Global HR research and advisory firm McLean & Company explains that organisations exist along a spectrum ranging from job-based to skills-based operating models, with “skills-aware” falling between the two. While a full skills transformation has many advertised benefits, it is not the answer for every organisation. The firm’s new Leverage Skills Practices in HR Guide explains the meaning of becoming skills-based and how to incorporate practices to build skills awareness and support the organisation’s unique skills journey.

Global HR research and advisory firm McLean & Company reports that as organisations prepare for an unpredictable future by seeking new ways to address internal and external challenges, many HR and organisational leaders are looking to skills practices as an attractive solution. However, the firm explains in a new industry guide that there is ambiguity around how skills practices can be implemented, with the transition to skills-based operating models demanding significant time, resources, and key player buy-in and a fundamental re-imagination of work. To help HR understand where skills practices will have the greatest impact in their organisation and guide leaders in scoping and prioritising skills practices based on their organisational context, McLean & Company has released its Leverage Skills Practices in HR Guide.

“Skills are often marketed as the solution to current and future organisational challenges,” says Grace Ewles, director, HR Research & Advisory Services at McLean & Company. “While a full skills transformation has many advertised benefits, it is not the answer for every organisation. Strategically incorporating skills into current practices presents an opportunity to reap the rewards associated with skills while laying the groundwork for the organisation’s unique skills journey.”

According to McLean & Company’s new Leverage Skills Practices in HR Guide, skills-based operating models exist along a spectrum. A pure skills-based organization makes all talent decisions through the lens of skills and skills intelligence, which is the ability to identify, grow, and leverage skills at the individual and organizational level. Instead of organizing work by jobs and associated job descriptions, work is understood as a collection of tasks and projects. (CNW Group/McLean & Company)

The firm explains in the recently published resource that while the current buzz around skills practices focuses on the impressive benefits, including increased employee engagement and retention, improved agility and innovation, and expanded talent pools, it can cloud a holistic view of the impacts of becoming a fully skills-based organisation. The guide notes that skills-based organisations also experience drawbacks, such as reduced role clarity, innovation fatigue and unintended bias. McLean & Company further highlights that most organisations are not yet ready for a complete skills-based transformation, indicating that becoming skills-aware may be a better fit.

“Skills-aware organisations leverage skills in some HR practices, while work continues to be defined through jobs, and opportunities are aligned with employees’ skills, potential and career goals,” explains Rachel Stewart, associate vice president, HR Research & Advisory Services at McLean & Company. “Becoming skills-aware can support organisations in bridging the gap between being job-based, which defines roles with fixed responsibilities and emphasises previous work experience and educational background, and being skills-based, which uses skills as the foundation to make all talent decisions and completely restructures work without the use of job descriptions.”

HR leaders seeking to roll out skills practices that align with their organisational needs and bridge the gap between being a job-based and skills-based organisation can follow the guidance in McLean & Company’s new guide, which is divided into three sections:

  1. Assess and uncover. Section one guides HR leaders through the analysis of the strategic direction of the organisation, the assessment of external factors and industry trends, and the evaluation of workforce data to identify pain points. The data collected is then used to identify focus areas for skills practices.
  1. Scope and prioritise. The second section provides an opportunity to review and shortlist skills practices that relate to focus areas, reflect on the current state of the organisation’s culture, skills, data and technology, and identify and prepare for downstream impacts of implementing skills practices. HR leaders will also conduct an effort and impact assessment to prioritise skills practices, then set goals and secure buy-in from leaders.
  1. Plan and implement. Section three shows HR leaders how to create a change management plan for each skills practice being implemented, then evaluate progress towards goals and iterate practices to support the organisation’s skills journey.

McLean & Company advises that developing a comprehensive skills taxonomy and inventory is a complex and resource-intensive task. However, it is critical that organisations do not rush through this process. Robust skills data forms the cornerstone of effective decision-making in skills practices, so without accurate and reliable skills data, the entire effort is wasted.