Skills Audit

What a skills audit is

A skills audit (تدقيق المهارات) in human resources management is an organised process by which an organisation takes stock of the skills held by the people who work in it and verifies them with evidence, so that it knows what it actually has rather than what it is assumed to have. “Audit” here means examination and verification. It does not mean an accounting review of the books.

It is a piece of work with a beginning and an end. It begins by defining who is examined and in which skills; evidence is then collected and judged, and the result is recorded with its date. What is built on the result afterwards is a different piece of work.

How a skills audit differs from the matrix and the gap

These pieces of work form one chain, and each link has its own question. The question of the audit is who holds which skill, and on what evidence. A skills matrix is a table with employees in its rows, skills in its columns and a level of proficiency in each cell, so it is the picture in which the result of an audit is displayed. A skills gap is the difference between what a team holds and what the organisation’s work requires today or in its coming plan, so it can be calculated only after the existing skills are known. A last question then follows: is training what closes the gap? Examining that is the subject of training needs analysis.

If the matrix is completed without an audit, its cells fill with impressions, and if the gap is calculated without an audit, what the organisation wants is compared with what people believe about themselves. A sound audit therefore sets the two links that follow it on a firm foundation.

What evidence shows that an employee holds a skill

We suggest that evidence be ranked by strength as follows, and that the audit record, beside each skill, the type of evidence on which the judgement rested:

• The employee’s statement: the employee says that they master the skill. It is the starting point of the audit rather than the point of judgement, because it is affected by what the employee thinks the question is for, as happens with self assessment when it is linked to pay and promotion.
• The manager’s confirmation: the manager confirms having seen the employee do the work and gives an incident or an example.
• A work record: tasks actually completed, or a certificate or course finished. A record of this kind shows that the employee has been exposed to the skill, but by itself it does not show that the employee masters it today.
• Direct performance: a short task that the employee carries out under observation, close to what a work sample test measures at hiring.

Take one skill, preparing the payroll run, in a department of 20 employees. These are hypothetical figures to show the structure. Twelve employees claimed to master it, which is 60%. The manager confirmed 9 of them, which is 45% of the department. Six performed an actual task successfully, which is 30%. The first figure pictures a capable department, and the last pictures a department of which only 30% have proved the skill by direct performance. The truth lies between the two figures. The difference between 12 and 9, three employees, appears when evidence is requested: they claimed the skill and the manager did not confirm it. That does not mean they are untruthful, since they may perform the skill somewhere their manager has not seen.

How a skills audit is carried out

The steps run in this order, and each rests on the one before it:

1. Defining the scope. Which roles are examined and which employees. An organisation can begin with the roles on which the work depends and then widen the scope, because auditing the whole organisation in one go can burden everyone.
2. Deriving the list of skills. The list comes from job analysis instead of a list taken from elsewhere. A skill that no role requires does not enter the audit.
3. Defining the levels. A written scale of what each level of proficiency means, with its levels phrased in observable terms, in the way competencies are described.
4. Collecting the evidence. According to the types of evidence agreed, and from more than one source for the skills on which the work depends.
5. Recording. Each employee’s level in each skill, with the type of evidence and its date.

What a skills audit result looks like in a team

Imagine a warehouse team of 8 employees in which six skills were audited, and the number who perform each independently is as follows: receiving and inspection 7, cycle counting 5, handling returns 3, scheduling shipments 2, operating the forklift 1, and preparing shipping documents 1. The organisation’s rule is that every skill should be held by at least two people, so that work does not stop when one is absent.

Three skills exceed the rule, one stands exactly at it, and two fall below it, the forklift and the shipping documents. That means 2 of 6, one third, rest with a single employee. This picture does not appear in a general report that says the team is “capable”. The audit is what reveals it: two skills with one employee each.

