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The talent landscape in Australia is undergoing a major transformation due to ongoing economic volatility, shifting demographics and fierce competition for vital skills, writes Dion Love.
These changes have put immense strain on talent management’s goal of achieving workforce agility – placing the right talent in the right position at the right moment. As a result, attracting and keeping skilled employees has become a critical concern for CEOs worldwide.
A recent Gartner survey highlighted that 41 per cent of companies acknowledge a skills gap in their workforce, 50 per cent admit they fail to fully capitalise on the skills available, and 62 per cent see uncertainty about future skills as a significant threat. Essentially, today’s talent isn’t equipped to meet current or future demands, contributing to a 26 per cent decline in employee performance.
Organisations are in urgent need of strategies to create a more adaptable workforce. HR leaders are aware of the necessity for greater workforce flexibility and are investing towards this goal. However, these investments aren’t yet translating into talent readiness.
Gartner’s research highlights that companies taking a more precise approach to talent fluidity can boost talent readiness by up to 60 per cent. But how can organisations achieve this?
Power of precise skills intelligence
Ensuring an organisation has the skills it needs requires precise skills intelligence. That is, comprehensive insights into current capabilities within the workforce and the skills required for future success.
Developing and maintaining such skills intelligence, however, has proven to be more resource-intensive than many expected. This requires significant investments in data, technology and ongoing analysis to ensure talent strategies are aligned with rapidly changing business demands.
Currently, only 8 per cent of HR leaders feel confident they have accurate data on the skills their workforce holds, according to Gartner. This creates a major obstacle in assessing current skill gaps and anticipating future needs.
HR leaders can adopt a targeted strategy by prioritising investments in skills intelligence for roles that have the greatest impact on evolving business needs. The focus should then be further narrowed to include highly dynamic positions that are particularly affected by rapid market shifts.
By gaining a clearer understanding of the organisation’s capabilities and needs in these key areas, learning and development teams can concentrate their resources where they’ll have the most significant effect on business outcomes.
Don’t overlook the personal costs of mobility
Where an organisation faces challenges in sourcing talent from the external labour market, encouraging internal mobility becomes an essential element of any strategy to bridge the skills gap. However, in this effort, talent management faces significant challenges in overcoming traditional employee and manager mindsets.
Today, employees don’t pursue mobility. Their top barrier is that they don’t find internal roles appealing. Managers also share this reluctance, with just one in two managers saying they want employees to grow their careers, even if it means losing talent on their team.
Although people leaders recognise the benefits that internal mobility offers employees, they frequently overlook a key aspect: the personal risks and costs employees associate with such moves.
Instead of concentrating solely on the potential advantages of internal transitions, organisations must also address any employee concerns, thereby mitigating a significant barrier to internal mobility.
Focus on today’s skills requirements first
According to Gartner, 79 per cent of CEOs say they’ll have a new growth and transformation strategy ready heading into 2025. Employees need the skills that are essential to their performance today, but they also need those that will support their performance tomorrow.
Yet only 23 per cent of organisations effectively develop skills for the future. HR leaders rank the skills gaps as the number one risk for their organisations and addressing unclear future skill needs as the number two risk.
Gartner’s research identifies that HR teams should prioritise proficiency in today’s core skills over learning future skills. Focusing on today’s skills has a five times greater impact on sustained performance than the skills of tomorrow.
In today’s rapidly evolving business climate and labour market, organisations need a targeted approach to talent fluidity. This means focusing on the work employees are already doing to understand skills supply and demand by differentiating their investments in skills intelligence.
Leaders must finish the work they’ve already started to get employees brought into internal mobility by focusing on the personal costs that managers and employees feel about internal moves.
Finally, they should free themselves from the work they’ve been trying to do to balance current and future skills by focusing on those that have the greatest impact on performance now and into the future: today’s core skills.
Dion Love is the vice president of advisory in Gartner’s HR practice.
