We have been discussing skills for so long that there is a temptation to dismiss anything skills-based as just another set of buzzwords. However, if anything, we aren’t talking about skills enough and certainly not in the holistic way we need to be. Forward-thinking companies are already using skills-based approaches to solve critical business problems. These aren’t abstract HR initiatives but data-driven transformations directly tied to revenue and operational outcomes. AI is helping to deconstruct jobs into tasks, map skills with precision, and deploy talent with unprecedented flexibility. So how are organizations making this transformation, and what does this mean for talent acquisition’s role in driving business strategy?
My guest this week is Craig Friedman, Talent Skills Transformation Leader at St. Charles Consulting Group and author of the book “Enterprise Skills Unlocked,”. In our conversation, he shares how skills-based organizations are solving real business challenges and fundamentally changing how HR and talent acquisition deliver value.
In the interview, we discuss:
• Definitions and drivers
• Moving from skills curious to skills ready
• A data-driven HR Transformation
• Building more effective talent processes by linking skills to people
• The workforce planning revolution
• Moving from headcount planning to capability planning
• True talent intelligence
• The role of AI
• Driving mobility and opening up talent markets
• Aligning HR and TA to business outcomes and strategy
• Getting started
• What the future will look like
Follow this podcast on Apple Podcasts.
Follow this podcast on Spotify.
00:00
Matt Alder
Talent acquisition is at a crossroads. In order to survive and thrive, it needs to demonstrate its value through more precise alignment with organizational business goals. This is much harder to do in practice than it is to discuss in theory. So why does skills based transformation offer the clearest route to achieving the alignment that TA leaders are looking for? Keep listening to find out. Support for this podcast comes from Greenhouse. Greenhouse is the only hiring software you’ll ever need. With built in analytics that deliver on demand insights, Greenhouse helps hiring teams align faster with stakeholders and make more confident hiring decisions. Greenhouse analytics empowers recruiting teams to explore data freely. No add on tools are needed. Query filter and build reports, drill into historical trends and create custom analyses to answer critical questions on pipeline, health, performance and sourcing efficiency.
01:08
Matt Alder
Greenhouse has helped over 7,500 customers across diverse industry verticals from early stage to enterprise become great at hiring, including companies like Airbnb, HubSpot and Lyft, SeatGeek, HelloFresh and DoorDash. If you’re ready to navigate your hiring data your way, you can visit greenhouse.com to learn more. Hi there. Welcome to episode 734 of Recruiting Future with me, Matt Alder. Recruiting Future helps talent acquisition teams drive measurable impact by developing their strategic capability in foresight, influence, talent and technology. If you’re interested in finding out how your TA function measures up in these four critical areas, I’ve created the free fit for the assessment. It’ll give you personalized insights to help you build strategic clarity and drive greater impact immediately. Just head over to Mattalder.me/podcast to complete the assessment. It only takes a few minutes. This episode is about talent.
02:39
Matt Alder
We’ve been discussing skills for such a long time now that there is a temptation to dismiss anything skills based as just another set of buzzwords. However, if anything, we aren’t talking about skills enough and certainly not in the holistic way that we need to be forward thinking. Companies are already using skills based approaches to solve critical business problems. These aren’t abstract HR initiatives, but data driven transformations directly tied to revenue and operational outcomes. AI is helping to deconstruct jobs into tasks, map skills with precision and deploy talent with unprecedented flexibility. So how are organizations making this transformation and what does it mean for talent Acquisition’s role in driving business strategy? My guest this week is Craig Friedman, Talent Skills transformation leader at St. Charles Consulting Group and author of the book Enterprise Skills Unlocked.
03:41
Matt Alder
In our conversation, he shares how skills based organizations are solving real business challenges and fundamentally changing how HR and talent acquisition deliver Value. Hi Craig and welcome to the podcast.
03:57
Craig Friedman
Hi Matt, how are you?
03:58
Matt Alder
I’m very well, thank you and it.
03:59
Matt Alder
Is a pleasure to have you on the show.
04:01
Matt Alder
Please could you introduce yourself and tell us what you do?
