WE'RE IN A SKILLS CRISIS. IS HR THE HERO WE NEED?

Every day, we see signs that confirm we’re in the midst of a global skills crisis.

In report after report – from the U.S. jobs data highlighting the exit of 100 million workers since 2021, to the Cybersecurity Ventures survey citing almost 3.5 million vacant cyber roles, to the KornFerry report predicting a gap of 85 million skilled workers by 2030 (just to name a few!) – it’s clear we don’t have enough talent with the right skills, where and when we need them.

And the impacts are not being felt equally across all geographies, companies and individuals. The latest Future of Jobs report from the World Economic Forum asserts that low- and middle-income countries, women, and workers with lower levels of education are bearing the greatest burden.

No matter how you look at it, the skills crisis is a people crisis. It’s also a financial one.

Accenture predicts the global skills shortage will spark more than $11.5 trillion in cumulative losses in GDP growth over the next five years, and a PwC Talent Trends report highlights the direct impact of skill gaps on company growth, customer satisfaction and innovation.

Although these trends began to emerge before COVID-19, the chasm is widening as we come out of the pandemic, driven by accelerating technology, the changing nature of work, new expectations from workers, and the struggle of many educators to keep pace with evolving industry needs.

Every crisis needs a hero. Human Resources can be the hero we need now, equipped with a super-utility belt powered by skills.

SKILLS ARE A SUPERPOWER

‘Skills’ earned their place in the spotlight through the pandemic – for good reason!

Rapid advances in areas such as artificial intelligence, cloud computing and blockchain are driving a digital transformation in many companies, amplifying the demand for new and deeper technical and digital skills. It’s also fueling the need for human skills that set people apart from technology, and higher cognitive skills to drive innovation and prepare the workforce to seize new opportunities and tackle problems we may never have seen before.

The focus on skills cuts far beyond learning professionals, and it’s now top of mind for all leaders. A recent McKinsey study found that companies that create opportunities for employees to actively build skills are better at attracting and keeping great people, and more consistent and resilient in their performance – with the best organizations being 4.2x more likely to outperform the competition. Skills provide the ‘connective tissue’ that links people strategies and systems, and fuels fact-based business and talent decisions. Skills also level the playing field for diverse talent, and open doors to new career opportunities. Investing in skills has become a business imperative, and HR is uniquely positioned to help organizations and individuals survive and thrive.

FUTURE-FOCUSED PEOPLE STRATEGIES

The best HR leaders drive out integrated, future-focused strategies that are anchored in skills and tightly aligned to business strategy.

How do these strategies work in a skills-based organization?

Let’s take a closer look:

• PEOPLE DATA & ANALYTICS AI-powered reporting and predictive analytics support HR and business decisions, fueled by consistent taxonomies for data and skills.

• OPERATING MODELS & DESIGN OF WORK Flatter, more dynamic hierarchies, and persistent agile teams support business strategy, enable horizontal collaboration and new ways of working, and drive results. Jobs are defined by key accountabilities and the type and level of skills required to do the work. Predictive modeling informs skill requirements, based on the combination of skills that are producing the strongest performance outcomes for each type of work.
  

• TALENT MIX & WORKFORCE PLANS Predictive, skills-based planning of resources (including the right blend of full- and part-time employees, contractors, etc.) support the business to meet its goals. To get the mix right, plans include talent strategies for

‒ building (developing amazing internal talent)

‒ buying (hiring new employees from the external market)

‒ borrowing (contracting gig workers and consultants)

• TALENT MARKETPLACE WITH SKILLS MATCHING & ‘FLOW TO WORK’ * An always-on, skills-based marketplace uses data and insights to dynamically match skills to work, and help leaders mobilize talent to the areas of greatest need based on their skills. It puts employees first – providing greater transparency into the skills they have, those they need, how skills connect to work, and how they can build a unique career through formal and informal experiences and opportunities. Talent marketplaces also enable companies to create agile talent pools based on skills, to drive greater flexibility and speed, and better tap into available capacity in every part of the organization. Talent marketplace insights, paired with effective workforce plans, enable leaders to be deliberate about where to prioritize external hiring to augment internal talent processes (e.g., to inject critical skills into the company quickly, continue to create greater diversity, etc.). Done right, talent marketplaces help to

‒ accelerate business performance by making the best use of critical skills within the organization

‒ get out ahead of anticipated skill gaps

‒ improve efficiency by strengthening cross-group coordination

‒ reduce unconscious bias and level the playing field for diverse talent

• LEADERSHIP & CULTURE The company’s purpose, culture and strategy are well aligned, and inform the skills and behaviours of everyone in the organization. Skills are valued, and they transparently inform people strategies, programs, and practices. Every leader prioritizes ongoing skill development, including deepening their own leadership behaviors, digital fluency and business and financial acumen.
  

• PERFORMANCE & TOTAL REWARDS Salary and incentives are linked to individual and team performance, the market and skill development. Creative non-financial rewards increase meaningful recognition and employee engagement.
  

• LEARNING & SKILL DEVELOPMENT Employees are encouraged to learn for their job, career, personal interests, and to prepare for the future. They have easy access to opportunities for ‘anywhere, any time’ learning to encourage exploration and engagement, creating a culture of curiosity and learning at all levels. Active skill building and credentialing are a priority for all employees, including UPskilling to help them stay current and improve existing skills, REskilling to develop new skills for a different role or industry, and PREskilling™ to build skills that will be critical in the future. Employees are objectively assessed on priority skills, and the assessment drives personalized development plans to deepen strengths and address gaps. Progress is measured and skills are reassessed along the way, to refine development priorities and drive rich skills intelligence (e.g., which skills, at what level of proficiency, how reliable is the insight, and how recent) at the individual, group and company level.

THE FUTURE IS NOW!

All companies will be at different points in their maturity as a skills-based organization, and some elements will be further along than others – and that’s okay. It’s a multi-year journey, and the most important thing is to get started. That will create additional ‘wind in the sails’ opportunities to make continual progress.

HR leaders will continue to watch, listen and learn, and be a critical partner to business leaders through these days of rapid change. They’ll use their super-utility belt of people strategies and systems to take action – starting now – to ensure their companies are ready to meet current challenges, while also anticipating and responding as new skills emerge, the pace of change continues to accelerate, and skilled talent becomes an even bigger differentiator.

Not all heroes wear capes – but you’ll know HR heroes by the impact they make with their partners, the talent across their companies, and the broader clients and communities they serve.

Now is the time to be bold, and HR is up to the challenge!

*=MCKINSEY CONCEPT FOR AGILE TALENT POOLS THAT ENABLE TALENT TO EFFECTIVELY FLOW TO WORK BASED ON SKILLS

TM =TRADEMARK OF GINA JENEROUX | THE FUTURE IS NOW CONSULTING INC.​