In today’s rapidly evolving workplace, organisations must continuously adapt to remain competitive. One of the most effective tools in the HR arsenal is a capability matrix – a framework that provides a clear representation of the skills and competencies required for various roles within your business. By mapping out these capabilities, you can better understand the strengths and gaps within your workforce enabling more strategic decisions in hiring, training and development to unlock the full potential of your workforce.

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So, what is a Capability Matrix?

The capability matrix is a tool used to enhance productivity and growth throughout the workplace. It is a set of detailed descriptions outlining the key behaviours and underlying skills, knowledge, abilities and attributes required for successful performance. A capability matrix indicates the behaviours that are valued and rewarded ensuring they are aligned with an organisation’s strategic direction, ultimately serving as a valuable tool for identifying high potential employees. 

A well-designed capability matrix helps an organisation better understand the strengths and gaps within their workforce. It enables more strategic hiring decisions and is essential for building out training and development plans. By allowing your employees to see exactly what skills they need to develop to enhance their careers, capability matrices offer a powerful way to unlock the full potential of your workforce. 

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How do you Build a Capability Matrix?

The key to building a powerful capability matrix is asking yourself “Will our people know 'WHAT' they need to do, 'WHY' they need to do it and 'HOW' to do it?”. Unpacking this is crucial to taking actionable steps to close the gaps, enhance growth and ensure employees’ skills evolve in tandem with organisational needs. 

To get the most out of your Capability Matrix, the following approach is recommended:

1. Define: Start out by outlining the critical capabilities needed to successfully achieve results in each role of the organisation. (These may include technical skills like data analysis along with soft skills such as people management).
2. Asses: Next, critique your employees based on their capabilities, providing analysis of outcomes and insights.
3. Develop: Lastly. create documents such as dashboards, coaching and development guides as well as learning resources to promote an increased focus on identified gaps in the Capability Matrix.

Creating the behaviours or expectations for each level of a capability matrix involves a thoughtful assessment of the operational demands of each role. Start by defining the core capabilities required for success, then break these down further into behaviours that reflect levels of proficiency. Consider the progression from entry-level skills to advanced leadership skills. Ideally, each level should build off the other. Align the skills and expectations with your organisation’s values and culture, ensuring they are realistic and achievable but challenging enough to encourage growth and development. 

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The “T-Shape” Concept 

Interpreting a capability matrix can be challenging. However, the "T-Shape" concept presents the idea of a well-rounded employee who has both deep expertise and a broad set of valuable skills and behaviours across the organisation. If we think of the letter 'T', it has a vertical and horizontal stroke – with the vertical stroke representing deep expertise and the horizontal stroke representing a broad range of skills.

The Depth of Expertise: The vertical stroke of the ‘T’ represents the specialised knowledge and skills required for an individual’s role, aligning with what is typically detailed and referred to in a Position Description. This is where an employee’s unique contribution to the organisation comes from, reflecting their depth of expertise in a particular area or department.

The Breadth of Skill: The horizontal stroke of the ‘T’ signifies the broader capabilities that every employee needs to be successful, regardless of their role. This aligns with the idea of a capability matrix, which outlines the skills, behaviours and competencies that are expected within the workforce. These are the qualities that enable employees to work effectively with others, adapt and contribute to the organisation’s culture and goals.

Together the “T-Shape” concept suggests that for an employee to be truly successful, they must not only excel in their specialised role but must also be competent in the broader more universal skills that drive organisational success. It encourages the workforce to identify gaps in current capabilities and ultimately strive to turn these into areas of growth and a strength. 

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So as a Leader how can a Capability Matrix Help?

The capability matrix serves as the correlation between employee ambition and ability. By clearly outlining the professional performance expectations across different roles within your organisation a capability matrix helps leaders recognise that while different roles may demand varying skills, the goal is to ensure that everyone is moving towards the same vision.

As a leader, this tool is invaluable. It allows you to identify gaps between your team’s current capabilities and the skills needed to drive the organisation forward. With this insight, many leaders will set targeted learning and development goals that align with both individual aspirations and the company’s strategic direction. 

The capability matrix helps you to establish a culture of continuous improvement, where ambition is matched with the necessary ability. This not only supports personal and professional growth within your team but also drives sustainable success for the entire workforce. By systematically developing the capabilities that matter most, you empower your team to reach new heights, ensuring that their growth is aligned to your organisation’s long-term vision.

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We Built a Capability Matrix – But How Do We Use it?

You've built a robust Capability Matrix, but now the question is: how do you effectively use it? The answer lies in its integration into various facets of HR, where employee potential can be unlocked:

Workforce Planning: The capability matrix is an effective tool used in career development. It allows your employees to think big picture, helping them answer the classic question: “Where do you want to be in 5 years?” By mapping out the capabilities required for future roles, employees can chart a clear path toward their career goals. The big picture thinking also aids in identifying potential high performers and developing retention strategies to keep them engaged and motivated.

