Organizational Wellness

How to Conduct a Skill Gap Analysis [5 Steps]

Feb 1, 2024
Last Updated Feb 1, 2024

As your company prepares to tackle future projects like adopting AI models, you’re likely to face the challenge of staying competitive and maintaining a skilled workforce. The rapid advancement in technology across numerous industries, as well as changes in sector trends, make a proactive stance towards addressing skill gaps a top priority. This forward-thinking approach can help sustain your success as an industry leader while you gear up for future opportunities.

When creating an adaptable business strategy, skill gap analysis emerges as a valuable aspect of performance management. It can help you align your staff’s abilities with the strategic goals of your organization for a more resilient and competitive organization. Discover ways your company can leverage this process to fill in the gaps between current capabilities and those required for future success.

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What Is a Skill Gap Analysis?

A skill gap analysis is a tool that companies can use to measure the disparity between current employee competencies and the proficiencies necessary to meet performance requirements. By identifying which skills can support company goals, this analysis can help your organization determine what to focus on in training.

Effective skill gap analysis benefits both existing employees and potential hires. It aims to dial in on specific blindspots for each employee so that the organization can offer development opportunities tailored to both their roles. It can also guide recruitment efforts as it shows HR leaders which capabilities could be supplemented with new team members.

Of course, not every skill is needed for all industries and positions. Instead, a skill gap analysis can provide insights into the specific abilities that employees need to perform their jobs. Whether that is something like inventory management or team leadership, the analysis can help ensure that your employees are on top of the latest advancements within your industry.

Why Is Skill Gap Analysis Beneficial?

Whether you are planning the next company training or recruiting new talent, a skill gap analysis can offer valuable insights into the current capabilities of your team. By identifying areas for growth, HR leaders can enhance employee performance. These benefits go beyond immediate changes to support long-term success within the organization. 

  • Insights into employee knowledge. One of the primary benefits of a skill gap analysis is that it gives meaningful insight into an employee’s knowledge about topics related to their duties. It is important to make sure that no team member is left behind when adopting new technologies or processes. The analysis can show both strengths and weaknesses so that employees know where to focus their attention. It can even illuminate how they can offer support to coworkers who may struggle in an area in which the employee excels.
  • Development and learning opportunities. Another reason for skill gap analysis is that it encourages employees to pursue targeted development and learning opportunities. Instead of attending training that is irrelevant to their position, individuals can focus their efforts on the skills that they need the most to succeed. Your organization can provide training sessions that focus on the most relevant talents and encourage employees to set clear learning goals.
  • Stronger competitive advantage. Companies in every industry are, of course, concerned with maintaining a competitive advantage. Skill gap analyses can help here as they serve to identify the expertise an organization must foster to stay ahead of competitors. 
  • Insights into what to focus on when recruiting. While organizations should provide existing employees with opportunities to reskill and upskill to stay in line with the  latest industry trends, it can help to recruit top candidates who already possess the needed capabilities. Once the necessary skills are identified, companies can work to attract the best talent and align them with the current business objectives.

How to Conduct a Skill Gap Analysis

HR teams are often responsible for conducting these analyses, so having a few basic steps can guide your efforts. It is important to remember that these analyses can take time and may need to be repeated as technology continues to change. 

  1. Plan Ahead

Before you start, plan how and when to conduct the analysis process. Depending on the size of your organization and employee performance, you may choose to perform a skill gap analysis on an individual basis or a company level. Both offer useful insights, but one may be more appropriate for your needs.

  1. Identify Key Skills

Once you plan for the analysis, you will need to identify valuable proficiencies to help employees — and the company itself — reach future goals. For example, organizations that are planning to expand operations in the future may want to determine how familiar employees are with cloud-based reporting systems. These systems can be used to keep different offices on the same page, but you may want to make sure employees can effectively utilize the system. Whatever the goals of your company, the skills that you measure should reflect the direction you plan to take. 

  1. Measure Current Skills

The next step is to measure the abilities of current employees in each of the areas that you have identified as necessary for achieving company goals. There are numerous methods available for measuring employee skills, including assessments, surveys, interviews, performance reviews, and 360 reviews. It’s typically best to use a combination of these measurements to gain the most accurate picture of where employees need to improve.

  1. Identify Gaps

After you identify how well the employees understand and utilize different skills, you can identify any areas where they are lacking and take action to resolve the disparity. Closing the gap could mean creating training for employees that targets the qualifications they need in order to succeed. Training can be in-person or online, through a mentorship program, or even through certifications.

  1. Hire New Talent

If the skill deficiencies of current employees are too large to tackle with training, consider hiring additional employees to supplement these areas. An abilities analysis can provide a clear idea of what capabilities are important for each position, and you can use that to guide talent acquisition.

Tools for Supporting Employee Development

A skill gap analysis can serve as a compass to guide your organization through the AI revolution and upcoming business challenges. It offers insight into current employee knowledge and helps companies develop a stronger competitive advantage. By identifying areas where current competencies fall short of future demands, your company can strategically invest in training and talent acquisition.

Wellhub is here to help you deliver the support and resources that your employees need to thrive. With a range of unique employee benefits like access to fitness studios and nutrition apps, a wellness program can help you boost employee engagement and satisfaction. Talk to a wellbeing specialist to learn more about how Wellhub can help you enhance your employee benefits.

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Wellhub Editorial Team

The Wellhub Editorial Team empowers HR leaders to support worker wellbeing. Our original research, trend analyses, and helpful how-tos provide the tools they need to improve workforce wellness in today's fast-shifting professional landscape.


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