To unlock the potential of a skills-based organization (SBO), companies must focus on four proven drivers of success !
Nicolas BEHBAHANI
Global People Analytics & HR Data Leader - People & Culture | Strategical People Analytics Design
🔥 The average half-life of skills is now less than 5 years—and in some tech fields, it's even shorter.
📉 That means organizations can no longer afford static roles and rigid career paths.
💡 To keep up with shifting market demands, talent shortages, and fierce competition, forward-thinking companies are redesigning their people strategies around skills, not just jobs.
✅ The secret? A successful Skills-Based Organization (SBO) isn’t just an HR initiative—it’s woven into the core business strategy, goals, and workforce planning.
❌ Launching an SBO for the sake of trend isn’t enough. ✅ True success comes when teams can continuously learn, adapt, and redeploy their skills in response to real business needs, according to a new interesting research published by Boston Consulting Group (BCG) using data from their internal clients.
✅ Four Success Factors to Overcome barriers to skills-based organization initiatives
Researchers identified four success factors that can help companies overcome common barriers to skills-based organization initiatives:
Focus on what helps the business the most.
Anchor skills-based organization work in the business
Use tech as a means to an end
Connect skills to the company’s culture and people agenda
Researchers found that organizations need to focus on what helps the business the most. Skills-based organization initiatives are successful when companies resist the urge to do too much too soon. They create a strategic skills plan and launch an end-to-end skills-based organization on a trial basis in a subset of the company—such as in a single business unit—where they know they can achieve quick wins that will create measurable impact and value before rolling out an initiative at scale.
✅ Key barriers for a SBO organizations
In another research done by TALiNT Partners shared by myself, researchers already found that there are three key barriers for a skills-based organizations:
❌ Internal politics
❌ Defining and assessing key skills
❌ Cultural resistance
In a follow-up to earlier findings, BCG researchers uncovered additional noteworthy challenges commonly faced by skills-based organizations. Among them stands a crucial barrier to success:
❌ Lack of Planning. Companies may fail to give themselves enough time to translate business strategy into a strategic skills plan. Between identifying skills gaps and recruiting to fill them and launching upskilling or mobility programs, this process may take three to five years.
❌ Isolated Use Cases. Companies often launch use cases that aren’t related to or don’t build on each other or that aren’t connected to HR activities that support the broader business strategy
❌ Lack of Integration Throughout the Employee Life Cycle. Companies sometimes launch a skills-based organization initiative that addresses a single point in the employee life cycle—they switch to skills-based recruiting, for example.
❌ Lack of Business Involvement. A company’s HR function may lead a skills-based organization initiative without input or buy-in from the business.
🚀 Finally researchers recommend below actions for a successful skills-based organization initiative :
✔️ Have a clearly defined ambition. Determine what you want to achieve and align initiatives with strategic priorities. Identify specific business needs that a skills-based approach can address, such as closing a digital skills gap or improving mobility.
✔️ Build a joint HR and business team. Form a cross-functional cohort of leaders and personnel from HR and the business to plan and implement any initiative.
✔️ Implement a strategic skills-planning framework. Create a strategic plan to determine demand for and supply of critical skills. Use the plan to identify gaps and design HR measures to fill them, including hiring, reskilling, upskilling, or moving people into different roles.
✔️ Find tech tools that meet your specific needs. Prioritize easy-to-use AI-based or other solutions that fit current and possible future use cases and that can be integrated with existing HR and business systems.
✔️ Foster a company culture that amplifies skills. Promote a culture of continuous learning and adaptability. Encourage leaders to model these principles by embracing skills-based talent decisions. Align incentives and career paths with skills development rather than traditional job roles.
✔️ Use what you learn to scale. Use key success metrics, such as talent redeployment efficiency or skills gap closure rates, to measure effectiveness
☝️ 𝙈𝙮 𝙥𝙚𝙧𝙨𝙤𝙣𝙖𝙡 𝙫𝙞𝙚𝙬:
I find the latest BCG research on skills-based organizations (SBOs) both timely and insightful—especially the emphasis on anchoring these initiatives in business strategy, not just HR oversight.
