The goal of HR has always been to match the best candidate with the best position. Competency-based human resource management is one of the most important efforts this search has inspired (Chouhan and Srivastava 2014). The effectiveness of an organisation is driven by its people, especially its leaders; hence, closing the performance gap between an organisation’s potential in human resources and its actual performance is essential (Sharma 2015). Since human resources are the primary source of value creation in the services sector, competency mapping and management are particularly crucial (Alexander and Shalini 2022). In these businesses, it is crucial to continuously emphasize the impact of competence mapping and evaluation on key organisational elements that affect performance (Waiker et al. 2022). The actual effects of competency mapping on performance, learning, and development, and ultimately all other HR initiatives, must be understood by management, particularly HR managers (Lafave et al. 2021). Competency mapping is a strategic HR approach for monitoring the effectiveness and growth of an organisation’s human resources (Lee and Pant 2020). It is widely seen that the HR system may use this paradigm to connect human resources with subordinate goals and the larger vision and purpose of the firm (O’Brien et al. 2022).

A company’s success is often defined by its people, especially those who create its strategy and are in charge of its action plans, especially in a highly unpredictable corporate environment (Bemmami et al. 2021). How well a leader controls himself, his job, and others ultimately determine his effectiveness (Kumar and Bhanu 2022). This calls for mapping, creating, and effectively using many different abilities, ranging from knowledge-level to behaviour-level competencies (Singh and Snigdha 2016). It is evident that competence mapping affects the management scope’s strategic dimensions (Silva et al. 2019).

Gaining a competitive advantage depends on a company’s personnel being able to use cutting-edge technology, superior goods, and a continual inflow of cash to join the market (Coombe et al. 2022). The effectiveness of a company’s technical tools depends on how effectively it can utilise them; these tools are rated on how well the advantages are presented (McLagan and Suhadolnik 1989).

2. Competency Mapping

Competence is the collection of observable traits and abilities that support and enhance a job’s effectiveness or performance (Nayak 2015). The word “competence” initially surfaced as a notion for performance motivation in a 1959 essay written by R.W. White (Jaman and Hossain 2015). The phrase was defined in “Planning the Executive Development Program” by Craig C. Lundberg in 1970 (Kumar 2015). The phrase gained popularity when David McClelland published a ground-breaking article in 1973 titled “Testing for Competence Rather Than for Intelligence.” The State Department hired McClelland to utilise the phrase to identify traits shared by high-performing embassy agents and to aid in the recruitment and development of such agents (Awasthi and Sharma 2016). Awasthi & Sharma exploited the idea regarding performance development and have subsequently popularised it. Its vastly disparate uses cause great confusion (Awasthi and Sharma 2016). According to some academics, competence may be defined as the state or quality of being appropriately or highly qualified, having the capacity to carry out a certain function, or as a mix of practical and theoretical knowledge, cognitive abilities, behaviour, and values utilised to enhance performance (Coombe et al. 2022). For instance, systems thinking, emotional intelligence, persuasion and negotiating abilities, and managerial competence may all be included (Bemmami et al. 2021). Competency is a complex and wide-ranging notion that, according to studies on the subject, is defined differently by many scientists. Johansson & Wallo conducted in-depth interviews with several training experts to thoroughly consider what constitutes competence (Johansson and Wallo 2020). “There is no obvious and distinct consensus about what creates competence,” he said after the interviews. Effective work performance is based on an individual’s management skills. In today’s cutthroat global market, organisations must put much effort into creating competence models to assist them in identifying the essential skills required to become more successful and competitive in future endeavours (Worlikar and Aggrawal 2017). Dubious and Rothwell observe that competencies are features that people have and use in methods that are acceptable and consistent in order to get the results you want. The knowledge, talents, features of one’s self-image, social motivations, traits, and thinking are examples of attributes, behaviours, attitudes, and behaving, feeling, and thinking in these ways (Che Rusuli et al. 2017 ). Competition becomes an integral component of the business, prompting the executives to either occupy a position of competition in the market or to coexist with rivals in the current market (Ravi and Jayasheela 2016; Salahat and Majid 2016; Sani et al. 2016). This raises the likelihood of imitation within the organisation. Competencies are located in workers; physical systems are simpler to copy than management system abilities or a company’s culture (Singh and Snigdha 2016). The executive class has become very important inside the organisation and is subject to tough challenges in conceptualising and separating capabilities from actual competencies for the organisation’s overall growth (Alexander and Shalini 2022; Estrada et al. 2022; Sharma 2015). However, many theoretical and empirical studies have focused on defining and identifying skills. Researchers have divided skills into many groups, including hard and soft capabilities: skills, performance standards, and a hierarchy-based categorisation. The organisational and analytical skills are seen as challenging (Coombe et al. 2022). Creativity, interpersonal communication, and behavioural skills are examples of soft abilities. The definition of threshold competences is the bare minimum necessary for effective performance, while performance competencies are characterised as the abilities and knowledge that truly distinguish between the average and outstanding performers in a hierarchical manner (Shivanjali et al. 2019). Szafrański et al. (2022) probed the future and quality of personnel in the context of problems pertaining to the digitalisation of the economy, such as Industry 4.0, and discovered that linking IT skills and knowledge to the requirements of enterprises and the employment market is an escalating issue for community and training institutions in making development decisions for the region. Through competency mapping, Ramola and Rangnekar (2020) emphasised workers’ understanding of diverse skills and how these skills were used by employees contributing to the organisation. Employees were found to be knowledgeable about skills such as communication, leadership, technical, marketing, and data analysis. Communication, teamwork, decision-making, accounting, and marketing abilities are among the numerous talents that employees possess. The key benefits of competence mapping include increased sales, company profit, and more prospects for advancement. Through competence mapping, Sakthi (2018) focuses on employee understanding of different types of skills and how these skills are employed by employees contributing to the organisation. Communication, leadership, technical, marketing, and data analysis are all determined to be employees’ capabilities. Employees have a wide range of skills, including communication, teamwork, decision-making, accounting, and marketing, and competency mapping has several major benefits, including higher sales, corporate profit, and more prospects for progress. The process of categorising involves creating a general list of managerial abilities that may help managers perform a variety of tasks more effectively (Singh and Snigdha 2016). Research that does consider the competency-based viewpoint sometimes primarily concentrates on either the function of organisational strategy or the organisational role of culture in acquiring management skills or in developmental projects that may aid in completing the gaps. However, more effort needs to be made to comprehend the relationship between the systemic effects of all these characteristics on executive and organisational effectiveness, especially in a scenario where the dynamic changes are occurring at a rapid pace. How employees behave is quite concerning.