In the past few years, skills have become a major focus in the conversation around talent management. Rapid digital innovation has shifted the job market and the demand for employees with a particular skill set. According to a report by Deloitte, 53% of executives believe that between half and all of their workers will need to be reskilled by 2025.
As evidenced by major crises like the Great Resignation and the ongoing pandemic, it’s becoming increasingly difficult for businesses to predict the future. Today, successful firms are cultivating workforces that can rapidly grow and continuously develop their skill set. Priorities have veered toward building a resilient and adaptable talent team that can respond to an ever changing work environment.
To improve their agility, firms are also taking a deeper look into their employees’ skills. By better understanding the capabilities of their workforce, firms can reassess their talent to close workforce gaps and meet evolving needs. All of this is part of a skills-based talent management strategy.
What is skills-based talent management?
Skills-based talent management is an approach to people management that places skills at the core of an organization’s strategies. Less emphasis is placed on roles or job titles, and instead, firms operate around the competencies and capabilities of the workforce.
Rather than job holders, employees are viewed as people with a collection of skills that can be applied in different parts of the organization. Skills-based talent strategies embrace a worker-centric mentality — employees are given agency and opportunity to use and grow their skills based on interest. Employees are recognized for their capabilities and rewarded accordingly.
Skills become the framework for all HR-decision making, informing the way firms hire their employees, develop their talent and allocate their work. The whole organization shifts to prioritize lifelong growth and evolution. While many HR processes were built for more stable environments, a skills-based approach recognizes today’s need for speed and flexibility.
What are the benefits of a skills-based approach?
Skills-based talent management offers a number of benefits for professional services firms. Here are a few.
- Better future preparedness. Only 17% of organizations feel they can anticipate the skills they’ll need in the next three years. A skills-based approach helps firms recognize their knowledge gaps and regularly equip associates with new skills as needs evolve. With better skills visibility, firms are more resilient to industry changes as they can quickly deploy workers at a moment’s notice.
- Improved talent development. Career issues continue to be the number one reason that people change jobs. With skills at the forefront, associates are given opportunities to upskill and reskill according to their interests, and professional development becomes a collaborative effort. A focus on career progression keeps associates motivated and improves retention.
- Higher productivity and profits. Skills insights allow firms to quickly source talent for projects and pull together powerhouse teams with diverse capabilities. This creates more productivity and a higher chance of success.. Skills also serve as a shared language that helps match associate goals to organizational goals, so firms can more quickly meet their objectives and financial targets.
How to embrace skills-based talent management at your firm
It’s important to note that the focus around skills-based talent management isn’t about having a large abundance of skills. It’s about leveraging the skills your employees do have and applying them to your organization in the best way possible. As outlined below, a skills management solution can help you track, organize and update your employee’s skills – making it easier to manage talent and stay competitive.
1. Develop a skill library and taxonomy
A skill library is an inventory of skills within an organization, and a skills taxonomy is a system for labeling and organizing these skills. As you develop your skill library and taxonomy, you’ll name and define all the skills within your workforce and categorize them in ways that make sense to your firm.
Throughout the process, you’ll build a common language so your skills strategy can be channeled throughout the entire firm, keeping skills at the heart of all talent management practices. A skills tracking and management software can help streamline this process by assisting in the creation of a skill library that works best for your firm.
2. Match skills to work for more effective resource allocation
Skills are the focal point for how your firm delegates work. Clear visibility of your professional’s strengths and skill gaps allows you to make the most effective resource allocation decisions. By using resource allocation technology, you’ll be able to identify critical skill requirements for each project, allowing you to identify the most qualified employees throughout your organization, regardless of job title.
Matching your associates’ skills to the appropriate work ensures your staff isn’t sitting on untapped potential. A Gartner study suggests that when HR leaders try to predict the skills employees will need in the future, their staff only end up using about 37% of the skills they acquire. With skills-based resource allocation, professionals are paired with concrete opportunities to use the proficiencies they have, increasing engagement and motivation.
Some firms also use skills matching to build an internal talent marketplace–a system that matches professionals to open projects and opportunities so they can grow in their careers. Internal mobility has increased by almost 20% since the onset of the pandemic, as organizations are recognizing that their employees’ expertise can be shared across the organization.
3. Reimagine learning and development with skills-based learning
A skills-centric approach also transforms your firm’s learning and development practices. Rather than structured curriculum and courses, the focus is on continuous skills-based learning. Data centered around your employee’s skills will allow you to analyze and tailor training to individual associate skill gaps. With skills-based learning, you’ll take on a flexible and collaborative approach. Professionals can identify the skills they want to learn, and the firm can then match them to projects where they can develop these proficiencies. For example, associates with particular skill gaps can be paired with professionals with corresponding skill strengths, creating mentorship opportunities. Importantly, learning takes place in the moment, as associates put their abilities to practice on real projects. Gartner research suggests that this dynamic and responsive approach to skill development lets employees use 75% of their skills.
On an organizational level, skills data allows you to spot competencies that are missing from your workforce and look for opportunities to upskill and reskill your talent team. This holistic view of the data provides a clear metric for measuring the effectiveness of your learning and development programs. You can keep track of whether your firm’s skill development is on par with business objectives and identify where the firm might be experiencing stagnancy.
4. Use skills data to measure and track associate performance
A skills-first approach to talent management also impacts your performance management strategies. For example, you can use skills-based personal development plans to monitor employee performance and help associates map out their careers. Managers play an active role in helping associates unlock their interests and uncover opportunities to develop the skills they need for the projects they’re interested in.
Your firm can track and measure your professionals’ progress on these plans by monitoring their skill development on a project-by-project basis. These metrics provide an unbiased way of tracking and evaluating their performance. With project-based performance management and real-time feedback, you can track employee performance as skills evolve while creating a productive conversation between manager and associate centered around coaching rather than evaluating.
Placing skills at the heart of your performance management strategy promotes a performance culture where associates are encouraged to explore different areas of work and envision their future careers at the firm. You can also choose to reward your professionals based on their skill growth, further encouraging them to prioritize learning.
Embrace skills and level up your talent management
viGlobal’s talent management platforms can help you implement a skills-based approach throughout your firm, with intuitive solutions from start to finish. Skills tracking and skills management software helps you build a skill library and track your professionals’ skill development. A smart resource allocation system lets you proactively match skills to work so you can assemble the best project teams and unlock growth opportunities for your people. Ready to learn more? Talk to one of our dedicated Talent Management Specialists today!