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How to develop a skills gap analysis

by Tom Shields

Learning and development strategies , Leadership and management

You know skills gaps are costing your organisation but what can you do about it? Employers must develop actionable strategies to reduce these on-going revenue vacuums. A skills gap analysis is required to focus on retaining talent as well as rapidly adding additional skills and competencies to the workforce.

What is a skills gap analysis?

A skills gap analysis is a simple formula to determine the variances between existing and desired skill levels in an organisation, team or individual:

 

Skills needed - Skills possessed = Skills gap

 

The solution can be to either hire new talent to close the gap through updated recruitment profiling or, offer training to close the gap, creating employee training programmes to help existing team members develop the skills identified as missing.

Why should you use a skills gap analysis?

A skills gap analysis should be conducted when there is a gap in current performance versus potential performance. It’s an incredibly useful tool to get the pulse of the company at a granular level. It may provide some harsh truths, however, if it is embraced and actioned, can reap enormous benefits to productivity, performance and employee engagement.

 

Deloittes 2019 Human Capital Trends Report quantifies upskilling the existing workforce to fill a skills gap as “Internal Mobility”, from their respondents, they conclude:

 

“Thirty-eight percent are looking at internal mobility to build better leaders, 31 percent cite the need to expand the business, and 32 percent believe mobility is required to increase employee engagement.”

 

There is a shift towards making skills gaps smaller in industry today, it’s estimated that it is costing the UK an extra £6.33 billion a year in recruitment fees, inflated salaries, temporary staff and professional training for workers hired at a lower level than intended. 

How to create a skills gap analysis

When you begin to identify skill gaps, you first need to understand what kind of skills you are assessing. Are they company values or, job description criteria, for example:

 

Organisational values and mission goals, your values may value something like effective communication, this is a difficult skill to test, so using things like appraisals and interpreting additional data effectively, like a combination of questionnaires. 1:1 notes, performance reviews, meeting minutes or any other documents can provide an objective score.

 

Competency based skills, each job role may require a more specific skill set, MS Office skills for management and SQL skills for technicians for example. These are more tangible and will help the individual in their current role to be more productive. These can be scored best via testing, appraisals and self assessment. 

 

The answers should be scaled numerically or using likert scale, offering a deeper level of how much training is required. Scales are important when assessing skills as the ability to interpret them effectively makes better use of training and development resources as interventions can be targeted.

 

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Skills gap analysis template

 

A simple template can be developed to capture possible skills gaps.

 

  1. Identify the skills required from a top down organisational level
  2. Give each skill an importance level
  3. Rate each skill level as its required

 

Once these are all marked out, begin assessing each job role in batches, managers, front line support, all levels, until you have a score for everyone.

 

  1. Have each person score themselves
  2. Have each person’s manager agree or disagree

 

This will give you an objective, truthful assessment of each skill. From there, work out where the skills gaps are (even colour code the hot spots).

 

SKILLS GAP ANALYSIS

Desired Skill

Importance

Required Skill Level

Name

Actual Skill Level

Skills Gap

C sharp

High

4

Jacob Blythe

1

3

Julie Paley

4

0

Sian Lee

3

1

 

 

 

 

 

 

An analysis exercise like this will inform your decisions on what training to schedule. You’ll have a clear picture as to where the skills gaps have the largest variance, and where a learning intervention will be most impactful. A gap differential of 1 can be addressed informally through merely highlighting it as a focal point, a differential of 4 on the other hand would require an immediate intervention.

Your skills gap analysis template can be modified as you see fit, to give you the granularity and breadth of data required.

“64% of managers don't think their employees are able to keep pace with future skill needs. Furthermore, 70% of employees say they haven't even mastered the skills they need for their jobs today.”

Bridging the skills gap, Gartner.

Analyse the analysis

Now that you have a quantitative data, you will be able to quickly see where the strengths are in the organisation, which employees stand out as leaders and can be benchmarked.

 

Identifying the weaknesses of an employee failing to meet the required skill set gives the ability to suggest tailored ways to improve. If there is too big a variance then it is time to decide whether you can build the skills by training or it's time to fill the position by recruiting someone who already has those skills.

 

It doesn't have to be all about "shrink to grow" though, when employees become aware of their weaknesses then they can attempt to improve them. As a result, they can improve and perform better than others. This is even great for advancement opportunities, a robust skill gap analysis offers a clearly defined route for professional improvement.

 

It culminates in building effective agile strategies that can identify future threats that could intervene with the growth of the company. Filling the gaps, whether it is through new staff, or as a result of a learning intervention is excellent to implement the actions required to meet business goals.


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Identifying skills gaps quicker through digital learning

Depending on the speed at which you need to conduct this analysis or the size of your organisation, you may not be able to scale a project like this quickly enough to make any meaningful impact. 

This is where digital online learning can help in being able to rapidly deploy, collect and analyse responses to give detailed data insight in a pre-set timeframe.

 

Verify - Detailed knowledge gaps highlighted

knowledge gaps

 

Verify from Logicearth is a fully managed agile microlearning service which can not only be deployed to rapidly scan all employees to identify skills gaps but also leverages spaced learning principles to conduct data driven, effective, skills based training programmes that transform learning expectations and guide strategic decisions within your organisation.

 

Verify dashboard

PowerBI - Dashboard - OttoLearn Microlearning V2

It will highlight precisely where the knowledge gaps are, giving you the objective assessment results you need to develop data-driven, effective training programmes that transform learning expectations and guide strategic decisions within your organisation.

Contact us to learn more about how to find, analyse and close skill gaps within your organisation.

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