Finding the best match with skills-based hiring
Hiring is all about finding the right person for the job. While skills have always played a part in this, skills-based hiring is emerging as a way to find high-quality talent that meets the practical needs of a role. With less focus on background and more on capability, some say it overcomes biases to find a great candidate fit. However, it is a departure from traditional hiring methods and requires a shift in mindset, processes and technology.
Firstly, what is skilled-based hiring?
Skill-based hiring looks at a candidate’s skills in relation to those needed for a role. These are prioritised over other criteria – like education and years of experience, that are often seen as critical to hiring – and includes both hard and soft skills.
Some roles and industries already hire based on skill. For example, orchestras hold blind auditions to reduce bias and ensure the best musicians are chosen. Other roles, like chef positions, frequently include a hands-on trial, while even professional roles increasingly include take-home assessments. One critical element, however, is that before a skills-based assessment can take place, a candidate has to pass an initial screening – which usually involves vetting for traditional hiring criteria, such as qualifications and years of experience, through a resumé.
So, how are Australian organisations putting skills-based hiring into practice? Two leading talent-acquisition professionals share their thoughts.
Evolving the skills discussion
The concept of work skills has been around for some time, says Leon Yin, Head of Skills and Workforce Strategy at Aurecon. “A few decades ago it was called KSAs: knowledge, skills and attributes. At other times we used terms like ‘competency’ or ‘capability’, but they’re all roughly the same as what is now simply called ‘skills’.”
So what is a skill then? “It’s about your ability to do the work,” Yin says. This means how internal attributes are expressed to achieve a certain task, activity or accountability.
When looking for talent, skills-based hiring means not just looking for someone with the ‘project manager’ title, but for someone who can do the specific type of work needed in the actual role. “People forget that when they define what a project manager is, that could mean something completely different to someone else,” says Yin.
“And similarly, if someone doesn't have the title of project manager but that person can implement systems or manage time and budget, they might have the right skills to achieve a role.”
One way to look at skills is like a currency, Yin suggests. “It's similar to trying to trade and find the value of someone through the currency of their skills.”
The challenge with this, he says, is that currencies have different values. “Sometimes it’s possible to trade because a skill is very similar, while other times it’s a brand new currency, like cryptocurrency, and no one really knows what to do with it.”
Emerging technology is enabling this new world of skills-based hiring. Much like the way digital tools and platforms have made currency exchange a breeze, newer technologies are changing how organisations identify, map and manage the skills of candidates, as well as existing teams.
“What’s different now is that we’re building these large language models that understand what skills are and the language we use for them, to consolidate and unify a single language around them,” he says. In other words, it’s helping hirers cut through differences in the terms and words candidates use on their resumés. This opens up new ways for organisations to seek out specific skills in a structured and even automated way, by building a skills model and embedding it in their Human Capital Management (HCM) software, to then filter out through all the hiring and people management across the business.
A different lens for hiring
Skills-based hiring isn’t a new concept, agrees Danielle Berto, Director of Talent Acquisition at Thales, but it’s one people haven't had to embrace before, because of a formerly rich candidate pool. “But that’s not necessarily true now,” she says. “There are a lot of roles sitting empty because there isn’t the skilled workforce to build them and that forces your hand,” she says.
While there are always leaders and laggards, she says the organisations that embrace skills-based hiring will have a huge advantage long term, with less attrition, higher productivity and a more diversified workforce.
According to Berto, hiring has been too prescriptive for far too long. “A lot of organisations just do what they’ve always done and check things off a list, looking for certain years of experience or past employers. Sometimes, the role’s behavioural aspects aren’t even considered.”
This often means they miss out not only on good candidates but on diversity. “If a candidate has a foundation in a certain skill then perhaps that can be developed with specific training. This helps close skill gaps with the existing workforce and develop them, making them feel supported and encouraged,” Berto says.
“By looking outside the tiny percentage of the market who can do the role and all happen to come from the same schools, backgrounds and companies, you open up plenty more opportunities and bring in far greater diversity.”
At the same time, it’s important to consider what the limitations for skills-based hiring may be in an organisation and for certain roles – this will depend on specific factors, such as industry, regulatory or educational requirements.
Getting started with skills-based hiring
Want to start using a more skills-based approach? While there’s no single way that will work for every organisation, there are some basic ‘rules’ to keep in mind. Here’s what Yin and Berto advise:
Begin with skills mapping. The first place Yin suggests starting any skill-centric approach is to start with the skills: define what’s core, strategic and important to the business, and identify a shortlist of what those skills are. By being succinct and articulating those critical points, leadership teams can get laser focused on what they need to succeed.
Start, then evolve. We’re good at talking about the skills problem and less good at finding a solution, Berto says. She suggests starting, then iterating through testing and learning – nothing will be perfect on the first go.
Keep it simple. It’s easy to overcomplicate skills, says Yin, so it’s important to be clear and succinct with your skills shortlist. Otherwise, you can end up going down a rabbit hole with too many desirable skills, which complicates hiring, or trying to be too different and confusing candidates. Industry skills frameworks can help you decide what the most important skills are.
Look at existing processes. In many cases, Berto says organisations already have skills-based hiring in place in some form, like internships, apprenticeships or graduate programs. Hirers can learn from their own success and consider replicating processes that work across other roles and departments.
Getting started with skills-based hiring doesn’t necessarily mean changing every process at once. Instead, start small and iterate – consider the tips above, the needs of the organisation and resources available to begin exploring how it could work for you.