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Seven key steps to skills-based hiring

Companies have the ability to achieve key workforce objectives through skills-based hiring while also having a positive impact on the lives of people in the communities they serve. By taking the necessary steps in advance of implementing skills-based hiring, you can ensure this impact is broad and stands the test of time.

Businesses from all industries are diving headfirst into skills-based hiring. The proof is in the numbers with a whopping 76% of employers getting on board with some form of skills-based hiring.

This approach means that relevant skills are taking the spotlight, especially when evaluating potential candidates. The advantage of skills-based hiring offers a double win. It benefits society as a whole because it offers workers who lack college degrees but who acquired skills through alternative routes (STARs) access to family-sustaining jobs. And, it benefits the business by significantly expanding their talent pools.

But here’s the thing. The popularity of skills-based hiring doesn’t mean it’s a quick fix. To gain the benefits, it takes a strategic approach.

Ready to dive in, but not sure where to start? Here are the 7 essential steps that enable you to get your game plan ready for successfully bringing skills-based hiring into your talent management initiatives.

1. Gain support from senior-level executives to take the lead
There’s a common misconception that removing degree requirements from entry-level and mid-level roles can be effectively implemented by a company’s talent acquisition and DEI teams.

In reality, prioritizing skills over a degree in hiring necessitates a shift in the organization’s talent management philosophy. Implementing a skills-based approach to talent management is not only a question of who the organization hires, but also how the organization will provide ongoing skills development support for all employees.

Of course, large-scale projects of this kind affect employees across the company. Some may question whether the benefits of implementing skills-based hiring will be worth the effort. And some may question the philosophy of removing degree requirements and replacing them with skills-based assessments.  To head off these concerns, leaders across the business must assuage these concerns by playing an active role in championing the skills-based strategy and overseeing the implementation process.

Establishing a steering committee ideally composed of cross-functional VP-level and several C-suite executives, such as a CHRO or CLO, along with talent acquisition and operational HR leaders, delivers the greatest impact. Once formed, all major decisions related to the project should run through this committee.

2. Take a focused approach to replacing degrees with skills
Not all roles are suited for swapping degree requirements with skill requirements. For example, an organization might require candidates to possess a degree for roles that:

  • Demand an employee to possess core competencies most often developed by completing a bachelor’s degree program, such as teamwork, collaboration and critical thinking.
  • Have a work visa attached to it and, to maintain a visa, a worker must possess a bachelor’s degree.
  • Include a cultural preference toward a degree within specific company business units. For example, technology leaders within a company may believe a degree in computer science provides a depth of knowledge one cannot attain through a technology bootcamp.
  • Necessitate an individual to possess a bachelor’s degree in order to obtain industry licensing, such as certified public accountant, social work, registered nursing and engineering.

One of your steering committee’s top priorities should be determining which roles are best suited for degree removal within your organization. This includes assessing which roles teams struggle the most with filling and then prioritizing those in which hiring challenges are most acute.

The next step is to schedule a kick off meeting with your steering committee. Be sure to invite additional stakeholders, such as hiring managers, that directly oversee the roles you’re targeting for degree removal. Also, come prepared with a list of job descriptions for each role.

3. Leverage insights from subject matter experts
Although HR teams typically have a general idea of the skills and experience required to perform a role, they may lack a nuanced understanding of what the day-to-day responsibilities entail.

Take, for example, a Configuration Analyst. An HR leader with knowledge of the job family under which this role resides may know it requires a candidate to possess Java coding and Agile methodology skills. They may not, however, understand how much coaching a configuration analyst does daily with cross-functional colleagues since it isn’t explicitly outlined in their job description.

That’s why subject matter experts play a critical role in the skills determination process. If, for example, you’re removing degree requirements from a payroll job family, the manager of the team should be included in all discussions related to skills-based hiring within the job family. They should be expected to provide ongoing input into the roles that can stand to benefit from degree removal, what they look for in strong candidates and skills that should be included once degree requirements are removed.

