Controlling Body: Strategies to Bridge Skills Deficits in 2025 (First Installment)
In the contemporary business landscape, navigating skills gaps within workforces has become a major challenge. How will corporations tackle this issue by utilizing technology and data? Let's delve into the importance of skills insights in this new era.
Embracing Skills as the Backbone of Decision Making
In my previous predictions, I touched upon the notion that businesses would start considering "skills" as a currency within HR. This trend is indeed underway, with an increasing number of organizations shifting towards a skills-first approach. A report by Deloitte revealed that 70% of business leaders acknowledge talent shortages necessitating creative approaches to sourcing skills rather than experiences. Furthermore, as per LinkedIn research, 73% of recruiting professionals prioritize hiring based on skills.
While many large organizations recognize the significance of skills, very few are adept at defining, measuring, and comparing skills, and managing their skills data. As per a study by Gartner, 70% of talent acquisition leaders acknowledge the value of skills-based hiring, yet only 17% are ready to implement it. The majority (83%) struggle to source talent with the necessary skills.
Ignoring this gap presents a substantial threat to businesses in the foreseeable future. If left unaddressed, as per Korn Ferry, the global economic loss due to talent shortages is projected to reach $8.3 trillion by 2030.
Transforming Training Decisions into Workforce Metamorphosis
Upskilling and reskilling have emerged as crucial tools for bridging skills gaps. In response to these challenges, many organizations initiate their skills-based metamorphosis within their Learning and Development (L&D) teams, where the language of skills aligns well with learning paths and career progression frameworks.
When it comes to L&D, organizational leaders can start by familiarizing employees with the language of skills, using it to map skills to development opportunities. However, this is just the beginning. To fully realize the benefits of a skills-based approach, sectors beyond L&D and HR need to adopt this lens.
Gaining an Advantage Through Better Insights
Skills analytics will influence operational decisions across the organization, from promotion and redeployment to resource allocation and upskilling. Successful businesses will integrate this skills-based approach at the core of their operations, enabling better resource allocation and efficiency.
To make significant operational decisions, you need two essential elements: data on the tasks to be accomplished and insights about the human capabilities required to execute them. Skills analytics connect these two fundamental elements.
Consider an HR team capable of identifying employees ready for promotions based on their skill profiles. Or a project leader who can promptly assess the skills required for an initiative, pinpoint gaps, and source the necessary internal or external resources. Or a CFO aiming to better predict workforce costs and ROI by understanding skills availability versus demand.
A skills-first approach transcends workforce planning and employee engagement. It is all about agility, efficiency, and precision at every organizational level.
By year's end, I predict that "skills" will no longer be merely a buzzword. Instead, they will serve as the foundation for operational excellence and a significant driver of competitive advantage.
Putting Skills at the Heart of Transformation Efforts
Adapting rapidly to technological shifts, market disruptions, and competition pressures is essential for business survival. However, most organizations grapple with this imperative, overlooking the crucial link between workforce capabilities and business transformation.
As per Gartner, 62% of HR leaders recognize that uncertainties around future skills present a significant risk. The foundation of any successful transformation lies in actionable skills data. Skills analytics can provide the much-needed insights to align talent with strategies, ensuring a business-focused approach to talent management.
By integrating skills-based insights into their transformation strategies, organizations can build agile, adaptive, and highly competent teams. Business leaders, rather than HR executives, are increasingly leading skills-based transformations. As forward-thinking leaders recognize, aligning talent with business strategy is no longer an HR-exclusive responsibility—it is a business imperative.
- Abakar Saidov, an analyst, highlights the importance of skills-based hiring, stating that while 70% of talent acquisition leaders acknowledge its value, only 17% are prepared to implement it effectively.
- To fully leverage skills insights and transform their workforces, organizations need to go beyond L&D teams and adopt a skills-first approach across various sectors. According to LinkedIn research, 73% of recruiting professionals prioritize hiring based on skills.
- Abakar Saidov predicts that by year's end, skills will become the foundation for operational excellence and a significant driver of competitive advantage, with business leaders leading skills-based transformations to adapt to technological shifts and market disruptions.
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