What does it take to transform from talent scarcity to talent abundance? How can you unlock workforce agility and ensure your business thrives amid uncertainty?
In the second chapter of our three-part series on becoming talent-centric, Randstad's Talent Advisory team explores:
- how prioritizing skills can unlock workforce agility and drive performance
- why we need to redefine the lens through which we view talent
- how to shift from talent scarcity to talent abundance
- why embracing skills and aspirations to unleash human potential is crucial — and where to start.
why is talent agility important?
While the idea of workforce agility has been around for some time, recently this concept has taken center stage in strategic planning. In the face of unprecedented challenges and opportunities, the need for a flexible, adaptive workforce has skyrocketed to the top of the priority list. Workforce agility is the cornerstone of resilience and sustainable growth for forward-thinking organizations.
Even though you might argue that navigating challenges and uncertainties is not a new feat for humanity — we have, of course, done this throughout history — digital transformation, the evolution of skills, the rise of remote work and other factors we discussed in Chapter 1 have spotlighted the significance of workforce agility. These elements have not only emphasized the need for adaptability, but have also reshaped the very essence of how we thrive amid disruption.
Take Airbnb, for example. During the challenging waves of the Covid-19 pandemic, the company not only weathered the storm but emerged stronger. A 2022 Harvard Business Review article attributes the company’s success to the triple As of strategic agility: its ability to swiftly adapt, the resilience to absorb shocks and its remarkable bounce-back power, propelling the company ahead of its competitors. It's a testament to the power of strategic agility in navigating turbulent times.
Workforce agility refers to the ability of an organization to swiftly adapt, reorganize and respond effectively to challenges by leveraging its talent pool efficiently and flexibly. According to our Talent Trends research, the focus on workforce agility has surged from 66% to 77% in 2023, emphasizing its significance in today's BANI world. And in LinkedIn’s 2023 Workplace Learning Report, 89% of organizations agree that proactively building skills will help them navigate the future of work. There’s a clear appetite to move towards lasting value creation.
Gone are the days when managing talent was just about filling positions and executing tasks. Today, the possibilities for talent management are boundless and exciting — there is a real opportunity to deliver true, meaningful value and play a key role in reimagining work. After all, people are the reason we created work — and the true essence of it lies in designing work for human progress, where our collective aspirations are realized.
Value creation, therefore, lies in harmonizing a holistic talent strategy with the very heartbeat of your workforce. It’s about tuning into the unique motivations and aspirations of every individual, to orchestrate a symphony of collective potential that, in turn, fuels workforce agility and organizational growth.
This transformation isn't merely about implementing new technologies or processes; if you want to align your talent and business strategies properly, brace yourself for a journey of change. We’re not just talking about new tools; it’s about rewiring the very DNA of your culture. Imagine a workplace where uncertainty isn’t feared but embraced; where flexibility and adaptability aren’t just core values, but the lifeblood of every endeavor.
When we start to reimagine work in this context, we are not just adapting to change, we are shaping our organizations’ future with purpose and adaptability as guiding principles.
harmonize business and talent strategies
A good place to start is by evaluating if your current organizational and talent strategies align. Does everyone understand the organizational goals? Are these goals directly related to how you nurture talent? Identify specific business challenges and opportunities.
This evaluation lays the foundation for a purpose-driven transformation that brings your strategic goals to life in practical ways. It will also help inform talent solutions that are focused on agility and relevance, to help you ensure the right skills are in place, gaps are addressed and you can swiftly adapt to market shifts.
Many organizations struggle with the ever-changing landscape of talent strategies and technologies. It's like trying to piece together a complex puzzle with constantly shifting pieces. Adopting new tech can sometimes lead to a mishmash of tools that don't quite fit together with the systems you already have in place, which makes it tough to create a smooth and flexible system that promotes workforce agility. But the good news is, the maturing HR technology landscape offers exciting opportunities to help you optimize your talent strategy and make the most of the systems you already have.
To simplify and streamline, focus on holistic alignment. This means ensuring that every technological and procedural intervention contributes meaningfully to the overarching goal: placing the right people, with the right skills, in the right jobs, at the right time.
skills are the new currency
To enable true talent agility, there's a new currency taking center stage: skills. The buzz around skills-based organizations is palpable, yet translating this trend into something tangible, which has a direct influence on achieving business outcomes, remains a challenge.
So what exactly is a skills-based approach? Essentially, it involves organizations adopting a holistic perspective on talent recruitment, management and the wider talent life cycle, with decisions based around individuals’ skills, performance and potential.
Instead of work being organized around narrow, standardized jobs and development limited by a traditional hierarchy ( i.e., an employee’s level in the organization), we reimagine the operating model to place skills at the heart of everything. By skills, we mean both the innate and learned, technical skills acquired for a specific profession or job (such as coding or accounting) and our human skills (from creativity to teamwork), which are more widely applicable.
Rather than hiring for specific qualifications and experience, recruiters look at skills as a way of connecting talent to work. Work is organized around output and value, and candidates are assessed according to their skills and competence — both inherent and learned, rather than their educational background or past job roles.
