The consensus among talent acquisition (TA) leaders is clear: there’s a huge opportunity to reimagine how we hire and develop talent today. Embracing a skills-first organisational approach is key to this transformation. From helping you discover new, unique talent, to creating a culture of continuous learning, to building a more equitable talent pool, skills-based approaches are essential for building sustainable workforces. In a recent LinkedIn survey, 73% of recruiters said hiring based on skills is a priority, while further LinkedIn data shows that taking a skills-first approach expands talent pools by almost ten times.
But while the idea is compelling, the practical implementation remains challenging. Very few organisations have perfected it yet, and there isn’t a one-size-fits-all technology platform to support the entire process. This uncertainty can make it feel fairly daunting.
Broadening talent through skills
Recognising and understanding the skills you have within your organisation is crucial. Put simply, every role can be dissected into a specific set of skills, and every individual in your business has their own set of unique skills.
It’s important to firstly identify the skills needed for current roles and anticipate what skills your organisation might need in the future. Having this clarity will allow you to strategically plan how to acquire and develop the right talent to meet both your current and future demands.
Read our skills-based hiring report to learn more
Proving ROI with pilot programs
One of the biggest hurdles in advocating for a skills-based approach is proving its return on investment (ROI). Unlike implementing a new IT system with clear financial benefits, transitioning to a skills-based organisation involves a cultural shift that involves considerable change management and long-term strategic planning. Focusing on pilot groups can provide tangible results and help you illustrate the value of this model among stakeholders.
Start by identifying areas where you have high attrition rates or specific demographic challenges. Implement a skills-based approach in these segments and measure key metrics such as retention rates, employee engagement scores, and Net Promoter Scores (NPS). Over time, these pilot programs can offer concrete evidence of improved outcomes, making a compelling business case for wider adoption across the organisation.
Leveraging internal talent
Becoming a skills-based organisation doesn’t have to start with a massive overhaul. In addition to pilot programs, begin by addressing problem areas or future skill gaps within your existing workforce. Use your HR data and predictive analytics to identify these gaps, and consider upskilling and reskilling current employees before looking to hire externally.
For example, one of our clients needed certified Lean Six Sigma project management practitioners. Initially, their leadership team thought none existed within the organisation. However, a search in their HR system revealed eight. These individuals were identified, then assigned to relevant projects – meaning they could leverage skills that were previously underutilised.
Steps to success
#1: Introduce a skills taxonomy and ontology
If you want to implement a skills-based approach, start by establishing a clear skills taxonomy. Think of this as an organisational chart for skills, which categorises and defines the proficiencies required across different roles. Your skills ontology, on the other hand, is more dynamic, capturing the relationships and interactions between various skillsets.
Watch our on-demand webinar on how to develop your own skills taxonomy
Using an HR system like Workday, for example, which includes a foundational skills cloud, you can identify key skills crucial for your current and future needs. These might be AI, project management, and technical expertise, for instance. Encourage your employees to update their skills profiles, highlighting 8 to 15 key skills they excel in or want to be known for.
#2: Validate and verify skills
Once your employees update their skills, it’s crucial to verify them. If someone claims fluency in business Spanish, for example, use tools or internal resources to validate this. This step is essential to maintain the integrity of your skills database.
It’s also important to maintain momentum. Skills management platforms can run into problems if the initial push for employees to update their skills isn’t followed by continuous engagement and updates. So, it’s vital to dedicate resources to ensure these platforms remain active and valuable if you commit to using them.
Read more: How to use skills mapping to assess workforce needs
#3: Offer internal gig and stretch assignments
To make the most of your internal talent, advertise internal gig or stretch assignments. This proactive approach gives employees the chance to apply their skills in new and exciting ways. This way, they grow with your company, and you boost engagement and retention.
#4: Promote side hustles
Many employees, especially those who entered the job market in the past decade, often have side hustles or additional skills beyond their primary roles. Creating an environment where these side hustles can be integrated into individuals’ day jobs can significantly enhance employee engagement, satisfaction and loyalty. It’s also important to educate managers and shift the mindset away from talent hoarders to being talent enablers. Seeing the business value of team members moving unilaterally and to other teams furthers organisational goals and makes businesses more agile in the face of increasing uncertainty.
Managing the cultural shift
As talent leaders, we have a unique opportunity to redefine our hiring strategies and prioritise skills like never before. But transitioning to a skills-based organisation requires a cultural shift, where hiring managers value internal candidates needing some training over external hires with ready-made experience. This shift demands a strong change management program and ongoing commitment. By taking small, intentional steps to start this journey, you can build a sustainable approach that leads to a more engaged and thriving workforce.
