Overview of the Concepts [tl;dr]
The People and Communities competency is focused on ensuring people have the information they need, can discover valuable conversations, ask questions, knowledge share, and loop in experts. It also focuses on individual (and team) skills, profiles, and insights into colleagues to enable effective teamwork and collective activities. It encompasses communities of interest, organizational culture, and working within common values.
Definition of this competency
For organizations to be effective they need to ensure that their staff can work together effectively both as teams and individual contributors. People need to be able to interact with each other effectively, understand skillsets, access expertise, and share interests with the right audiences.
This competency is different from the Communication competency, as it focuses on the interactions between people who are peers or at similar level in the organization, but who might not normally work together in the same department, business unit, or discipline.
Within Microsoft 365, this means multiple individuals communicating across different channels (or as Microsoft sometimes calls them “loops”) to target their messaging or requests to the right people, in the right place, at the right time.
The solution for which channels to use can vary depending on the size of your organization. For example, a small company of 6 might fulfill their need for company-wide communication via an org-wide Team while this approach would be disruptive to productivity in a company of 6,000 people actively using Teams to collaborate on projects.