Best practices for skills-based hiring
How do you know who’s right for the job? Making the wrong decision can delay schedules, damage morale and cost your company at least 30% of their salary. In one study, 74% of employers say they have hired the wrong person for a job 1.
As skills-based hiring is on the rise, companies are seeking more effective ways to evaluate candidates and ensure they're making the right choice.
How can organizations stop making the same hiring mistakes?
What is skill-based hiring? Skill-based recruiting assesses candidates on their hard skills and soft skills compared to traditional criteria like a college degree. Recent skills-based hiring statistics reveal the effectiveness of this approach:
Hiring for skills is 107% more effective than hiring for experience or education 2.
The benefits of skills-based hiring? It can expand the talent pool and speed up the time it takes to hire. It also facilitates internal moves within organizations.
Moreover, skills-first hiring helps reduce unconscious bias rooted in past job titles, which often disadvantages minority group candidates. Most of all, it can better match true job competency.
How to implement skills based hiring?
1. Create a skills matrix
Interview your top-performing talent and find out what their strengths are. What specific skill do they use most often? What does a typical day look like, and how does it differ from another person doing the same job at the same level?
Just 24% of workers report they do the same work as others in the same role. Even if the work they do differs, what skills do they share?
2. Rewrite your job posting to put skills first
Evaluate which skills are needed to do the job. Rewrite the job description and put those skills centre stage. What skills will you expect them to use day-to-day?
What transferable skills would benefit the role? Focus on the results you’d like to see, instead of the type of person you think could deliver those results.
3. Train hiring managers and talent acquisitions about the new skill-based hiring process
Make sure everyone is on board. Talk to the hiring manager about hiring for skills.
When comparing skill-based hiring vs degree-based approaches, the data is clear. Give them the facts - hiring for skill is 107% more effective than hiring for experience or having a degree requirement.
Explain the potential risks of hiring someone you ‘spark’ with because they are similar to you - also known as the ‘mini-me’ bias 3.
4. Consider a skill assessment to identify competence
Ask potential candidates to complete skills tests or create a scenario designed to put the skills you’re looking for into action.
If you’re looking for a product owner with leadership skills, ask them what they would do if the next release of their product was due tomorrow but there are a number of bugs on it.
Or create a simple assignment, then conduct a follow-up interview to ask them about their process in completing the task. Their answers will give hiring managers insight into their core competencies and skill sets.
Are you ready for skill-based organization?
With a few simple changes, a skills-based approach to hiring can help organizations make the right hiring decisions. A skill-based recruitment process can also reduce time to hire, increase workplace diversity and reduce unconscious bias.
Implementing these practices can transform your company into a skill-based organization.
Read more: Why you should hire for skill, not experience
References:
The Cost of a Bad Hire, NorthWestern
The skills-based organization: A new operating model for work and the workforce, Deloitte Insights, 08 September 2022
When Hiring, Prioritize Assignments Over Interviews, Harvard Business Review, September 27 2022
