This is the fourth in a ten-part series on Skills-based talent.

Today’s blog focuses on the implications and challenges of implementing a skills-based talent strategy on resource management and staffing processes. Shifting to skills-driven resource management has a direct impact on the operational delivery of products and services to clients and customers. As such, it can have many implications for business operating units, talent functions, and employees.

Definition

First, let’s level set what skills-based resource management means. It can mean decomposing the basic unit of staffing assignments from an FTE job assignment to more of a task level. For example, If I were a consulting manager in a professional service firm, instead of being assigned as the project manager of a project for 6 months, I might be assigned the task of tracking the testing workstream part-time on one project, while gathering the functional requirements part-time for a second project, while writing training materials part-time for a third (assuming each of these was a skill of mine). Conversely, if I were a resource manager staffing a new project, instead of looking for one consulting manager who had all the requisite skills to manage my entire project, I might decompose my project management needs into component tasks such as work planning, budgeting, stakeholder management, etc. and determine a resourcing strategy where each task/skill was sourced by different resources. I might even optimize by resourcing strategy such that some skills were filled by AI automation, some by offshore resources, some by on-shore, and some by contract labor – if I believed that would be more efficient for my project.

Skills-based resource management might look different if the work were not project-based. Perhaps resources might be pool-based and assigned in real-time into cross-functional work teams based on specialty – as perhaps a health team assembled to address more complex patient cases. It can take different forms depending on the work itself and how the work is designed. Given these dependencies, a variety of implications arise.

Implications

• A Common Underlying Skills-based Framework: Skills-based resource management pre-supposes the organization has developed an underlying framework that decomposes all the work that needs doing (all its service offerings) into the component skills required to deliver those services. This would determine the Demand for skills needed coming from the business or demand plan. Likewise, the identical skills framework must underlie the available workforce, such that each available resource has an up-to-date inventory of skills (or credentials) they can perform.
• Skills Matching – A process, either manual or technology-enabled, must exist to match open skill needs to available skill resources at the speed of the business need. This can be driven from the demand side (e.g., by the project leader), by a central authority (e.g., by a staffing function), or from the supply side (e.g., by self-selection from a jobs board). It can happen with or without an overarching resourcing strategy to guide the matching algorithm (e.g., Buy, build, borrow).
• Flexible Job Roles & Teams: In a skills-based organization, job roles may be more fluid and adaptable. Instead of strictly adhering to fixed job descriptions, employees are assigned tasks and projects based on their specific skill sets, allowing for greater flexibility in staffing while ensuring that their expertise is fully leveraged. Teams may be assembled based on the required skills for a particular project rather than solely on departmental lines. This fosters collaboration and diversity of thought, leading to more innovative solutions. This can lead to more flexible career paths. It can also lead to more complex headcount supervision and advancement.
• Efficient Task Allocation: With a clear understanding of employees’ skills, resource managers can allocate tasks to individuals with the most relevant capabilities. This improves task efficiency and reduces the risk of assigning work to someone without the necessary expertise. For example, if my project manager is highly skilled in most tasks but has never managed a budget before.
• Blended Learning Approaches: Skills-based organizations often adopt blended learning approaches that combine various training methods, such as in-person workshops, online courses, webinars, on-demand learning nuggets, and on-the-job training. This mix allows for a more comprehensive and engaging learning experience.
• Increase in Informal Learning: As the organization's conception of learning shifts from a knowledge acquisition activity to a skill acquisition opportunity, many organizations will increase their appreciation of informal learning experiences, such as developmental staffing, mentorship, and peer-to-peer knowledge sharing. As these experiences are more heavily integrated into the training and development process, formal learning content development efforts lessen, speeding the organization's ability to drive new learnings into the organization.
• Measuring Training Effectiveness: Skill-driven training more directly aligns learning outcomes to on-the-job performance. Training outcomes are not only measured by knowledge checks and attendance but also by applying newly acquired skills in real-world scenarios. As training begins to look more like work, the organization can more easily assess the impact of training on performance and business results.
• Performance-Based Training: Training initiatives are more easily linked to performance evaluations. Employees may receive training opportunities as rewards for their achievements or as a means to address improvement areas.
• Promotion of a Continuous Learning Culture: Skill-based training helps drive learning to become more integral to the organization's culture. Employees are encouraged to engage in continuous learning practices, learning more "in the flow of work” as opposed to events that take them away from the job. Learning shifts from being driven top-down to being self-directed. The learning team spends less time developing and publishing content and more time curating learning experiences, providing resources to support individual skill development journeys, and embedding learning opportunities within the organization's processes.
• Skill Development Centers: Skills-based organizations may establish skill development centers or centers of excellence to promote continuous learning and foster expertise in critical areas. This may require an upskilling of the learning team as new development methods and technologies are introduced.

Challenges

Beyond the standard challenges that every organizational transformation faces, implementing an enterprise-wide skills-based talent strategy can offer some unique challenges:

• Enterprise Learning Strategy & Governance: Implementing and maintaining a skills-based talent strategy requires significant re-investment in training and development. There are multiple audiences, learning approaches, technologies, and approaches to be balanced. Budget constraints or limited resources may hinder the organization’s ability to upskill employees continuously. Enterprise learning governance may need to be established to define and strategically coordinate learning activities across organizational boundaries. New learning groups or technologies may be required.
• Skills Validation: Learning development activities rely on a clear definition of skills. Each organization must define its own skills language and skills taxonomy. Agile and adaptable work definitions are necessary for a successful transition. Obtaining robust data to articulate existing skills, target proficiency levels, and skills-based development methodologies can be challenging. Some parts of a business, especially regulated functions, may face more challenges than others.
• Balancing Focus on Hard vs. Soft Skills: Skills-based organizations may prioritize technical or hard skills, potentially overlooking the significance of soft skills like communication, leadership, and emotional intelligence, which are essential for leadership, effective teamwork, and collaboration.
• Developing Skills vs. Experiences: Formal and informal learning experiences differ in structure, objectives, delivery, guidance, and environments. Both formal and informal learning experiences play essential roles in an individual's overall development. Formal learning provides a structured and systematic approach to education, while informal learning fosters lifelong learning and encourages curiosity-driven exploration. Combining both types of learning experiences can lead to a more well-rounded and adaptable individual. Few organizations have a robust enterprise infrastructure to deploy and coordinate both kinds of learning equally and strategically.
• Implementing the Right Learning Technology. A large market for learning products must be evaluated and carefully selected to work together as a cohesive platform for your employee’s learning experiences. Many technologies overlap, creating redundancies, interfacing, and reporting issues. Skills data spans both many talent functions and operational functions. Technologies are constantly evolving, making constant intelligence and flexible technology architecture necessary. Most organizations do not prioritize learning technology investments often, making investigation and maintenance activities slower.
• Evaluating Skill Development Centers: Defining an enterprise-wide skills strategy may require re-thinking the federation of learning responsibilities across organizational boundaries. If necessary, setting up a new skill development center or center of excellence is a significant decision, often requiring careful navigation through senior leadership. If approved, all aspects of an organizational design project must be addressed, including structure, process, and (re)skilling the learning team.
• Coordination of Development Roadmaps: The organization must decide whether to prioritize skill definition or develop a workforce strategy coordinating skills efforts. Despite aspirations for a skills-based work model, few organizations are experimenting with the infrastructure needed to implement the approach broadly.

Stay tuned for our next blog on the Implications of a Skills-based Talent Strategy - on Credentialing and Proficiency Assessment.