04:05
Craig Friedman
Hi, I am Craig Friedman. I’m the talent skills transformation leader for St. Charles Consulting Group, which is the consulting arm of NIIT. And I am author of the book Enterprise Skills Unlocked.
04:18
Matt Alder
Fantastic.
04:18
Matt Alder
Tell us a little bit more about the book.
04:20
Matt Alder
What’s it about and why did you.
04:22
Matt Alder
Decide to write it?
04:24
Craig Friedman
It’s about becoming a skills based organization. I decided to write it. I guess I started about three years ago, started working with clients on sort of moving people from this state of being sort of skills curious to skills ready. We were working on strategies around how to approach this whole new area of skills based transformations. There was a lot of confusion in the marketplace about it, so I started blogging about it. The blogging generated more client conversations sparked some research into it. Research started, more research. We developed a maturity model, we did some benchmarking, we started publishing some white papers, and then over time we had started to amass enough information that we decided to pull it together into a book.
05:10
Matt Alder
You mentioned there that there is a.
05:12
Matt Alder
Lot of confusion in the marketplace around this whole discussion, this whole transformation. Can you break everything down for us? What does it mean as far as you’re concerned in terms of skills hiring, skills based organizations, all those kind of things?
05:27
Craig Friedman
Yeah, Well, I think some of the confusion just comes from the word skills. I think a lot of people who aren’t following it closely sort of naturally assume that since the word skills is in the title, it’s mostly some sort of L and D initiative. Right. That somehow it’s mostly targeted at delivering better quality learning solutions to employees. And it’s much broader than that. What it really is it’s a data driven transformation. A data driven HR transformation.
05:53
Craig Friedman
Right.
05:53
Craig Friedman
So what we’re really doing is we’re creating this entire new layer of data underneath our HR systems that is tying skills information to not just people and learning solutions, but to work tasks, to job descriptions, to long term workforce planning. And this layer is enabling enhanced talent outcomes for the entire talent value chain.
06:17
Craig Friedman
Right.
06:17
Craig Friedman
Because it starts linking to things like talent marketplaces and skills based recruiting and skills based work design, all kinds of different, more effective talent processes.
06:29
Matt Alder
Absolutely.
06:30
Matt Alder
And just to sort of dig into.
06:31
Matt Alder
That a little bit deeper, I mean.
06:32
Matt Alder
The transformation towards skills, I mean, what are you seeing? How is it affecting the way that companies operate? What is that transformation looking like?
06:41
Craig Friedman
You know, it depends on the journey and it depends on, you know, what area of the talent value chain you’re leading with. But for, so for example, when you link skills information to people, right? So people is, you know, I’ve got a profile of my skills information and it’s linked to my training courses and my development options, right? You have the ability to have much more targeted, much more personalized L and D pathways for people that are constructed in real time. So for example, I might start myself on a project and right away the system knows what skills are on my profile and what skills are needed for the task I’m being assigned for. It can see any shortcomings in real time and immediately feed me sort of real time project onboarding, right?
07:27
Craig Friedman
If I link skills data to jobs, you get a lot of career mobility. I get transparency of all the skills required for any job, right? Imagine that in your system. Now, just saying I’m in procurement, I’d like to move into marketing. I wonder what skills I would need to do that. You know, you click on the skills that you would like to develop so that you could move in that direction and you start get again you start, you get an instant learning pathway, right. That will start moving you from point one. You get learning options. Maybe you get skills in a talent marketplace that you can start to develop from real time hands on gigs that you can develop, right? It can tag me with mentors that have that skill. It can contact me with communities of practice where people discuss that skill, right?
08:12
Craig Friedman
When I link it to tasks, of course I, I get talent marketplaces and the ability to manage my resources more efficiently because I’m staffing now at the task level as opposed to, you know, moving someone from one box on an org chart to another. So it’s much more adaptable. When I start linking it to workforce plans and long term capability planning, I sort of get the full spectrum of sourcing and talent acquisition. You know, build L and D, buy recruiting, borrow, crowdsourcing, contracting, bot AI, work design, rebadge, moving people internally around the organization. All of that is linked to now at the skills level, which is, you know, I can more granularly move what’s needed in the organization around the organization. I can develop it in a more targeted way. I can move it around more flexibly and adaptably.