4. Align on a skills taxonomy
A skills taxonomy establishes a common language and framework for skills at your company. It grounds skills-based hiring in terms familiar across industries and job candidates.

Before settling on a taxonomy, first explore what skills your company is already using for hiring and advancement. This will inform the criteria by which you evaluate various skills taxonomies, assuming you aren’t already using one.

From there, you should begin researching publicly available skills taxonomies. Commonly-used taxonomies include:

  • Lightcast Open Skills Taxonomy
  • World Economic Forum’s Global Skills Taxonomy
  • O*Net
  • European Skills, Competencies, and Occupations (ESCO)

Once you have decided on a skills taxonomy, collaborate with your HR team to ensure skills are consistent across roles at the same level of seniority within the company. For instance, if a director-level role in marketing requires strategic-thinking skills, the HR team should aim to instill this as an expectation for all director-level roles in which degree requirements are removed.

5. Determine how to assess a candidate’s skillset
Employers have long regarded an earned degree as an indicator that a job candidate possesses essential skills crucial for job success. This is based on several reasons:

  • Rigor of college coursework
  • Variety of coursework such as presentations, papers, team projects, etc.
  • Workload associated with earning a degree
  • Acquisition of core skills including teamwork, written and oral communication, critical thinking, time management and digital literacy

When removing degree requirements from job descriptions, employers need to accurately gauge if a candidate possesses required skills since it may not be apparent based on their work experience. An effective two-step method includes first mapping the core skills required to roles in which you have removed degree requirements. Then build a repository of situational interview questions your team can use. Create several questions for each of the core skills. For example, ask candidates situational interview questions about a time when they used a specific skill. In particular, to measure teamwork ability, inquire about an incident when they had a conflict with a teammate and how they resolved it.

For certain roles, it can be difficult to determine a candidate’s mastery of skills based on interview question responses alone. Therefore, consider purchasing a third-party skills assessment platform that measures an applicant’s proficiency level of technical skills such as coding languages and Microsoft Excel.

6. Prepare your stakeholders and assign responsibilities
You’ve decided on the skill requirements for the roles targeted for degree removal. It’s now time to bring skills-based hiring to life.

Implementation can be challenging if team members aren’t clear on their roles. Some managers may also be initially resistant to the idea of hiring individuals who don’t have a degree. Others may not feel comfortable evaluating whether a candidate for a role possesses the necessary skills for it.

To ensure stakeholders are invested in the project  and know their roles, plan to hold a training session before the project launches. The following stakeholders/managers should be included in the training:

  • Talent acquisition
  • Talent management
  • Managers from within job families targeted for degree removal

Eventually, after skills recommendations are made for positions, members of the talent acquisition team will be responsible for re-writing job descriptions to include the new skills and creating new interview questions that allow candidates to showcase their relevant skills.

7. Measure the impact
Adopting skills-based hiring is a big undertaking. It’s important to consistently test whether it’s meeting expectations.

As you decide on metrics to measure the success of the initiative, your focus should not solely be on hiring. Also track the internal movement of employees hired through skills-based hiring to ensure the skills requirements for roles are properly calibrated. High levels of internal mobility also indicate employees are receiving the support they need to upskill and advance their careers.

The following are examples of metrics to consider tracking:

  • Time-to-fill for positions in which degree requirements have been removed
  • Cost-per-hire for roles in which degree requirements have been removed
  • Employee satisfaction scores for teams within your company that have many roles in which degree requirements were removed
  • Retention rates among employees hired through skills-based hiring
  • Promotion rates among employees hired through skills-based hiring
  • Enrollment in workforce education programs among employees hired through skills-based hiring

Support your double bottom line
So there you have it — insights, practical tips and examples that provide you with a roadmap for making a positive impact and fulfilling business needs with skills-based hiring.

Companies have the ability to achieve key workforce objectives through skills-based hiring while also having a positive impact on the lives of people in the communities they serve. By taking the necessary steps in advance of implementing skills-based hiring, you can ensure this impact is broad and stands the test of time.

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