Reasons to Embrace a Skills-First Strategy

In today's rapidly evolving business landscape, companies are under pressure to acquire the skills they need to stay competitive.

Traditional hiring strategies are becoming less effective due to a global talent shortage and the extensive skill development required for nearly every employee.

These old methods are not only unsustainable but also financially impractical. This brings us to the critical question: Build vs. Buy?

The financial well-being of businesses hinges on their ability to swiftly adopt the latest technologies and continuously develop new skills.

Why Companies Should Adopt a Skills-First Approach

A skills-first strategy prioritises skills over traditional qualifications and can be transformative for organisations in several key areas:

Skills: Closing Skill Gaps and Overcoming Talent Shortages

1. Unlocking Hidden Skill Pools: Companies often overlook the untapped potential within their existing workforce. A skills-first approach can reveal these hidden skill pools, allowing businesses to make better use of their current employees' capabilities.
2. Breaking Down Formal Education Barriers: By removing the requirement for formal university degrees, companies can access a broader talent pool. This includes individuals with non-traditional backgrounds who possess valuable skills gained through alternative education or work experiences.
3. Structured Skill Development: Providing a clear framework for internal skill development helps companies address their specific skill shortages more effectively. This approach encourages continuous learning and upskilling among employees, fostering a culture of growth and adaptability.

Productivity: Maintaining High Productivity Levels

1. Easier Access to Specific Skills: A skills-first approach ensures that employees with the right skills are readily available for individual projects, enhancing project efficiency and outcomes.
2. Streamlined Task Deployment: Organizing teams based on skills rather than traditional roles allows for quicker and more efficient task deployment. This flexibility can significantly improve response times and project completion rates.
3. Enhanced Motivation and Engagement: Employees who feel their skills are valued and utilized are more motivated and engaged. This, in turn, boosts overall productivity and job satisfaction.

Retention: Fostering Internal Growth and Opportunities

1. Learning from the Great Resignation: The post-Covid wave of resignations has shown that lack of opportunity is a factor of driving your current employees to leave. A skills-first approach addresses this by creating more internal opportunities for growth and advancement.
2. Retaining Top Talent: Research indicates that 80% of workers who moved to new roles switched employers because they couldn't find opportunities internally. By providing clear paths for skill development and career progression, companies can retain their best talent.
3. Providing Choice and Growth: When employees have the chance to develop new skills and advance their careers within the company, they are more likely to stay. This approach builds loyalty and reduces turnover rates.

Additional Benefits of a Skills-First Strategy

Agility:

Companies can quickly and efficiently deploy new projects and teams as needs arise. This agility is crucial in today's fast-paced environment, where the ability to adapt and deploy to changing demands can be a significant competitive advantage.

Innovation:

There is a positive correlation between workforce diversity and innovation. Research by the World Economic Forum (WEF) shows that diverse teams are more likely to bring innovative ideas and solutions. A skills-first approach promotes diversity by valuing varied skill sets and experiences, leading to a more innovative and dynamic workforce.

Relevance to the Future Workforce: Gen Z and Gen Alpha

As we look to the future, it's essential to consider the upcoming generations that will soon dominate the workforce: Gen Z and Gen Alpha. These generations bring unique characteristics and expectations that align well with a skills-first strategy.

Gen Z (born 1997-2012)

1. Digital Natives: Gen Z has grown up with technology and is highly adept at using digital tools. A skills-first approach that emphasises continuous learning and tech-savviness resonates with this generation's strengths and experiences.
2. Desire for Continuous Learning: Gen Z values opportunities for personal and professional development. They are eager to learn new skills and seek employers who provide clear paths for growth and advancement.
3. Preference for Flexibility: This generation values flexibility in their work arrangements. A skills-first strategy allows for more dynamic and adaptable roles, meeting Gen Z's preference for varied and flexible work experiences.

Gen Alpha (born 2013 and later)

1. Future-Proofing the Workforce: Although still young, Gen Alpha will enter the workforce in the next decade. Preparing now by adopting a skills-first approach ensures that businesses are ready to integrate this highly tech-savvy and innovative generation.
2. Adaptability and Lifelong Learning :Gen Alpha is expected to be even more adaptable and accustomed to rapid technological changes. A skills-first approach that fosters lifelong learning and adaptability will be crucial to engaging and retaining this future workforce.
3. Emphasis on Diversity and Inclusion: Growing up in an increasingly diverse world, Gen Alpha will likely place a high value on diversity and inclusion. A skills-first strategy that promotes diverse skill sets and experiences aligns with these values and can attract top talent from this generation.

Action: The time to rethink and restructure your skills strategy is now.

Adopting a skills-first strategy is not just a trend; it is a necessity for businesses aiming to thrive in the modern economy. By focusing on skills over traditional qualifications, companies can close skill gaps, maintain high productivity levels, and foster a culture of continuous growth and innovation.

This approach not only addresses the immediate needs of the workforce but also prepares organizations for future challenges and opportunities.

The future workforce, composed of Gen Z and eventually Gen Alpha, will be more tech-savvy, adaptable, and diverse. Embracing a skills-first strategy now will ensure that your organisation is ready to meet the expectations and leverage the strengths of these upcoming generations.

The time to rethink and restructure your skills strategy is now.

Are you ready to embrace the future of work?

You've got this 😎✌️

Gem Hallett

miFuture Founder & MD

Only 19% of companies had a Skills Plan for 2024, if I can help with your Skills Plan for 2025, just let me know.