Skills based organisations: a new way to connect talent to work 

A roadmap to upskill and reskill your organisation with data, insights and talent marketplace technology.

Are you ready for the skills economy?

The war for talent, a global skills shortage, the great resignation – call it what you like, tight labour markets can make it difficult for businesses to fill jobs.

But what if ‘filling jobs’ is the wrong way to think about it? What if there’s a better way to plug the skills gaps in your organisation?

That’s the thinking behind a new approach developed by Mercer’s global leader for transformation services, Ravin Jesuthasan, and introduced at the Workforce Solutions webinar Are you ready for the skills economy?

Jesuthasan, author of Wall Street Journal-bestseller Work Without Jobs, says the very concept of the ‘job’ and its one-to-one relationship with a person may be the factor holding businesses back from success.

Instead, leaders should shift to a new model, deconstructing jobs into their underlying tasks and matching those tasks to different individuals’ skills.

Resetting the work operating system around skills – not jobs – opens a potent new way of thinking about work and talent.

“How are we going to redesign work to enable talent to flow to it as seamlessly as possible?” says Jesuthasan.

“How do we re-envision the talent experience so that we’re meeting more and more talent increasingly on their terms, as opposed to forcing them to comply or fit a one size fits most model?”

The answer is an entirely new approach to work that moves beyond the job to a marketplace for talent where people are matched with work in a fluid, agile and flexible way.

Unlocking your employees’ skills

Jesuthasan tells the story of an experiment conducted with the World Economic Forum to uncover the hidden skills in a workforce by using machine learning algorithms to analyse people’s work history and education.

“The average employee, when asked to identify the skills he or she had, had a list that was about seven long,” he says.

“When the algorithm went through and looked at all of that person’s previous work, their previous projects, their education etc... the average starting point was 24.”

This explosion of skills available to an organisation comes from analysing individuals’ work without reference to their current job.

“It put the organisation in a much, much better place to understand the complete makeup of skills.”

Everyone has a different starting point on the road to a skills-based approach to work.
 Andrew Lafontaine

Partner, Strategy & Growth, Workforce Solutions, Mercer Pacific

Work without jobs - how it works

There are three main ways organisations can think about connecting talent to work.

Flex Flow
The traditional way of working for regular full-time employees. A convenient volume of work is bundled into a job that is filled by an individual. Employees are organised in jobs but have the flexibility to express their skills by taking on additional project work outside their domain. Employees fully flow to tasks, assignments, and projects. Capabilities are matched with projects and tasks in short-term bursts.

Mercer’s experience shows the most advanced organisations are moving to a model where 30 per cent of work is in fixed jobs, 50 to 60 per cent can flow to projects and 10 to 20 per cent is in completely agile pools that are connecting to work through skills architectures.

Companies that move towards more agile ways of working and skills-based architectures are seeing exponential gains in productivity, speed and agility, says Jesuthasan.

Benefits of a skills-based organisation

So, what are the key benefits of a skills-based approach?
  • Reduced time to fill 
    – finding talent to fill a role becomes quicker when you’re not seeking someone to fill an entire job, but rather complete a task.
  • Insights into work trends
    – mapping skills to work allows businesses to see clearly when new work is emerging or demand for existing work declines.
  • Talent availability and visibility
    – unlocking people from their job opens a wide range of talent to the organisation and can be supplemented by contractors, freelancers, volunteers and gig workers.
  • Productivity and agility
    – precisely matching skills to tasks allows for rapid lifts in productivity, partly by reducing downtime. One organisation using the approach saw a 600 per cent lift in digital talent productivity.
  • Diversity
    – a traditional jobs-based approach to work provides only episodic opportunities to address diversity and inclusion at hiring, pay review and when positions change. But when hundreds and thousands of tasks are available in a dynamic, project-based environment, the opportunity to address diversity increases exponentially each time a new task is assigned.

How do you get to the new way of working?

Jesuthasan outlines four principles for the new work operating system.

  1. Start by defining the tasks that need to be done – not the jobs that traditionally did them
  2. Use automation and technology to enhance human productivity
  3. Consider all the ways we can work including freelance, contract, gig work, alliances, projects and more
  4. Allow talent to flow to work and don’t limit people to their job.

What you need to put in place

Andrew Lafontaine, Partner, Strategy & Growth, at Mercer’s Workforce Solutions, highlighted two core systems that underpin effective implementation of skills-based work.
  • Workforce Intelligence
    – the technology systems and processes that capture and validate the skills in your workforce, often underpinned by artificial intelligence systems that examine each employee’s work history and education and build a map of all the skills available in an organisation.
  • Talent marketplace
    – the central orchestrator connecting people to work, where projects and tasks are matched to the available talent. The talent marketplace allows businesses to understand the volume and velocity of work, demand for different skills and capability gaps both inside and outside the organisation.

Where to get started?

“Everyone has a different starting point on the road to a skills-based approach to work”, says Lafontaine. Some will need to spend time considering the benefits to their own organisation. Some will want to workshop the idea internally. Others may want to build a business case, create a skills taxonomy or select a technology vendor.

Whichever starting point you are at, Mercer is here to support you.

To learn more, read Mercer’s Guide to Talent Marketplaces or get in touch to speak with a Mercer talent specialist.

Related products for purchase
Related solutions
Related insights
Related case studies