New Resource From McLean & Company Suggests Becoming a Skills-Based Organization Is Not Simple or Easy – HR Leaders Will Play Critical Guiding Role

According to new thought leadership research from global HR research and advisory firm McLean & Company, HR leaders must guide organizations past the enticing promises of the theoretical skills-based organization toward more realistic opportunities.

As the idea of a skills-based organization gains popularity, global HR research and advisory firm McLean & Company explains that becoming an organization that makes talent decisions through the lens of skills requires much more resourcing than simply updating current talent acquisition and management practices. In a new thought leadership resource for HR, What It Means to Become a Skills-Based Organization, McLean & Company explains that though a skills-based approach to talent management can come with benefits, such as improved employee retention and enhanced organizational agility, most organizations are not yet ready for this type of transformation. The path forward to skills-based decision-making is intentional and demanding, requiring support from HR to make realistic choices around the right approach for each organization’s unique needs.

McLean & Company, the HR division of Info-Tech Research Group, defines a purely skills-based organization as one that “makes all talent decisions through the lens of skills and skills intelligence, which is the ability to identify, grow, and leverage abilities at the individual and organizational levels.” The skills-based operating model is inherently agile and can pivot to address change quickly and effectively, but the shift from a job-based model requires a complete reconceptualization of an organization’s relationship with what work is.

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“HR leaders are influential decision-makers regarding the feasibility, appropriateness, and scope of a skills-based transformation,” says Jodi Callaghan, director of HR Research & Advisory Services at McLean & Company. “HR’s strategic interpretation of the sensationalized promise of skills enables organizations to translate the noise into realistic opportunities for the organization. Presently, a fully skills-based organization is an idea rather than fact, with most organizations using a traditional job-based model. However, operating models exist on a spectrum, with the lesser-known skills-aware model offering a more attainable option for many organizations as they look to shift toward an increased focus on skills. Becoming skills-aware leverages skills in some HR practices, with opportunities given to employees based on skills, potential, and career goals, and bridges the gap between job-based and skills-based models.”

To help HR leaders navigate the intentional and demanding path to skills-based decision-making, the global firm has organized the new resource into four easy-to-follow sections. The sections, which are outlined below, have been designed to help HR understand the variations of what it means to be skills-based, what the potential outcomes are, and what organizations need to know to complete the transformation.

1. Overview. Section one of the firm’s resource explains the theory and foundation of skills-based organizations, the associated spectrum of operating models, and the organizations best suited for this type of transformation.
2. Draws and drawbacks. Section two highlights what is influencing the re-popularization of the idea and promise of skills-based organizations as well as potential unintended outcomes of becoming skills-based.
3. Obstacles to transformation. Section three outlines the challenges of moving along the skills-based spectrum and how organizations can be proactive when planning to address them. HR leaders will also find guidance on current philosophies of work, challenges with evaluating skills, the relevance and half-life of certain skills, and the current and future states of skills intelligence.
4. Visualize the future. Section four provides sample questions to determine the organization’s readiness for transformation, presents real-world examples of organizations with effective skills-based practices, and covers the fundamental conditions required for change. The final section also offers a list of resources to support movement along the skills-based spectrum.

While some organizations are motivated by a sense of urgency and the unique set of challenges they face, McLean & Company advises HR leaders that organizations must first meet some fundamental conditions before moving along the skills-based spectrum, such as leadership buy-in, cross-functional collaboration, and resourcing. Regardless of why an organization is looking to become more skills-based, these fundamental conditions are crucial. Desire and will alone are not enough to move along the skills-based spectrum.

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