GOING

SKILL
BASED
Rethinking Hiring
and Retention

3 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

 25% Skill sets required for jobs have changed
by 25% since 2015. And this rate is
expected to double by 2027.

TODAY’S
CHALLENGES 89% OF
LEADERSHIP
CALL FOR A DEVELOPMENT

89%
PROFESSIONALS
DIFFERENT agree that navigating
the future of work will

APPROACH
require proactively
building employee skills.

TO TALENT
MANAGEMENT

54% 54% OF
ORGANIZATIONS
are targeting workforce
Sources: , LinkedIn’s 2023 Learning Report, Gartner upskilling / reskilling to
create critical talent pools.

4 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

In an evolving and unpredictable business environment,
organizations continue to face key talent challenges.

SCARCITY AGILITY
Skills shortages stretch Workforces lack
across roles and the flexibility to
industries, with demand react quickly to
outweighing supply in change, inhibiting
critical areas such as business performance
digital and technology. and growth.

SOURCING DEVELOPMENT
Even if organizations Cultivating and
know what skills they developing the right
need for the future, they skills to support
don’t know where or how retention continues
to find candidates with to be a challenge.
those skills.

To counter these challenges, many forward-thinking employers are embracing a skills-based

approach to hiring and talent management, particularly in industries and functions hit hard
by talent shortages. As a result, there’s a rush to “future-proof” organizations by finding and
developing people with the right skills. But what does this approach look like in practice and
how can your organization use it to drive business success?

We will outline some of the potential opportunities and take you through a series of key questions
to ask when adopting a skills-based talent strategy. It’s time to start planning for a skills-based future.

5 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

WHAT
WHAT IS A SKILLS-BASED
APPROACH TO HIRING AND
TALENT MANAGEMENT?

ARE A skills-based approach to hiring

and talent management is about much
more than just changing the mechanics

SKILLS?
of your recruitment process or retention
practices. It’s an entire mindset shift in
how you think about people’s value within
your organization and their potential.

Historically, organizations have judged

potential hires by their education and
The term “skills” covers a lot of ground, but experience, using these criteria as a
at its core, it combines technical abilities, proxy for the skills and behaviors
behavioral competencies, and personal required to be successful in each job.
identity. Skills are learned or developed over
the course of a person’s career through In contrast, a skills-based approach focuses
the roles they hold, challenges they face, on how a candidate’s practical skillset can
success and achievements, mistakes made, offer value to a business, rather than their
and lessons learned. Some skills may be educational achievements and previous
acquired through education, on-the-job work history. It is a forward-looking
training, formal mentoring, new experiences, approach that selects candidates for their
and changing roles. Others are more innate potential future performance, not their
aspects of a person’s self, closely tied to past job responsibilities and track record.
their behavior and identity. This model recognizes that learning and Click here to download ‘The
skill acquisition can happen anywhere, New Skills Landscape’ eBook
including beyond professional work
experiences and formal education.

6 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

JOE’S
STORY: enthusiastic door-to-door salesperson.
Although it was outside the usual
protocol, she offered Joe a four-week
work experience trial, with the prospect
WHY TRADITIONAL of a high-paid future career.
HIRING CAN MISS Joe did not disappoint. When the
TOP PERFORMERS sales started coming in, it clearly didn’t
matter that he had no degree – or that
A round of applause sweeps the office he had never worked in B2B before.
as Joe is announced as salesperson of He was a great listener who was
the month for the third time running, passionate about solving customers’
just eight months into his new job in B2B problems, he had resilience in the face
software sales. of rejection, he was a fast learner, who
could quickly switch to selling new Joe’s story is representative of
It’s a proud moment for Joe, as his products. And selling gives Joe a the stories occasionally told about
background is very different to the lot of energy. outlier employees – the people
longer-serving members of his sales from an unexpected background
team. The rest of the team were hired Joe’s performance earned him the job who land a job in unusual
because they have a degree and at least full-time. Within just a few months, he circumstances and go on to
some previous B2B sales experience in was matching and then exceeding the outperform their peers. But rather
a technology environment. Joe knocked performance of his peers. Now, when than relying on luck and chance,
on the front door of the Head of Sales Joe reflects on his career journey, he how can companies make it an
one evening and tried to sell her a is grateful for the opportunity he has everyday occurrence to find future
vacuum cleaner. been given – it makes him want to top performers? The answer lies in
stay with his new employer and keep reframing the talent strategy, and
The Head of Sales didn’t need a on getting better. The Head of Sales reevaluating traditional criteria, to
new vacuum, but she was short of wonders how many other people like create a consistent, data-driven,
headcount in her team – and she was Joe are out there that she is missing repeatable process for identifying
instantly impressed by the skills of this out on hiring. relevant skills.