09:02
Matt Alder
And that’s a kind of a big.
09:03
Matt Alder
Shift for how HR talent functions have kind of always been structured and always thought, I mean, how are they transforming with this to kind of really enable some of these advantages to happen?
09:14
Craig Friedman
Yeah, well, I mean, if you think about it, right, for most of the last 30 years, since the advent of all this digital technology, HR has mostly been built on the top of person level data.
09:23
Craig Friedman
Right?
09:23
Craig Friedman
We hire a person, we give them a job title and a salary and benefits and put them in a box on the org chart where they sit for a while, maybe for many years, until, you know, their boss leaves or a box opens up and we can move them to a different box. That’s largely been the way it’s worked. It’s worked, right. And so what you get is HR working a bit. You know, it’s kind of a headcount management exercise. When you move stuff down to this more granular skills level, it’s not only that you get efficiencies and more precise targeting and more adaptable because just the level of data is more granular that you have to work with.
09:58
Craig Friedman
But skills data is pretty critical because unlike other pieces of data, it not only tells me something about the person and what they can do at an individual level, but at an organizational level, it tells me about something about what the business can do, right. What the capability of this division or this business unit is. And so it kind of moves HR from a headcount management exercise to a capability management exercise which is much more closely aligned to business goals. And so it moves us closer to the things that our business partners actually care about.
10:33
Matt Alder
Absolutely. That makes perfect sense. And you sort of mentioned technology a couple of times in the conversation already. What role is technology is AI playing as some part of this process?
10:43
Craig Friedman
Well, I mean, it’s all about technology, right? It’s all data driven transformations are built on top of technology, right? Technology generates the data and then we try to take advantage of the data. In the case of skills, what we’ve got is maybe three, arguably four kinds of AI enabled new systems that are all coming out simultaneously that there’s some synergies between, right? You’ve got skills taxonomies, a set of tools that are making it possible to catalog all the skills and infer them from other systems and deal with unstructured data and plucking it out of other HR systems and organize it, you know, into, you know, relationships that we can leverage. So you’ve got skills taxonomy systems. You’ve got, of course, talent marketplaces which leverage several kinds of AI to help match people with open jobs.
11:39
Craig Friedman
You’ve got talent intelligence systems that are giving us information about talent in the marketplace and emerging skills and skills trends. And to some extent, you could argue that’s linked to the new applicant tracking systems that recruiting places are using. So you’ve got a number of different systems all enabled by AI, all leveraging skills data much more aggressively. And so when you start to knit together a kind of ecosystem that makes this idea of a skills based organization possible.
12:08
Craig Friedman
Right.
12:09
Craig Friedman
So that’s the first thing. The second thing is it also plays a big role in the adoption of AI in the marketplace because the whole process of decomposing work processes to find out where AI can leverage is all built on the back of skills.
12:25
Craig Friedman
Right.
12:26
Craig Friedman
Because what you do is you take a business process, you break it down into tasks, you figure out the skills required. Those that can be automated with AI are, those that aren’t are left to be managed by a skills based organization that, you know, you can develop it at the skill level and move it around. And so it’s integral to the AI transformations as well.
12:43
Matt Alder
So obviously, as you say, technology is a big driver of this.
12:47
Matt Alder
Why else is it happening now?
12:49
Matt Alder
What are the other kind of drivers behind it? Because it’s something that skills have been sort of talked about for a long time, but we seem to really kind of be seeing some traction and some transformation and some movement now. Why is that happening other than just the availability of the technology to make it work?
13:04
Craig Friedman
Yeah, I mean, there’s a few large sort of business drivers that skills based organizations can really fundamentally help with that are also happening sort of concurrently. So you’ve sort of got demand and supply happening at the same time. Right. So from a demand standpoint, why would we want or need a, a skills based organization? Number one, you’ve got faster churn of new skills required.
13:27
Craig Friedman
Right.
