting's contents tie to overall busi-ness objectives, organization needs, beyond the project at hand, orcareer paths that may be associated with this job. The posting isusually developed as-needed to fill a job posting can be improved by adding some perform-ance Expectations , more definitive skills and knowledge require-ments, and some consideration of how the job fits in the specificorganization. This enhanced document is sometimes called a jobdescription.

8 Job descriptions are often developed as standing ref-erence sources from which an organization can more easily devel-op job postings as needed. It can also serve as a rudimentary basisof employee performance assessments. The skills and knowledgerequirements are generally more definitive than a job posting, be able to perform Monte Carlo analysis in support of riskanalysis. However, like job postings, unless a job description isderived from a competency model, it does not usually considerhow the contents tie to overall business objectives, organizationalneeds for the rest of the company, or Career paths that may be asso-ciated with this few take the extra effort at the job description stage to iden-tify and prioritize core competencies . The Society for HumanResource Management (SHRM) defines personal core compe-tencies as those which employees must possess in order to suc-cessfully perform job functions that are essential to business oper-ations [15].

9 The authors suggest also adding and business objec-tives. CII defines organizational core competencies as those forwhich the market cannot provide it in an effective and/or reliableway [2]. However, to truly understand what is core to the busi-ness, companies must use a more robust organizational develop-ment (OD) approach to develop competency and Career defines the OD process as a planned organization-wide effort to improve and increase the organization's effective-ness, productivity, return on investment and overall employee jobsatisfaction through planned interventions in the organization'sprocesses [15]. Few companies take this final step to developingcompetency and Career development models. The word develop-ment is key. Development considers the concept of skills andknowledge maturity or progress towards business objectives inalignment with the culture and environment as indicated in fig-ure often describe the competency maturity or progresspath in discrete levels or steps that are often called a technical lad-der.

10 Most companies recognize four or five steps with headingssuch as the or entry, or junior, or senior, , expert or competency development model is often illustrated as atable with the basic skills and competencies ( core and non- core )listed in the first column, and the levels of performance across thetop. In each intersecting cell of the table, the expected aace international TransactionsFigure 1ance of the given skill at the given level, levels 1 though 4 isdescribed. The description needs to have enough information fora person's performance to be objectively assessed. Examples ofsuch a table are provided later in this a model is created, the organization has all the infor-mation needed to readily create job descriptions and job postingsas needed, with assurance that the job posting meets businessrequirements as well as specific job related to competency development is Career devel-opment. This is defined by SHRM as the process by which indi-viduals establish their current and future Career objectives andassess their existing skills, knowledge or experience levels andimplement an appropriate course of action to attain their desiredcareer objectives [15].