Growth Development Planning: Providing a focused approach to both current and future development planning and learning the capability matrix enables your employees to set long term goals. Through understanding the direction in which they wish to pursue and the skills required to get them there, you can create targeted development plans that allow for growth in critical areas. 

Performance Management: In performance management, the capability matrix serves as a clear guide for the behaviours and skills required to be successful in any given role. It sets transparent expectations, allowing employees and managers to assess performance against specific criteria. The clarity helps in giving constructive feedback, setting improvement goals and KPIs as well as recognising positive achievements. 

Remuneration: The capability matrix plays a crucial role in shaping remuneration strategies. By identifying and categorising the capabilities required for different roles, it provides valuable input for salary banding and other compensation approaches. This ensures that remuneration is aligned with the value the employee brings to the organisation, promoting fairness and transparency. 

Talent Acquisition: Perhaps the most significant of all the applications of the capability matrix. It helps identify critical and essential capabilities required for roles serving as a key criterion during the selection process. In this way, it becomes an indispensable tool in finding that elusive “unicorn” candidate who perfectly fits the role and the organisation’s needs.

By integrating the capability matrix into these core HR functions, leaders can not only enhance their workforce’s individual and organisational performance but also ensure their strategies for growth, retention and talent acquisition are all well aligned. 

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Our Capability Do’s

When building and implementing a capability matrix, ensuring effectiveness and relevance across the organisation should be at the forefront. Here are our ‘Capability Do’s’to ensure ultimate success:

Clearly Outline the Line of Progression: A well-structured capability matrix should provide a transparent path for career advancement and development. It is crucial to clearly define how employees can progress from one level to another, outlining the specific capabilities and behaviours required to do so. This clarity will empower your employees to take charge of their career development, allowing them to set clear goals and understand what is expected. 

Make the Matrix Achievable: The capabilities outlined in the matrix should be challenging yet attainable. They should strike a balance between pushing employees to grow and ensuring that the expectations are realistic. An achievable matrix motivates employees to strive for improvement without feeling overwhelmed and encourages a learning and development focused culture.

Provide an Opportunity for Internal Growth: The matrix should be designed with internal mobility in mind, offering employees the opportunity to grow within the organisation. By identifying both transferable skills and capabilities you can create a pathway for employees to move into different roles and/or departments. This not only aids the enhancement of employee satisfaction and retention within your workplace but helps build a more versatile and adaptable workforce. 

Be Specific: Specificity is the key to unlocking employee potential. Each capability should be clearly defined, articulated leaving no room for ambiguity. This precision ensures that both managers and employees have a shared understanding of what is required, making it easier to assess performance and set goals at the time of your performance reviews!

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Our Capability Don’ts

Now you know our ‘Capability Do’s’, it is essential to avoid common pitfalls that can undermine the effectiveness of your capability matrix. Here are our ‘Capability Don’ts’ to avoid:

Don’t Overcomplicate it: While we acknowledge it is important to be thorough in the development phase, overcomplicating it can lead to confusion and disengagement. Keep the structure simple. An overcomplicated, complex capability matrix can overwhelm employees, making it difficult for them to understand and effectively apply it to their development. Simplicity ensures that the capability matrix is accessible and useable for everyone in the organisation no matter their role or title.

Don’t Lose Sight of what you are Trying to Achieve: The purpose of the capability matrix is to support the organisation’s strategic goals by aligning employee capabilities with those objectives. Don’t get caught up in the details to the extent that you lose sight of the bigger picture. Every element of the matrix should contribute to achieving your overall business goals, whether enhancing performance, enabling growth or driving innovation. Stay focused on what you want to accomplish and ensure that the capability matrix remains a tool to help you get there!

Don’t Give a False Sense of Hope: It is essential that you are realistic in your expectations and communication when using the capability matrix. Avoid creating a false sense of hope by promising opportunities or progression that may not be available or achievable for everyone. Be transparent. Being clear and honest about the requirements and challenges involved, ensuring employees understand what it will take to get there. This honesty builds trust and helps maintain motivation by setting realistic goals that employees can aspire to achieve. 

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So why do we Need a Capability Matrix?

Ultimately, a capability matrix is essential for creating a structured and transparent approach to employee development. They ensure that an organisation’s workforce is aligned to their strategic goals, driving substantial growth and innovation internally. Capability matrices are an invaluable tool for achieving this alignment by clearly defining the skills and competencies required across various roles within your organisation. They are effective in identifying the strengths and gaps within teams enabling leaders to make informed decisions throughout the employee lifecycle. By outlining the progression pathways and setting realistic goals, capability matrices empower the workforce to take charge of their career growth and further advance a culture of continuous improvement. 

Capability Matrices are to be used as a support mechanism when workforce planning, performance managing and acquiring new talent, ensuring alignment with the long-term vision and goals of your organisation. They not only provide clarity in performance expectations but guide remuneration strategies and help identify high-potential employees for future leadership positions. Through using a capability matrix, you can unlock your workforce’s full potential and ensure that employees are equipped with the necessary skills to meet both current and future challenges. 

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