83% of U.S. Organizations Have Skills Gaps. Here’s What They Can Do About It.

The Ugly Truth About Skills and Leadership Gaps in U.S. Companies

It’s no secret that many companies are facing increased difficulty in finding and hiring qualified experts and professionals with the right skills for their business models, strategies and operational needs. But recent research by the Association for Talent Development has revealed some alarming numbers about just how prevalent the problem is.

In a survey of 304 talent development professionals, including team leaders, managers, directors and executives at U.S.-based companies, ATD found that 83% of survey respondents believe a skills gap exists in their company, and 78% anticipate a future skills gap.

As ATD defines it, a skills gap is “a significant gap between an organization’s current capabilities and the skills it needs to achieve its goals and meet customer demand.” If an organization faces significant skills gaps, it risks not meeting customer demand and may not be able to grow, compete and prepare for the future of work.

Fact vs. Fiction: Challenging Doubts About Skills Gaps

However, some analysts challenge these numbers and suggest that skills gaps aren’t real. They claim that skills gaps are mostly a consequence of companies looking to hire people with high-end skills for low-end wages, posting jobs with long lists of requirements that no single individual could fulfill, or not having the talent development and training budgets to find and cultivate the right talent in their organizations.

As Wharton School Professor of Management Peter Cappelli puts it, “While employers say they can’t afford to train new workers, they also say they can’t pay higher wages or find the money for sophisticated recruiting. That alone may be enough to explain why hiring is difficult for U.S. businesses.”

However, ATD’s survey challenges this skepticism with some hard data. When asked why there is a skills gap or will be such a gap within their organizations, 57% of respondents said the skills of their current workforce don’t match changes in company strategy, goals, markets or business models. An additional 48% said that internal candidates lack the requisite skills when being promoted to certain types of jobs, and 45% said there are too few qualified candidates when hiring for certain jobs.

Furthermore, 43% of respondents said their organizations lack skilled talent in one or more of their company’s lines of business, and 43% said they have insufficient bench strength in their leadership ranks. Compare this to the 35% who said that training investments have been cut or that senior leaders lack commitment to talent development, and it seems difficult to dismiss reported talent gaps so easily.

There are clear signs of internal talent issues and difficulties in recruiting qualified external talent that aren’t simply the consequence of offering too little pay, creating job postings that are too demanding, or not having the budget to recruit and develop talent. These factors may contribute to the problem, but they’re not sufficient to explain it away.

The Most Common Skills Gaps

The types of skills gaps that organizations are facing reinforce that there are much bigger issues than pay, job postings and budgets. For example, ATD’s research revealed that soft skills are by far the biggest concern across industries, but leadership and executive skills were also among the most common gaps.

In fact, 66% of respondents said that communication and interpersonal skills are the top missing skill set, followed closely by critical thinking and problem-solving (65%), managerial and supervisory skills (61%) and leadership or executive-level skill (52%). These same four categories were also the areas where respondents expect their organizations to face skill gaps in the future.

Other studies and analysis have also pointed to issues with leadership skills, such as a Development Dimensions International (DDI) study, which suggests that most executives are best equipped to focus on challenges such as improving quality, building relationships and focusing on customers and efficiency. But they lack skills for more strategic challenges, such as building or reinventing brands, markets, organizations and cultures.

Ultimately, this means organizations need to address these gaps, but doing so can be a major challenge. Most companies put the responsibility on their talent development or HR departments. According to ATD’s survey, 69% of organizations place the sole or shared duty for resolving skills gaps on their talent development departments, and 55% believe it’s largely HR’s responsibility. Only 38% believe responsibility lies with senior leaders, and only 16% say it’s with the president/CEO.

Tips for Addressing Skills and Leadership Gaps

Addressing skills and leadership gaps requires a shared responsibility and may require strategies that on multiple fronts, connecting individuals and organizations across sectors and industries and collaborating with outside partners. ATD has helpful insights, recommendations, case studies and even a talent development action plan in its white paper on organizational skill gaps.

But we’d be remiss if we didn’t mention one of the quickest and most efficient ways to address skills and leadership gaps, which is tapping into on-demand talent networks and independent consultants.

At Graphite, we’ve helped many organizations address major gaps in skills, leadership and executive-level roles by connecting them with pre-vetted and highly qualified business experts and consultants. It’s a smart and cost-effective strategy for many companies, particularly when they want to fill a short-term or project-specific need for talent and leadership, or they want to audition a leading professional or executive for a permanent role.

Through our network of over 5,000 independent consultants, organizations can hire experts, managers and executives on demand, adding crucial skills, subject matter expertise and leadership when it might not otherwise be available internally or on the open job market.

Many organizations have successfully leveraged our network to engage interim operators or executives, hire sales, marketing, finance or IT experts, and bring in consultants who can help them develop and reinvent business models, brands, products, organizational structures, operational processes and more.

Each of our consultants goes through a rigorous pre-vetting process, and each must have a proven background at a top consulting firm such as Bain, McKinsey or BCG. Our experts have an average of 12 years of experience, and 57% have MBAs, including hundreds from a top 10 U.S. or international business school.

To learn more about the possibilities, you can visit our website at www.graphite.com to see how it works and search our publicly available consultant profiles. Thousands more consultants with private profiles are also available, and you’ll have a chance to connect with them once they apply for your project or role.

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Greg Andrade

Greg Andrade handles Graphite's marketing and communication programs. A graduate of the University of Michigan, he worked in corporate marketing for 15 years before turning his focus to virtual marketing consulting for startups and global businesses.

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