7 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

THE 2 4
SHIFT TO MORE MAKE
AGILE, DYNAMIC MEANINGFUL
ADVANTAGES WAYS OF WORKING PROGRESS ON DE&I

OF SKILLS-
A workforce structured around specifically Skills-based hiring enables you to target
defined job requirements can be too candidates from a broader section of society,
rigid to adapt rapidly to changing market outside traditional sources. It helps level the

BASED HIRING
conditions or customer needs. When the playing field by recognizing the value of
focus switches to skills, you can move much skill-building experiences outside common
faster to reshape your workforce, harness educational and career pathways for under-

AND TALENT career mobility, and reimagine the tasks

that individual employees perform.
represented groups during the hiring process.
When also applied consistently to L&D,
rewards and promotions, a focus on skills also

MANAGEMENT creates a more equitable employee experience.

3
BOOST
PERFORMANCE
5
ENHANCE EMPLOYEE
AND INNOVATION EXPERIENCE AND
1
ADDRESS SKILLS
SHORTAGES AND Research studies repeatedly show that
RETENTION RATES
hiring for experience or education is
TALENT GAPS not always the best predictor of future By focusing on skills, you give employees
job performance. A better performance clarity on what is expected of them, and there
By looking beyond qualifications and predictor is to confirm someone has the is an opportunity to support their career
experience, skills-based hiring increases needed skills or potential to develop them. goals and purpose. According to LinkedIn,
the size of the candidate pool. The bigger Hiring people with the right skills also employees without college degrees tend
the pool, the easier it is to attract, identify speeds up time-to-performance, which to stay in their roles 34% longer than those
and assess candidates who can fill your further strengthens operational delivery. with degrees. Korn Ferry’s research shows
talent gaps. Increasing response rates also Additionally, by focusing on skills, you that when people’s talents are well aligned to
shortens the average time-to-hire. can build teams with optimal combined the task they perform, and opportunities for
capabilities– bringing the right skillsets upskilling and adjacent skills enhancements are
together is key to fostering innovation there, then employee engagement is stronger
and getting ahead of competitors. and attrition rates are lower.

8 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

 RETHINK THE
QUESTIONS
YOU’RE ASKING
ABOUT TALENT
MANAGEMENT
STRATEGY

In this section, you will find a series of

questions that organizations can ask
when planning a skills-based approach.
These are exactly the questions that Korn
Ferry is helping clients across the world
to answer as they begin working towards
skills-based talent management. We’ll
address how a skills-first focus impacts:

Workforce planning, job and career

architecture, hiring, L&D, rewards,
internal mobility, promotions and
evaluating performance.

9 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

 1 SKILLS-DRIVEN APPROACH
• What are the skills of my

WORKFORCE •
workforce today?

What are the gaps between

PLANNING •
what I have and what I need?

What is the most efficient and

effective way to bridge that gap?

TRADITIONAL APPROACH • Do we hire new people, build capacity

internally through upskilling or go
with a combination of both?
How many people will we
need and in what jobs? With a skills-driven approach, you are
thinking in terms of what people can do
It used to be that organizations and jobs were
(based on their skills) in the context of a
reasonably static. It was common to approach
wider lens on the work of the business.
workforce planning by simply determining
With access to the right skills data, an
the number of employees needed to work
organization can get a deeper look into
in specific jobs, in what locations and within
organizational capabilities and how they
certain budgets.
might be re-wired and developed to drive
more effective and efficient organizational
performance. With skills-based planning,
you also have better insight into where you
THE MISSED OPPORTUNITY can best focus on reskilling and upskilling
– or where you might consider borrowing
By considering skills in the context of the skills through interim or contingent
work that needs to be done today and, in the workers. Their skills can be engaged on a
future, employers can take a broader view of temporary basis to build capability rapidly
what’s possible for their people to achieve. or deliver a specific outcome or project.
As work continues to evolve alongside a
fluid workforce, employers will be better It means taking a broader look beyond
positioned to identify adjacent skills the confines of today’s jobs so that you
across seemingly unrelated roles. can plan for a more agile workforce.

