Performing a skills gap analysis

Performing a skills gap analysis

If you haven’t performed a skill gap analysis recently, you might have more of a skills canyon forming beneath your workforce. New technology, products, and services beget new skills, and many organizations struggle to keep up. So if you want to avoid taking a tumble down a widening skills gap, the first step is identifying where you’re lacking.

Many organizations will be considering performing a skills gap analysis soon. Even in this 2017 Salesforce survey, 59% of hiring managers predicted AI would dramatically impact the skills businesses sought. However, with the explosive arrival of tools like ChatGPT-4, that prediction seems to have underestimated those impacts. One survey saw 63% of respondents clamoring for talent with AI skills. Numerous roles across industries and functions will likely experience some degree of change due to AI, but that’s just one major wrench in the skills gap quandary facing businesses everywhere. 


So what can you do? Well, first, you can identify the skills your current workforce lacks with a skills gap analysis. Before tossing money and time at a learning solution, you should ensure you’re targeting the right problem. In this article, we’ll walk you through the steps involved in conducting a skills gap analysis and briefly explain how to apply your learnings from there.


An HR team collaborates on their skills gap analysis project.


Step 1: Identify highly valued skills in your organization

What skills are most fundamental to the success of your business today? Look through each department and determine what makes it function at the highest level. Try not to limit your search to hard skills. Soft skills will become increasingly essential as tools like AI automate other functions. For example, consider whether employees often have conflicts with their managers. Could that point to a skills gap in communication, and would better communication skills improve the productivity and morale of your teams? These are the kind of questions to ask yourself now. 


Of course, what you need today might not align with your needs next year; things change fast. You may even find in your analysis that certain skills were overlooked or overvalued. Think of this step as a log of what you think you know and need right now. Then, be open to what you discover in the actual analysis.


Step 2: Determine the scope of your analysis

Once you’ve established your baseline in step one, move forward with building your analysis plan, starting with scope. For example, you might be ready to dive deep into the necessary skills to succeed in each specific role in your organization. Otherwise, widen your lens to entire departments or the company as a whole. That would help you understand whether a project requires outside talent or if you could address the gap through upskilling. 


Some common overarching categories to focus on for a skills gap analysis include:

  • Departments
  • Managers
  • Individual contributors by team
  • New hires after a set time period
  • Organizational analysis focusing on a specific skill or set of skills (data analysis, soft skills, etc.)  



Step 3: Assess the skills of your employees

Now that you have identified the highly valued skills in your organization and determined the scope of your analysis, it’s time to assess the skills of your employees. You can use various methods, such as surveys, interviews, and assessments, to evaluate the current skills of your workforce. Similarly, you may find useful information in previous performance reviews. If there was an area for improvement in the previous review, try to discern how that’s been handled since. 


It’s essential to be transparent about the process and ensure that employees understand the purpose of the analysis. The phrase “skills gap analysis” can create a sense of unease among your employees. Any unnecessary dodginess from leadership about the project might hurt morale. If your ultimate goal is to invest further into the skills of your employees, let them know from the start. Too much anxiety about your intentions could lead to flawed responses.

Step 4: What to do with your analysis

The final step in performing a skills gap analysis is to decide what to do with your findings. Here are some options to consider:

  • Develop training programs: If you identify skills gaps, create training programs to address those gaps. These programs can be in-house, outsourced, or a combination of both. 
  • Hire new talent: If the skills gaps are significant or critical to your business’s success, you may need to hire new employees with the necessary skills. This process can be time-consuming and costly, but occasionally it’s the only way forward. 
  • Redesign job roles: Sometimes, the skills gaps indicate that the job roles are outdated or poorly designed. You can use the findings to redesign job roles, merge or eliminate positions, or create new roles that align with your business’s goals. 
  • Offer upskilling opportunities: Providing upskilling opportunities to employees can help close the skills gaps and increase employee engagement and loyalty. 


Aim to implement one or more of the above solutions based on the needs of your organization. The last thing you can afford to do, however, is remain stagnant. Research shows that skills degrade over time, and the possible half-life of a skill could be just five years. As the rate of technological innovation accelerates, we may enter a period where that shrinks even shorter. 


Without constant upkeep, your team will fall behind, sending your organization right back to step one. You’ll never lock up your skills gap forever, but if you don’t take the right steps, you’ll find yourself staring down a grand skills canyon that could have been a mere skills crack. So instead, make it an organizational priority to stay on top of industry trends and emerging technologies. Otherwise, by the time you’ve built your workforce of the future, a newer, wider skills gap will have already opened up beneath it.


ADDA seals your skills gaps

Addressing your skills gaps is imperative if your organization hopes to keep pace with or lead the competition. With a complete understanding of your opportunities for improvement through a skills gap analysis, you’ll be on the right track. ADDA’s HR experts know how to identify your areas for improvement and guide strategies to address them. Contact us today to strengthen your workforce. 

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