At livingHR, we know that your people are your superpower. When their skills, passions, and potential are aligned with your business goals, that’s when the real magic happens. So if you’re starting to ask questions like “Do we have the talent we need to grow?” or “Where should we be investing in development?”—you’re in the right place. A skills gap analysis can help you find those answers.
But here’s the thing: this isn’t just a spreadsheet exercise. It’s not about tracking deficiencies. It’s about understanding your people, unlocking their potential, and intentionally shaping the workforce you need for today—and for the future.
Let’s walk through what a skills gap analysis looks like when it’s done with people, strategy, and culture at the center.
A skills gap analysis is a structured process that organizations use to identify the difference between the skills their workforce currently possesses and the skills they need to achieve business goals. It helps leaders assess their current talent landscape, highlight areas for development, and plan for future needs, whether that means upskilling, reskilling, hiring, or redesigning roles.
But it’s more than a diagnostic tool.
At its best, a skills gap analysis offers insight into how well your people are aligned with your strategy, how equitably development opportunities are distributed, and where you can create more meaningful, human-centered pathways for growth. It’s not just about measuring capability, it's about unlocking potential.
There are many types of skills gap assessments, including:
When approached thoughtfully, this process not only builds business readiness but also strengthens trust, belonging, and performance across your organization.
Before you start collecting data or building fancy dashboards, take a step back. Why are you doing this? Maybe you're scaling, navigating change, or shifting toward a new strategy. Maybe you’ve got teams stretched thin or new roles emerging faster than your people can grow into them.
According to McKinsey, nearly 90% of leaders believe they are already facing or will soon face skill gaps that limit performance. For organizations that want to stay competitive, proactive workforce planning is critical.
Whatever your reason, get clear on your goals. The more connected your analysis is to the business strategy, the more meaningful your insights will be—and the easier it’ll be to act on them.
A well-executed skills gap assessment helps leaders:
(Pro tip: If you're planning for digital transformation, acquisitional growth or succession planning, now is the perfect time to pair those efforts with a thoughtful skills gap review.)
Next, let’s talk about what you’re actually measuring. Spoiler: it’s not just technical know-how.
Sure, you’ll want to understand things like data analysis, project management, or compliance expertise. But don’t forget the human side of performance. Emotional intelligence, collaboration, inclusive leadership—these are critical skills, too. And they’re often the differentiators between an okay culture and a truly great one.
In fact, Lattice found that 74% of high-performing organizations are now tracking soft skills as part of their performance strategy. So you’re in good company.
Before jumping into tools or templates, take time to define your "why." A successful employee skills assessment is grounded in clear, business-relevant objectives.
Are you:
By tying your analysis to strategic goals, you ensure that the outcomes are meaningful, actionable, and directly connected to business performance.
Identifying the right skills to evaluate is one of the most important steps in the process. A common mistake is focusing only on technical skills while overlooking the competencies that enable collaboration, innovation, and leadership.
Include a mix of the following:
Organizations that track both hard and soft skills see more holistic performance outcomes and stronger alignment between individual potential and organizational needs.
With a clear goal and a list of essential skills in hand, it’s time to take inventory. What skills do you already have on your team? Where are you thriving, and where are the gaps?
This part should be collaborative—not just a top-down audit. Bring in managers. Ask employees to self-assess. Leverage the HR technology platform you use to house performance and development data.
At livingHR, we recommend a multi-method approach:
This blended approach ensures your skills gap assessment is rooted in both data and experience, helping you uncover not just what people can do, but what they care about doing more of.
Now that you have a clearer picture, patterns will start to emerge. Maybe a whole team is struggling with strategic thinking. Maybe your high-potential employees are missing opportunities to lead. Or maybe your frontline leaders need more support navigating change.
As you identify the gaps, don’t just think about what’s missing. Think about what’s possible.
Where are people underutilized? Where could a stretch assignment, a mentorship relationship, or a redesigned role unlock someone’s potential? And are there equity issues—like access to development opportunities—that need attention too?
A skills gap analysis should shine a light on capability gaps and culture gaps alike. That’s where the real growth happens.
Ask questions like:
Now consider what you can do:
The goal is to build a workplace where development isn’t a privilege, it’s a shared expectation.
Development plans that stick are co-owned by employees and the organization. Rather than prescribing a one-size-fits-all learning path, invite employees to co-create their next steps.
Together, design:
As we like to say at livingHR: skills gaps aren’t just about what people lack—they’re about what organizations haven’t yet nurtured.
You’ve done the work—now let’s measure it.
How do you know if your skills gap strategy is working? Look beyond completions or checkboxes. Focus on outcomes that tie back to your people and your business. For example:
Organizations that actively close skill gaps consistently outperform their peers, and they build workplaces that attract and retain top talent.
At livingHR, we help organizations uncover, understand, and close their most critical skills gaps while honoring the human experience of work.
We do this through:
We believe that when you see your people clearly, you unlock your competitive advantage.
A skills gap analysis is more than a tactical exercise; it’s a window into the future of your workforce. And when you take a human-first approach, you see more than gaps. You see opportunities.
Opportunities to:
By understanding where your people are today and what they need to succeed tomorrow, you create a culture that thrives not just in spite of change, but because of it.
Ready to get started? Connect with us. We’d love to help you build a workforce that’s skilled, inspired, and future-ready.