10 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

 2 JOB AND CAREER ARCHITECTURE
TRADITIONAL THE MISSED SKILLS-DRIVEN business in a way that transcends
the boundaries of current jobs.
APPROACH OPPORTUNITY APPROACH A skills-driven job architecture
becomes a career architecture
How do we organize our jobs Job architecture needs to be • How do we understand that helps you to group similar
into a hierarchy of levels? more than a grading structure. It how skill requirements link role types that share common
becomes a powerful tool when to the work we do today skills so that you can identify
It used to be that job architecture it holds job families and job and tomorrow? helpful adjacencies to progress
was simply a grading structure, levels, allowing people to see talent and provide the in-role
designed primarily to set salary career pathways that cut across • How can we identify adjacent work experiences that will help
ranges for jobs. This one- functions. You can use your skills across a wide range of to further develop skills. The
dimensional framework went job architecture to understand jobs and roles? reality is that Korn Ferry can
from bottom to top, informed by and communicate the talent support skills and work to live in
organizational structure, hierarchy, • How do we develop a a common ecosystem where skills
requirements needed to do the
and specifically defined jobs. In common taxonomy for skills enable the evolution of work, and
work, utilizing a combination
the absence of an alternative and skill progression to the evolution of work requires
of behavioral competencies,
framework, this structure was also support workforce analytics new skills. When the job and
technical skills, and personal
used for promotion and career and fair assessment? career architecture integrate skills
identity. When skills are aligned
mobility, leading to an unhealthy to your job architecture, you can in the broad sense of behavioral
A skills-driven approach allows
focus on upward mobility, rather better understand progression competencies, technical skills,
your job architecture to be more
than acquiring a diversity of of skills, and adjacencies in skills and personal identity, it becomes
than a grading structure. When
experiences, and blocked career across related work. It transforms a genuinely powerful tool for
you populate your job architecture
progression pathways for many. your skills library from a simple workforce transformation
with a clear taxonomy and scaling
list of words into the actual for skills, people can see how and development.
capabilities that are needed to skills relate to the work of the
do the work of your business.

11 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

 3 HIRING
TRADITIONAL SKILLS-DRIVEN
APPROACH APPROACH
What work has this person • What work could this
done before and what person do now?
education do they have?
• What kind of work is this
When hiring is based on an person best suited to?
approach focused on the
qualifications and experience of • What work could this
candidates only, then the aim is person adapt to in
to identify a person’s ability to the future?
perform a specific job, rather
With a skills-driven approach
than to evaluate what skills they
you can identify current
could bring to an organization.
capability and future potential
– hiring people for their
skillset (or engaging relevant
interim talent) provides you
THE MISSED with an agile workforce that
OPPORTUNITY matches your organizational
requirements in which
Today’s approach to hiring is individuals can perform the
broader and more inclusive and tasks needed today and then
enables you to significantly flex and develop to deliver the
increase the pool of candidates work needed in the future.
who could add valuable skills to
your organization – and identify
more people with the potential
to be high performers.

12 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

 4
LEARNING AND DEVELOPMENT
TRADITIONAL APPROACH SKILLS-DRIVEN APPROACH
What learning does this employee need to • What skills do employees need to
help them be successful in their role today, or acquire to build their capability?
to help them get their next job?
• What adjacent skills can employees
A traditional approach to L&D ties learning acquire with relative ease?
needs to a specific job and to the outputs and/
or goals of that job - or L&D may be focused • What is our re-skilling strategy?
on developing the skills to advance through a
A skills-based approach focuses on versatile
hierarchical grading structure
skill application, including the development
or to gain a promotion.
of learning agility and change-readiness. It
also targets key adjacent skills that enable
career mobility and the opportunity for in-
role development experiences, either through
THE MISSED OPPORTUNITY transitioning to related jobs or through special
projects that allow people to practice their
Tying L&D to specific jobs reinforces rigidity skills in different contexts. For employees, it
in the workforce and limits your ability to becomes easier to navigate non-linear career
leverage skills adjacency and career mobility. paths and identify work experiences that aren’t
Should employees take on very different tied to a specific job. At a strategic level, your
responsibilities that require a similar skillset, company is better positioned to identify the
you lack the flexibility to deploy the right skills reskilling or upskilling needs of the workforce
at the right time in the right roles. as a whole, more effectively planning
large-scale learning or training initiatives.

