AI and the Future of Talent: The Human-Led Skills Taxonomy as Your Compass in the Digital Age

Hashtags began to materialize only in 2007. Recruiters took this hashtag-mining to the next level, atomizing their defined position descriptions into a series of core competencies defined as a few hashtags and taking it to market. What about the next iteration of the hashtag? Is it Taxonomy? And what about the future of AI here?

It seems that, in an organizational world that is now in a state of constant change (with people's skills being the company's most valuable asset) and where agile and rapid upskilling is critical, the strategic roles of skills taxonomies for workforce planning and organizational learning are growing. A skills taxonomy is a structured framework that delimits, verifies, and codifies an organization's skills, knowledge, and competencies to perform its roles.

What is a Skills Taxonomy?

A skills taxonomy offers a granular map of the skills base of the organization that guides its people policies. It analyses each job into component pieces and articulates the hard and soft skills needed to succeed. A common language to describe and assess skills provides a shared vocabulary for HR professionals, managers, and employees.

The Multifaceted Benefits of Skills Taxonomies

Skills taxonomies offer a wide array of benefits that touch upon every aspect of the employee lifecycle, from recruitment to development and retention:

Talent Acquisition and Recruitment: Targeted Recruitment: Clearly defined skill requirements enable recruiters to streamline their searches, target specific candidates, and assess them accurately, leading to better hiring decisions and reduced time-to-fill.

Refined Job Descriptions: Taxonomies help recruiters craft more accurate and comprehensive job descriptions, attracting candidates with the right skill sets.

Don't unique unicorn yourself! The key at this stage is alignment with the compensation team because, in my experience, ensuring that job requirements match salary ranges is a critical component of ensuring that jobs are positioned both to attract suitable candidates and to be feasible relative to the company's compensation strategy. I have found that misaligned compensation can derail even the best recruiting efforts, primarily when recruiting highly specialized or hard-to-fill positions.

Performance Management: Objective Performance Evaluations: Taxonomies provide a structured framework for setting performance expectations, evaluating employee performance, and identifying areas for improvement. This leads to more focused, productive performance conversations and personalized development plans.

Learning and Development: Targeted Training Programs: By pinpointing skill gaps within the workforce, organizations can develop tailored training programs to address specific needs, ensuring employees have the skills to excel in their roles and contribute to the company's goals.

Personalized Learning Recommendations: AI-powered tools can further personalize learning recommendations based on individual skill profiles and career goals, enhancing employee engagement and development.

Career Pathing and Internal Mobility: Empowered Career Development: Employees can leverage taxonomies to understand the skills required for different roles, chart their career paths, explore new opportunities within the organization, and make informed decisions about their professional growth.Increased Retention and Engagement: Providing clear career paths and development opportunities fosters a sense of purpose and growth, leading to increased employee engagement and retention.

Workforce Planning: Anticipating Future Skill Needs: Organizations can use skills taxonomies to anticipate future skill demands based on industry trends and business objectives. This allows them to proactively plan their workforce, identify potential skill gaps, and implement strategies to bridge them.Strategic Talent Development: By understanding the skills needed for future roles, organizations can invest in developing their existing workforce, ensuring they have the right talent to meet evolving business needs.

AI's Transformative Impact on Skills Taxonomies

Artificial Intelligence (AI) is revolutionizing the way organizations build and utilize skills taxonomies, making them more dynamic, efficient, and effective:

• Automated Skill Identification and Extraction: AI algorithms can efficiently analyze vast amounts of data, including job descriptions, resumes, learning content, and performance reviews, to identify and extract relevant skills automatically. This saves time and resources and ensures a more comprehensive and accurate taxonomy.
• Dynamic Skills Mapping and Gap Analysis: AI can dynamically map skills to specific roles and job families, making identifying skill gaps and redundancies within the workforce easier. This allows organizations to address talent shortages and optimize their talent allocation proactively.
• Personalized Learning and Development: AI-powered tools can analyze individual skill profiles, learning styles, and career aspirations to provide personalized learning recommendations, guiding employees toward the most relevant and impactful development opportunities. This personalized approach enhances employee engagement and accelerates skill development.
• Predictive Analytics for Workforce Planning: AI can analyze historical data, industry trends, and emerging technologies to predict future skill demands. This enables organizations to proactively plan their workforce, identify potential skill gaps, and implement targeted training and development programs to prepare for the future.

The Future of AI in Skills Taxonomies

As AI technology continues to advance, we can anticipate even more sophisticated applications that will further enhance the power of skills taxonomies:

• Real-Time Skills Validation: AI could assess and validate skills in real-time through simulations, project-based assessments, or even by analyzing work output, providing a more accurate and dynamic picture of workforce capabilities.
• Adaptive Skills Taxonomies: AI-powered taxonomies could continuously learn and update themselves based on new data and feedback, ensuring they remain relevant and aligned with the evolving needs of the business.
• Skill Transferability Analysis: AI could analyze the transferability of skills across different roles and industries, identifying hidden talent within the organization and facilitating internal mobility.

Don't lose your soul! The Human-AI Partnership for Effective Talent Management

Developing a skills taxonomy is equal parts science and art; it requires as much of technology's rules and data-based insights as it does of experienced professionals' contextual understanding, experience, and human judgment. In this sense, an excellent skills taxonomy is no different than an executive recruiter with an eye for talent—an intuition borne out of years of study and interaction with candidates. And just as an experienced leader at the helm of any executive search effort, it takes a good leader to steer it.

A critical role in making a skills taxonomy work is for an organization to have a strong Talent Program Management and Lead Corporate Strategies and Recruitment Infrastructure leader. This leader must understand the organization's unique culture, values, and strategic priorities. They also need a keen eye for the nuances inherent in each position. These hard, soft, and technical skills must be present for a position to be successful. They should work with compensation partners to ensure that skill requirements align with the appropriate pay grades to minimize misaligned pay that might derail a recruiting or retention strategy.

It has worked for me. Throughout my career, I've worked in a large, multi-facility healthcare organization in Arizona, where I was fortunate to partner with my compensation counterpart in developing and maintaining a skills taxonomy that accurately reflected the organization's needs and compensation philosophy and that produced realistic job profiles that secured the talent we needed to carry out our mission, at a price the organization could afford. We worked as a team. Through this collaboration, the entire talent management staff learned to trust each other and work together. This is just one example, but to be successful, you need many stories like this within different parts of your organization.

The role of the Talent Program Management leader will be even more critical in the future when AI is even more advanced. They will have to be able to use AI-powered tools most effectively, translating the insights they provide based on data into decisions for action and retaining the human judgment and experience so crucial in grasping the role and relating to the candidates and employees.

The best skills taxonomies are not just a mash-up of data points but an expression of an organization's core characteristics. If we start with a talent management system that uses AI to combine the best of human expertise and machine calculation, then new forms of dynamic talent management become possible.

#SkillsTaxonomy #FutureOfWork #SkillDevelopment #ArtificialIntelligence #MachineLearning #LinkedInForBusiness #TalentAcquisition #EmployeeEngagement