Conducting a Skills Gap Analysis
Many employers experience a growing need to upskill or reskill their workers to address talent shortages. As such, a skills gap analysis can be an important tool to drive and shape workforce planning. Such an analysis sheds light on talent opportunities and allows employers to examine and optimize business priorities. Not only can a skills gap analysis help organizations find the right workers, but it can also help retain employees. Workers who are a good fit for the company may be able to take on other roles and responsibilities that better support the organization’s aspirational goals and are vital to its future.
This article explores the steps for conducting a skills gap analysis.
Building a Case for a Skills Gap Analysis
A skills gap analysis can help determine which skills and knowledge need to be improved among employees on an individual level or within a team, a department or the overall organization. This analysis can even go one step further and look at the industry as a whole, either in its current or future state.
Once equipped with this information, employers can address the skills gap in the organization through hiring, upskilling, reskilling and other learning and development (L&D) initiatives. Such an analysis can also help inform and shape recruitment efforts and strategic workforce planning.
Auditing Skills
Conducting a skills audit is often the first step in assessing current employee skills and identifying possible skills gaps in the organization. Along with understanding existing and missing workplace skills, this exercise can help an organization evaluate its future skill set needs and use these findings to shape the strategy.
A skills audit typically involves the following four steps:
Identify the roles and responsibilities within the organization. It can be helpful to group roles that require similar skill sets, making it easier to identify gaps later.
Identify the desired skills of each role. Think about the skills within each category and the skills critical for organizational performance. Measure employees’ existing skills. Examples of measurement methods include:
Performance reviews
360-degree reviews
Conversations with key managers
Employees’ past work experience
Employee degrees, certifications and education
Self-assessments
Employee interviews
Technology (e.g., skills management software and learning management systems)
Evaluate the skills of employees. This can be done in various ways, including a one-on-one skills audit with each employee; a team or department discussion to get the overall picture; a skills matrix outlining knowledge, skills and abilities outside the typical scope of work; and an employee survey. This step is scalable depending on the company size and the variety of workplace skills.
Process the results. Once you have gathered all the intel, it’s time to review and understand strengths, weaknesses and opportunities. Consider rating current and future skills based on their importance.
It’s important to keep in mind that even the highest-performing teams will have areas that can be improved upon, especially as skills and industries, in general, are evolving.
Once armed with findings specific to the organization and its employees, employers are poised to move on to the next step of the analysis process and further build out their game plan, focusing on opportunities and weaknesses and how they match organizational goals.
Analyzing Skills Gaps
Similar to a current skills audit, employers can create a plan to determine their real and desired skill sets for the future. Such skill sets would support the future of the organization and its aspiring goals or mission. Current and future skill set plans can fit into larger strategies, such as a skills gap analysis.
Here are six steps for conducting the analysis:
Consider how evolving and prospective trends might impact company or industry skills in the future. Ask the following questions:
What required skills will change due to technology?
How does the economy impact skills?
How would potential company or industry growth (or consolidation) impact skills?
Set goals and develop a plan to use the analysis data. For example, to fill skills gaps, organizations may decide to train (e.g., upskilling, reskilling, mentoring and pursuing outside educational opportunities) or hire (e.g., sourcing passive candidates and using structured interviews to reduce bias) employees.
Determine programs and define learning pathways that best support the development of the desired skills. It may be helpful to start small with one department or team.
Execute the plan. This may involve modifying processes or strategies, such as updating a screening process to account for in-demand skills, training employees on deficient skills and modifying the hiring process.
Communicate your findings, goals and learning opportunities to employees. As with any workplace initiative, keeping employees informed on skills-related progress, changes or achievements is important so they feel involved and supported. Skills gap analyses and subsequent efforts are designed to help employees reach their potential and contribute to overarching business goals.
Encourage companywide conversations about skills—instead of just jobs or roles. It comes down to fostering a culture of learning, development and growth. Employees should be able to talk openly about skills, have opportunities to hone their skills and understand how their skills support larger organizational goals.
The need for a skills gap analysis could be triggered by various stages in workplace processes, including before a big project, during hiring planning or when launching L&D initiatives. Alternatively, an analysis could be done periodically.
Regardless of cadence, a skills gap analysis is best done not as a one-time exercise. Performing ongoing skills gap analyses to measure progress and identify new or changing skills in the organization or industry is critical.
Summary
Skills have and will continue to change or shift. Savvy employers will take a proactive approach, consider their current workforce needs and develop a game plan to close skills gaps to remain competitive. Investing in such workforce planning and L&D efforts can attract current and prospective employees since it demonstrates an investment in professional development and a forward-thinking mindset. In the end, these efforts can help strengthen employee attraction and retention efforts.
This HR Insights is not intended to be exhaustive nor should any discussion or opinions be construed as professional advice. © 2023 Zywave, Inc. All rights reserved.