Smarter Workforce Planning: Leveraging AI for Skill Gap Analysis & Upskilling

Skill gap analysis is critical for boosting employee productivity and future-proofing your business. Technology continues to impact careers across industries, so it's imperative that team members have the skills that they need to adapt, innovate, and fuel business growth. The World Economic Forum declared that the 2020s are the "decade of development for employees and employers in terms of skills and career progression."

It’s clearly needed. As Gallup found, less than half of employees say that they have the skills to be exceptional at their current job, and according to PwC, many employees say that upskilling impacts their decision to stay with an employer or leave for another position.

So, if your organization isn’t providing the proper skills training and upskilling that your team members need, what's the solution?

This guide breaks down why skill gap analysis is pivotal to business success and how AI-powered development tools can help you build a more capable, future-ready workforce.

What Is Skill Gap Analysis?

Skill gap analysis involves assessing the difference between employees' current skills and the ones that they must develop to fuel business growth. In other words, it's a strategy that companies can use to determine which competencies their teams lack. For example, skill gap analysis might reveal that employees need to develop specific technical or analytical skills to effectively use new tools and data systems.

Why Is Skill Gap Analysis So Critical?

This type of analysis lays the foundation for upskilling opportunities and crucial employee development. Done right, it can help businesses:

• Improve productivity. With updated skills, employees can be better equipped to meet their goals and innovate for business growth.
• Boost employee engagement and retention. Proper training can help employees feel more effective in their roles and engaged with their work.
• Harness new learning opportunities. Are there particular skills that are lacking across teams or the organization as a whole? Use this as an opportunity to build new learning programs for scalable development.

Are We in a Skills Shortage?

Due to rapid technological advancements, many employees are not equipped with the skills that they need to keep up and drive change within their organizations. According to the World Economic Forum’s Future of Jobs Report, today’s workers expect that almost 40% of their skills will change or become outdated by 2030. Specifically, skills like AI management, analytical thinking, creative thinking, resilience, and agility—which are already critical now—are expected to become even more important over the next five years.

It's no surprise, then, that 85% of employers plan to upskill their employees between 2025 and 2030.

The Benefits of AI in Skill Gap Analysis and Upskilling

AI has the power to transform skill gap analysis and upskilling processes for organizations across industries. That means no more manually tracking, updating, and developing skills to meet each employee's needs. By using AI to drive learning and development processes, organizations can:

• Improve efficiency. Trust AI to pinpoint skill gaps that employees can't self-identify and team leaders might miss. Plus, avoid the risk of human bias and error in the assessment process.
• Save valuable time and resources. Let AI do the grunt work of analyzing large data sets and checking in with employees about their progress.
• Create personalized skill development plans. Instead of deploying a one-size-fits-all learning program with moderate results, use AI to build customized plans tailored to each employee's needs, schedules, and career goals.
• Deliver data-driven insights. As employees develop their skills, the AI platform can continuously learn and adapt to optimize their experiences and increase productivity.
• Build a culture of learning. Skill development isn't just a box to check off for the quarter or year. With a dedicated AI mentor and personalized guidance, employees can integrate skill development into their everyday work.

What Was the Old Method?

Historically, companies conducted skill gap analyses manually, which meant they had to survey or collect data from employees individually and have team members analyze their findings. Even once gaps were identified, organizations may not have had the time or resources to create and implement customized learning development programs for each employee.

The result was that traditional skill gap analysis was considered flawed because it was often inefficient, difficult to scale and sustain, and prone to human bias and error.

How to Implement AI for Skill Gap Analysis and Upskilling

Follow these steps to start building a streamlined and optimized skill gap analysis process, one powered by AI:

• Research AI tools for employee development. Consider your unique needs for an AI-powered skill development solution, such as data security, integration capabilities, and scalability.
• Select and implement a comprehensive solution for your needs. Research and compare solutions that meet your criteria, and integrate the platform into your organization's tech stack.
• Gather employee data. Use the AI platform to collect necessary data from team members, including their current skill levels and changing responsibilities or competencies.
• Conduct a skill gap analysis. Automatically identify the skills that still need to be developed or advanced, and leverage predictive analytics to forecast future needs.
• Build personalized learning plans. Use data-driven insights to develop customized programs for upskilling and competency development.
• Launch programs. Implement these new, tailored solutions across teams. Set actionable goals and clear milestones for completion.
• Continuously monitor progress. Collect data and gather personalized feedback along the way to continually optimize programs and improve outcomes.

The Future of AI in Employee Professional Development

The future of the workforce will be driven by skilled, competent, and technologically savvy employees, and the future of skill development for those employees lies with the power of AI. With the so-called "decade of development" well underway—and a growing skills shortage—these AI-driven solutions aren't just nice alternatives. They're necessary for businesses that want to drive transformation and remain competitive in a rapidly evolving landscape.

Baryons is your strategic partner for exponential growth, merging human ingenuity with the transformative power of AI. We are shaping the future of organizations by unlocking human and business potential through custom-trained AI voice agents designed to foster personal and professional development. How is your organization leveraging AI for employee growth?