The Hidden Gold: Using KPIs to Identify Competency Gaps

In the intricate world of leadership and team management, Key Performance Indicators (KPIs) stand as indispensable tools. They are not merely metrics or targets; they are insightful instruments that, when utilized effectively, reveal deep aspects of team performance and competencies. Such insights empower leaders to take concrete actions, enhancing their team’s capabilities, which leads to improved performance and the achievement of organizational goals.

When a KPI is at risk of not being met, it’s a leader’s cue to intervene. Prompt action and course correction are hallmarks of effective leadership, safeguarding customer satisfaction and productivity. Some leaders see the performance gaps and swoop in to “fix” things and often they do just that.  However, the true mark of exceptional leadership lies in first correcting the matter and then looking at the situation with the eyes of a teacher.  These leaders know that if it is dependent on them to fix problems then they become a bottleneck on speed of response and innovation. The teacher’s mindset, on the other hand, recognizes that KPIs are instrumental in uncovering competence gaps within teams, a crucial step in fostering growth and excellence.

A shortfall in KPIs presents an opportunity to ask critical, pragmatic questions: Why did this happen? What factors contributed to this gap? While materials, tools, and equipment are important considerations, the concept of competence is often central. Competence includes the necessary knowledge and skills for effective performance. A decline in KPIs frequently signals areas where these competencies are lacking or need strengthening, and it’s a leader’s responsibility to identify and address these. When this happens well, the competence of the firm grows a broader foundation.

Knowledge Gaps: These are often the simplest to identify and address. If a team isn’t meeting a KPI, investigate whether they possess all necessary information and understanding to achieve the goal.

Skill Gaps: This is about the ‘how’ of task execution. For example, a sales team might understand the sales process but lack proficiency in negotiation.

In addressing these gaps, it’s beneficial to gather the team and review the team’s skills matrix. Such meetings should focus on constructive solutions rather than assigning blame. Questions to consider include: Is the required competency tracked? Does anyone lack essential competencies? Is there a team member qualified to instruct in critical areas?  What is our process to review and train critical knowledge and skills?

KPIs are more than numerical data on a dashboard; they are windows into the capabilities of our team members. As leaders, our role is to peer through these windows, identify the gaps, and implement actionable steps to bridge them. This approach ensures that our teams are not merely meeting targets but are continuously growing, evolving, and enhancing their competencies with each new challenge.

About the Author

Paul Doyle
Paul Doyle is the founder of LeaderWork. He brings more than 35 years of diverse business experience, including 15 years as a CEO, leading manufacturing companies. Paul has been active in North America with companies ranging from $20 million to $450 million in revenue.