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What is a Skill Gap Analysis and Why is it Important?

Melis Oktay
What is a Skill Gap Analysis and Why is it Important?

Making skill gap analysis is essential for employee development and company success. As companies grow and get more competitive over time, their goals change too. New things bring new challenges to face along the way, and organizations’ number one goal is to keep overcoming the challenges to deliver their objectives. Every company needs to identify the organizational needs of their goal they need to meet and manage their workforce accordingly.

As we mentioned in our article How to do Strategic Workforce Planning, companies need to have an adequately competent workforce at all times to keep delivering and stay competitive. But, how can one know if their employees and teams are qualified enough to keep up with the challenges of the market? The answer is simple, skill gap analysis. In this article, you can read about skill gap analysis, how you can do it in your organization and why you should care about it. 

What is skill gap analysis?

The skill gap analysis is a project carried out by an organization to evaluate and understand the skills required in their workforce. It helps in understanding the current and future demand for various skills in the market. It also helps identify shortfalls and opportunities when it comes to talent acquisition for skills that are not available internally. 

There are several things to be considered while making a skill gap analysis for your organization; 

  • The skills required internally,
  • Skills available externally,
  • Future demand projections,
  • Skills shortage/surplus projections,
  • Skill gaps projected through the next term

A skill gap is a difference between the skills needed for a job and the skills currently possessed by the person performing it. This difference could be caused by changes in technology, changes in the field of work, or both. Identifying skill gaps are essential in creating a workforce strategy for your organization.

Defining skill gaps in your organization help you in several ways. By keeping track of your team’s qualifications and identifying emerging shortcomings, you can understand how different skill levels affect organizational performance and ensure that your team members have skills relevant to their jobs. 

Also, being aware of the skill gaps in your organization help your employees find their strengths and weaknesses, so they can have an opportunity to grow and let you manage your talent better.

How to do skill gap analysis?

Creating the plan 📋

Before starting the process of skill gap analysis, you need to clarify what is going to be the purpose of this analysis so that you can choose the right way to do it. In general, there are two options for employers to choose from regarding what they are expecting from the analysis. First, you can do a skill gap analysis that focuses on individuals in your company if you are trying to decide whether an employee’s current skill levels are adequate for the job they are doing or applying for.

Also, you can do a skill gap analysis for your whole company. This will help you determine if your current workforce will be enough to meet your organizational goals in your upcoming terms and if they are qualified enough to help your company develop. That way, you can either decide on hiring new talents to fill your projected skills gaps or focus on employee training programs to help your current workforce advance. 

Identify your company’s current skills 🧐

Next up, you should make an extensive, organization-wide competence assessment in your entire company, including every department and employee. Identify the skills you currently need and the skills you will need in the future, determine their importance according to their levels of affecting the smoothness of your workflow and keeping your company successful. That way, you can correctly examine the results of the competency assessments you made in your organization and see which employee has the qualifications that are going to help your company the most.  

Time to act 🏃‍♀️

After making a thorough evaluation of your company’s current competency level, you need to compare it to the requirements of the market and figure out what you need to improve to stay competitive. You can take two different paths here; hiring or training. Since hiring new talents and including them in your workflow is much more costly than just training existing employees and developing them, covering for your skill gaps with employee training programs is the way to go, if it’s possible, of course. 

Identify and cover your skill gaps with Kolay! 👓

The workforce management platform Kolay helps you in all your complex HR processes. With Kolay, you can make goal-based or competency-based performance evaluations to identify your company’s skill gaps! Start your Kolay trial now for free, and take your company one step forward with modern HR solutions.


1- https://whatfix.com/blog/skills-gap-analysis

2- https://www.aihr.com/blog/skills-gap-analysis

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