13:28
Craig Friedman
A lot of that coming out of technology. It seems like every year we’ve got another hot topic.
13:33
Craig Friedman
Right.
13:33
Craig Friedman
Like the two years ago everybody was, you know, talking about crypto and the underlying technology there. Now everybody was talking about AI when the large language models came out. And next year it’ll be another thing.
13:45
Craig Friedman
Right.
13:47
Craig Friedman
And so companies have to churn their skills much faster.
13:51
Craig Friedman
Right.
13:51
Craig Friedman
The half life of a skill is getting shorter and shorter. And these systems, because they’re so much more flexible at managing skills and developing skills in real time, really help you keep pace. That’s one thing. Another thing is there’s a lot of talent challenges like scarcity in the marketplace. A lot of that is coming out of the retirement of the baby boomers from the workforce, leaving a big hole, especially in STEM fields, science, technology, engineering, math fields. And that’s being seen across many different industries.
14:23
Craig Friedman
Right.
14:24
Craig Friedman
A Lot of engineering, heavy industries, a lot of science heavy industries. Right. Healthcare, heavy tech industries, telecom, obviously, high tech companies, all that sort of stuff.
14:37
Craig Friedman
Right.
14:38
Craig Friedman
They’re all losing a lot of talent. There’s a brain drain going on.
14:41
Craig Friedman
Right.
14:41
Craig Friedman
They have to find ways to leverage the skills that they have more flexibly and more adaptably across the organization. They’ve also got to find aggressive ways to build more and find more.
14:52
Craig Friedman
Right.
14:53
Craig Friedman
Find more in the market, build more internally, stretch it more flexibly across. And that’s exactly what these skills based organizations are designed to do. They’re focused on a variety of different techniques that can help you do this.
15:05
Craig Friedman
Right.
15:06
Craig Friedman
Skills based recruiting helps. If you’re looking for a skill in the marketplace that, let’s say doesn’t require a formal degree, you know, like medicine requires a formal degree, but there are still tasks within medicine that other people can do.
15:22
Craig Friedman
Right.
15:22
Craig Friedman
If you can find people who can do those tasks and you can, you know, then redesign the workflows to push down anything that isn’t required of the doctor that’s in short supply, you can stretch your skills, you know, further in the marketplace. Right. So you’re simultaneously taking work off of the doctor through work redesign, but you’re also finding more people in the marketplace that maybe don’t have an md, Right. That’s a larger population who can do these other, you know, who can take vitals or who can do something to take some workload off of the doctors.
15:53
Craig Friedman
Right.
15:53
Craig Friedman
And that’s just one example.
15:54
Craig Friedman
But you get the idea, right?
15:56
Craig Friedman
If you’re, if you drop degree requirements where you can, where it’s feasible, you open up, you know, a much larger audience to recruit from.
16:07
Matt Alder
To come back to the point you made earlier about this is the opportunity to kind of really align what HR does with business objectives and business strategy. Can you just elaborate on that a little bit more? Because it’s obviously something that HR has been looking to do for decades, but has never quite managed. So what’s possible now with this type of transformation?
16:28
Craig Friedman
Yeah, And I’ll give you an example.
16:30
Craig Friedman
Right.
16:30
Craig Friedman
One of the companies we worked with was a mining company and we work with them to identify places in the business where skills management would be helpful.
16:40
Craig Friedman
Right.
16:41
Craig Friedman
And so we talked to business leaders and one of the examples we got when we talked to business leaders was a few people from the copper mining group and the copper mining group were saying they have aggressive growth plans. It all comes out with the moves towards more sustainable energy, it turns out wind power and solar power and these more sustainable energy sources Use a bit more copper wire than fossil fuels. So as the world moves to more sustainable energy sources, the world needs to dig more copper out of the earth. And all the copper we’re digging out of the earth today is close to the surface of the earth. So if we’re going to, you know, double or triple our copper output, we’re going to have to dig a little deeper to find it.
