Skills Gaps – How to Prevent Them from Damaging Your Organisation

Andy Andrews

“Skills gaps” – they have almost become a cliché, haven’t they? We see them referred to in the titles of HR magazine articles, survey, reports, research papers and even mainstream newspaper headings. However, skills gaps are not just a cliché, they are real and they can have a profound effect on the performance of your organisation. The Deloitte study ‘Building tomorrow’s skills-based organisation’ provides some interesting insights into the impact of skills gaps on businesses. According to the study which incorporates a survey of 1,021 workers and 225 business and HR executives, 73% of business leaders expected to experience talent shortages within three years.

In this blog post, we’ll explore what skills gaps are, why they are such a problem, and what organisations can do to stop them from damaging their business.

What Are Skills Gaps?

At an individual level skills gaps refer to the difference between the skills that are required for someone to perform their job successfully and the skills and levels of proficiency that they actually possess. Very often the term ‘skills gap’ refers to the aggregated gaps of a team of people or the whole organisation. Ultimately, at an organisational level when there is a skills gap, there is a mismatch between the skills needed for the organisation to be successful and the skills that are currently available through its workforce.

How does a skills gap occur? The world of work has become more complex, the pace of technological change has accelerated, and changes in the economy and the nature of work have found organisations increasingly struggling to keep up. As a result, skills gaps have emerged as a major challenge. This problem manifests itself as many organisations find it difficult to find the right people with the right skills to help them to be successful.

Why Are Skills Gaps Such a Problem?

In the ‘LinkedIn – 2022 Workplace Learning Report’ 46% of learning and development professionals indicated that they had seen an increase in their organisation’s skills gap. Furthermore 49% said “executives are concerned that employees do not have the right skills to execute business strategy.”

Here are some examples of specific ways in which skills gaps can have a serious impact on organisations; the list isn’t exhaustive but reflects some of the most common consequences that we come across at Lexonis, when speaking with our clients:

  • Decreased Employee Engagement: We’ve heard a lot over the past few years about employee engagement and its importance hasn’t gone away. When employees feel that they lack the skills to perform their jobs effectively, they may become disengaged and demotivated. This can lead to lower job satisfaction, increased turnover and the costs associated with that; the consequences of low retention also include operational risk.
  • Reduced Productivity: Considering things at an individual level again, when employees lack the necessary skills to perform their jobs competently, they are likely to be less productive. This can lead to delays in completing projects, missed deadlines, increased costs and damage to brand reputation.
  • Reduced Customer Satisfaction: When workers lack the skills to provide high-quality customer service, customers may become dissatisfied and take their business elsewhere. Poor customer satisfaction can also result in higher costs due to increased customer service demands and the need to attract new customers to offset losses. Conversely, satisfied customers are more likely to remain loyal and recommend the business to others, leading to increased revenue and a strong brand reputation. Without doubt, a focus on customer satisfaction is crucial for the long-term success and growth of a business and it all comes down to providing high-quality customer service delivered by employees with the relevant customer service skills delivered at the right level.
  • Decreased Innovation: We don’t automatically associate lack of skills with decreased innovation, yet the Deloitte study tells us that 57% of the business and HR leaders surveyed identified improved innovation as a benefit of taking a skills-based approach. When a business lacks the necessary skills to keep up with technological change, it may fall behind its competitors and lose its competitive edge. This can make it difficult to innovate and develop new products and services.

What Can Organisations do to Stop Skills Gaps from Damaging Their Business?

There are several strategies that businesses can employ to address skills gaps. Here are a few of the most effective:

  1. Identify Skills Requirements: The first step in addressing skills gaps is identifying them. This involves identifying the skills that are required for success in each job role and the degree of expertise required. This is something that we spend a lot of time helping clients with at Lexonis by customising our extensive 3,000 build job profile template library building them from the ground up using AI tools.
  2. Capture Skills Gaps: The second step in addressing skills gaps is to identify them by conducting a skills assessment to determine which skills are lacking and which skills have the largest gaps. Our employees would not be happy with that, I hear you say. Interestingly, the Deloitte study tells us that 79% of workers are open to their employers capturing their demonstrated skills and capabilities. Our Lexonis TalentScape software offering is just such a tool – helping organisations to capture skills and identify where the highest priority skills gaps are.
  3. Develop a Skills Development Plan: Once skills gaps have been identified, businesses can develop a plan to address them. This might involve providing learning and development opportunities to employees or hiring new staff with the necessary skills. Capturing the organisation’s skills gaps as described in step 2, enables the organisation to make an informed decision on whether to build or buy the skills in.
  4. Provide Ongoing Learning and Development: Skills development should be an ongoing process, not a one-time event. Organisations should provide regular learning and development opportunities to ensure that their employees are able to keep up with the latest developments in their field. However, this is something that should be done in the context of not only the individual’s current role but their career aspirations too.
  1. Skills-based Hiring: Another strategy that businesses can use to address skills gaps is to focus on skills-based hiring. This means looking beyond traditional qualifications and experience when hiring and instead focusing on the skills and competencies that are required for the job. By doing so, businesses can ensure that they bring in employees with the skills that they need to succeed.
  2. Foster a Culture of Learning: Finally, organisations can help to address skills gaps by fostering a culture of learning within their organisation. This might involve encouraging employees to share their knowledge and skills with others, providing opportunities for peer-to-peer learning, and recognizing and rewarding employees who engage in learning and development activities.


Skills gaps are a major challenge for organisations in the modern economy. As technological change continues to accelerate, businesses that fail to address skills gaps are likely to fall behind their competitors and struggle to keep up. However, by taking a proactive approach through skills-based learning and development, and skills-based hiring, businesses can help to ensure that their workforce have the skills they need to compete effectively in the marketplace. By embracing new technologies and investing in their workers, businesses can create a workforce that is ready to take on the challenges that lie ahead.

Learn more about how Lexonis helps organisations to address the skills gap conundrum by attending our March 16th webinar, How to Stop the Skills Gap from Damaging Your Business: 5 Steps to Skills-based Hiring and Development.

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