Assess employees on what they can do and not on their position

By focusing more on people's skills rather than their job titles, organisations are better able to adapt to the changing demands of the modern workplace and labour market. Marlene de Koning, HR technology and data specialist at PwC, looks at the benefits of a so-called 'skills based organisation' (SBO). 

There has been growing concern in politics and society about the shortages in crucial and rapidly changing sectors, such as healthcare, technology and environment. Developments such as digitalisation and climate change, and the shortage of trained personnel, mean that there is a gap between what employees are capable of and what organisations need for coping with these changes. 

PwC's 27th CEO Survey shows that 52 per cent of CEOs believe their industry's profitability will suffer significantly over the next decade due to the lack of employees and skills needed for fundamental business transformations. By emphasizing and developing employees' skills, organisations are not only working on a response to the tightness of the labour market. They also look for answers to social changes and challenges, such as the energy transition, rapid digitalisation and economic and geopolitical instability. 

An AI accelerated transformation

Artificial intelligence (AI) accelerates the transformation of organisations to a so-called 'skills-based organization' (SBO). New technologies enable organisations to manage talent in a different way: no conventional selection, analysis and planning based on diplomas, roles and job titles, but a more nuanced exploration of the specific underlying skills and competencies that each employee offers. 

By focusing on skills and embracing these technologies, organisations gain insight into where the required skills are located within the organisation. By knowing all the skills of employees, including the hidden skills, organisations can seamlessly deploy them where they add the most value at that moment. This offers organisations opportunities to meet their development needs and organizational goals, even across different departments. 

Skills mapping

An SBO fosters a culture of continuous learning, enabling employees to adapt to the dynamic and evolving needs of the organization. By accurately mapping skills and including them in forming strategy and decisions, more transparent promotion decisions and fairer rewards are created. In addition, recruitment is not simply based on CV and position, but on what employees can actually do. 

Like any change, the transition to an SBO also presents challenges. Some employees may be reluctant due to privacy concerns or simply because they are used to the old system. Leadership plays an important role in encouraging employees to be open to change and embrace the importance of skills. When an organisation embraces the importance of skills, a culture of appreciation and recognition is created. In this culture, employees are motivated to grow and contribute to the success of the organisation. 

A more inclusive future of work

The shift to an SBO, supported by AI-driven talent management systems, promises not only agility, but also a more inclusive future of work. It is not just a trend, but an evolution that brings organisations and employees together to confidently meet the challenges of the modern working world.