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How To Find Efficiencies In The New Skills Economy

We recently hosted a webinar with Forrester, featuring Betsy Summers, Principal Analyst at Forrester, Matt Fenton, VP Advisory at Beamery, and Tom Shurrock Product Director at Beamery. The three came together to discuss The Skills Economy – A Zero-Waste Strategy

When we say the “Skills Economy”, we are referring to a fundamental and enterprise-wide shift in the way organizations manage the employee journey, from workforce planning to recruitment, and from redeployment to retention of talent. And making this shift successful relies upon establishing common language around skills. 

Utilizing a common skills language enables a holistic and “truer” understanding of an organization’s composition. It also – perhaps more importantly – helps organizations actively identify skills they need today, and plan for the skills they will need tomorrow.

But why is it a zero-waste strategy? Many organizations are currently missing out on hidden skills or under-utilized skills within their workforce that may be completely unknown or only known by a small group. Many have wasted time, money, and resources hiring new talent, when it would’ve taken them much less time to train and develop an existing employee with adjacent skills, and redeploy them to where they are needed most. 

In today’s rapidly changing talent landscape, the kind of skills intelligence that enables agile decision-making, is necessary for business success. 

Why Skills? Use cases across the enterprise

Betsy then shares that the benefits from skills-based strategies are almost always twofold – both for the organization and for employees. Forrester has done a lot of research into what employees are looking for from their organizations, and they found that 71% of employees are looking for opportunities to pick up new skills. They also found that “I can find new and interesting aspects in my work” was the top answer given by survey respondents when asked about skills development.

This data shows that skills development is actually one of the top drivers for engagement. And the ability for an organization to serve up those opportunities is really at the core of creating value for employees, and for the organization. Skills are a crucial piece of that puzzle. 

In fact, Forrester reports that skills-first hiring criteria are 5 times more predictive of an individual’s future job performance than educational background, and 2.5 times more predictive than work experience. This is not to say that education and experience are unimportant, but going off these factors alone not only leaves room for bias, but it can also leave room for inconsistency, as two people who held the same previous job title, likely don’t have the exact same skills. 

skills first hiring

Betsy  shared some of the more ‘common’ use cases for skills across businesses: talent acquisition, talent mobility, career pathing, gig/project management, and upskilling and reskilling journeys. While these are all critically important to effective talent management, the work doesn’t stop there. 

As organizations continue on this skills journey, they will discover more and more tangential use cases that they can pursue in the future – succession management, workforce management/scheduling, workforce planning, resource management, performance development and management, and even compensation and rewards. 

Due to the continued tight talent market, skills management approaches need some serious help in order to be effective. As Betsy noted, it’s traditionally been a manual, static, and time-consuming process. And, with the current pace of change, that is simply no longer a viable option – humans need help from tools and technology to keep up with today’s business demands, and even anticipate future business needs. 

Having the skills intelligence to understand the gaps and future needs is important, but once you have that data, you also need to consider the upskilling and reskilling programs you will need, and the possible career paths that could become available for employees who develop those skills. It’s an ongoing process, which is why having the right tools and dynamic skills intelligence is so critical. 

Common barrier to creating value

Forrester found that only one in five companies that are adopting skills-based talent strategies are doing so organization-wide. The majority of organizations who have applied skills to their talent processes are only doing so in one or a few specific areas, like talent acquisition or talent mobility, for example. 

What are the main challenges organizations face when creating value through implementing a skills-based approach? Betsy shared several of the most common barriers, which fall into four main buckets: 

  • Difficulties with siloed teams with competing budgets and priorities
  • The lack of data extensibility across the organizational ecosystem
  • Conflicting skills language across multiple tools and databases
  • Low adoption & low confidence from employees when a new tool or technology is introduced 

Often, a company has purchased several different tools to solve individual problems around skills, but those tools aren’t communicating with each other. Therefore you see a lot of the problems mentioned above, including low adoption, and conflicting skills languages. 

This is why choosing the right vendors, that will help you achieve a ‘zero-waste strategy’, is so important, not only for effective talent management, but for overall business success.

Emerging best practices from those who have gone through a skills transformation  

Betsy shared some of the current best practices and helpful pieces of advice the Forrester team has observed from organizations that have gone through successful skills transformations. These included: 

  • Work together and treat the process as an enterprise-level transformation with multiple value streams and contributors.
  • Seek partners; these large projects truly take a village.
  • Employee and leader confidence in skills data is paramount, so be sure to manage expectations, and make it a part of your company culture.
  • Enterprise skills data management is a new and emerging category: no vendor can do it all (yet). Pay close attention to the product roadmap. 
  • No competency or skill clusters should be left behind; import and translate everything into skills data for consistency.
  • Don’t let people self-declare skills (as some companies do). The most important thing is that you can validate skills and maintain confidence in your data.

As you can see, there’s no one-size fits all approach to skills transformation, but there are some commonalities that are present in most successful skills transformation projects. The key is to work with vendors who are aligned with your goals and your needs, and to make sure your transformation efforts are prioritized across the organization. 

How does Beamery help?

The traditional skills management methods that many companies are still using are manual, time-consuming, static and limited. While most business leaders are aware of this, they need help from a technology vendor to get started. 

One of the first things we can help with here at Beamery, is the creation of a Job Architecture, which is key to success of any skills-based transformation. We can also help you utilize it, so you can realize ROI, and immediate time and cost savings. And, perhaps most importantly, our solution helps keep your Job Architecture up-to-date dynamically, without any manual updating. 

This is the very foundation of a skills-based approach to talent management, because as soon as your skills data is out of date, so is your strategy. 

Watch our webinars on demand to learn more about how you can implement a zero-waste talent strategy, or build a business case for skills-based transformation.