✨ Skills-Based Organisation (SBO): Thoughtfully building a foundation that is ready to scale! 🚀

Why Transition to Skills-Based Organisation (SBO)?

As above, there is compelling evidence and statistics to show that SBO isn't just an HR buzzword; it's a necessary strategic adaptation to the changes technology and other societal factors are having on the rate of change around skills. Currently, work is mostly organised for previous Industrial revolutions; permanent, 9-5, in fixed and siloed teams – suggesting that is the way business models, employee expectations or the markets are now. We know they are not. SBO is really an acceleration in the way organisations match skills to different types of work, whereas before that work was always met with permanent roles, now work is being chopped up and based on the specific skills required. The need for this is driven by the pace of change the market requires for skills, the rate at which skills are outdated, the expectation of employees to enjoy multiple careers and the need to collaborate to solve complex problems, means that embracing this approach is essential for sustaining business success. It leverages the full potential of your workforce and means organisations know that they can fulfil demand for work now and in the future.

…However, with Careful Consideration of the Practical Challenges:

However, you can breathe a sigh of relief that this isn’t another article encouraging readers to blindly build a skills-based organisation at scale, where the roads will be paved with nothing but gold. Hence this article is on the longer side. The investments can be high and whilst major changes are creating a need for quicker and more precise skills mobilisation, they are happening at different rates and in different ways. Many early adopters are reaping the benefits in better mobilising skills, and in some instances entirely new businesses and business models have been created on the premise of matching and quickly mobilising skills with demand signals e.g., LinkedIn, Fiverr, Upwork etc. but within organisations there have been outright failures or more commonly lower adoption levels or levels of impact than expected. The overall case for change is there, organisations can’t remain static on this issue, but in practice, knowing even where to start and where to have impact is more challenging. Key questions include: What are the minimum requirements to get started? What elements are part of the ‘foundations’? Who needs to be involved and how does change and adoption need to be supported? How to utilise the current tech stack? Where in the organisation is ready to start and is there the capacity and appetite to absorb more change?

Capgemini’s Journey:

At Capgemini, we are not just talking about it; we are living it daily. Our practical learnings have helped us chisel out what the key pillars for success are, as well as the common banana skins waiting there on the path. We are progressively building and adopting a skills-based model for our 330,000+ workforce across 50 countries. Through this blog series, we aim to cut through the hype and share practical insights from our experience within Capgemini and other clients we support.

Join Us, in our Blog Series:

For our first blog of the series, Natalie Hughes Jacquemin, Chief Talent and Learning Officer at Capgemini Group and Mark Howarth, VP of Employee Experience and HR at Capgemini Invent share our top five critical lessons that feed into our three-phased approach to building a foundation ready to scale.

So here are our top 5 learnings:

1. SBO needs to be a business transformation, not just an HR initiative. SBO is a holistic change, that needs to be focussed on business priorities, not purely on HR optimisation. At Capgemini, it drives extensive changes across the Talent lifecycle to ensure front-line teams have the right capability to support our clients.  This includes enhancing the way teams are formed to provide the right mix of skills ensuring that individuals are supported to upskill appropriately and recognising their increasing skills maturity in their performance discussions. At the moment, we are particularly focused on upskilling around GenAI and Sustainability via our tailored campuses.

2. Don’t try to boil the ocean. SBO isn't about uniform change; focus efforts strategically where needed most. Diagnostics, vision, and roadmaps drive unique strategies, preventing wasted resources on misaligned investments.

3. Enabling technology is important but not the sole driver of success. Many SBO aspects aren't new; competency assessments and skill-based talent moves have been standard. The difference now is the speed and precision in matching skills to roles, enhancing responsiveness, and reducing admin – through adopting the right consumer grade technology much of which coming with AI. However, SBO success hinges on a comprehensive strategy, strong sponsorship, and cultural change, not just technology.

4. User acceptance and adoption cannot be taken for granted. After all, if no one engages with their skills data and upskilling path, it’s bound to fail. It’s crucial to integrate this within the strategy; assumptions like "build it and they will come" or HR's omniscience often lead to setbacks. Understanding user needs, including skills requirements and team dynamics, is pivotal for effective implementation.

5. Keep the skills strategy adaptable and responsive to change. SBO strategies must remain dynamic, evolving alongside business needs. Continuous feedback loops and adjustments ensure alignment, fostering ongoing learning and sustainable traction. Dare we say it, a controllable amount of failure is going to be a necessary part of progress, to know what works within your specific organisation.

So, what can you do to get it right?

We suggest a three-phased approach: start by building strong foundations, then test before scaling. Let’s dive deep into each phase, sharing our experiences and practical steps to guide you through the process.

