December 13, 2022
General
7 minutes
Masooma Memon

How to Perform a Skills Gap Analysis in Your Organization

Want to make better upskilling and hiring decisions? A skills gap analysis will give you a baseline understanding of where your team is at - from there, smarter decisions await!

For any business to survive and thrive, it’s essential to build a skill pool that covers all critical skills you need - plus the skills you need to progress, innovate, and futureproof. 

A workforce with a strong skill set can help you steer through every challenge. Meanwhile, a undertrained, underinvested-in workforce may - with the best will in the world - simply just not be able to deliver the results you need to navigate an unpredictable business environment

So, the question is how can you build a skill set that sets you up for success? The short answer: conduct regular skill gap analyses. As for the long answer — this guide covers it all.

Here’s what you’ll learn today:

Let’s dive in. 

What is a skills gap analysis?

A skills gap analysis is a technique you can use to identify the gap between the current skills employees have, and the critical skills a business needs for employees to work on its projects. This refers to the projects currently in the pipeline, and projects that the company plans to take on in the future based on its vision and direction.

What are examples of skill gaps?

Employees may have gaps in hard skills that they need to complete certain tasks, and these are often easy to identify. Examples of these hard skill gaps include not knowing a particular coding language, not knowing how to write technical documentation, or not knowing how to use a particular software.

However, hard skills are often straightforward to acquire with the right training and certification. The soft skills that improve company culture and work quality are often lacking, and these are frequently more challenging to develop. 

Some examples of these soft skill gaps include a lack of skills like teamwork, attention to detail, critical thinking, time management, and communication. 

Why should you conduct a skills gap analysis?

From improving your hiring process and giving you a competitive edge to boosting employee motivation, there are lots of benefits to conducting skills gap analyses. Let’s look at these perks in detail:

  • It engages employees, increasing their dedication to work

87% of millennials and 69% of non-millennials say learning and development opportunities are important to them in a job. The results of a skills gap analysis give employees the opportunity to learn and develop their skills, and so it can improve their motivation.

  • The analysis helps you maintain an up-to-date resource inventory

A resource inventory is a log of all the people working with you and the skills they possess. It’s used to assign work based on each employee’s skill set. You can also pick out the best team for a high-priority project or client using the resource inventory.

In addition, by giving you an overview of the available skills, a resource bank helps with strategic workforce planning. Use it to identify lacking skills and set new hiring requirements.

But this inventory is only useful if it reflects the new skills employees learn in their job. If you don’t have a system to regularly update your workforce’s skill set, a skills gap analysis is the starting point that will help you build an updated resource inventory.

  • It keeps your business at pace with new technological advancements

There’s no recipe for a specific set of skills that can drive your business to success throughout its lifetime. Instead, as your company matures and new technology emerges, you need new skills to drive success through fresh challenges.

Think of it like this: a decade and a half ago, print media dominated. But digital media dominates today — requiring reskilling to leverage it for growth. In fact, it’s only recently that TikTok and short-form videos have gained prominence in marketing. As a result, businesses now need video marketing skills in their resource bank. 

  • A skills analysis gives you a competitive edge

Identifying talent gaps helps with resource and skills management, strategic planning, and employee engagement. Its aim is simple: assisting businesses in creating a skill pool that keeps them on top of their game.

Put simply, the workforce that you end up creating because of skills gap analyses is a ready-to-conquer-it-all force that faces challenges head-on and drives the company to success.

Naturally, all these benefits give you an edge over your competitors.

When to conduct a skills gap analysis?

Generally, conduct a skills gap analysis when there’s a change in your business strategy or when there’s a change in employees’ responsibilities.

Essentially, determining when you need a skills analysis depends on the type of assessment you’re conducting — individual level or team/company level.

Conduct individual analyses when there is:

  • A change in an employee’s job responsibilities
  • You’ve promoted them or assigned them a new project
  • Their performance review turns out poor

Similarly, conduct a team or company analysis when there are:

  • Strategy changes
  • You’re using new technology
  • You’re consistently failing at meeting defined business goals

Software vs spreadsheet: What to use to conduct an effective skills gaps analysis?

Before we dive into the meat and potatoes of “how” to determine a skills shortage, let’s address the elephant in the room: the tools you need.

You can always use a spreadsheet to record, organize, and manage the current and future skills of your talent pool. However, this process is manual and can quickly become a time sink.

A skills spreadsheet also does little for resource allocation. And it doesn’t make it easy to conduct the next talent gap analysis down the line.

A better alternative is using a resource management platform that has built-in skills analysis features, like Runn. The tool is a winner in the following three main ways:

Runn makes it easy to track skills

You get a visual skills inventory, showing you all the available skills in your current workforce. You can view them as a list when you view your inventory by Skills.

You can also easily see what skills each individual possesses when you view your inventory using the People tab.

It speeds up future skills gap analyses

Not only does Runn make it easy to analyze current skills, but it also lets you add, edit, and delete skills whenever you want. This makes managing a skills inventory simple - which, in turn, makes it easy to maintain an updated skill sheet.

