Personalised recommendations for our music, movies and even our meals are now the norm. Why hasn’t that extended to our careers yet? It’s because organisations are stuck on a fundamental first step, collecting the right skill data to make those personalised recommendations.
Forward-thinking organisations such as Unilever, IBM and Cargill are now experimenting with data and AI; to shape our career opportunities and make workforce decisions. It’s given rise to a new work model: the skill-based organisation (SBO).
Becoming skill-based
Bringing personalised recommendations to the workforce relies on having complete, accurate, and up-to-date skill data. That’s where AI comes in, as a way of finding, consolidating, structuring, and analysing data to give business leaders the insights they need for better workforce planning.
Skill data exists in many different systems including HR, learning, employee management and the tools employees use every day. Knowing what data you have, how to capture it and how to use it is the foundation of the skill-based organisation. It’s essential for making workforce decisions around internal mobility, hiring, upskilling and career development.
AI changes the game
This isn’t the first time that HR has tried to move towards skill-based decision-making. As Josh Bersin points out, energy, telecommunications, retail, pharma, oil, and manufacturing, have been experimenting with this for decades. A quick Google search brings up over 370 million results for the skill-based organisation, some dating back as far as 2011.
What makes the current discourse different to before is the role of AI. Skill-based models were previously limited to organisations willing to put in the time and effort to set up and then continuously update their skill infrastructure and data. With AI, this work becomes much more scalable and accurate. Josh Bersin explains our current situation well, stating, “What is new is the technology, applications of AI, and the idea of using skills in an integrated way for recruiting, development, internal mobility, and pay.”
The foundation of the skill-based organisation
This vital part of the skill-based organisation will revolutionise how skills are used throughout a company. It powers the skills taxonomy (a common way of describing skills in your organisation), allowing for intelligent matching, moving people from project to project, and personalising their learning and career opportunities. Without AI, the work of manually maintaining a skills taxonomy is impossible — like trying to maintain the Oxford English Dictionary when 25% of the words change every year. Skills simply change too often for us to manually keep up.
AI does the heavy lifting
With AI working to enhance existing skill data, plug any missing information, and make suggestions based on data, the responsibilities of human HR teams and people leaders are to take action on the insights. The groundwork is largely done by AI, so you can rest assured that an individual’s skill profile is as up-to-date as possible. That improves the quality of your data, leading to more accurate results (matching and recommendations) and confident decision-making.
As it becomes possible to have complete, accurate and up-to-date data, organisations are finally embracing the skill-based approach.
How SBOs operate
But what else do you need to consider? SBOs broadly operate in the following ways:
- Build a skill framework. Create a common language on how you organise skills in your organisation.
- Be strategic with workforce decision-making. Use the data you have on skills, not your existing job profile infrastructure to make decisions on your workforce
- Reorganise how work gets done. Look beyond the structure of roles and job profiles to instead what skills are needed for each project and task.
- Reorganise your people. Put your people on the right projects, where their portfolio of skills and unique contributions will be most recognised.
Getting started with skill-based approaches
So with that in mind, how can you begin the journey?
The first step is knowledge. There are a lot of different terminologies out there, from the SBO to skill frameworks and skill taxonomies. Get your head around the nuances between each term, so you know exactly what vendors and industry influencers are talking about.
Secondly, understand what the SBO will look like in your company and the benefits it will bring. Identify your use cases and potential returns, as this will build your argument when you propose it to senior stakeholders. Also, work on your internal communications around the shift to skill-based, and consider what it involves for your workers and how it benefits them. You’ll need widespread buy-in for it to be a success.
Finally, once you’re ready to take practical steps towards becoming skill-based, you need to do your foundational work. This involves consolidating all of your skill data and then setting up your skill taxonomy and framework. Some organisations might leapfrog this stage and go straight into a use case like a talent marketplace or recruitment, but they will eventually have to return to doing this groundwork to make their skill-based processes scalable. Therefore, it’s better to do this from the start if you’re beginning from scratch.
