1. Got Skills?
Managing the Skills Gap in your Organization.
Gordon Ritchie, Offering Manager and Product Evangelist
May 18th, 2016

2. © 2016 IBM Corporation2
Agenda
1. No One Talks about the Competency Gap
2. Redefining work and connecting skills to results
3. Four steps to skills management
4. Conclusion

3. © 2016 IBM Corporation3
ONE: NO ONE TALKS ABOUT
“THE COMPETENCY GAP”
Define the skills your enterprise will need in the future, as
industries converge and ecosystems predominate. Bring in new
and necessary talent. Any enterprise that follows these steps will
be in a much better position to navigate the tempestuous winds
of disruption and lead like a Torchbearer.
2016 Insights from the Global – The CEO Perspective
IBM Institute of Business Value

4. © 2016 IBM Corporation4 4
WHAT ANALYSTS SAY AND HAVE BEEN SAYING…
“…are the currency of Talent Management”, Josh Bersin, 2007
“Skills are the new arms race; our newest research shows that nearly 70 percent of global organizations feel they lack
the required skills to compete..” Building a Smarter Workforce, 2013
“..the most critical, foundational component of the roadmap is the establishment of job responsibilities and
competencies… If those initial foundational elements are missing, then the rest of the organization’s structures are
prone to inconsistency.” Integrated Talent Management: A Roadmap for Success, 2012
“… companies realize they cannot solve their skills shortages externally. To achieve competitive advantage, they must
commit to developing the right skills internally” Corporate Learning Factbook, 2012
SHRM reported in their 2013 Employee Job Satisfaction survey
that being recognized for the skills you have is now the #1
employee job satisfaction issue, above pay, benefits, etc.

5. © 2016 IBM Corporation5
Show me the Skills
Source: 2014 IBM CHRO study: New Expectations for a
New Era: CHRO insights from the Global C-Suite Study
% of CHROs
87%
80%
68%
65%
60%
Talent Development
Employee Engagement
Talent Retention
Workforce Productivity
Sourcing & Recruiting
CHROs find developing talent to be their
largest workforce challenge
• 66% anticipate losing business to
competitors
• 64% fear a loss of revenue
• 53% anticipate delays in innovation
• 59% face lower customer
satisfaction
• 87% say their employees feel more
pressure/stress
Accenture 2013 Skills and Employment Trends Survey
CEOs fear gaps in their current talent will
directly impact customer success:
90% of organizations DO NOT have the SKILLS they
need to be successful!

6. © 2016 IBM Corporation6
How is this being addressed? Learning and Hiring…
1 Bersin Corporate Learning Factbook
To address talent gaps
at all levels,
organizations have
directly increased
their L&D budgets by
11% since 20131
Corporate L&D
spending topped $130
billion yet many don’t
know where this
spend is focused1
identify and address
gaps – adding
precision to guide the
Learning or make
informed Hiring
Decisions

7. © 2016 IBM Corporation7
Not an HR issue, a business survival issue
Competency Framework Development:
Buy vs Build?
• 7,000 Job Descriptions, 180,000
People
 Average tenure is 12 years, 22 if you don’t
count people working in call centers.
 Integrated across SuccessFactors and SABA
 9 Months start to finish
 Sponsored by Recruitment, Org
Development, Learning and Development
and Compensation
Gearing Up for the Cloud, AT&T Tells Its
Workers: Adapt, or Else
• Skills 8: Competencies 0
• Vision 2020
 Complete its cloud based software
transformation: IoT, phones, satellite
television and huge volumes of data
 combines online and classroom-based course
work in subjects like digital networking and
data science, as well as a look at old skills
that can be transferred to new careers.
 internal website where employees can enter
their job titles, see what types of careers
might be available in a software-driven
company, and what courses they need to
take to get them.
 a year into the program, over half of the work
force, mostly managers, has started training,
sometimes with dozens of short online
courses
http://www.nytimes.com/2016/02/14/technology/gearing-up-for-the-cloud-att-
tells-its-workers-adapt-or-else.html?_r=0

