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How to Conduct an Effective Skills Gap Analysis

It’s no secret that a well-trained workforce is an essential part of ensuring a company’s success. With technology and global economies changing so quickly, however, how can employers make sure that their teams measure up?

One study suggests that 65 percent of children entering elementary school may have careers that don’t currently exist. While there is no way to see the future, a skills gap analysis may be the best tool HR and development teams have to ensure their employees are ready to take on new challenges and conquer business objectives.

Related: Once you’ve conducted your skills gap analysis, identify how many recruiting resources you need to hit your hiring goals. Use IQTalent Partner’s Recruiting Resource Calculator to figure it out. 

What is a Skills Gap Analysis?

One of a handful of revealing tools, a skills gap analysis can tell you the difference between what your company needs for continued growth and the current talents and abilities of your workforce. Because these often don’t match up, it can be an eye-opening way to address inefficiencies and provide opportunities for education and development.

If done properly, the analysis can direct your knowledge and development teams, Human Resources, and management to focus on which employee skills need to be communicated to your workers. They can even help you get ahead of trends and technological advances before your methods become outdated.

Why Should You Conduct a Skills Gap Analysis?

In addition to telling you where your employee’s current skill levels are in comparison to what’s needed, a skills gap analysis can serve as documentation of the state of your workforce. Over time, these metrics can be beneficial, not just for closing skill gaps, but for directing your talent searches and reaching out to promising new job candidates.

A well-conducted skills gap analysis can also serve as a way to evaluate if your current training programs are meeting their intended goals.

How to Conduct an Effective Skills Gap Analysis

There are many steps to ensuring your skills gap analysis is thorough and provides the data you need most. While these are the most common stages of analysis, you can adapt each to meet the business goals of your organization.

1. Create a Plan

While you will measure the important skills of each member of your organization, it’s also important to see how teams work together to meet skills goals. Develop a strategy that includes a list of those closest to each team and who would be most appropriate to share their experiences. Department heads are often a good choice, but lower-level supervisors can offer insight, too.

2. Set Goals

Any fact-finding mission is useless without stated goals. To understand any gaps in your workforce, you must first establish where you want to be. This may require some big-picture thinking that could include the revision of mission statements, business projections, and desired outcomes.

Only after you’ve asked, “Where do we hope to be in the next year or ten years?” can you truly know if you’re on your way to getting there. Include details related to these goals, such as specific skill sets and employee outcomes.

3. Research Future Work Trends

It’s not enough to envision where your company will be in a decade; you must embrace the way your industry is heading as a whole. To do this:

  • Consider how automation may change jobs or even make some redundant.
  • Give yourself some time to explore what the skills of the future might look like.
  • Turn to thought leaders in your industry and global reports to guide your search in ways you may not have explored before.

4. Define the Skills of the Future

After you take the time to see what the work will look like, break down those trends into actionable, tangible knowledge sets and skills. Remember that not every new skill will apply to your company. Those that do may only require an adjustment to what you are teaching now.

For those skills that are a leap for your existing employees, consider how your full-cycle recruiting process can be changed to identify (and hire) these workers of the future.

5. Measure Current Skills

Your next step is to see what skills your current employees possess. This inventory is important to know where you are at. It’s your starting point.

The questions you should ask include:

  • What KPIs (key performance indicators) do you currently measure? If you measured them now, where would your steam stand?
  • What surveys, tests, or conversations can you have to measure skills and knowledge?
  • How can a 360-degree feedback process fit into the plan to measure skills?
  • What can each employee contribute to the process? How can they do skill assessments on their own to get a view that’s more personal than what an outsider can offer?

Technology is available to assist in this step, which can take up a large portion of the skills gap analysis. HR tools range from short-surveys, custom polls, performance review data and analytics software to full-scale skills management systems.

6. Look for Gaps

After you’ve defined your goals and measured your employee’s current skill set, you can now identify where they don’t match up. These can be current gaps related to your production today,  or gaps for where you think you won’t align well into the future. These gaps can drive both present solutions for immediate needs in quality and production, as well as what your business of tomorrow will prioritize.

Example of gaps can include:

  • New employees don’t display the technical skills needed to operate machinery or use software that’s due to roll-out for your industry in the next five years
  • Current employees aren’t staying up-to-date on legal terminology for the changing landscape of medical or insurance industries

Once you have determined there is a shortage of critical skills – or a gap – you know what to address moving forward.

Here’s what you can focus on:

  • Update your knowledge and development materials to train your employees yourself. Use internal resources to keep costs low and maintain control over training. This also keeps company culture at the top of your priorities.
  • Outsource a firm or training company to address each skills gap individual through a series of workshops or training sessions.
  • Sponsor team members to attend industry conferences and events where presenters and panels address specific skills gap needs.
  • Create a tuition-reimbursement program to compensate employees who continue their education in areas labeled as a skills gap need.
  • Subscribe to industry publications, learning services, and media accounts that directly address skills gap needs.
  • Start a mentorship program pairing those in your organization who have skills with those who need them.

One other option is to focus on hiring workers who don’t have these skills gaps. If you can’t wait until new hires come on board permanently, work with a temporary staffing agency or freelance service provider. They can help fill the need until you recruit employees who are trained and ready to work within your existing processes.

Skill Gap Analysis Templates

A skills gap analysis involves lots of steps, measurements, and collecting and sorting of data. One way to keep the process manageable is to use an existing template. A skills gap analysis is not a new process, and HR teams have been refining the best practices for decades. Some of the best HR tools come with templates, as well as staffing and applicant tracking systems.

When you use a template, don’t feel limited in how you put it to work for you. Feel free to adapt it to your unique business needs and create templates for different business segments or locations. 

Comeet can help you in every step of the skills gap analysis process, from determining if your existing employees have what it takes to recruiting to fill specific needs. Reach out now to start your own free demo!

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