Critical Skills Gap Analysis

Critical Skills Gap Analysis: What is it?

Published on February 2nd, 2023


Defining Critical Skills Gap Analysis

Critical skills gap analysis is a process used to identify the skills and knowledge areas that are lacking in an organization's workforce compared to what is required to achieve its goals and objectives. It involves comparing the current skills and knowledge of employees with the skills and knowledge needed for future success and identifying the gap between the two.

The objective of this analysis is to identify the specific training and development needs of the workforce so that the organization can effectively address its skills gap and build a competent and capable workforce for the future.

Why Critical Skills Gap Analysis is Important?

There are several reasons why an organization might need to conduct a critical skills gap analysis:

  • Stay competitive: In a rapidly changing business environment, organizations need to stay ahead of the curve by continuously upgrading the skills and knowledge of their workforce. A critical skills gap analysis can help an organization identify the skills that its employees will need to be successful in the future and invest in developing those skills.

  • Improve performance: By identifying the areas where employees are lacking the necessary skills, an organization can target specific training and development programs to improve performance and achieve its goals.

  • Fill talent gaps: A critical skills gap analysis can help an organization identify skills that are in high demand but lacking in its workforce. This information can then be used to attract new talent and fill those gaps.

  • Better allocate resources: By understanding the skills that are most critical to its success, an organization can prioritize its resources and allocate them to the areas that will have the greatest impact.

  • Foster a learning culture: By identifying the skills and knowledge that employees need to be successful, an organization can create a culture of continuous learning and development, which can improve employee satisfaction and retention.

When should you conduct a Skills Gap Analysis?

While performing a "skills gap analysis" may appear like a static exercise done once or twice a year, some organizations may want to have access to real-time skills data so that teams and departments are always equipped with the skills they need to succeed. Because more employees join and leave larger teams and organizations often, real-time skills data is crucial for them.

You can track talents in real-time with some tools. However, if you are content to use a skills gap analysis only once, you should carry out the exercise when:

  • You see a decline in company performance, such as when financial goals are not met.
  • You are introducing a fresh method or technology.
  • You expect a market disruption like artificial intelligence (AI), automation, or developments in the gig economy that could affect your company.
  • You want keep track of the skills that are gained or lost as a result of worker mobility.
  • To stay ahead of the curve, you are modifying or pivoting your business strategy or model based on any of the aforementioned criteria.

Full-Proof Plan to Conduct a Critical Skills Gap Analysis

1. Conduct a Skills Mapping Exercise

By doing a skills mapping activity, you can evaluate the skills and skill levels that are now at your disposal.

It's a smart start if your organization currently has thorough skills data available. In the event that you don't, you can begin by going over and analyzing previous employee/team evaluations, performing fresh assessments alongside interviews and job knowledge tests, and setting up one-on-one meetings between managers and team members.

If organizations make sure the skills mapping process is inclusive, they frequently stand to gain. That is, in addition to the organization's top-down skill mapping, employees are requested to map their own skills (bottom-up), where they identify their strengths, note their degrees of proficiency, and list the skills they love using at work since it gives them a boost.

2. Identify Future Skill Requirements

What objectives does the organization have for the next five years? For instance, do you have any plans to change your business strategy or model during this time? List the abilities you'll need to achieve those new goals.

Analyze your market and the path it is taking to discover whether any technological or other disruptions are anticipated. Ask yourself:

  • Are there any recent changes, such as new technology, that are predicted to change how your industry operates? Are there any jobs that will be mechanized at the most basic level? Will any jobs be eliminated?
  • Do your current staff possess the abilities required for these predicted organizational changes or market disruptions?

3. Fix the Skills Gap

You should now have two lists of skills: one listing the ones your organization already possesses and the other listing the ones you will require in the future. Your skills gap is what separates the two lists.

You will have richer data to use as a reference for your future approach if you also captured expertise levels while mapping skills.

You probably have a long list of abilities you need to learn or hone. The next stage is to rank them according to priority depending on how the firm is harmed by the lack of each ability. This enables you to concentrate your corrective efforts—whether they involve recruitment, learning and development, or upskilling—on the most critical issues. After all, filling in skill gaps takes time, money and effort.

4. Craft a Solution

To bridge skill gaps, experts advise taking a multi-pronged strategy. For instance, Gartner advises businesses to use a "build, buy, borrow, and rent" strategy to bridge talent gaps. Among the top techniques it advises organizations to use are outsourcing, recruiting part-time or full-time staff with the necessary capabilities, and upskilling or reskilling current employees.

One of the most common ways to bridge skills gaps is by up- and re-skilling through training and development. It is their "top priority," according to global learning and development experts polled for LinkedIn Learning's 2021 Workplace Learning Report, and US HR professionals think holding onsite and offsite training through seminars and workshops is the greatest method to close the skills gap.

Your Takeaway

Knowing what abilities and competences your workforce possesses is crucial in a time when businesses are increasingly trying to train their employees for the future. A skills gap analysis is a useful tool for this since, when properly executed, it provides you with insightful information about your whole manpower, aids in strategic workforce planning, and enhances recruitment efforts.

You may also tailor your learning and development programs to reskill your workforce where necessary, with the help of an efficient critical skills gap analysis.



Radhika Sarraf

Radhika Sarraf is a content specialist and a woman of many passions who currently works at HireQuotient, a leading recruitment SaaS company. She is a versatile writer with experience in creating compelling articles, blogs, social media posts, and marketing collaterals.

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