The topic of skills is fast becoming a strategic common denominator across the HR function. Whether it be rewards professionals considering pay premiums for ‘hot’ skills; learning and development leaders seeking to optimize training programs; or strategic workforce planners looking to identify and close skill gaps. In this article, we will focus on a few of the core trends illustrating how organizations are using various forms of skills intelligence, and leveraging both external and internal data, to inform their strategic decision making and meet the needs of various stakeholders.
Within WTW, the Digital Strategy & Innovation team is seeing a rapid shift to skills happening globally. An increasing number of organizations are recognizing the benefits of a focus on skills as part of their HR strategy. As part of these efforts, the perspectives of different stakeholder groups need to be accounted for.
In recent years, many organizations have started to adapt their business model to become more digitally transformed. This placed pressure on HR to attract and retain talent with the required(often digital) skillsets.
To meet these challenges, organizations are increasingly discovering that they can leverage various technology and data science capabilities to provide a data-driven perspective to their strategic initiatives. For example, organizations are mining publicly available job description data to better understand prevalent skills or get a market view on emerging skills. By combining this type of external market insight with internal skill data sources (that often exist in the form of role profiles stored on HRIS systems), organizations can work towards producing a dynamic list of employee skills. It is also possible to identify how these skills relate to the work required to execute a given business strategy and vision. By ascertaining the current skills existing within the workforce and how they map to requirements to get work done, organizations can identify their most critical capability gaps. In turn, this understanding can inform decisions around build vs. buy initiatives, therefore supporting and optimizing business transformation and growth.
Employees are becoming more vocal regarding their expectations when it comes to rewards, wellbeing initiatives, and organizational culture - including flexibility on ‘How?’, ‘Where?’ and ‘When?’ work is done–as well as being increasingly focused on an organization’s purpose and the impact it (and therefore its employees) has on climate and society–essentially the ‘Why?’.
However, from a skills perspective, addressing the question of ‘What?’ work is done, can often be a differentiator in attracting and retaining talent, since employees increasingly expect to develop themselves via exposure to interesting and challenging projects. They demand varied experiences and the opportunity to acquire new skills which in turn should present them with more vertical and lateral career pathing opportunities to consider. The rise of internal talent marketplaces and opportunities for ‘gigs’ are evidence of this trend. Organizations taking the right approach to these concepts of career experience and internal mobility will surely be more effective in attracting and retaining in-demand employees.
“Balancing the needs of diverse stakeholders, adapting to new business realities, whilst delivering on employee expectations in a more structured way is no small task.”
The same data-driven approaches which aid business strategy, can also be leaned on to solve for people needs. Skills inventory data, essential for identifying skill gaps in workforce planning, can also provide direction to learning and development programs, drive skill-based internal mobility opportunities, or anchor internal talent marketplaces. Using technology platforms to map skills against work requirements is not only a must for strategic workforce planning, but a necessary component of any plan to provide employees with personalized and custom career pathways. Whilst all employees are effectively empowered to take ownership for their careers within the organization, having visibility of skills data can be especially empowering for managers in having career development discussions with their teams.
With many progressive organizations having already elevated the HR function to that of a critical business partner, the role of HR professionals in helping to translate market intelligence into actionable business outcomes cannot be overstated. Indeed, successfully achieving a ‘shift to skills’ by intertwining aspects of skills intelligence, the employee experience, and business outcomes may not even be possible without the active involvement of a strategic HR function.
As part of their remit, the HR function might consider the following use cases for leveraging skill intelligence.
- Complete regular skill scans to benchmark skill requirements, anticipate market movements and identify targeted talent acquisition hot spots.
- Build and govern a skills taxonomy, which can be leveraged to provide personalized communication to employees on their potential career pathways based on skill adjacencies.
- Conduct gap analysis to compare current skills inventory against external market data, validated by business stakeholders.
- Analyze how talent competitors approach Total Rewards, in order to better understand their own organization’s position in the labor market, then focus on areas where improvements may be required to win the best talent.
Balancing the needs of diverse stakeholders, adapting to new business realities, whilst delivering on employee expectations in a more structured way is no small task. Taking a data-driven approach to this skills challenge, may present the best chance of making the right business decisions, win the war for talent and transform workforces to capture post-pandemic opportunities.