Competency based system is crucial in the healthcare because it defines the critical competencies that managers need to possess to understand future challenges in healthcare (Henderson, 2007). A firm can communicate to the geographically dispersed communities the advantages of management competencies through implementation of information oriented competencies such as strategic thinking and business understanding (Henderson, 2007). Competency-based pay system is more flexible because it allows firms to understand factors underlying successful adaptation of compensation. This enables a firm to ensure optimal use of rewards in meeting organizational objectives. Informed employers can obtain valuable information about their organizations through developing standardized job descriptions (Witherspoon, 2007). This can be achieved when used with constructive tools such as job analysis, on-line resources, and sample job descriptions.
Wolfgang can use the three competency categories as a series of measurable, behavioral indicators to assess the executive’s contribution to healthcare. This can be achieved by evaluating the executive’s levels of communication and relationship management, leadership skills, professionalism, knowledge of healthcare management, and the ability to apply business skills and knowledge including systems thinking that are related to healthcare (Dowling et al, 2008). Building a leadership competency model ensures that the new behavioral indicators are customized to local or regional contexts. This follows a five stage approach that requires one to assemble a focus team and create a list of processes. Build behavioral indicators for each process, and then categorizing the data obtained. Consequently, it is followed by ordering each category and validating the competency model. This ensures a balanced organizational standardization and local relevance. Wolfgang can expand his analysis through adequate training, in order to; avoid any errors that are common in performance appraisal. Such training should be offered to employees to include cultural, legal, and client differenced across countries by the provision of adequate tools to improve the process of communication (Dowling et al, 2008).