Skills Gap Analysis: Definition, Benefits & Methods
A skills gap analysis is the process of identifying the skills your organization needs and comparing them to the skills your employees currently possess. This method is essential for understanding workforce strengths and uncovering areas for improvement. Addressing skill gaps not only enhances operational efficiency but also ensures your business remains competitive in an ever-evolving market. In this post, we’ll define skill gap analysis, explore its benefits, and outline actionable methods to help you close those gaps effectively.
What Is a Skills Gap?
A skills gap occurs when an organization requires certain skills that its employees lack. For example, imagine your business experiences a surge in growth, and you want to launch a marketing campaign. However, none of your current employees possess marketing expertise. This gap forces you to seek external assistance, often at a higher cost than training or reskilling existing employees. Learn more about skills management.
The same applies to technology—a domain where skills gaps are especially common. Without a clear understanding of your workforce’s capabilities, you may be unaware of existing gaps, leaving your business vulnerable to inefficiencies or missed opportunities.
Why Conduct a Skills Analysis?
A analysis offers several benefits to align skills:
- Improved Workforce Planning: Helps you understand the skills your team needs now and in the future.
- Cost Efficiency: Reskilling employees can be more affordable than hiring new talent.
- Enhanced Productivity: Employees equipped with the right skills perform tasks more effectively.
- Future-Proofing: Prepares your organization for technological advancements and market shifts.
Methods for Conducting a Gap Analysis
Performing a skills gap analysis doesn’t have to be overwhelming. Here’s a step-by-step guide to get started:
- Identify Current and Future Skills Needs
Begin by listing the skills required to achieve your business goals. Consider both present needs and anticipated future demands driven by technology or market trends. - Assess Employee Skills
Use tools such as surveys, self-assessments, or performance evaluations to gather data on your workforce’s existing skills. - Compare and Identify Gaps
Match the skills your employees possess with the skills needed for current and future roles. Highlight areas where deficiencies exist. - Create an Action Plan
Develop a strategy to bridge the gaps through upskilling, reskilling, hiring, or leveraging external expertise. Ensure the plan aligns with your overall business objectives.
A Simplified Approach
Skill gap analysis doesn’t need to be overly complex. By taking the above steps, every organization can gain insights into their workforce and address areas for improvement. Here’s a quick example: If your company plans to adopt a new software system, assess whether your employees have the technical skills to use it effectively. If not, schedule training sessions to ensure a smooth transition.
The Bottom Line
A skills gap analysis is a critical tool for maintaining a competitive edge. By identifying and addressing skills gaps, organizations can operate more efficiently, enhance employee productivity, and prepare for the future. The process may require effort, but the payoff is invaluable.
Don’t let skills gaps hold your business back—start your skills gap analysis today and position your organization for long-term success. Use a skills inventory tool to simplify the process of a gap analysis.
To learn more about skills, check out the Brandon Hall Group
Examples of Skills Gaps in the Workplace
One of the biggest benefits of gap analysis is that it uncovers the weaknesses that exist within your company. Examples of skill gaps in the workplace include inadequate or obsolete skills in technology, out-dated ideas on workplace inclusion, lack of strong leadership skills, lack of effective communication skills, and lack of soft skills such as management, flexibility, and critical or creative thinking.
Even the strongest companies may be surprised to find, upon analysis, that they have widening skills gaps. This often happens simply because the nature of work, especially in science, technology, and medicine, is continuously advancing. As a hiring or HR manager, you may feel your hiring practices preclude the need for upskilling and reskilling of your existing workforce, but more often than not, these gaps exist where you least expect to find them. This is why it’s vital to perform a routine skills gap analysis at somewhat regular intervals and to devise an effective strategy for addressing gaps where they exist.
Business News Daily has identified several critical industries in which skills gaps are widening exponentially. They include:
- Cybersecurity
- Machine learning
- Cloud migration
- Big data
- Advanced manufacturing
- Computer technology
If your organization relies on one or more of these industries, you may be harder hit by widening skills gaps than you foresee. Therefore, it’s more important than ever to invest in analytical tools, such as skills gap analysis, if you hope to remain competitive in a 21st century world.
Skills Gap Analysis Tools
In reality, there are multiple ways to measure the competencies of employees, but computer programs are the ideal skills gap analysis tools. And the best programs allow the employee to see where their own skills are lacking and take steps to fill in the holes. This type of software goes hand-in-hand with career-pathing, and it’s a very effective tool for closing skills gaps. Mostly, because workers can see, first-hand, where they lack experience and what benefits they can reap by correcting the deficiency.
The right software can collect data, interpret data, make predictions, and identify areas for improvement. It can give you a detailed skill gap analysis report that drills down on the exact skills you need to nurture. Using this valuable information, you can then devise methods for closing skills gaps in critical areas through a variety of tools and methods, such as: Training sessions, mentors, internships, employee development tools, employee certification classes.
There are as many methods of closing skills gaps as there are of measuring them. But skill gap analysis tools such as a skill gap analysis questionnaire and career-path software must be utilized before resolution can begin.
If you own or manage an organization that you’d like to see flourish over the next decade, now is the time to begin thinking about and addressing skills gaps. Tomorrow’s jobs could look vastly different from today, requiring innovation and a flexibility previously unknown. Make sure your company is ready to hit the ground running by assessing the skills and competencies your employees have and comparing them with the skills your company will need going forward. A skills gap analysis is the most logical place to begin.
