Skills, job architectures, and workforce intelligence

How to build a skills-based organization (and succeed)

By Maya Finkelstein

In the new world of work, skills are stealing the spotlight. As talent shortages continue and knowledge gaps widen, organizations are putting a premium on upskilling and reskilling efforts to ensure employees are prepared for their next chapter. Unsurprisingly, building critical competencies ranks as HR leaders’ top priority.

Despite this focus, very few businesses are on the path to becoming skills-based organizations. If companies want skills to replace jobs as the fundamental unit of work, leaders must look beyond small upgrades and subtle changes. Instead, businesses need to embrace new frameworks and game-changing technologies in order to put skills at the center of their talent management strategy.

With this change in approach comes an entirely new vocabulary for HR leaders to master. While the terminology might sound foreign at first, these concepts are quickly becoming part of the lexicon for skills-based organizations and the executives who are at the helm of them.

Why skills-based strategies are essential in the new world of work

Although many leaders are embracing skills as the new work order, others may have lingering doubts about the efficacy of a skills-based strategy. After decades of successfully breaking down work into jobs and relying on the same processes to maintain operational continuity, shifting to dynamic ways of working can sound like a big risk.

Yet, it’s going to be a necessary leap of faith, particularly in an era of work hallmarked by accelerated innovation and ongoing disruption. While rigid hierarchies may have functioned well when the working world was stable and predictable, it’s not going to hold up during this era of uncertainty. Now that new challenges are emerging more frequently, survival hinges on a business’s ability to rapidly respond to change.

A skills-based strategy is essential for unlocking the level of agility the new world of work demands. When enterprises shift the unit of work from jobs to skills, leaders gain full visibility into their workforce’s capabilities and employees are empowered to achieve their full potential.

As a result, skills-based organizations enjoy several game-changing advantages, including better retention and engagement rates, higher output levels, and better performance, as Novartis demonstrates. When the leading pharmaceutical organization shifted to a skills-based strategy, the enterprise unlocked 50,000 hours of capacity and saved nearly $2 million in enhanced productivity.

Inside the skills-based organization: 5 terms HR leaders need to know

Once leaders decide it’s time to make the shift towards becoming a skills-based organization, there are a few essential terms to prioritize.

#1. Workforce intelligence

Workforce intelligence combines data and AI to produce insights for greater talent agility. As skills become a top business priority, organizations are increasingly harnessing workforce intelligence offerings to gain a comprehensive understanding of the capabilities within their company.

Gloat’s Workforce Intelligence is a central platform that serves as a single source of truth for workplace skills. It’s a suite of tools that provides the actionable insights needed to design future-fit workforces and drive positive business outcomes—all powered by proprietary datasets. Workforce Intelligence includes a handful of offerings crucial for powering skills-based organizations, including a Skills Management Console, Job Architecture Console, and Workforce Insights.

#2. Job architectures

Job architectures are a system of cataloging an organization’s roles by hierarchy and relationship. They often include classifications per job, such as function, family, title, code, and level to provide clarity across teams.

Typically, organizations may pull from a predefined catalog or work internally across teams to define a job architecture. Yet, these frameworks can be time-consuming to maintain, and difficult to keep accurate. That’s why skills-based organizations tap into Workforce Intelligence. With this offering, leaders can keep roles and responsibilities updated with insights from internal and external data sources, view suggested positions to merge and job codes to update, and receive recommendations on relevant and trending skills that should be prioritized.

#3. Skill taxonomies

Skill taxonomies, or inventories, are lists of relevant competencies found within an organization. Many businesses will use an off-the-shelf skills taxonomy, which can cause their inventories to become outdated, overly generic, or incomplete.

Rather than relying on a skills taxonomy, Workforce Intelligence harnesses a self-evolving ontology that takes into account the relationships between not only skills to skills, but also skills to jobs. The self-evolving ontology is made up of multiple layers of data that constantly evolve as more information about skills and jobs are added.

#4. Talent marketplace
Talent marketplaces autonomously match employees to internal opportunities based on their skills, capacity, and ambitions. The AI-powered platforms give managers frictionless access to untapped talent, while employees gain visibility into all of the experiential learning opportunities that their organization has to offer.

When paired with Workforce Intelligence, the talent marketplace creates a continuous loop of insight to action. Real-time data on companies, employees, competencies, skills, and even aspirations provide hyper-relevant information that business leaders can use in workforce planning and decision-making.

#5. Data harmonization
Data harmonization is the process of bringing together data from varying file formats and naming conventions and transforming it into one cohesive data set. This helps to create consistent meaning and context for workforce information. Data harmonization bridges the gap between disparate skills information, creating a clear workforce understanding with connected and normalized HR data sources.

Shifting to a skills-based strategy with Workforce Intelligence

Shifting to a skills-based strategy requires more than a vocabulary lesson. To activate more dynamic ways of working, businesses must take advantage of disruptive technologies designed to facilitate the seamless exchange of skills and talent.

By pairing Workforce Intelligence with a talent marketplace, workforce agility platforms empower leaders to strategically redeploy employees as new priorities emerge. Workers can harness the platform to seek out skill-building opportunities that align with their career goals, while employers gain ongoing insight into the capabilities their workforce has and the competencies they need to prioritize.

In short, workforce agility platforms put skills at the heart of every talent management and workforce planning decision, so that your business can tap into all of the benefits that skills-based organizations reap.

To learn more about what it takes to get ahead in the new world of work, find out how you can harness a workforce agility platform to build a skills-based organization.

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