In fact, for the subsequent skill gap analysis you do, use the up-to-date skill sheet to identify which future skills your business needs to close skills gaps — no need to assess current skills all over again.

The tool assists in assigning work to resources

Lastly, Runn shows you each employee’s skills when you’re assigning work for projects or determining the best resources to work on a new project.

To do so, hover over the diamond icon next to a person’s name in the planner. This will show you their skills, and their proficiency levels in those skills.

How to do a skills gap analysis with Runn in 3 Steps

Conducting a skills gap analysis is pretty straightforward in principle. Anyone from an HR lead to a team manager can identify skills shortages on the business-wide or team-wide level, respectively.

The one thing to be mindful of though: identifying the current skills and creating a list of desired skills can be quite time-consuming if this is your first time.

Also, this is not a one-and-done job. Meaning: you need to conduct skills analyses regularly. But once you’ve put in the legwork in creating a skills inventory in a resource management software like Runn, analyzing needed skills becomes a breeze — more on this below.

With that, here are the steps you need to follow for an effective skills gap analysis: 

Step 1: Make a list of employee skills important to you

Look at three things to identify skills that are most important to you as a business:

  • Your objectives
  • The business vision
  • Job descriptions

Admittedly, job descriptions may not accurately cover all the required skills, or they may be outdated. A better option then is talking to team leads to learn what skills are truly necessary for their teams to get their job done.

And if you don’t already have clarity on the business objectives and vision — in short, where the company is headed for serving its customers — talk to the leadership team for a refresher. 

A software company selling a customer support solution, for example, may be focused on providing an excellent customer experience. In that case, important skills for them could include: empathy and listening, adaptability, relationship building, and communication among others.

Besides talking to team managers and business stakeholders, survey employees to learn their insights on which skills are important to get their job done (regardless of whether they have that skill or not).

Involving employees in the skills analysis process from the get-go engages them — something that’ll pay off in the last step when you’ll take steps to fill the gaps in your talent pool.

Step 2: Identify skills in your current employee pool

For those of you conducting skill assessments for the first time, this step will take some work.

While team leads can possibly list out hard and soft skills a team member has, an objective skills analysis comes from:

  • Studying feedback from performance reviews
  • One-on-one conversations with employees to learn their strengths and shortcomings

All the work that you do here will eventually give you a skills list for each employee. Create and assign these skills to employees using Runn in the following manner:

  1. Head to Manage from the top menu bar on the Runn dashboard
  2. Select Skills and click on New Skills
  3. Type out the skill you want to add (you can add multiple at a time)
  4. Hit Add
  5. Click on + Add People on the created skill row and add people with the skill by clicking on the check box beside their name

Pro tip: Add a skill rating or skill level in Runn to each person as you add skills. You’ll find the skill proficiency drop-down scale beside the checkbox you use to add the skill. This will show you each employee’s level of expertise with that skill (for instance, someone who speaks basic conversational French vs. a native or bilingual speaker).

 

And if you have already created a skills list, you can simply import it into Runn as a CSV to better organize and manage employee skills.

Step 3: Identify the gap in skills and create a plan to fill the shortage

With the visual inventory of available skills (use the Skills tab to view the list in Runn) and the required skills list side by side, pinpoint missing skills lacking in your team.

Now create an action plan for how you’ll fill the needed skills gap. Two ways to go about doing this:

  • Train employees to help them develop important skills

Organize external workshops and training sessions in your workplace to train employees in the desired soft and hard skills. Create opportunities for them to attend industry conferences and events to learn. 

You can also enroll employees in online courses - there are an enormous number of courses out there, and so you're bound to find something appropriate for the skills your team needs to develop.

Lastly, you can also encourage peer-to-peer learning. Since 55% of employees turn to their peers to learn something new, this approach is a pretty effective one. Start by looking back to the skill levels you assigned to each employee to pick out the ones who are strong at certain skills, and then ask them if they would be able to give internal workshops to educate their colleagues.

  • Hire new talent or work with external talent

Use this option if you find there’s a skill gap that can only be met by hiring new talent.

An effective way to hire for skills gaps is to tap into your network by putting out a call for people with the required skill sets. You can also use LinkedIn to find people for the exact skills you’re looking for. 

Use Runn today to conduct an efficient skills gap analysis

In summary, a skills gap analysis boosts employee motivation and gives you a competitive edge.

But it’s not a one-time thing. Instead, after you’ve conducted your first analysis using the steps we’ve shared above, continue keeping an up-to-date skills inventory in Runn that lets you add, delete, and edit skills that each employee possesses. As you work with employees to refine their skills, adjust their skill levels in Runn. 

All these features make it easy to conduct a skills analysis and record the results of the steps you take to fill the skills gap. 

So what are you waiting for? Try Runn for free today to log your employees’ current skills and identify gaps in the skill pool.

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