Who takes part in a skills audit

Human resources sets the method: the list of skills, the scale, the type of evidence accepted and the date of the audit. The employee gives a statement and sees what is recorded about them. The line manager confirms what the manager has seen and attests to direct performance where needed. A colleague who is expert in the same skill may be brought in if the manager does not know it, since a manager of accounts does not judge an employee’s mastery of a skill in a field the manager does not practise.

None of these parties should decide alone. Human resources does not see the daily work, the manager may not know what the employee does outside the manager’s view, and the employee is a party to the result. The parties agree before starting who decides when they disagree.

How a skills audit differs from performance appraisal

A performance appraisal judges what the employee achieved in a past period and the quality of it, and decisions on reward and development follow from it. A skills audit describes what the employee is able to do, even if the employee did not practise it in the period. An employee who spent the year on a single assignment may have performed excellently in it and still hold skills that were never requested, while another employee may perform at an average level because the job does not use the employee’s strongest skills.

Confusing the two wastes the value of each: weak performance is taken as weak skill, and the absence of a required skill is taken as a failure of performance. We suggest that the dates of the two instruments be kept apart, and that employees be told explicitly that what is audited does not enter their annual appraisal.

How the result of a skills audit is kept

A record is kept for each employee covering each skill: the level, the type of evidence, its date and who judged the level. The records are reviewed with a simple measure, the share of old records. If a department has 120 records and 30 of them are older than twelve months, the share of old records is 25% (30 ÷ 120).

The organisation decides an age after which a record counts as old, so that it is examined again or left out of reports until it is renewed. Records are kept so that only those who need them for a decision on training, hiring or planning can see them.

When a skills audit is carried out and how long its result lasts

It is carried out when a decision is wanted that depends on what people hold: before allocating a training budget, or before workforce planning itself, or after a change in the way of working or in its tools that alters the skills required. A procedure carried out with no decision waiting for it produces a document that nobody reads.

Its result ages. An employee advances in a skill that the employee trained in, and may decline in a skill not practised for a year. Every record therefore carries its date, and the skills on which the work depends are audited again at a frequency that the organisation decides and writes down.

How a skills audit is explained to employees

Employees are told before the start why the audit is carried out, what will be recorded, who will see it, and what will not be built on it. The employee is given a chance to review what has been recorded and to add what the manager missed, such as a skill acquired outside work that serves the organisation’s work.

A short message that begins from the purpose will do: “We want to know what the team holds so that we can plan training and assignments, and the result has no connection with your annual appraisal.” If the message is not written, employees’ guesses fill the gaps.

Where a skills audit goes wrong

An error occurs when the audit relies on the employee’s statement alone, so that the result becomes a mirror of each person’s confidence in themselves. Counting a certificate as a skill is another: a certificate shows that the employee received a programme and does not show that the employee performs the work with it. Mixing the audit with performance appraisal is a third: if employees understand that their answers will affect their pay or promotion, they may lower what they say or exaggerate it.

We suggest that the start of the audit state that its purpose is to know what exists, with no judgement of anyone. A list of skills that grows too long may tire the people who complete it and reduce its accuracy. Worse still, the audit may end in a report from which no decision comes, so that the time of employees and managers has been spent for nothing.

What is done with a skills audit result

Every finding is turned into an action. A skill held by one employee, like the forklift in the warehouse example, means that a second employee is trained in it, which is upskilling when the employee stays on the same path and raises their level. If the training succeeds, the skill is held by two, and the number of skills that only one individual holds falls from two to one, which is from a third to a sixth. A skill that nobody holds and the organisation needs is filled through training or through hiring, and skills based hiring helps with the hiring, since it chooses the candidate by what the candidate can actually do, whatever certificate is held.

Employees are told what was recorded about them and what will be done with it. If an employee learns that another will be trained in the employee’s skill, the employee understands their role, whereas an employee who is told nothing will treat the audit as a hidden appraisal the next time the employee is asked. The date of the next audit is fixed from the start, so that employees know when what was recorded about them will be reviewed.

This is an explanation of the concept, not legal advice.