The World Economic Forum predicts that 44 percent of workers’ skills will experience disruption by 2027. Workplace change is a stark reality: It is rapid, accelerative, and highly disruptive. It’s an era where adaptability and continuous learning trump traditional role competencies and their associated role boundaries. Therefore, training and development approaches must also shift, particularly when it comes to skills.

Skills transparency is an emerging concept that is rapidly becoming the bedrock of modern approaches to talent acquisition and skills development. When talent development leaders gain a comprehensive overview of their organization’s available skill set, employers can, dynamically and strategically, use that data to shape their workforce to align with current and future needs.

A focus on skills transparency has emerged as companies increasingly assemble their workforce around skills. As McKinsey puts it, “The effects of the COVID-19 pandemic, a potential recession, still-rising inflation rates, and the Great Attrition have driven employers to rethink their approach to human capital and talent management. Namely, they’re moving beyond degrees and job titles to focus more on the skills a job requires and that a candidate possesses.”

The rise in skills-based hiring is one part of the transformation; the other component is workplace training. Shaping the workforce through smart, strategic training initiatives has become increasingly important as talent shortages in key industries make hiring an ongoing challenge.

By homing in on skills, employers are taking a fresh look at a wider potential talent pool, many of whom don’t fit the stereotype. Considering a wider range of candidates has many benefits, both for companies’ bottom lines and from a diversity standpoint. Organizations are motivated to evaluate candidate potential beyond the traditional profiles that would normally fill certain roles.

Against that backdrop, the concept of skills transparency has gained traction. More than a buzzword, it’s a fresh new paradigm that helps employers lay the right foundations to nurture an ethos of continuous learning and implement modern, fluid L&D practices.

What is skills transparency?

A skills transparency culture is one where companies don’t restrict employees’ skills, competencies, and learning paths. Instead, employees can openly share with—and gain acknowledgment from—their employers. From a TD and hiring perspective, skills transparency can help organizations assess worker effectiveness and success as well as validate skills and competencies, which is the number 1 challenge, according to the McKinsey article “Taking a Skills-Based Approach to Building the Future Workforce.” The practice also helps prospective candidates (internal or external) to accurately evaluate their suitability for roles and to showcase their own abilities using open, accessible skills assessments.

From an organizational perspective, skills transparency enables strategic workforce planning and talent management. Employers can identify skills gaps and training needs, leading to more targeted and effective L&D initiatives. Such an approach also enhances team building, because managers can assemble diverse and complementary teams based on a clear understanding of each member’s abilities.

The value of visibility

Transparency’s biggest advantage is its impact on company culture. Employees who view their organization as transparent have almost nine times greater job satisfaction than workers with the opposite perception, reports Future Forum. Transparency leads to greater employee engagement and has a positive impact on retention rates.

Many employers consider themselves to be transparent already, but employee feedback suggests otherwise. Future Forum found that 73 percent of executives believe their companies are “very transparent,” yet only 41 percent of employees agree. Bridging that gap should be a core goal for any business embarking on a skills transparency transformation.

Skills transparency is particularly important to understanding career progression and advancement opportunities. In a Hays survey on the state of the US workforce, 61 percent of respondents said they were seriously considering leaving their jobs and 53 percent cited lack of career growth as a key reason for their departure. Conversely, a Deloitte study shows that 64 percent of workers are more likely to remain at an organization if it contributes to their overall growth and helps them to realize their potential.

Implementing a transparent culture

To bridge the transparency disconnect, companies can take practical steps.

Ensure a 360-degree visibility of core skills. Move beyond restrictive job titles and define roles based on skills and experience. Agree to a set of skills criteria and competencies a particular role requires to achieve success. Communicate those standards to employees.

Collaborate with those working in each role. Include managers, strategic business planners, and talent acquisition teams.

Establish clear company goals. Work with talent acquisition to establish which skills the organization needs to meet its goals and which of those are hardest to find. By starting with critical roles and critical skills, companies can keep the project manageable. Too many TD and HR departments get overwhelmed by starting too big.