13 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

 5 REWARD
TRADITIONAL THE MISSED SKILLS-DRIVEN the skills and knowledge needed
to achieve business objectives.
APPROACH OPPORTUNITY APPROACH People are rewarded for
acquiring and demonstrating
• What is the available Pay markets reflect more than the • What skills do employees skills that deliver against specific
salary range for the job seniority or complexity of jobs. have that are needed to move business needs.
this person is in? They are a dynamic reflection of the business forward?
the relative demand and supply A skills-based approach to pay
• How well has this person for talent and skills. That is why • How valuable are those gives organizations greater
performed in their job? pay gets complicated when skills to the organization? flexibility in deploying overall
organizations try to balance staffing budgets and adapting to
A traditional approach to • What is our skills-based changing volume needs. It also
internal equity within salary bands
reward will link pay and bonus compensation philosophy? gives employees greater clarity
when external market pricing
opportunity to the salary band for on the additional skills they need
leads them outside the framework. Skills-based pay compensates
the job that someone has been to gain to benefit their career
When salary ranges are stretched employees for the depth, breadth,
hired to do. An employee’s in-role and their compensation. A skills-
to accommodate hot skills, and types of skills they obtain and
performance will be the key factor based pay philosophy does risk a
organizations can experience apply in their work. Pay levels are
in deciding pay raises and actual more individual approach to pay
overall pay escalation without largely determined by a person’s
bonus payouts. which could lead to an increase
a targeted approach to specific skill set within the context
rewarding for the skills in inequities, which is something
of their required work. Skill-based organizations must monitor
that are most in demand. pay helps organizations focus on and manage fairly.

14 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

 6 INTERNAL MOBILITY
AND PROMOTIONS
TRADITIONAL APPROACH that people bring to the table – skills that
may not have been needed or apparent
in the context of their current role.
How well has this person performed
in their current job?

Traditionally, employees are judged for

suitability of a new role based on their SKILLS-DRIVEN APPROACH
outputs and achievements in their current role.
• What existing skills has this person
acquired and refined (since last promotion
or job move) that are needed to perform
THE MISSED OPPORTUNITY in the next role?

• What new skills has this person

Framing readiness for internal mobility or acquired to improve and strengthen
promotion within the context of current role their performance?
performance means that people may fail to
consider the skill differential between the By evaluating employees on the full set of
current and future role. When it comes to skills they have gained and used successfully,
upskilling, the delta on the ‘up’ matters. A you are better placed to assess whether they
promotion or job move will be more difficult are deserving of, and suitable for, a promotion
where there are completely new or very or job move. You are basing decisions on
complex skills required in the new role. the value of their expanded skillset – and on
their potential to develop further skills in their
Organizations often miss out on the chance next role. Having oversight of skills across the
to progress high potential talent into more workforce also aids succession planning and
senior or specialist roles because they are not can feed into the promotion process.
considering the capabilities and hidden skills

15 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

 7 EVALUATING
PERFORMANCE
TRADITIONAL APPROACH SKILLS-DRIVEN APPROACH
What results are being delivered • What skills gaps do we have today
by our organization? vs yesterday, in our enterprise?

Traditional measures of success focus • How productive is our workforce?

on financial metrics and the delivery of
functional/ organizational goals. The • How agile is our workforce?
emphasis is on what is delivered and
• How diverse is our workforce?
less so on how it is delivered.
By evaluating performance through the lens
of skills, you will add an extra dimension
to your analysis. First, you can see how
THE MISSED OPPORTUNITY effectively you are closing key skills gaps.
Next, you can assess how effectively
Organizations will be fitter for the future if employees are deploying their talents to
they evaluate how skills enable performance meet business needs and determine if
and recognize the agility and capabilities there should be a re-alignment or change
the workforce has acquired, alongside the to how skills are used in-role. You can also
immediate outcomes it has achieved. assess your workforce’s readiness to pivot
Defining the value of specific skills by and in response to new market conditions or
for specific jobs will help better evaluate customer needs. Progress on diversity will
performance as well. be accelerated by a focus on skills.

16 | GUIDE | Going Skill Based: Rethinking Hiring & Retention

EMBRACING A
SKILLS-DRIVEN
FUTURE
Skills-based hiring and talent balance flexibility with focus and
management have proven agility with delivery excellence. Korn Ferry is a global organizational
potential to tackle skills
The Korn Ferry team can help consulting firm. We work with our
shortages while enhancing the
agility, capability, loyalty, and you dig deeper into your talent clients to design optimal organization
performance of your workforce. strategies. Our powerful taxonomy structures, roles, and responsibilities.
of skills makes it easier to We help them hire the right people
Shifting to a skills-driven approach organize, simplify, and normalize and advise them on how to reward
might seem like a big step, but your organization’s skill field.
and motivate their workforce while
it could be beneficial to your Korn Ferry’s extensive expertise
business if you consider the right based on research, day-to-day developing professionals as they
questions and harness a smart experience and AI-generated navigate and advance their careers.
combination of data, technology, insights can help your organization
people, and process. It also does define what “good” looks like and Business advisors.
not mean abandoning your spans what total skill set makes a person
Career makers.
and layers. Instead, by having skills successfully fit to the work that
overlay to your job architecture needs to be done.
into a career architecture, you can

To start the skills conversation,

contact us now.

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