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Why a skills audit is important to your business.

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Published on 27 April 2022

Recognising potential knowledge gaps early can help to support the long-term success of a business while improving a company’s retention rates and employee happiness. But why is conducting a skills audit now more important than ever?

Skills gaps have been present for many years, but the problem has continued to worsen after the pandemic. The workplace has been forced into adopting a more digitally focused approach to how things are done. According to a recent survey by McKinsey, responses to COVID-19 have sped up the adoption of digital technologies by several years – and many of these changes could be here for the long haul. 

As the workplace evolves, workers have to refresh their skills to avoid falling behind.

This leaves companies with the question of “buy or build?” Should you recruit or retain employees? This is how a skills audit can help. A skills audit can identify current skills within the business as well as any skills gaps.

What is a skills audit?
A skills audit is the process by which employers gather information on their employees’ current skills, and look for shortfalls which can be considered on either an individual or collective basis. Benefits of regularly executing a skills audit include allowing businesses to further train and develop their employees’ current skills and further the development of their careers. A skills audit also presents the opportunity to identify potential knowledge gaps within a company that may be resolved via new hires.

So, how do you conduct a skills audit to ensure your company has the competency it needs?

1) Communicate with your team.
When done well, skills audits have proven to be very effective, however they cost time, money and resource. It’s important you communicate why you’re doing a skills audit and how it will benefit the business to your team. This will give you the opportunity to see if your scope is in-line with business targets, goals and trajectory. It’s also important to talk to your team and reassure them that any data taken is secure and confidential. Explain why a skills audit is important and how it can benefit each employee, and appoint someone that they can ask any questions to throughout the process.

2) Lay out all your strategic goals and skills required to meet these goals.
You should start by recognising your short-term and long-term goals. Try mapping out job titles and related important skills in each role needed to meet those goals. 

3) Evaluate current skills.
Evaluating current skills will kick-start your audit, allowing you to identify any gaps. You can do this by collecting and analysing workforce data. One way to do this is by asking employees to fill out surveys and looking at job descriptions and performance evaluations. 

4) Create your scope.
Research which framework, innovations and processes will fit in with your company targets and goals. Which employee skills will you be assessing? Which skills, technical or soft, will your team need in order to support company growth? How will these skills need to adapt to changes along the way? Talking to employees about their role and what they currently perceive their responsibilities to be will allow you to integrate this into your framework, and complete a successful skills audit.

5) Put together a plan.
Once all the data has been collected, you’ll have a much clearer picture of what in-house training in-house needs to take place to help current employees gain new skills, and where you need to hire employees with certain skill sets. You may identify skills adjacencies – skills similar to the ones employers are seeking. If this is the case, you should put a plan in place to retrain the workers, using in-house training to up skill.

A skills audit will benefit both you and your employees. It allows you to focus on bridging your skills gaps, allowing you to make smarter decisions on whether to buy or build talent. Meanwhile your employees can develop, upskill and advance in their careers. Their progression will lead to retained talent and a more engaged, productive and motivated workforce for you.

Why a skills audit is important to your business.