Share findings internally and externally. Disclosing measurable skills criteria begins the process of transformation within an organization. Long-lasting, meaningful change requires not just leadership buy-in but also creating a culture that supports and encourages development. For instance, by making an employer’s required skills part of an employee’s development plan, leadership can reward managers who encourage and support their team members’ development. By rewarding the acquisition of critical skills with internal mobility, employers show a dedication to employees’ career growth.

Advanced tools to transform a transparency culture

In an increasingly distributed and changing workplace, traditional learning pathways, with their rigid schedules and one-size-fits-all content, are becoming obsolete in the face of roles that demand continuous growth. Instead, L&D professionals need a more flexible mindset that accepts the world of work’s constant flux.

A personalized, highly adaptable approach is gaining traction because training needs vary greatly from employee to employee. By integrating modern tools, such as artificial-intelligence-generated insights, organizations can identify individuals’ specific skills strengths and gaps and map learning pathways accordingly. Modern L&D platforms that leverage AI to process and interpret unstructured feedback and performance data drive successful, skills-based, transparent organizational cultures.

At a micro level, AI systems can analyze an employee’s work, evaluate their project involvement and outcomes, and recommend specialized courses to upskill them in the areas where they individually require support. For instance, a software developer may have excellent hard skills such as coding, but their employer may hold back their career progression due to an absence of soft skills such as networking, public speaking, or presenting. Other software developers on the same team may be versed in those soft skills but seek leadership training. Rather than assigning all software developers to the same learning pathway, use learning platforms and learning management systems that enable each person to develop according to their unique talents and trajectories.

At a macro level, L&D platforms can spot skills gaps and opportunities for the organization as a whole, anticipating future needs. For example, the program could highlight how a worker’s skill set could be highly transferable to other areas in the business. The combination of a transparency culture and modern tools improves skills development and aligns with the organization’s wider goals.

Obstacles

What prevents transparency in the workplace?

Traditional hiring practices. Organizations need to be ready and want to change their usual methodologies. In previous talent shortages, the answer was to hire based on need, filling roles as companies created them or as existing employees vacated their jobs. In today’s market, where skills requirements shift rapidly, that hiring model is less viable, less effective, more costly, and squanders valuable organizational knowledge. Employers must focus on molding the existing workforce to suit precise needs and timelines by developing skills in-house.

Plug-and-play solutions. One-size-fits-all initiatives do not suit modern companies. The tools exist to facilitate personalized learning opportunities at scale.

Lack of executive buy-in. Effective culture change comes from the top with long-term support from executive leaders.

Employee resistance. Workers require support and training to adapt to new tools and technologies.

Lack of trust. Many individuals have privacy concerns about data and AI usage. To combat such misgivings, operationalize a framework of policies and tools that assure trust, such as Gartner’s model, which includes AI trust, risk, and security management (AI TRiSM). The model predicts that organizations that implement AI TRiSM will realize a 50 percent improvement in AI adoption, attainment toward business goals, and user acceptance by 2026.

Data modernization. The time, effort, and cost associated with digitizing an L&D function can be overwhelming. Organizations that need to upgrade archaic legacy systems must invest in those upgrades, but the task is necessary to turn the data into a malleable state.

The future of skills transparency

As the workforce becomes increasingly fluid and L&D becomes more dynamic and personalized, the skills transparency movement is gaining ground.

Many employers are taking steps to become more transparent, but early evidence suggests that results are mixed, with a significant disconnect emerging between organizations’ intentions and workers’ perceptions.

Nevertheless, skill transparency is poised to be a defining force in a boundaryless, skills-centric workforce. As such, successfully implementing a skills transparency culture is no longer a nice-to-have effort but a strategic imperative. This cultural shift, combined with a digitized, AI-enabled approach to L&D, will have a transformative effect on team building, enable employee alignment with company goals, and create a more agile and responsive workforce.

Read more from Talent Development Leader.