8. © 2016 IBM Corporation8
Reinventing how and where we talk about a job
• A linked framework of the
skills needed to be
successful in delivering
the business results
required, and tools to
develop and do better.
• A Blueprint of the talent
you require to continue to
be successful.
http://www.bersin.com/blog/post/The-End-of-a-Job-as-We-Know-It.aspx

9. © 2016 IBM Corporation9
TWO: REDEFINING WORK AND
CONNECTING SKILLS TO
RESULTS

10. © 2016 IBM Corporation10
How do we usually define work? Job Descriptions
 Regulatory, Legal
 ADA, FLSA, EPA, SEC, TJC…..
 Job Postings
 Why work for us? What we mean by an Accountant:1
 Survey Matching
 What does the survey define as an Accountant:1 as
and is that the same as ours?
DEFENSIBILTY,
RECRUITMENT,
COMPENSATION
So how much do we value or invest in a job description?
$5, $50 or $5,000?

11. © 2016 IBM Corporation11
What is meant by “skills”?
 Aptitude or Ability?
 Capability or performance?
 Behaviours?
 Competency or Values?
 Education/Schooling?
 Time served in a role
What is meant by “gap”?
 A gap is a measure of distance between
two points.
 To have a gap, you need to know
A) the start point
B) the end point
Skill Innovation
Definition
Develops new ideas and initiatives that improve
the organization's performance.
Level 2:
Working
Experience
Seeks new or non-traditional ideas to improve effectiveness in
own area of responsibility.
Participates in efforts to develop ideas generated by team
members.
Seeks applicable new ideas and approaches.
Surfaces ideas from other groups that have applicability to the
team.
Helps develop implementation plans for introducing innovations
to the group.
Level 3:
Extensive
Experience
Encourages exploration of non-traditional ideas from team
members.
Seeks new or non-traditional ideas to improve effectiveness in
team's area of responsibility.
Fosters a team culture that encourages exploration of non-
traditional ideas.
Guides team members in the development and fulfillment of
proposed innovations.
Develops change initiatives that target improvement of
significant organizational capabilities.
Implements strategies for renewing or deepening change
efforts.

12. © 2016 IBM Corporation12
3 Questions to Ask about how you define, value and equip your
workforce?
What are the
organization’s
strategic priorities?
What are the critical
skills required to get
the job done?
Does the workforce
already possess
those capabilities,
and if not, do we
develop or hire?

13. © 2016 IBM Corporation13
Connecting Skills to Business: Examples of Potential Impact
Career Impact: Turnover
80,000 employees - limited
career opportunities for 10,000
EEs in key role – results in high
turnover: 30%
3,000 employees replaced on an
annual basis @ an average cost
to replace @ $50K yields:
$150M in turnover costs
READINESS: KEY ROLE
By highlighting career
pathways/competencies required
for succession we can reduce
turnover by 1 point to 29%
means replacing 100 fewer EEs
Savings of over $5M in
annual cost
Innovation: Hiring Costs
25,000 employees across 15
countries
Major focus on creating a new
product line that is highly
innovative
Current resources are unknown –
need 10 new headcount
READINESS: INNOVATION
By highlighting current
strengths/qualifications within the
organization; identified 8 internal
resources that have the right
technical skills
Saved external hiring costs
of $600K for 8 employees @
$75K per employee
Training: Sales
200 sales people in key position
Mandatory training required
annually over 2 days @ 8 hours
per day
Average sales of $10,000 per day
($2.4M per year)
READINESS: SALES
By assessing current proficiency
on required skills and only
training on specific skills saves 1
day of training each sales person
If 200 sales people are back on
the floor selling during that day
yields $2M in increased
sales on an annual basis

14. © 2016 IBM Corporation14
Focus on impact
• Culture
• Alignment
• Direction
• Operation
• Execution
• Customer Engagement
$$$$$$$$$$$$$$$$$$

