What is skills management software?

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By Nicole Schreiber-Shearer, Future of Work Specialist at Gloat

Exploring the tools leaders can harness to fully capitalize on their workforce’s capabilities


Across every region and industry, talent shortages are reaching crisis levels. Studies indicate that by 2030, there will be a global talent deficit of more than 85 million workers, which means $8.5 trillion in revenue will be at risk if shortages aren’t addressed.

There’s one overarching challenge that’s fueling today’s talent shortages: a lack of in-demand skills. As technology rapidly advances and consumer expectations evolve, the knowledge that workers need to excel in their jobs is rapidly changing—and many employees are struggling to keep up with these shifts.

Rather than letting competency gaps widen, savvy leaders recognize that they’ll need to embrace new strategies and tools to put a stop to talent shortages—which is where skills management software comes into play.

What is skills management?

Skills management describes the practice of understanding, developing, and deploying people and their skills. Most impactful strategies should identify the competencies that a job requires, the capabilities that employees possess, and any discrepancies between the two.

Although it might sound simple, keeping track of employees’ skills is challenging because people are continuously learning new competencies. At the same time, every worker brings knowledge from their past professional experiences that managers may not be aware of because it falls outside of their current job scope. Rather than having to make educated guesses about who might know what, skills management software gives leaders full visibility into the knowledge their workforce has and the skills they need to acquire.

In the past, companies that wanted to leverage technology to manage skills often purchased repositories, used databases, created their own skill taxonomies, or hired consultants to build a framework for mapping skills to jobs. However, technological innovation has paved the way for a new generation of skills management software that harnesses AI to automate this process and generate more real-time data on workforce skills.

What are the advantages of using skills management software?

As leaders put a premium on developing and acquiring in-demand capabilities, skills management software is quickly becoming a necessity for businesses that wish to thrive in the new world of work. These systems map out skills, roles, and talent across your company, in turn equipping executives with the insights needed to fully tap into all of the expertise their workforce has to offer.

Skills management software also serves as a medium to help leaders deploy talent to roles based on their capabilities—in turn fueling their company’s shift towards becoming a skills-based organization. Businesses that harness skills-based operating models reap several important benefits, including a 107% greater likelihood of placing talent effectively, in addition to being 52% more likely to innovate.

What are the essential features of skills management software?

Leaders who are looking to embrace skills-based strategies should search for skills management software that offers the following:

  • Job architecture management 
    Even as organizations look to skills-based models, executives still need a framework to understand how roles are structured and a skills-based view of what each role means. This helps them identify what skills employees will need to possess and where their requirements for various roles may be outdated—which is exactly what a job architecture management system provides.Although job architectures are considered to be the backbone of an organization, manual ones quickly become outdated and often fail to capture the breadth of employees’ skills. To successfully enact skills-based strategies, leaders must look beyond business units and job codes and harness tools that enable them to deploy talent to projects and tasks at the skill level.  These tools also help executives identify roles that may need to be discontinued and those that are on the rise to create efficient and future-looking organizational models.
  • Skills profiles
    A skills profile is a singular view that captures all of an individual’s skills, abilities, and experiences. They might include a summary of an employee’s work experience and certifications, as well as technical skills and any other relevant information that highlights expertise. The purpose of a skills profile is to provide a comprehensive overview of an employee’s qualifications, enabling leaders to search for critical skills and gain a roster of qualified talent across the company. As executives begin restructuring jobs or considering ways to move talent from outdated jobs to high-priority roles, skills profiles provide a skills-based view of how to build a deployment plan.
  • Skill and job benchmarking
    Since today’s talent landscape is hyper-competitive, leaders need insights to understand exactly how their workforce’s skills stack up against others in the market. Skills management software should help executives understand the market value of a job and identify whether a capability is on the rise or on the decline. Some systems even provide insights into how the competition is positioning their jobs so businesses can pivot ahead of the curve and make informed L&D decisions to prioritize skill development effectively.
  • Skills assessments
    Skills assessments are processes that organizations undergo to gain a more comprehensive understanding of the knowledge that individual employees have and their proficiency to perform various tasks. As work evolves and technology continues to advance, skills assessments are shifting to become more data-focused. Rather than asking employees to complete a test—or in addition to an exam—companies are now collecting data from employees’ previous professional experiences to evaluate their skills and how to best utilize them.

3 differentiators that set top-performing skills management software apart

While most types of skill management software will help bridge talent gaps, leaders should look out for the following differentiators to ensure they’re choosing the most impactful platform:

#1. Harmonization
The best skills management software creates a single source of truth so that leaders can fully understand the skills their workforce has and how they can be harnessed effectively. Traditionally, it has been hard to get all of this information in one place because skills information is typically siloed among various HR platforms. However, top-performing skills management software will integrate with existing HR systems to create a harmonized view of workforce capabilities that evolves as employees expand their expertise.

#2. The ability to pull in real-time company data 
Your skills management software should be trained on billions of data points from thousands of open web sources, government databases, aggregated and anonymized data—and most importantly, real-time information from your company. When skills management software connects to a talent marketplace, leaders can feel confident that the insights they’re seeing aren’t based solely on statistics or labor repositories that are updated once a year; instead, they’re built on real-time data from their company and organizations everywhere.

#3. Connection to an action platform
Once companies have skills mapped to jobs and a skill view of their employees, leaders typically have one question: What do I do with this information?

When skills management software is connected to a talent marketplace, executives can begin working with managers to create development plans, open roles to redeploy talent, and devise pathways for employees to hone in-demand skills.

To learn more about the best practices that leaders are harnessing to put skills at the center of their strategies, check out our research report on workforce skills.

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