What is the best way to identify skill gaps in your workforce?


Skill gap analysis can be conducted at an individual level as well as at a company level. It allows the organization to identify where the gap exists and work on it.

skill gaps in workforce - vector image of a guy jumping between gap

Skill gap analysis: Skill gap analysis is a procedure to identify the gap in the skill of the workforce which results in the reduction of performance. The skill gap analysis allows the organization to identify where the skill gap exists and work on it.

Properly identifying the skill gap is of strategic importance for any organization. The required skill to achieve the goals of the organization should be identified and corrected using the skill gap analysis. 

Skill gap analysis can be conducted in three steps such as planning, identifying important skills and measuring the current skills and acting on the data to improve the skills to achieve the goals of the organization.

The skill gap analysis should be conducted when the organization feels that the goals of the organization are not met and the reason for this should be found out. 

Steps to conduct skill gap analysis:

There are 3 steps to conduct the skill gap analysis. In the first stage there should be a proper planning of the things to be identified and compared with. The skill gap analysis can be conducted at an individual level as well as at a company level.

Once the planning is done the next stage is to identify the important skills required for the job among the individuals or for the company. In the next step these skills should be compared with the existing skills of the individuals and assess if these skills match the requirements of the company.

If the skills are in deviation from those of the required skills, then it is important to take necessary steps to reach the desired skills in the organization to reduce the skill gap. The reduction in skill gap increases the productivity of the individuals as well as the organization as a whole. 

Step 1: Start internal conversations about skills:

The first step in the skill gap analysis process is to understand the skills required for doing a particular job. These skills should be identified at the organizational level and should be clearly defined and mentioned.

The skills can be the Key Performance Indicators (KPIs) that are required to do the job perfectly. The skills necessary for the effective functioning of the organization can be analyzed by answering the below two questions:

  1. What skills do we need in our organization and what kind of skills do we value?
  2. What skills do the employees in each and every department need to do their job perfectly?

Once the skills required to achieve the goals are identified then it is important for the organization to proceed to the second stage of the skill gap analysis process. 

Step 2: Identify future skills needed in your industry:

The second step of the process is to identify the skills that are needed at present and in the future. The company may have a vision about its growth in the future and the employees should be aligned to the growth by analyzing if the employees are having the required skill to achieve the set targets in the future. 

This is of utmost importance as the organizations need to look into the future and plan for the future as the growth needs to happen for the sustainability of the firm and the growth happens only when the planning for the future is done with utmost care.  

Step 3: Measure existing skills:

After the existing and future skills required are identified, then in the next step it is important to measure those skills to understand the gap. The skills can be measured using the surveys or assessments, interviews with the employees, feedback from the performance evaluation process and other skill management software available in the market. 

Response to Skill Gap Analysis:

The next big thing to be done after the skill gap analysis is to provide the necessary skills to the employees required to achieve goals in the long run as well as the short run.

  1. Training programs: Training programs can be conducted to provide the required skills for reducing the skill gap. 
  2. Succession Planning: Succession planning can also be done to identify the employee that would replace the existing employee who would generally have all the required skills to achieve the goals of the project. 
  3. Mentoring initiatives: The other response to the skill gap analysis could be mentoring the employees with some senior employees to decrease the skill gap. 
  4. Hiring: The last option that can be chosen to reduce the skill gap is to hire employees from outside who can bring the necessary skills to the organization. 

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Susheel Agarwal

Namaste. I'm Abhinay Nedunuru, a Fellow of the Insurance Institute of India with a passion to make insurance simple and crisp. I write on insurance and investment. I have a passion for teaching and training in particular to insurance. I'm currently doing my PhD from IIM in Management.