15. © 2016 IBM Corporation15
THREE: FOUR STEPS TO
SKILLS MANAGEMENT

16. © 2016 IBM Corporation16
SUCCESS FROM FOCUSING ON THE JOB AT HAND
 Develop and use quickly and update over time.
 Focus on buy-in and change management
processes.
 Make sure you get to the application; don’t get stuck
in model development
 Get the “big things
right”; “don’t dwell on
the small stuff”.
 Apply existing materials
and best practices in
developing a rapid draft
 Focus on the overall
architecture
 Clear success criteria
and themes.
 Models for
learning how to
change behaviors
(vs. a perfect
output image).
 Demonstrate
prototypes
application
Integration
Iteration
Launch &
Communication
Implementation
IBM Talent Frameworks
Development
80% of the effort
Recommended Approach
20% of the effort
Typical Competency Development
application
Integration
Iteration
Launch &
Communication
Implementation
20% of the effort
(if able to move out of development stage)
Typical Approach 80% of the effort

17. © 2016 IBM Corporation17
Skills Management Process
VERIFY / ASSESS :
Self-assessment of
proficiency with manager
verification / Testing of job-
based skills through
Assessments
WORKFORCE
READINESS: Enable
action through employee
and organizational views of
talent
IDENTIFY
REQUIREMENTS FOR
TALENT SUCCESS:
Enables mapping and
validation of jobs to
competencies
ANALYZE AND
IDENTIFY TALENT
GAPS:
Talent gap reporting, skills
matches, reporting by
competency
Validate Skills
Outcomes
requirements for
success
Gaps in proficiency,
capability, and
coverage are
identified
Workforce
Readiness planning
is enabled at
individual and
organizational
levels
Confirm
competency
proficiency utilizing
multiple
approaches
Identify and Address Talent Gaps by to Build a Global Supply Chain of Capabilities

18. © 2016 IBM Corporation18
Map Competencies and Skills Required For Each Job Role
IDENTIFY
REQUIREMENTS FOR
TALENT SUCCESS:
Enables mapping and
validation of jobs to
competencies
Identify linkages between organizational roles and key competencies and skills across a consistent job
reference architecture
IBM Kenexa Talent Frameworks provide:
• Ready-to-use job descriptions
• Job specific competencies
• Proficiency-based behavioral statements
• Development goals
• Coaching tips, and
• Interview Questions aligned to the competencies
• Multiple learning formats mapped to specific
competencies
Ensure skills definitions is used across development planning, succession planning,
hiring, performance management, and learning management

19. © 2016 IBM Corporation19
• Functional area with in each
industry or expertise
• 6 Job Bands for employees,
management and executive
matrices
• Job descriptions
• Job profiles
• Job responsibilities
• Job focus
• Compensation Market Data
Business – 36
Individual – 28
Management – 22
Leadership – 32
Functional/Technical – 2,000+
4 Levels of Proficiency with 21 unique
behavioral descriptors for action
oriented skill observation, evaluation
and communication.
Each competency has a suggested
level of proficiency used for each role.
Competencies (2,000+) Application Accelerators
• Learning References (OJT, Web,
References, professional bodies, etc.)
• SMART Development Goals
• Coaching Tips
• Performance Feedback Writing
Assistants
• Interview Questions
Designed to engage and optimize use In
context. Extends the application of the
competency model to support models such as
the 70/20/10.
• General Corporate Functions (HR,
Finance, Legal, Sales, etc)
• Information Technology (IT) Operations
(Agile, Cloud, Security, Mobile, etc)
Job Families (185+)
Jobs Profiles (2,500+)
Industry Frameworks General Competency Frameworks
• Banking & Financial Services • OEM Software
• Construction • Insurance
• Consulting Services • Manufacturing
• CRM Call Center • Media and Publishing
• Education • Pharmaceutical
• Energy • Real Estate
• Healthcare • Retail
• Hospitality • Telecommunications
• OEM Hardware Manufacturing
IBM Kenexa Talent Frameworks: Jump Start

20. © 2016 IBM Corporation20
Assess and Verify Proficiency
VERIFY / ASSESS
COMPETENCIES:
Self-assessment of
proficiency with manager
verification / Testing of job-
based skills through
Assessments
Confirm proficiency across critical job-relevant competencies utilizing multiple approaches
Confirm required
skills.
Employee self-assessment of proficiency
levels across skills with verification

21. © 2016 IBM Corporation21
Analyze Competency Results to Identify and Illustrate Gaps
ANALYZE AND
IDENTIFY TALENT
GAPS:
Talent gap reporting, skills
matches, reporting by
competency
Gaps in proficiency, capability, and coverage are identified
Employee Competency Gap Analysis:
Identify which employees require the
greatest development and which
competencies should they target
Organizational Competency Gap Analysis:
Identify competency gaps by function / team
which would prevent meeting business
objectives
Subject Matter
Identification:
Identify peak
proficiency
across the
organization

