The best approach to workforce management today is a skills-based approach, says Kraig Eaton, a principal in Deloitte Consulting’s U.S. human capital service area in Glen Mills, Pennsylvania, who also serves as the co-lead of the Deloitte global human capital trends team.
Eaton spoke with StrategicCHRO360 about why companies need to look at talent through the skills lens, and the impact that has on operations, recruitment and retention.
What is a skills-based approach to workforce management, and what are its benefits?
A skills-based approach has four guiding principles at its core. The first is disentangling work from formal job descriptions and breaking down the work into projects or tasks. The second is to see workers as having a portfolio of skills rather than as job holders. The third is to make people decisions within the organization based on skills—from hiring to pay, promotions and more. Finally, building a “skills hub,” the storehouse of skills data, technology and governance that will help enable your decision-making.
When you can tap into the full range of workers’ capabilities to solve problems, it helps achieve positive outcomes. Our research shows that organizing the workforce based on skills helps boost productivity, efficiency and effectiveness by aligning work with the worker’s interests and the organization’s business priorities.
Organizing by skills can also help recruit and retain top talent, with organizations leveraging a skills-based model faring far better in both areas.
You’ve said we’re witnessing “the end of jobs as we know them.” In what way?
Traditionally, the job was the defining structure for organizing every aspect of work. However, that no longer makes sense in a world where work is increasingly being performed across business functions. Recent Deloitte research shows that only 19 percent of business executives and 23 percent of workers say work is best structured through jobs. The increasing pace of change and the growing need for agility has cemented the shift away from jobs.
Additionally, worker agency has employees pushing for more career options. Traditional organizational structures can slow leaders’ ability to change those key areas and make crucial progress for workers and the bottom line.
What are the main factors driving the rise in employee choice and influence in the workplace?
Workers today have more choice and influence, as evidenced by the lowest unemployment rate in a generation. They also have an increased sensitivity to their work’s effect on society and want to do something that has a positive impact.
Our 2022 Gen Z and Millennial survey found that a third of our respondents would leave their job without having another job lined up, and nearly two in five say they have rejected a job or assignment because it didn’t align with their values. Ultimately, it’s a combination of the current labor market and the attitudes of today’s workers.
How can organizations drive value and strengthen their relationships with workers by embracing the rise in worker agency?
Workers want meaningful choices, which include having a say in how, when and where they work. Organizations should come together with their workers to co-create the new rules of their working relationships and determine how work will be done.
It’s essential that leaders develop a clear collective purpose that embeds and prioritizes human outcomes into new ways of working. Most importantly, they need to make a real commitment to incorporating workers’ perspectives into business practices when possible. Don’t just pay lip service, or workers will likely become disengaged.