17:22
Craig Friedman
Well, that’s a challenge from a skills perspective because underground mining is a completely different set of engineering practices than surface level mining. Right. New engineering, new principles of geotechnical engineering come into play. Different mining techniques and engineering techniques come into play. So now you’ve got a company that has to build capability and build it fast at the same time. We’re not graduating as many geotechnical engineers from the universities as we used to for a large variety of reasons. Some of it is baby boomers, some of it is that we just less STEM graduates in general. Some that like people who are going into engineering fields more frequently, pick what seem like more exciting fields like, you know, AI and computer science and are moving away from some of the earth sciences.
18:10
Craig Friedman
So for all those reasons, they have, you know, demand for new skills and they don’t have enough supply. So enter skills based solutions that can help them much more aggressively target the skills they need in the marketplace. Find the places on the planet where people have the appropriate skills, figure out ways of moving them where they’re needed, like physically. Because you know, you have to mine copper where it is, you can’t just like locate it in a city.
18:39
Craig Friedman
Right.
18:39
Craig Friedman
Like if it’s in Mongolia, you’ve got to move the skills to Mongolia to get there much more flexibly and quickly develop the skills. Move people from, you know, maybe other underground mining for coal into underground mining for copper, or move people from the surface level copper into the underground copper. Figure out the gaps between what they know and what they need to know. The adjacency of skills. Identify the gaps more flexibly, feed them the skill development that they need, move people around the organization as needed if they need to be re badged. All of that is enabled by skills based organization. And that is a very different sort of exercise for talent to be engaging in typically as opposed to, you know, increasing headcount for the recruiters.
19:25
Craig Friedman
Right.
19:26
Craig Friedman
And just trying to get a bunch more heads somehow in the organization. It’s much more aligned with the needs.
19:31
Craig Friedman
Right.
19:32
Craig Friedman
And so that’s just one example, but you know, it’s a pretty powerful one.
19:36
Matt Alder
One of the biggest issues that employers seem to have with this is actually getting started. It seems to, it seems to be sort of very rare to find an organization that kind of actively disagrees with this as an approach. But, but in terms of kind of getting started on that journey, it’s something that big challenge. What would your advice be to employers in terms of how they can do that? What does the journey look like? Where do they start?
20:00
Craig Friedman
Well, I think that mining example is actually a sort of a good example is I would start with a. Something that’s smaller, focused and very business relevant like find a front end business problem, something that is absolutely tied to either revenue or operational savings, something that drives the bottom line in one way or another and then figure out where skills could significantly help enable that business goal. And so when you’re building out a skills taxonomy, right. You are focused on. Again, I’m going to go back to the copper example. You’re not building out the entire taxonomy of the entire mining industry or the entire mining company.
20:43
Craig Friedman
Right.
20:43
Craig Friedman
You’re just focused on underground copper mining at first.
20:47
Craig Friedman
Right.
20:48
Craig Friedman
That enables you to have great focus. You can kick the tires, you can figure out your policies and your challenges and how many levels you’re going to support and all the details of figuring out your skills taxonomy as it’s relevant to building this capability in underground copper mining. When that project is done, you have built a portion of the skills based organization just to support the, you know, the underground copper mining capability. But you will have tested things out, you will figure out the challenges and it will have produced immediate value to the company so that when you identify your next business case, right. Which might be.
21:23
Craig Friedman
Oh, by the way, at the same time we’ve got this thing going on in copper in the iron ore group where we’re retiring all our diesel trucks and replacing them with electric trucks just to meet our sustainability goals. Aha. Well, there’s another place where we can do the same thing, right? It’s a shift in skills. There’s going to be a shift in job titles that goes along with it. We build out the underlying skills capability and the talent. There’s probably going to be some talent marketplace piece to that, definitely some skills taxonomy piece to that. We build the piece of the solution that supports that business objective.
21:57
Craig Friedman
Over time as we start finding different areas around the company that we can leverage, we start pasting these, the solutions together rather than say have the chief learning officer just announced that they’re going to do sort of a kind of a housekeeping of all their skills data.
22:17
Craig Friedman
Right.
