Skills gap analysis: what is it, pros and cons

A skills gap analysis is an asset that HR (Human Resources) professionals can use to understand how employees contribute to the organization. If you are in HRs or any other leadership role, understanding how a skills gap affects your organization can be highly beneficial. 

But why is this important? What are its pros? And its cons? How can a skills gap analysis help my company or me? 

Let’s give it a thought.

What is a skills gap analysis? Defining the term

Before knowing what a skills gap analysis is, it is necessary to understand where these gaps come from and the skill gap definition. 

A skills gap, or skills shortage, is the difference between an employee’s skills and the skills your company wide requires for a specific role. 

A skills gap analysis is a tool that allows you (or your organization) to identify the different skills and abilities that employees need to meet specific job requirements or to perform certain tasks more effectively.  

In addition, a skills gap analysis provides a quantitative approach for hiring qualified professionals who meet your needs. It also helps to determine how to structure training programs that support employee skills development.

How to perform a skills gap analysis?

The HR team of an organization is usually in charge of initiating this type of analysis, although the team leader or manager carries it out.

At first, it is necessary to assess whether it is an individual-level analysis (i.e., affecting individual employees) or a group-level analysis (work group or project).

• If it’s performed at an individual level, it is more straightforward. As we have already mentioned above, it will be a matter of determining the skills that the organization requires and whether an employee meets or can achieve them. 
• If it’s performed at a group level, the generic skills of the group will be assessed, and if we cannot find the desired skills in the group, we will have to look for external recruitment. 

Identify your organization’s needs

Use your organization’s needs to help you determine the skills and qualifications required to meet your business objectives. For example, identify what skills your organization relies on and use this information to assess what skills your organization will need for your future goals.

Assess current staff competencies

Once you understand your organisation’s current and future skills needs, assess your staff’s current skills. 

How can this be done? You could use:

The results will provide insight into employees’ skills to meet business objectives more effectively.

3. Identify what skills employees need

Use the results of your analysis to identify the areas where your team will need to improve to close the skills gap. 

4. Create learning and development plans… or hire.

The information gained from the skills gap analysis can help you create and implement improvement plans. With the data from your assessment, you can determine what kind of training programs, workshops, or courses your team can benefit from learning.

Also, the skills gaps in your organization might be too wide to minimize with training. Then, you can consider hiring to bring new knowledge and skills to your company.

Pros and cons of skills gap analysis

Pros and strenghts

In addition to the obvious benefits discussed above, this type of analysis can also help your organization to:

1. Achieve competitive advantage: a skills gap analysis can lead to improved business processes, higher productivity, and quality products or services. These factors are essential to help a company gain a competitive advantage in the marketplace.
2. Create new training methods: you can use the obtained information to create alternative branded approaches to employee training. For example, if you determine that your company’s training program isn’t helping employees fill skills gaps, you can implement alternative methods.
3. Streamline contracting processes: the information gained through a skills gap analysis can help you make your organization’s hiring process more efficient by allowing you to target only qualified candidates for specific jobs.

Cons of performing a skills gap analysis

Even with the many advantages of a skills gap analysis, there can be some drawbacks to conducting it:

1. Negative impact on employee mood: for an employee, observing the various gaps between the job requirements and their experience can sometimes negatively affect their mood. If this is the case, your organization should encourage them to see development as an opportunity to learn new skills that will help them succeed in the future.
2. Production costs: conducting a skills gap analysis could increase your costs. This is because employees often stop or interrupt their productivity while participating. 
3. Application period: depending on the size of your organization, this type of analysis can take a long time. Thus, it is advisable to perform a skills gap analysis in short blocks of time.

Conclusion: an interesting resource to close the skills gaps among your employees

Assessing the skills of your organization’s employees is something you should regularly implement to identify those that can be improved through training. 

It’s also an opportunity to discuss each employee’s career path and the skills they feel they need to strengthen.

Don’t forget that SMOWL tools for companies can help you carry out fairer and remote evaluations, which will benefit your employees’ work-life balance. Also, it could help you supervise online recruitment processes in case you need to hire to fill some of the gaps.