Skills-based hiring or a skills-based organisation focuses on specific skills individuals possess rather than the traditional qualifications like degrees or job titles. This involves creating a skills taxonomy, a structured framework that categorises and defines the skills needed for each role.

So, for example, an HR coordinator might automatically be grouped into an HR job family because they support an HR function. Thus, the salary band is matched to the HR function. But by examining the core skills such as project management and organisational abilities, they might find that they are a better fit in the administration job family.

This approach ensures employees are placed in a role that best matches their skills, leading (obviously) to job satisfaction and productivity. It also helps with learning and development. Job families should be defined by the skill required, not by the team names or the departments, and this allows for more accurate role alignment. This closes the gap between skills and fosters internal mobility, which supports continuous growth and development within the organisation.

At HelloFresh we focused on building skills-based organisation by resetting expectations. Fortunately, we received quite a sanguine response from stakeholders. We started with a comprehensive skills assessment to identify our employees, current skills, and any gaps.

Some key steps we took at first were skills mapping workshops, involving the team leaders and the employees to accurately define the skills needed for each role, and continuous learning programmes.

We implemented training to skill employees and support their growth; we had flexible role definitions to find, so we redefined roles based on skills rather than rigid job titles and completed a job family restructure; and we ran a lot of communication with stakeholders informing them why we're doing this, how we're doing this, and what is the benefit of this.

We did a lot of testimonials of successful transitions, including managing by skills rather than by job titles. It took a lot of clear performance metrics to track the impact of these initiatives.

Creating an effective and scalable skills taxonomy hinges on understanding talent density and doing more with less. Not everyone intuitively grasps this concept, so change management is very crucial here. It involves shifting the mindset from adding headcount to optimising processes.

So, do I need five people to do this? Or is the problem the process, the way I work currently, or the way this team works currently?

This was not and is not an overnight thing. Process optimisation means looking at and reengineering our workflows to say, if we had to cope with 50% less staff, how would we deliver?

It’s a bit like Elon Musk suddenly cutting X’s staff. I’m not saying to go down that route, but thinking that way can help you optimise. You're not saying get rid of those people, but you can get those individuals to focus on other more important tasks.