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How to build a competency framework

To build a competency framework, define the Functions and role tracks you need now, choose distinct competencies for each Function, and write observable expectations for every level. Review the draft with managers using real work examples, publish a version for the next review cycle, and revise it only after you learn where the wording fails.

Published by Peasy HRPublished 18 Aug 2026Updated 18 Aug 2026

Short answer

To build a competency framework, define the Functions and role tracks you need now, choose distinct competencies for each Function, and write observable expectations for every level. Review the draft with managers using real work examples, publish a version for the next review cycle, and revise it only after you learn where the wording fails.

Which Functions should you build first?

Start with the job families included in your next review cycle. Each Function should represent one family of related work, such as Backend Engineering or Customer Success, and contain the role tracks and levels that people actually use.

Do not model a future org chart. A smaller framework that covers current decisions is more useful than a large catalog that managers cannot apply.

  • List the Functions in the next review cycle.
  • Record the current IC, Manager, and Executive levels for each Function.
  • Choose which company-wide competencies must keep the same meaning everywhere.

How do you choose useful competencies?

Choose competencies that cover different parts of the work. Technical design, code quality, and incident response can each produce separate evidence. Communication and collaboration may overlap unless you define a clear boundary.

Check the set as a whole. It should cover the Function without rating the same shortfall twice. Company-wide competencies keep a portable definition, while the Function description explains how each one appears in that job family.

Write levels that managers can observe

For each competency, describe what changes across levels through scope, autonomy, complexity, or influence. Write in the present tense and name work a manager could verify in documents, decisions, customer outcomes, delivery records, or other normal artifacts.

Avoid personality labels and intensifiers. They do not tell an employee what to do differently or give a manager a defensible basis for a rating.

Replace a trait with evidence

Communication: 4 out of 5.

Records decisions, owners, and open questions so the team can continue without another meeting.

Test the framework before a review cycle

Give two managers the same anonymized work example and ask which level it meets. If their answers differ, find the phrase that allowed both interpretations and rewrite it. Also ask employees whether the next level describes a visible path, not a hidden judgment.

Publish a named version before the cycle starts and keep that version fixed through sign-off. Record unclear expectations during calibration, then correct them in the next version instead of changing the standard mid-cycle.

Sources

  • Peasy HR competency writing style guide: observable behavior, distinct competencies, portable descriptions, and level changes by scope, autonomy, complexity, or influence.
  • Peasy HR SEO and AI search visibility strategy: direct answers, useful procedures, honest claims, and task-specific calls to action.

Draft your first Function

The free builder can create an editable starting point from your Function, tracks, levels, and competency categories. Review the wording with your managers before using it in decisions.

Open the free builder

Common questions

How many competencies should a Function include?

Use the smallest set that covers the work without gaps or overlap. For many Functions, 6 to 10 is a practical review load, but the quality test matters more than the count.

Should every Function use the same competencies?

No. Shared institutional competencies can keep the same name and portable definition across the company. Functional competencies should reflect the craft, with a Function-specific description even when related Functions share one.

When should we update the framework?

Collect feedback during normal use, but apply changes between review cycles. Keep completed and active reviews tied to the version used when each cycle started.

Related resources

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Competency framework vs competency matrix

A competency matrix is usually a grid that maps skills against people, roles, or levels. A competency framework defines the competencies, level expectations, behaviors, and examples used to make people decisions. The matrix can be a useful view, but reviews and career progression need the fuller standard behind its cells.

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Competency frameworks for startups

A startup competency framework should cover the job families and levels the company uses now, not a future enterprise org chart. Start with the Functions in the next review cycle, write a small set of observable competencies for each one, and publish a version that managers can test and improve after the cycle.

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Function template

Backend Engineering competency framework template

This Backend Engineering Function defines communication, ownership, service design, and delivery quality with evidence a manager can cite. Use it as a starting draft, then edit names, levels, and examples to match how your team actually works.

View template
How to build a competency framework | Peasy HR