22. © 2016 IBM Corporation22
Informed Action to Address Gaps at Individual
and Organizational Levels
WORKFORCE
READINESS: Enable
action through employee
and organizational views of
talent
Workforce Readiness planning is enabled at individual and organizational levels
Identify and
define
functional or
cross group
career
pathways
Job and career planning enables efficient
identification of target jobs, core skills
needed, and proficiency required for any
job
Employees can act on results to plan
competency-based learning activities and
schedule according to priority

23. © 2016 IBM Corporation23
FOUR: CONCLUSION

24. © 2016 IBM Corporation24
A Skills Based Job or Talent Frameworks connects…
Attracting
Candidates
Hiring
Decisions
On boarding Managing
Engagement Performance
management Development
Compensation
planning
Set expectations of who
will be successful in the
job beyond a job
description
Smarter hiring
decisions based on
capability to do the
job
Improve chance of
success and retention
with accelerated time to
productivity
Support managers
development
discussions with tools to
improve trust and
impact.
Provide clear view
of portable/mobile
skills to engage the
engageable.
Provide job specific
performance criteria for
evaluation and
contribution.
Drive up learning
as its easier to find
content in your
LMS
Understand the jobs
you are matching
beyond just the salary
survey job title.

25. © 2016 IBM Corporation25
SMART Goals Competencies, Skills,
Behaviors
Cross-functional
Skill Mobility
Interview
Questions
Learning
Suggestions
Coaching TipsPerformance
Feedback Help
IBM Talent Frameworks Job
Profiles
Career Paths and
Job Levels
Example: The SuccessFactors Cloud

26. © 2016 IBM Corporation26 26
12 SKILLS MANAGEMENT BEST PRACTICES TODAY
Model Building
1. Ensure linkage between competencies and skills with organization strategies
2. Keep models simple at launch
3. Add dimensional criteria and keep the momentum
4. Don’t start from scratch: buy Skills Dictionary or Talent Framework
Applications
5. Focus on assessment and development first, then evaluation and pay applications
6. Integrate of the competencies with all processes, even if tools aren’t
7. Ensure consistency of applications rather than allowing too many variations
Change Management
8. Clarify and communicate specific objectives of your applications up front
9. Ensure top management and line management buy-in and ongoing support
10. Be focused in implementation (i.e., one function, one pilot group first)
11. Provide training and communication more consistently and carefully (building in training at all
stages of implementation)
12. Develop and consistently apply a measurement system used to evaluate the effectiveness of
implementation over time

27. © 2016 IBM Corporation27
Future of HR Systems
• https://www.ibm.com/blogs/smarter-workforce/2015/11/exploring-a-newwaytowork-ibm-and-outside-influencers-predict-the-future-of-hr/
• http://www.hr.com/en/app/blog/2015/12/the-future-of-hr-in-
2016_iia7skny.html?cm_mc_uid=40912972335514151088464&cm_mc_sid_50200000=1450364170
• http://www.bersin.com/News/EventDetails.aspx?id=19402
Josh Bersin: two thirds of us are overwhelmed and our companies are not sure what to do
about it. Improving the work experience is a top priority. Makes systems easier to use as
“systems of engagement’. Engagement is an always on issue. Shift from HR centric to
Employee Centric
Consumerization
Personalization
Employee Centric
Systems of engagement

28. © 2016 IBM Corporation28
Help Pull the people levers that drive the business measures
• Describe the skills a worker needs to demonstrate to be successful.
• Ensure they are aligned to the business measures of success
• Focus on making skills accessible for people to connect on their job and use them for:
 Hiring with better Interview guides
 Development with Coaching guides
 Career Planning with transparent career matrices
 Growth with Prescriptive Learning Plans
 Focused management in agile performance discussions
“Mind the gap”

29. Got Skills?
Managing the Skills Gap in your Organization.
Gordon Ritchie, Offering Manager and Product Evangelist
ritchieg@us.ibm.com