Phase 1. Build your foundation: take time to get this right!

1a. Start with Strategy: Identify the problem statements. Why adopt a skills-based approach? At Capgemini, our success hinges on how swiftly we can anticipate and meet changing skill demands with teams that have the right skills profile. The Centre for Management Consulting Excellence predicts a significant shift in consulting skills over the next six years, especially in cybersecurity and Generative AI. Thus, our focus is on targeted upskilling, reskilling, and skills-based recruitment to bridge any gaps. Our journey from here is to broaden skills throughout our people management processes, leveraging skills-based performance management and enabling skills-based internal mobility.

Practical steps:

• Define your overarching goal: Unite your Talent and Learning, HR, Group IT, ERP Delivery Teams, and Business SMEs to define your vision for SBO and how the sum of the parts will enable this. This collaboration will help you not only focus efforts in the right areas, but you will also gain early commitment by demonstrating the value and practical benefits it can bring to the business.
• Achieve quick wins: Focus on areas with quick wins to demonstrate value to your stakeholders. For us we started with Talent Deployment and Performance Management. You may want to be skills-based across the hire to retire lifecycle but start incrementally to ensure it sticks.

1b. Develop: Your core architecture to underpin your transformation. As a global, matrixed organisation, building a skills-based foundation meant developing around 25 Professional Communities across functions. As a role can be found in different parts of the business this approach unlocks more agile resourcing, talent mobility and targeted upskilling. We also adopted a single skills ontology which presents the source of truth on skills, creating clarity and consistency, essential to the transformation. 

Practical steps:

• Build from what you have: if you can avoid it, don’t start from scratch.  Any established infrastructure like a competency framework can serve as the basis to build off.
• Create consistent understanding of terms: Start by getting everyone speaking the same language - skill vs. competency, role vs. job, mobility vs. assignment mobility.
• Establish a source of truth: Determine your source of truth on skills and where your skills taxonomy should reside for seamless system integration. And if you don’t have a single taxonomy, you may need to build middle ware. Regardless, your taxonomy needs to be scalable so that it can last.  

1c. Design: Use technology to enable your skills experience.

Many rush into tech solutions, only to backpedal later. The lesson? Adopt the right tool without haste. Most of us are managing skills via quite a complicated tech stack: our core HRIS, Learning Experience Platforms, our Talent Deployment tool, our internal SharePoint sites and more.  Navigating a smooth and seamless employee journey is crucial for it to be used! 

The critical question isn't whether you need specialised tools in addition to your ERP —chances are you will—but how to select the right ones. A wrong choice risks exacerbating issues like data silos and poor user experience, derailing your transformation efforts.

Practical steps:

• Understand your ERP's capabilities: Leverage your ERP's evolving skills management and scalability, ensuring it aligns with your skills ambitions in the medium term. Only then pinpoint specific challenges where a best of breed tool could enhance or fill gaps. Too many tools with overlapping functionalities can undermine your transformation efforts.
• Consider your integration needs: Match tools to use cases and ensure consistent data flow because depending on your use case, the integration needs will vary.
• Minimise manual effort for people-and certainly remove any repeat work: Consolidate data entry points across systems to eliminate redundancy and ensure consistency.

Phase 2. Test: Pilot

Practicality is paramount. Start with willing early adopters to build success stories, refine your business case and drive further rollout. Begin small where the impact can be measured effectively. For skills-based Talent Acquisition, we focused on high-volume, strategic roles while keeping everything agile.

Practical steps:

• Select your pilot group: Choose a business area based on critical needs, readiness for change, and skills maturity.
• Maintain parallel operations: Operate the skills-based model alongside the traditional model to minimise disruption for employees and HR.

Phase 3. Scale

Scaling requires careful planning, phased implementation, and a supportive culture. Communicate successes and continuously measure progress. One common issue is neglecting the necessary culture shift. For instance, in skills-based mobility, line managers often resist changes due to familiarity with traditional role-based assignments.

Practical steps:

• Communicate successes: Share early success stories to build momentum and support your scaling efforts.
• Implement phased rollouts: Start with departments or regions that are most ready or have the highest need for skills-based changes. Use metrics such as current skill gaps, employee readiness, and business impact to decide where to begin.
• Measure and adjust: Track key metrics like employee engagement and skill utilisation to identify areas for improvement.

Shifting to skills is a huge change. It requires new technologies, cultural shifts, and new ways of working. It takes time, investment, and bringing the business on the journey.

What challenges do you foresee in adopting a Skills-Based Organisation model within your organisation? What excites you most about its potential? Share your thoughts, questions, and experiences in the comments below.