In an unpredictable climate, businesses are realising that skills are the cornerstone of effective people management. Roles-based structures and processes are giving way to skills-led approaches to learning, workforce planning and reward.
This was the theme of KPMG’s latest Future of Learning event. Hosted by Louise Scott-Worrall, Partner and Head of Learning Services, the session brought together L&D leaders from a wide range of sectors.
Speakers included our Financial Services director Matt Yerbury, on the role of data and AI in skills-based L&D; and Reward Consulting Partner Scott Cullen, who looked at how to integrate skills into reward programme design.
Understanding employees’ learning expectations
Louise began by sharing the headline findings from recent KPMG research on employees’ experience of workplace learning.
Our survey discovered a healthy appetite among staff to learn and improve. More than half (55%) want to enhance their performance at work. This rose to 79% in the legal services sector, and 70% in business and consulting.
Which begs the question: are organisations effectively enabling them to do so? We asked workers about how they access learning, and what they think about how it’s being delivered.
The results underline three key imperatives for employers:
1. Give people time to learn
‘Time to focus on training’ – cited by 44% of survey respondents – was the most pressing improvement staff wish to see in their employers’ L&D offerings. Employees want to be given the time and space to take on the skills that will boost their performance.
In part, that means creating a psychologically safe environment, where people are encouraged to learn, as several of our attendees pointed out. Asking for training shouldn’t be perceived as admitting to weaknesses, or as signalling that you have spare time to take on more work.
Instead, leaders must signal the value in taking time out to learn, and be open about the training they do themselves.
2. Make the right content easy to find
Relevant content was second on employees’ wish list (cited by 40% of survey participants). Yet only a fifth (22%) said they can find the appropriate learning in their workplace within five minutes.
This is worrying: if the appropriate training isn’t immediately available at the point of need, employees will simply go elsewhere. And ‘elsewhere’ means online.
More than three in five survey participants (62%) told us they’ve used external social media or online platforms to learn new workplace skills, and a fifth (20%) do so regularly. Obviously, businesses can’t control the quality or suitability of learning materials that staff find for themselves.
3. Offer a mix of learning approaches
There’s no one preferred way to learn among employees. Virtual workshops are the only format enjoyed by most workers (55%). That said, on-the-job learning (49%) and traditional, face-to-face courses (43%) are also fairly popular.
Clearly, firms must provide a flexible mix of delivery types and platforms if they’re to engage their people with learning. As an example, one guest explained that their organisation gives staff a choice between all-day training, or two hours a day over the course of a week.
Data and AI: underpinning the skills-led approach
Our previous Future of Learning event had examined the rise of the skills-led organisation in today’s fast-changing business environment. Continuing the theme, Matt explored the need to harness data and AI to become a skills-led workplace.
Skills data is the common currency between employees, learning and company strategy. As such, being skills-led means investing in your skills-data infrastructure; then deploying it to optimise learning, so that it meets employee expectations and strategic demands.
That requires a major, cross-discipline transformation, involving workforce succession planning, recruitment, resourcing, learning, mobility and reward.
Your infrastructure must be underpinned by a robust data foundation, made up of three core elements:
- Jobs-to-skills mapping, to enable you to translate jobs-based inputs (such as open positions) into skills-based ones (such as demand for skills)
- A comprehensive and accurate record of the skills needed to perform the jobs within the business – now and in the future
- An inventory of the skills possessed by your employees
The latest generative AI solutions are highly effective at mapping jobs to skills – putting the creation and management of skills-linked workforce architectures within reach.
At the same time, however, our attendees highlighted some data challenges they’re encountering as they move to a skills-led approach. These include overcoming inherent biases in their data; validating their skills data and proficiency levels; and reconciling disparate datasets. As one guest put it: “It’s difficult to get to a single source of truth”.
L&D leaders must work hand-in-hand with their CFOs to take a skills-led approach to learning. What’s more, they must make sure that the skills they’re delivering are in line with the business’s goals and ambitions. Ultimately, training must drive the behaviours that will achieve the right outcomes for the organisation – whether that’s delighting customers, improving retention and/or keeping costs down.
Case study
The benefits of taking a skills-led approach to workforce management.
Matt presented a compelling example of the benefits of taking a skills-led approach to workforce management.
KPMG recently worked with a life-sciences business, which was looking to fill 607 specialist biological, chemical and research science vacancies.
By analysing the firm’s workforce skills, we discovered that:
• 157 employees already had the relevant skills, and could possibly be redeployed to the vacant roles via the firm’s internal mobility programme.
• 339 had capabilities adjacent to those needed for the vacant posts, with the potential to be reskilled or upskilled for them.
As a result, only 111 posts would necessarily require an expensive recruitment process. This would save the company money and free up HR resource, compared to filling all 607 externally.
The rise of the skills premium
Scott finished the session by examining the case for linking reward to skills acquisition, and how organisations can make the connection.
In June, a KPMG pulse survey of HR leaders highlighted the continuing talent shortage facing businesses. Almost nine in ten (86%) said they’re finding it difficult to attract critical talent; 79% believe it will be even harder to do so in the future.
As a result, firms are paying upwards of 50% premiums for the scarcest skills – and that’s before global economic growth picks up.
Traditionally, businesses have linked reward to skills through grading structures. Each role is graded according to its size, with a salary range attached to each grade. Employees move up through the grades by taking on bigger roles, after developing new competencies, passing exams, or meeting performance criteria.
One shortcoming of this approach is a lack of explicit link between reward and skills development. As a result, firms’ reward data is typically job-based, rather than skills-based.
By contrast, skills-led reward is founded on an infrastructure that combines the conventional grading structure with:
- A job architecture which accurately reflects the organisation
- A set of core job descriptions and role profiles
- A skills taxonomy – which in turn links to:
- An inventory of employee skills (i.e. the supply of skills within the business)
- A map of the skills required to perform the various roles within the firm (i.e. the demand for skills within the business)
Crucially, a skills-based reward programme also requires a skills architecture, which enables the company to consider rewarding certain competencies by:
- Identifying ‘exceptions’ – skills that need to be treated differently
- Creating ‘premium’ salary bands – for the most in-demand capabilities
- Introducing skills premiums – for individuals who are learning those abilities
The premiums can be used to encourage the development of critical skills, and to retain key talent. They’re most frequently applied to technology roles, where demand for skills is highest, and there’s better skills-based pay data.
Skills premiums not only help firms to recruit in-demand skills; they also encourage the development of new capabilities. They signpost the sought-after abilities that staff must learn if they’re to earn the premiums.
In summary
Until now, learning has been a legacy purchase for many organisations. They’ve mostly bought the same content year to year, as the business’s skills requirements haven’t drastically changed over time.
But in today’s disruptive environment, that will no longer cut it. New skills gaps will constantly emerge as companies adapt to continuous change.
As they go on their reskilling journeys, firms must ensure they have the data and frameworks to identify these gaps and reward in-demand skills. And they must work with their suppliers to deliver the necessary learning.
While doing so, they must also offer the learning experiences their employees want. That will mean giving people the time and space to learn; and making the right content readily available, in a variety of compelling settings and formats.