In skills-based organizations, individuals are viewed as a fusion of capabilities rather than being confined to one specific role. Skills become a dynamic currency, flexibly allocated to projects, teams, sprints and high-impact work. In theory this approach, rooted in adaptability, promotes workforce agility. But what does it mean in practice?
Essentially, it means moving away from traditional job descriptions and delving into a detailed analysis of what skills your business needs. This analysis broadens the spectrum of potential candidates while also transforming how you identify, attract, deploy and retain talent — shifting the perspective from talent scarcity to talent abundance.
navigating change through skills
The skills-centric approach opens the door to a wider, more diverse range of abilities that can contribute to workforce diversity, organizational growth and innovation. It also facilitates internal mobility, creating an internal talent marketplace. Since the skills needed to perform specific projects or tasks can rapidly change in an ever-evolving business landscape, skills-based models put the emphasis on employee development.
By understanding who has which skills and what skills are vital for key roles in your business, you can enhance talent agility by creating more fluidity among teams and encouraging cross-pollination of skills. This approach empowers both individuals and organizations to adapt and pivot effectively in the face of change.
It’s simply not sustainable to continuously hire to meet all skill needs. That’s why organizations such as global insurance firm AXA XL are expanding skills internally, using data insights to bridge skill gaps and create personalized learning programs. The company is also making data and AI critical competencies in every field. Through skill-building, the company drives internal mobility and boosts potential, infusing agility into its workforce and empowering employees to future-proof their careers.
why focus on skills now?
The urgency to upskill and reskill the workforce in the face of rapid technological advancements, such as generative AI, is clear. The World Economic Forum predicts that by 2025, 50% of the workforce will require reskilling. This substantial societal challenge will not only demand new skills but will see workers using them to transition into different occupations. Although it’s a complex task, it's precisely this complexity that makes it necessary to act now.
However, even the rate at which organizations are investing in upskilling employees is mixed. Some studies suggest that these investments can reach up to 1.5% of total budgets, yet Linkedin’s 2023 Workplace Learning Report shows varied progress: 40% of companies are in the initial stages, pitching their programs to stakeholders and building their teams; 54% are in the middle stages, actively developing and implementing their programs; only 2% have finished their programs and 4% have yet to begin.
BCG likens the consideration paid to skills today to “the attention given to diversity, equity, and inclusion (DEI) about 15 years ago” arguing that while companies look at skills, few integrate skill development into their strategies or report on skills management with the same diligence as other crucial assets.
While upskilling is on some organizations’ agendas, what’s actually needed is substantial reskilling. Upskilling aims to teach employees new skills to optimize their performance, but reskilling (sometimes termed “professional recycling”) is designed to train employees to adapt to different work within the company. Despite some organizations embracing the reskilling/upskilling challenge, only a few have done so effectively, with efforts often limited in scale and impact. This raises a crucial question: Now that the need for a reskilling and upskilling revolution is evident, where do you start?
Identifying skills within current processes and technologies can pose a significant challenge. The validation of these skills is equally daunting. Josh Bersin invites HR to “fall in love with the problem” when shifting towards a skills-based organization. He urges us to proceed thoughtfully, establishing governance, testing various tools and addressing challenges one by one. This deliberate approach will ultimately lead to the creation of more flexible, scalable, agile and productive companies in the years ahead. He says, “If you take the transformation seriously and consider how important it will become, you can build a plan that works.”
Why is it worth the effort? Because as individuals, we all seek growth, progress and meaningful challenges in our work. It’s not just about climbing hierarchical ladders, but also about the journey of personal development and discovering purpose and meaning in every task. Nurturing this growth and empowering individuals is at the heart and soul of progressive talent retention and the spark that ignites people to perform at their best.
Reframing the role of the talent function in this way is both liberating and invigorating. When the symphony of skills and human qualities is harmonized, something magical happens. It positively impacts performance, attrition rates and overall organizational momentum.
the magic mix: skills and aspirations equal human potential
We know that traditional hiring practices often prioritize qualifications and experience over skills — seemingly essential but not always indicative of job performance. There's more to an individual than their education and skill set; it’s their human qualities and potential that profoundly influence performance.
The blend of being and wanting pushes people outside of what they know and have already done, encouraging them to invent new ways of doing things, imagine new paradigms and come up with creative innovations. This not only boosts their ability to adapt but also strengthens the overall agility of the workforce.
In the past, organizations grappled with the nuances of soft and hard skills and debated the differences between taxonomy and ontology. Many have also attempted to solve the skills-matching challenge for their entire organizations, which often felt overwhelming. Some believed that technology alone could solve the problem, but as we touched on earlier, tech should complement a well thought-out framework, not replace it.
The evolution of skills isn't just about categorizing soft and hard skills; it’s a profound decoding of talent to gain a proper understanding of how it aligns with the work that needs to be done. Skills and abilities are just the tip of the iceberg; integrating skills, abilities and aspirations unlocks vast human potential within both talent and organizations (as our Human Potential model below demonstrates). This integration not only broadens the talent pool, promoting fair and diverse recruitment, but also equips talent and organizations with the capabilities essential for thriving in this new era.
the human potential model.
