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September 23rd, 2022 · 5 min read

The crucial role of a skills taxonomy for HR and L&D success

skills taxonomy article blog header

What is a skills taxonomy?

How do you create a skills taxonomy?

example of a skills taxonomy

Skills taxonomies address the changing ways that companies are hiring and developing talent

7 benefits of a skills taxonomy

  • Empower your organization to allocate the right learning resources to the right people. Knowing what skills your organization needs the most allows you to strategically develop learning programs that are truly effective at equipping your workforce with the training or education needed to address skills gaps.
  • Enables a more accurate and equitable assessment of job candidate suitability by matching specific skills required for the job to the specific skills of the candidate. This avoids the ambiguity and lack of consistency in traditional hiring processes.
  • Guides your efforts when conducting a skills gap analysis by providing a common vocabulary of skills and what they encompass.
  • Eliminates the guesswork of trying to piece together what skills are needed to be successful in a role. This also enables people managers to better support individual employee development and goal-setting.
  • Provides better transparency into internal mobility plans. Employees, managers and people leaders alike will understand the exact skill sets employees need to develop in order to advance within the company or take on a new role in a different department.
  • Helps you keep a finger on the pulse of emerging skills, allowing you to forecast future skills needs before they arise.

skills gap analysis template cta

8 steps to building a skills taxonomy framework

  • Understand hard vs. soft skills
    You should be looking at both technical capabilities as well as character-based qualities to foster a deeper understanding of the nuanced drivers of success within each role. It can be helpful to create both a hard and soft skills taxonomy when getting started. 
  • Build skills clusters
    Skills clusters help you to understand which roles share what skill sets, what skills may transfer between different career paths, as well as what skills may relate to one another. Skill clusters are not job-specific, but give you a broader overview of the application of a variety of skills and competencies across jobs and even teams or departments.
  • Differentiate between skills and competencies
    Knowing what counts as a skill versus a competency is tricky but important, as competencies are often role-specific and not something you can easily train for. For example, use of Google Analytics software is a skill, whereas the ability to make data-driven decisions is a competency.
  • Weight skills by required proficiency and importance to the role
    For instance, both an Editor and a Graphic Designer may require knowledge of Photoshop, but the editor may need only cursory experience for resizing images, while the designer requires expert-level proficiency. Or a Cyber Security Analyst, Nurse and Web Designer may all need to know Excel, but that skill is far less important than others required by each role.
  • Start small
    A skills taxonomy is an enormous undertaking, so consider starting with a single department or a cluster of roles to get a clearer understanding of the process. Take time at the front end to see how things work and what level of detail makes the most sense for your organization.
  • Loop in key stakeholders
    For buy-in and accuracy, get input from both the workers doing the jobs and their managers on the skills needed for each role.
  • Leverage external data sources
    Industry data can help give you the context you need to better analyze skills for the roles within your organization. Incorporating external data into your taxonomy can also help you stay on top of emerging skill sets that you may not be aware of and need to account for in the future.
  • Dial it back
    If your taxonomy is getting too granular to be useful, don’t be afraid to simplify. As the saying goes, the best taxonomy is the one you use. 

Why the quality of your skills taxonomy matters

You can address talent development challenges