Why Building Your Skills Taxonomy Is Important

In a general sense, we know the importance of skills in knowledge industries. In the previous edition of PSA Insights, I described some specific reasons why? management of skills inventory is vital for your day-to-day operations and progress. I also gave an overview of all that you need to get right to keep your skills inventory or talent pool finely tuned to your current and future requirements.

Skills taxonomy or the way you describe and group the vast number of skills is the foundation of your talent pool management.?

Having Resumes of people is not enough.

Whether you wish to find people with the right skill sets and costs, or you wish to hire people with niche skills to prepare for the future, it is not enough to have resumes of competent people in your database. You won’t be able to search the right kind of people using their resumes - definitely not if you have 100s or 1000s of people to search from. Everyone from applicants to project managers describes skills differently. Some resumes may mention ‘ Java ‘ skills, but if you need people to use Java in fintech, not all people who know Java will be suitable for your project.

Therefore, you need a consistent method of describing skills and their levels across all functions - the technical term for such a structure is skills taxonomy. Let me elaborate on that.

The IT industry relies on many skills, perhaps hundreds.

Your skills taxonomy may include different categories of skills that you need or will need in future.

1. Technical skills: Knowledge of programming languages like Java, Python etc., data structures, development methodologies and other tech skills fall in this category.
2. Industry \ Domain skills: Knowledge of using the tech skills in different industries or domains like fintech, healthcare, automobile and others need to be classified.
3. Functional skills: Skills like project management, customer relationship management fall in this category. Even technical skills like programming may need to be qualified further with applications in development, testing, or providing solutions.
4. Soft skills: Communication skills, problem solving, teamwork and such skills are in this category.
5. Niche skills: You may want to define some niche skills like AI applications as a combination with a few tech skills. Niche skills are in demand and you may need to assess and price them separately.

The next step is to organize all the skills you have identified as necessary in your organization.?

Configuring the skills taxonomy

You need to organize various skills in a way that meets your needs and yet it is simple enough to use. Here is are some methods:

1. Flat taxonomy: In this approach, all skills are listed as individual entities without any hierarchical structure or categorization. While it is simple to construct, this approach can become unwieldy and difficult to manage as the number of skills grows.
2. Category-based taxonomy: In this approach, skills are grouped into broad categories such as technical, industry/domain, functional, and soft skills. This approach provides a higher level of abstraction and organization.
3. Hierarchical taxonomy: In this approach, skills are defined as combinations of multiple skills or categories and arranged in sub groups? For example, "Java in FinTech" or "Project Management in Healthcare." This approach is more complex but can capture nuances and industry-specific skill requirements.?

Your skills taxonomy’s structure needs to be detailed or granular enough to differentiate functional, domain, and competency needs in your organization. A well-structured skills taxonomy is essential for managing your talent pool.

Defining Competency Levels

Organizations must be able differentiate levels of competencies needed to perform various tasks. Competency levels per skill must be recognized. Here is a common framework for competency levels.

1. Beginner
2. Practitioner
3. Competent
4. Proficient
5. Expert

You need to define objective criteria for each of the competency levels. Commonly used? criteria are? -years of experience, certifications, and expected tasks or responsibilities. For example, to be an "Expert" in Java might require a certain number of years of experience, relevant certifications, and the ability to lead complex projects or mentor junior developers.

Assessing employees for skills and competency levels

You need assessment and validation methods and apply them consistently so that you can populate the employee skills database properly.? I will cover this subject in detail in a forthcoming edition of PSA Insights.

Legacy enterprise software is not enough.

Enterprise software packages weren’t designed for managing talent pools. A good PSA platform that integrates all your enterprise applications can provide you with templates and frameworks for defining skills taxonomy, competency levels, assessing criteria, validation and updating. Such a capable PSA should also be equipped with workflows for various tasks needed to update your skills inventory from time to time.

A well constructed and regularly updated skills inventory is a powerful tool in your hands to find the right people and to determine if you are going to face a shortage of some skills in future. It is the best way to be ready for the future.

Kytes offers all the above and more capabilities to you. Please contact us at [email protected] for more information and a demo.