Inherent core skills: Inherent skills, the core of this model, blend nature and nurture, shaping cognitive, emotional and personality traits. It’s who you are and how you show up 90% of the time. These unique abilities define how individuals approach tasks and influence their roles within diverse environments, emphasizing their essential, deeply personal nature.
Learned skills: These are skills acquired throughout your life and career, evolving with experience and education. You can emphasize these skills when defining roles within your organization. They are learnable and movable, like using different tools for different tasks and situations.
Motivations and aspirations: Understanding what drives individuals, plus their changing goals, and how this links to the organization's motivations and aspirations and the work to be done.
Company values, culture and organizational context: Ensuring alignment between these factors to drive performance and engagement.
The Human Potential model explores individuals' inherent, learned and motivational aspects, placing a spotlight on the importance of inherent skills. The magic happens when we blend learned skills with these inherent traits. Aligning motivation and aspirations is a game-changer in the talent process. It ensures authenticity and effectiveness, sidestepping the trap of candidates simply echoing what they believe the organization wants to hear. This approach not only generates momentum but also addresses the common issue of skills lacking impact when considered on their own.
Recruiting for specific AI skills is difficult, but training individuals in other areas is more feasible. This approach helps organizations bridge gaps in data and talent. Imagine universities identifying core inherent skills, enabling learning — a potential hiring and training revolution. Our model not only identifies skills but also provides a road map for reskilling and decoding talent effectively.
proving the value: experiment and learn
When implementing a skills-focused approach, it's important to measure everything comprehensively, all while managing expectations during the transition. Think of it as planting seeds in a garden; it takes time, care and patience.
For instance, if hiring and people managers take more time to adapt to the new approach, your time-to-hire metric might temporarily increase and your use of a talent review tool may become challenging. Don’t be deterred; initial challenges are natural when introducing significant changes.
Rather than viewing setbacks as roadblocks, see them as hidden opportunities — all part of the adaptation process. Experimenting and learning is key. By keeping a long-term perspective and believing in the effectiveness of the new approach, you can navigate obstacles and ultimately see improvements in talent outcomes.
For example, we recently collaborated with a client where the uptake of mobility opportunities fell short of the targeted expectations. This provided an opportunity to delve into the reasons behind it — what assumptions had been made? In this case, the skills aspect of the project was well-defined, but the motivations and aspirations of talent were not fully understood, considered or prioritized. This serves as a valuable example of learning for the improvement of future designs.
When paired with action, hope transforms into power. The Human Potential model can help you identify the important work in your organization, so you can unlock the possibilities within your workforce. It can help you identify where to invest in talent and what roles are crucial, especially in times of change when agility is key. The process involves prioritizing, experimenting, learning and aligning your technology and data to support the model.
use human potential to promote talent agility
In a landscape where talent seeks more than just a job, our approach to work must transcend the mundane. Embracing skills and aspirations (human potential) as the cornerstone of recruitment, development and retention is about more than just adopting a trend; it’s orchestrating a transformation that aligns an organization's heart and soul with the collective needs of its people.
When you design work with the genuine intention of nurturing human progress, you lay a foundation that's not just about tasks and responsibilities; it becomes a platform for dreams to flourish, for skills to evolve, and for individuals to realize their fullest potential.
Ultimately, when it comes to talent, skills and abilities are crucial, but insufficient on their own. The secret lies in the fusion of aspirations — a blend of willingness, skills and ability — to create a synergy that unlocks human potential within individuals and organizations. This integration forms the bedrock of an ecosystem where talent agility and growth thrive.
Aspirations become the catalysts for transforming individual and collective potential into reality, enhancing talent agility and profoundly impacting organizational performance. As a result, you become better positioned for sustained business success in this fast-paced, hugely competitive environment.
In chapter 3, we will explore more about what it takes to become truly talent-centric and craft a workplace where progress isn't merely a goal; it's the very essence of what work is meant to be — a journey of growth and possibility.
a four-step approach to focus on skills.
- Inclusivity: All voices, including those of leadership, management and talent, are valued and heard.
- Data precision: Focusing on four to six key data points per area, overlaid by a holistic perspective), helps minimize bias and ensure accurate decision-making.
- Enhanced outcomes: Implementing these principles enhances predictive performance and boosts talent ROI.
- Transparency and fairness: Upheld through a robust and simple process, ensuring equitable treatment for all.
Organizations that have embarked on this journey typically find that a good starting point is to focus on around 5% to 15% of the organization, as this is where the most significant impact can be made. For example, some begin with a focus on early careers. Starting with these four steps can provide a clear and structured approach to navigating the complex landscape of talent management and workforce development.
Watch our webinar to explore how building human potential can help your organization boost performance in today’s complex landscape.
In the final chapter of our series on becoming talent-centric, Randstad Enterprise's Talent Advisory team explores:
- the shifting motivations of talent and how organizations can respond
- why placing talent at the heart of organizational strategy determines long-term viability
- how to elevate HR as a proactive force through a balance of fixes and innovation
- why experimentation, imagination and forgetting predictions are key to success
- how to build a human-centric future of work with HR and talent at the forefront