Leading Companies Use Skills as the New Currency for Workforce Transformation
Skills have become the new currency of workforce and talent strategies, as more than half of organizations that responded to the 2021 Mercer Global Talent Trends survey are targeting upskilling and reskilling of critical talent pools to drive workforce transformation.2 In response, Mercer has launched its Skills-Edge Suite, an integrated service offering of consulting, technology and data that helps companies advance skills-based talent and pay practices.
For most organizations, from COVID-19 to technological advances, the nature of work has experienced seismic disruptions as we have become more interdependent, knowledge-focused, specialized and flexible about where, when and how we work. Traditionally, the base unit of managing a workforce has been a job. Job descriptions and titles have, until recently, defined how companies viewed work, how they set salaries, and how they made critical decisions around talent and workforce transformation. Today, the base unit of work has fundamentally evolved from jobs to skills.
"It became clear during the pandemic that skills fuel business transformation and organizational resilience. Companies that took inventory of their workforce or talent ecosystem have been able to find talent quickly, move talent to where it's needed most, and make critical talent decisions to keep the business running during uncertain times. Mercer research shows that 14% of organizations that responded to Mercer's 2021 Global Talent Trends survey have already embarked on skills-based talent practices such as skills-based pay," said Kate Bravery, Global Advisory Insights and Solutions Leader at Mercer.
Mercer Skills-Edge Suite will help organizations adapt to the new shape of work through a skills-based workforce strategy. The offering helps to create skills frameworks and roadmaps to help companies transition from job-based practices to skills-based talent and pay practices.
A skills-based approach to workforce strategy assesses talent based on their holistic skill set (including adjacent skills across industries), rather than industry experience or qualifications. A well-designed skills-based workforce strategy will enable organizations to proactively identify future skills needs and develop an actionable plan to retain, build, buy and deploy talent, as needed.
According to Mercer's 2021 Global Talent Trends survey, there has been an increase in talent practices that have enabled organizations to use their talent pool more flexibly. To better adapt to evolving business needs, 44% of survey respondents stated they have already made it easier to loan and/or share talent internally, with 26% to do so in the future.
The Global Talent Trends survey also revealed, however, that organizations are still struggling to understand the skill gaps in their current workforce. Two in five HR professionals responding to the survey admitted that they do not know what skills they have in their own organizations.3
"Transformation demands deconstructing jobs into tasks and skills, and updating talent models so that skills are the basis for defining work and compensation, deploying talent, managing careers and valuing employees. Companies that do this well will be better positioned to meet today's business goals, remain agile in a changing world, and be more likely to retain and attract the best talent over time," said Ravin Jesuthasan, Global Leader for Transformation Services, Mercer.
"By making skills the currency of work, organizations can connect talent to work in a more modern, agile way, and better meet the needs of the changing business landscape. Employers can focus on what skills they need - by either acquiring or developing them through workforce planning and supporting activities - and employees can focus on skill development and career alignment," added Jesuthasan.
About Mercer Skills-Edge Suite
The Mercer Skills-Edge Suite creates skills frameworks and skills roadmaps to help companies to transition from job-based practices to skills-based talent and pay practices; and the support to operationalize and integrate companies' skills philosophy into their HR systems through deployment and optimization services. Some of the new products include:
Mercer believes in building brighter futures by redefining the world of work, reshaping retirement and investment outcomes, and unlocking real health and well-being. Mercer's approximately 25,000 employees are based in 43 countries and the firm operates in 130 countries. Mercer is a business of Marsh McLennan (NYSE: MMC), the world's leading professional services firm in the areas of risk, strategy and people, with 76,000 colleagues and annual revenue of over $17 billion. Through its market-leading businesses including Marsh, Guy Carpenter and Oliver Wyman, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment. For more information, visit www.mercer.com. Follow Mercer on Twitter (News - Alert) @Mercer.
1 Mercer's Global Talent Trends survey, 2021, reflecting 50% of survey respondents