Thursday, May 17, 2018

Top Risk For Businesses: The Skills Gap

The metric that hits the top mark and is currently at an all-time high is the percentage of businesses that identify a lack of skilled employees as their worst management problem. The 'skills' gap' has been a challenge for some time and it is getting worse. It spans all types of jobs from manufacturing to IT to marketing to HR - and it is occurring at all management levels.

Skills' shortages are growing as a major long-term business issue that must be addressed. Companies will need to look at training programs to boost skills among existing workers, and work more closely with educational institutions to ensure the right skills are being taught at an early age.

What are the right skills? Maybe not what you think. Evidence suggests that it is not technical know-how, but soft-skills that are equally, or more, important than technical skills.

Currently, according to LinkedIn, the skills most sought after by companies were:

- Communication
- Organization
- Teamwork
- Punctuality
- Critical Thinking
- Social Skills
- Creativity
- Interpersonal Communication
- Adaptability
- Having a Friendly Personality

Not surprising, LinkedIn's list is very similar to the top 10 skills identified by the World Economic Forum:

- Complex Problem Solving
- Critical Thinking
- Creativity
- People Management
- Coordinating With Others
- Emotional Intelligence
- Judgment and Decision Making
- Service Orientation
- Negotiation
- Cognitive Flexibility

The skills' gap is a key risk for businesses, and the skills they are looking for are soft-skills rather than hard (technical). So, the question becomes: where does one go to get the required soft-skills?

Educational institutions, at all levels, have historically been much better at teaching technical know how than cultivating soft-skills. Teaching models where students have to learn to work together - including across cultural divides must now be emphasized as never before.

Employees, at all levels, know that their skills directly impact their earning power - as the saying goes: "the learning curve is the earning curve."  Additionally, businesses have an incredible opportunity to gain competitive advantage by training current employees in the 'missing soft-skills'.

In a world increasingly saturated with social media and with renewed focus on customer service, the need for mastering soft-skills is paramount and not going away.  Talent is and will in the future be the #1 source of competitive advantage.

Jim Lavorato
Principal, Fund-House Ventures

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