5 Steps to Conduct a Skills Gap Analysis

Skills gaps - discrepancies between the capabilities required by an organization and those provided by its workforce - are a pressing problem for many businesses around the world.

The Skills Gap 2019 study from the Society for Human Resource Management highlights:

• 83% of HR professionals in the US struggled to recruit suitable candidates in the previous 12 months
• 75% of those reporting hiring difficulties said there were skills shortages among applicants
• 52% felt talent shortages had become more acute in the past two years

Other countries are experiencing similar difficulties. Research in the UK last year showed that 68% of employers struggled to find the skills they need in the previous 12 months, at a total cost to businesses of $5.5 billion (£4.4 billion).

To address this problem you need to understand its severity. This requires a skills gap analysis, which you can complete by going through the following phases:

1. Plan

This is the stage where you answer some of the most important questions about how the skills gap analysis will run, such as:

• Will it function on an individual or a team/organizational level?
• Who do you need to speak to, from the C-suite all the way down to frontline employees?
• Who will lead the project?

If you plan to run the analysis on an individual level, the process will involve identifying the competencies required to fulfill a certain role and judging whether a member of your workforce can provide these abilities.

Taking a broader approach that focuses on teams or the organization as a whole will require more time and resources, but could yield results that inform wider business strategy and help you overcome long-running challenges.

2. Identify required skills

In order to pinpoint areas where skills are in short supply, first, you must have a strong understanding of the knowledge and capabilities the company needs the most.

To identify the key skills you need, you should look at the organization's current strategy and what it wants to achieve in the future. This will make it easier to decide which attributes you need to reach these targets.

For example, if the firm has ambitions to expand into new geographical markets, do you have the necessary local understanding and competitor insights to maximize your chances of success? Do you have the right experience at management level to guide teams and the workforce through what could be a particularly busy and challenging time?

The digital skills gap is a particular concern for many businesses, so it's worth considering if you can access the tech expertise you need to meet customer needs and thrive in the modern era.