A little over two decades ago, the first technology-based competencies systems—the precursors of today’s skills-based talent mobility platforms—landed in corporate America with a tiny thud. The technology didn’t excite anyone outside of highly regulated industries like financial services and pharmaceuticals which saw the early platforms as a way to create rules-based access to internal data and systems.
But about seven years ago, once high-speed internet and smartphones became ubiquitous and made the new way of working increasingly digital, that all changed. Several new platforms emerged —including Hitch—to help companies create better talent strategies in an increasingly competitive labor market by better understanding and deploying the talent they already had in-house.
It was an exciting time. HR teams suddenly could assess and define every skill and create a comprehensive skills inventory of their entire workforces. But the result was, too often, an overwhelming dataset that teams couldn’t map back to the jobs and skills required to do the work.
So, what is the right way to use a skills-based approach to define our talent pools and help employees create their own, personalized career paths based on skills? I’ve found there are three business-driven skills taxonomy approaches that can build on each other over time:
- For underperforming operations: Identify a business problem, such as not hitting sales numbers. Then, apply skills technology to move the needle.
- To address current or future talent gaps. Define the gaps and use skills technology to close them. This is also where an internal talent marketplace —which I consider to be an implementation of a skills strategy— fits in. A talent marketplace is useful for talent development, career pathing, employee engagement, and all sorts of business transformation initiatives.
- For long-term transformation. Apply a skills strategy to reach the desired state to be competitive.
Let’s take a deeper look.
The first way to approach implementing a skills project is to focus on a particular business problem. For example, perhaps sales numbers are falling, or your customer service is not keeping up with product innovation.
Take the example of a computer chip manufacturer. After many years of running the company by doubling down on the business aspect of manufacturing, company leaders decide they need to prioritize engineering in order to regain a competitive edge. Companies like Apple and Nvidia now dominate the sector’s hiring and innovation and are chipping away at this company’s market share.
To do this, the HR team is charged with recruiting, developing, and retaining engineering design expertise and overcoming the company’s gap in AI-related skills and expertise. To do this, the team works through a massively complex skills strategy around building AI expertise in the company’s design and engineering career path.
When a company needs to quickly and aggressively move into a new market or product area, taking a skills-based approach is often the only realistic way to reach those big goals. For example, JPMorgan Chase just announced that it is spending a billion and a half dollars on building internal digital blockchain and cryptocurrency skills.
There simply aren’t enough people to hire on short notice to get to where the company needs to be in any labor market. To obtain the number of financial services people with that expertise, they’d have to buy up the bulk of their competitors to get those skills. Therefore, the only option is to take a skills-based approach.
I see similar talent gaps everywhere, across industries. We all know there’s a huge talent gap in healthcare. It’s not just a shortage of nurses that’s impacting the industry growth. Shortages are also in areas such as digital healthcare and cybersecurity – areas in which industry veterans don’t have the skills to execute a level regulation demands.
Both of these cases require understanding and defining the specific skills gaps and building a project using skills-based technology to solve that problem.
Whether it’s digital transformation or hybrid work transformation or moving into entirely new business areas, right now, just about every company has some sort of business transformation in the works.
For example, let’s take a mature software maker specializing in distinct applications for various design and manufacturing specialty areas. Their industry is changing. Their customers don’t want to buy a product design tool, a tool for manufacturing design, and another tool for architecture. Instead, they want one platform that does all of those things and integrates into the other business software in place.
The leadership team realized they needed to move from siloed on-premise software products to developing an integrated, cloud-based platform. Working with HR, they identified some missing skills that were critical to this effort, including systems thinking and broader knowledge of the software industry beyond the walls of their product-based confines.
With the above frameworks as context, we had a lively conversation in the recent Hitch Magnet Group about how to adapt these approaches to the participants’ organizations. And we collectively came to a consensus on these four key takeaways that apply across these three approaches.
- You need the right talent mobility technology. You need to put third-party data into a talent mobility technology, to enrich your internal data and help it become more relevant. This could include competitors’ skills, skills demanded by the market, or skills required for new technologies or products on your road map.
- Skills by themselves aren’t enough. Skills alone don’t make an organization competitive. It’s how you combine them that creates capabilities and allows you to be competitive.
- Ditch the aspirational job descriptions. Job descriptions too often reflect what the job should be—they are more aspirational than an accurate representation of the work that the person will be doing daily. In other words, don’t tell me what my job is (the lofty goals); tell me what my work is (the necessary core capabilities and the projects I’ll own).
- Review skills in context. To get the highest value out of analyzing the skills you have, you need to do more than just collect them. You must put skills into context, correlate them to each other, cluster them, and understand what you are seeing. What is the evolution, the development, the findings?
If you can align your skills project to one of these three scenarios and keep these key takeaways from our conversation in mind, you’ll likely be successful. Skills technologies put HR professionals in a position to define the future of work and the entire way in which the company goes about the business of work. It’s all about starting with a well-defined problem and putting the right technology in place to unite your data and put it to work for you.
About the Author
Josh Bersin is an analyst, author, educator, and thought leader focusing on the global talent market and the challenges and trends impacting business workforces around the world. He studies the world of work, HR and leadership practices, and the broad talent technology market. He is often cited as one of the leading HR and workplace industry analysts in the world.
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