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Skills Gap

Term in Qoyod's Business Glossary. Practical definition with examples from the Saudi market.

Skills gap: a definition

A skills gap (فجوة المهارات), also written skill gap, is the difference between the skills that an organisation’s team actually holds and the skills that its work requires today or that its plan for the period ahead will require.

The definition sets two things against each other. The first is the set of skills the team actually holds: the skills its members have now, as distinct from the skills the team is assumed to have. The second is the set of skills the organisation needs, and the definition gives that second set two points in time. One is the work the organisation is doing today. The other is what its plan for the period ahead will require. A skills gap can be measured against either point, and the two points correspond to the two forms of gap set out further down.

How a skills gap is measured

A skills gap is measured in three steps, and no step is valid without the one before it:

  1. Identifying the required skills. It means setting out the skills each role requires, each at a defined level of proficiency rather than under a general label. Such a label names an area of skill without stating how much of it the role needs, and so it leaves no level against which a person’s current skills can be set.
  2. Assessing the current level. It means assessing where each individual stands on those same skills. The assessment uses the skills identified in the first step and no others, so that what each person holds and what the role requires are compared on the same terms.
  3. Calculating the difference. It means working out the distance between the required level and the current level, and then deciding which part of that distance is critical and which part can wait. The calculation gives the size of the gap; the decision about what is critical and what can be postponed sets which parts of it cannot wait.

Each step depends on the step before it. The current level of an individual can only be assessed against skills that have already been identified, at a level that has already been defined. The difference can only be calculated once both the required level and the current level are known, because it is the distance between the two.

The first step is the one that can be cut short. When it is, the gap is measured against a standard that has never been written down, and the result becomes an impression expressed as a number. The figure looks like a measurement, but the required level it is measured against was never set out, so the figure records a judgement about that level rather than a comparison with it.

The current skills gap and the forecast skills gap

A skills gap takes one of two forms, according to the point in time at which the skill is needed:

  • A current gap. It concerns a skill that the team lacks and that the work in progress needs. Its effect is immediate, and it shows in delays, in errors, or in reliance on a single person. Because the work that needs the skill is already under way, the shortfall appears in that work as soon as the skill is called for. Where one member of the team holds a skill that the others lack, the work that needs that skill depends on that one person.
  • A forecast gap. It concerns a skill that the plan for the coming year will need and that nobody in the team holds today. Its effect is deferred, because the work that will need the skill has not yet begun. The cost of ignoring it can be higher, because closing it takes time. A skill that nobody holds today cannot be in place on the day the plan needs it unless the time that closing the gap takes has been allowed for before that day.

Ways of closing a skills gap

A skills gap can be closed by training, by hiring, or by bringing in an outside provider. Training builds the skill in people the organisation already employs. Hiring brings the skill into the team by appointing someone who holds it. An outside provider supplies the skill under a contract, without the person who holds it joining the team.

The choice between the three routes is governed by two questions.

The first question is how long closing the gap would take by each route. The answer can differ from one route to another, and it bears on whether the skill can be in place by the point at which the work needs it.

The second question is whether the need for the skill is permanent or tied to a specific project. A permanent need continues for as long as the work that calls for the skill continues. A project need ends when the project ends.

The answer to the second question rules out a mismatch in each direction. A skill that the organisation will need permanently is not built on an outside contractor, and a skill needed for a single project does not call for a permanent appointment. In the first case the skill would stay outside the team for as long as the need for it lasts. In the second, the appointment would continue after the project that called for the skill had ended.

How a skills gap differs from a training need

A skills gap is a diagnosis: it establishes that a shortfall exists. A training need is a decision that training is the remedy for that particular shortfall. The diagnosis states what is missing, and the decision states how that specific shortfall is to be addressed.

Not every skills gap is closed by training. A shortfall whose cause is a lack of time, a lack of tools or a lack of authority is not remedied by training, however many times the training is repeated. In each of those cases what is missing is the time, the tools or the authority, and training supplies none of the three.

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

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