As I’ve highlighted in previous research, only 22% of organizations have a clear strategy for skills-based transformation, and just 15% truly recognize its benefits. That gap is striking—and it reinforces the importance of aligning SBO efforts with real business needs, not launching them as standalone HR projects.
What I particularly appreciate is how the researchers identified four key success factors that help overcome common barriers. These include strategic planning, piloting for quick wins, integrating technology purposefully, and embedding skills into company culture
Thank you 🙏 Boston Consulting Group (BCG) researchers team for these insightful findings: Dr. Sebastian Ullrich Jens Stefan Baier Vinciane Beauchene Suketu Shah Fabio Tank
Dave Ulrich George Kemish LLM MCMI MIC MIoL
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Founder @ Yucap | Rebuilding leadership with human insight l Creating the Leadership Navigation Platform for teams that want to thrive — not guess.
1moNicolas BEHBAHANI very interesting topic Skill Based Organisations. It is essential for organisations to design a vision on it. The pace of innovation is that high that it requires strategy how to build a sustainable business in the future. Key questions like “what business are we in?” “What is our purpose?” “Where we want to play?” And “What do we need to stand out? - people, skills and systems.”
HR and OD Expert with expertise in organizational design and people management.
1moAn insightful post and research work Nicolas BEHBAHANI, it is timely and relevant. In times when there is lot of disruption, focus on skills building and integration with the business is the key. Anchoring skills with the business needs is an organizational need of all times, but it has gained more momentum now when skills is more important than the qualification or degree. When I have experienced in different organization is that certain individuals dominate the workplace mostly not by virtue of their skills or competence but power politics. They are the real barrier to creating a skill based organization, since they are not relevant to the needs of the job or titles they hold, they are always there to resist any change. When there is a resistance to change, learning new skills as per the job requirements is never a part of their professional mandate. It is how the life goes. But change is inevitable, and it cannot be resisted for long, shallow approaches never work. People of substance they ultimately appear successful. Thanks once again Nicolas BEHBAHANI
Tactics for execs who own outcomes and create the path forward | Passionate sailor investing into the blue economy | Entrepreneur & CEO
1moOne thing I’d add: most companies underestimate the mindset shift required to operate as a skills-based organization, not just design one. It’s not only about mapping skills to roles... that's actually the smaller part of the puzzle. It’s about fundamentally rethinking how teams are formed, how performance is measured, and how opportunity is distributed. That means unlearning legacy structures where job titles define contribution, and replacing them with systems where capability drives value creation. One practice I’ve seen work: start by breaking one rule. Assemble a project team based entirely on skills, not e.g. reporting lines. Let that pilot speak for itself. When business leaders see speed and adaptability increase, the case for scaling becomes obvious. Skills-based transformation is partly an HR upgrade and partly a leadership choice.
Speaker, Author, Professor, Thought Partner on Human Capability (talent, leadership, organization, HR)
1moNicolas BEHBAHANI Wonderful insights by talented researchers on SBO. Their advocacy that skills need to be embedded into a system to success is timeless and timely. I think of the legacy 7S model by McKinsey that includes: Strategy, Structure, Systems, Shared Values, Skills, Style, and Staff Or the STAR model by Jay Galbraith: Strategy, Structure, Processes, Rewards, People (Skills) Without doubt SBO needs to be integrated into other processes. An addition in this latest research is the inclusion of technology as an enabler and details on a skills based transformation plan that starts small and grows. Thanks again for sharing.
HR Strategist. Lecturer and International Speaker on HRM and Value Management.
1moThere is a lot to take from this research Nicolas. With the continuing change in both the internal and external environments, brought about by the continuing advance of AI solutions together with the uncertainty in the external environment, there is a need to ensure that the development of skills is ongoing. That said, there is also a need to ensure that those skills that are not being utilised but that are available within an organisation are kept current as they may need to be utilised again in the future (skills fade can come back to bite). Whilst HR might have oversight of the skills needed and available, it is the line management that will be ultimately responsible for ensuring that their teams receive the development that is required to create growth (for both the employee and the organisation). That said, there is also an onus on the employee to pick up on skills that are required and to ask for development where they feel that they lack the knowledge, skills and experience. Great post Nicolas - thank you for sharing.