In today’s highly competitive and globalized business environment, competency mapping plays a crucial role in organizations. This process involves identifying and developing the skills and competencies of employees to meet the evolving demands of the market effectively. This paper explores the historical roots of competency mapping in Chanakya’s Arthashastra and highlights its significance in improving employee performance and organizational success. The study emphasizes the importance of continuous skill enhancement, aligning competencies with business goals, and integrating competency-based systems in HR practices. We have performed extensive survey to collect the data and analyzed it using chi- square technique. The data was then analyzed using R Studio to extract the relevant results. The findings underscore the need for organizations to adopt competency mapping as a strategic approach to employee development, fostering a culture of excellence and maintaining a competitive edge in the market.