22:18
Craig Friedman
And build a skills taxonomy that underlies everything without specific focus, which, you know, can be a little challenging without, you know, being able to focus on a specific business problem. It’s very broad, but it’s not very targeted. When you start tying skills data to specific things like work tasks or job titles, it provides a lot of focus and it also provides a lot of value to the sort of change management of the whole thing because you’re building value with every step and then you just need some governance to start talking about common language points and how you’re going to interface the different pieces to work together. That’s how, that’s how we recommend doing it at least.
22:52
Matt Alder
Yeah.
22:53
Matt Alder
And I think that sounds like an excellent way to kind of frame it. Definitely. And as a final question for you, I mean, where is this taking us? What do you think the future looks like for HR for work? The way that companies, the way the companies operate.
23:07
Matt Alder
What’s the sort of, the, what’s the.
23:08
Matt Alder
Ultimate vision for this kind of transformation.
23:11
Craig Friedman
In the first place? I don’t know that every company is going to do the end to end enterprise wide transformation. Right. They might just, for example, again, they might just support the business group and maybe the diesel trucks and call it a day.
23:24
Craig Friedman
Right.
23:25
Craig Friedman
And you know what, if that’s all that’s needed, those are two things that added value.
23:30
Craig Friedman
Right.
23:30
Craig Friedman
Those are two things that fundamentally supported the long term strategic goals of two business units. That’s a wonderful thing. There’s talent adding value. But some companies are going to, you know, continue on that journey and start pasting together all of these pieces and actually have an enterprise wide solution where they can share skills information all the way from, you know, what’s on Johnny’s employee profile in terms of his skill profile to, you know, do we have enough cardiologists in our healthcare system right now and what’s the five year prognosis look like? And do we have to, you know, find ways to hire more of them or retain more of them? Right. So all the way from one end of the talent spectrum to the other, from detail to high level, we can share that information freely. It’s transparent.
24:18
Craig Friedman
So if you need someone because you’re staffing a project, you can just look it up. It’s not like sending an email to everyone who knows, does anybody know a project manager who can, you know, help me with a Python project? And like, you know, you’re doing word of mouth kind of staffing, which is honestly still how most companies work. You have full transparency of career mobility, right? If you’ve tied skills to your job architecture, anybody can look up any job in the company and just figure out what it takes to move from my spot to their spot and instantly get fed with development opportunities that can move you in any direction you want.
24:55
Craig Friedman
Right?
24:55
Craig Friedman
You’ve got the real time, you know, much more targeted, much more personalized learning solutions, right? Including just on time project onboarding. It’s going to change learning teams a little bit too. They might have to work. They might worry a little less about sort of curriculum management, like constantly having to organize their curriculum every time someone changes a job title. You don’t necessarily have to spend time updating your curriculum or your learning pathways every time someone changes job responsibilities or work design. You don’t necessarily need to update all of your, you know, your learning catalogs because it’s all going to happen automatically.
25:31
Craig Friedman
Right?
25:31
Craig Friedman
They can really stay focused now on curating the best solutions to teach, you know, individual skills and then managing the validation process of how people have those skills. Leadership development can now reach a broader audience. Recruiting efforts can meet a broader audience. As I mentioned before, it supports AI enabled work redesign because it goes right through skills. In general, the whole talent ecosystem becomes more personalized, more efficient, more adaptable.
26:03
Craig Friedman
Right.
26:03
Craig Friedman
And better able to keep up with the times and much better aligned with business needs and priorities. That’s sort of how I see the things changing over time.
26:14
Matt Alder
Craig, thank you very much for talking to me.
26:16
Craig Friedman
Just head over to Mattalder.me/podcast. Thanks for having me.
26:19
Matt Alder
My thanks to Craig. You can also search through all the past episodes at recruitingfuture.com where you can also subscribe to our weekly newsletter, Recruiting Future Feast and get the inside track on everything that’s coming up on the show. Just head over to Mattalder.me/podcast. It only takes a few minutes and you’ll receive valuable feedback right away. You can also search through all the past episodes at recruitingfuture.com where you can also subscribe to our weekly newsletter, Recruiting Future Feast and get the inside track on everything that’s coming up on the show. Thanks very much for listening. I’ll be back next time and I hope you’ll join me.
