Article · 5 minute read
By Laura Stewart & James Hollingsworth – 16th July 2024
A key trend that organizations are racing to get ahead on is the ability to understand their organization in terms of skills.
Whilst skills-based hiring and development are frequenting many of the top trend lists for 2024, the shift towards a skills-based approach has been gathering pace for some time.
To create a successful skills-based strategy across the talent cycle, it is important to understand the drivers that are reshaping jobs and the workforce.
Job roles and titles have traditionally shaped how organizations structure and understand their workforce. Today, many industry experts are suggesting that the notion of jobs as structural units are becoming obsolete, replaced by a greater focus on skills. Organizations are looking at the skills an individual brings to a project such as data analysis, project management or delivering presentations, as opposed to what that person’s job title is.
This reshaping of work was signalled back in 2016 when Klaus Schwab, Founder and Executive Chair of The World Economic Forum (WEF) coined the term ‘Fourth Industrial Revolution’ (4IR). The next phase of digital transformation including the rise of data, connectivity, analytics, human-machine interaction and robotics propelled the need for a more agile way of working, focusing on projects rather than the long term.
As well as skills-based hiring, development and reskilling, the need for agility when managing talent in a digital age has seen a rise in contingent workers, hiring from emerging markets and an increased use of Artificial Intelligence (AI).
AI is already changing the way we work and the change is happening fast. The now ubiquitous mobile phone took 16 years to reach 100 million users while ChatGPT took just two months. AI is the latest contributor to the rising prevalence of automation in the workplace and this trend is one we expect to continue; the 2023 Future of Jobs report suggests 42% of business tasks will be automated by 2027. The rising influence of AI and automation in the workplace often raises concerns about the erasure of human jobs, however, a more optimistic perspective is offered by Josh Bersin, a leading thought leader in the talent management space.
Bersin suggests, rather than replacing human jobs, AI and Automation is removing the most ‘boring’ elements of work, reducing or eliminating the need for repetitive, routine, and mundane tasks. This is increasing the demand for non-routine work, leading to growth in jobs that can’t be automated, that are often better paid, more interesting and – significantly – require new skills.
Bersin believes that increasing automation will lead to increased demand for ‘power skills’, referring to crucial skill areas that facilitate success but that lie outside technical or specific job-related expertise, such as communication, empathy, optimism and drive. Each of these skill areas are underpinned by many individual more narrowly defined skills.
The rise of AI means that whilst raw analytical skills or cognitive ability are still desirable, companies will see increasing demand for employees with skills that AI simply can’t replicate. Whether that’s the ability to provide excellent customer service, effectively coach colleagues or rally a team around a goal, these previously underestimated uniquely human skillsets will no longer be taken for granted.
According to the British Council, 65% of today’s students will be employed in jobs that don’t yet exist and some of the most in-demand jobs today (Artificial Intelligent Specialist, Cyber Security Engineers and Managers, Programmers & Software Developers) would have been unlikely to break into the top 10 most in-demand job lists a decade ago. as they do today.
It is unsurprising that the reshaping of jobs and rise in AI have contributed to the skills gaps we see today; the 2023 Future of Jobs report indicates that 66% of large businesses say that they will struggle to recruit the skills they need in 2024.
This leads to another fundamental component of skills-based talent management: upskilling and reskilling. With external hiring no longer offering a quick solution to fill skills gaps, organizations are forced to pivot their strategy to first look internally, investing in reskilling and upskilling existing talent to meet business needs.
At Saville Assessment, we worked with Ricoh Europe to identify individuals within the organization to be placed on a digital talent program, who would then have the opportunity to move into newly created roles once the program was complete. 100 hard-to-fill roles were successfully recruited into from a reskilled internal talent pool, including individuals currently in roles where demand was declining due to shifts in the market and strategy. You can read the full case study here.
Undoubtedly, many organizations are looking to embrace a skills-based approach to talent management which meets the needs of an evolving market and workforce.
Successful organizations will be those who can accurately identify individuals with the skills required to be successful, although if it was that easy, everyone would be doing it already.
The emergence of a skills focus is already causing the ‘paper-ceiling’ to crumble. In the same way, organizations are relying less on job titles to indicate the skills an individual can bring to a project and they are becoming less reliant on degrees and academic achievements.
For new roles, and the future of work in general, previous experience is expected to become less important, with increased opportunities to gain and develop the skills required for success ‘on the job’.
This adjusted lens should focus more on ‘Skills Potential’; organizations will benefit from scientifically, accurately and robustly measuring the capacity for individuals to acquire, develop and utilize skills effectively.
Working towards a tangible approach for skills-based talent management will elevate organizations, reshaping not just the work that people are doing, but also how they realize the untapped potential of their people and the teams they operate in.
Get your complimentary copy of our recent whitepaper, where we explore the shift towards skills-based organizations and what a scientific skills-based approach to talent management really looks like.
© 2024 Saville Assessment. All rights reserved.
