Digital skills dominate the modern workplace. As talent shortages persist and knowledge gaps grow, organizations prioritize upskilling and reskilling to prepare employees for the future.
Talent management leaders’ top priority in 2023 is to establish a vital pool of digital skills and competencies.
Despite this, only a few companies are becoming skills-based. Leaders must go beyond minor upgrades and subtle modifications to replace jobs with skills. To put skills at the center of talent management, firms must adopt new frameworks and game-changing technologies.
These terms may seem unfamiliar initially, but aerospace and defense (A&D) CEOs and talent management leaders must quickly learn and create skills-based organizations.
Why Skills-Based Strategies Are Essential in A&D
A&D companies struggle to find top digital talent due to the small talent pool with the demand-supply ratio at 2:1, especially in the Greater Washington, DC, area, where several major A&D companies are headquartered.
Here are some more talent insights in A&D:
- Workers with digital and analytical skills are fewer in A&D. Only about 30 – 43% of employees have the necessary skills compared with tech companies at 62%.
- 50% of A&D companies face competition for tech talent from tech companies and advanced electronics companies.
- The A&D industry does not highlight the industry’s strengths. Their approach is also slow and bureaucratic, preventing them from attracting and retaining recent graduates. 39% agree that providing compelling careers is a challenge.
- The strategic requirements of A&D HR are growing. The A&D industry must improve its talent engagement strategies by reimagining how companies can better integrate the HR function. Only 50% of A&D companies believe their talent management strategy will outperform the competition in five years.
After decades of effectively separating work into roles and relying on the same methods to preserve operational continuity, transitioning to dynamic working modes may seem risky.
It is a necessary leap of faith in an era of rapid innovation and upheaval.
Skills-based strategies enable the adaptability needed in the new workplace.
When companies change from job roles to skills, management can empower their workforce to reach their full potential.
Transform Talent Management in A&D With Skills Architecture
A&D talent management must integrate skills into its activities to become a skills-based organization.
Organizations can progress towards becoming a skills-based organization by weaving skills into talent activities like workforce planning, leadership, and succession planning.
Instead of headcount, A&D organizations must plan for skills:
- Instead of job architecture, they could develop a more flexible work and skills architecture;
- Instead of succession planning based on roles, successors are identified based on real-time verified skills and capabilities needed for the future.
However, being a skills-based organization goes beyond redesigning talent management.
The bigger opportunity is to use skills to redefine the future of work — changing how work is done, what it means to be an organization or a worker, and the value businesses can provide for humans and society beyond financial value.
Strategic workforce planning maps a company’s business goals. Instead of a role-based headcount supply/demand graph, it maps skill-level supply and demand gaps.
This can help A&D talent management hire, reskill and upskill with this skills architecture output.
Actualize Skills-based A&D Organizations
Skills-based architecture may speed up R&D, Systems Engineering, Quality Assurance, Aftermarket Services, Procurement & Supply Chain, and others and help organizations comprehend emerging and declining skills, costs, availability, and criticality of skills.
Here are some practical steps that Draup recommends (with illustration):
1. Define Core and Specialized Skill Clusters: Consider core and specialized skill clusters across Systems Engineering, research, sales and support, and other functions.
Core and specialized skill clusters are shown here.
2. Define Functional and Emerging Skills by Clusters: Each skill cluster is further categorized into functional and emerging skills.
3. Map Skill Depth By Experience: A third layer of skill depth analysis can map out which experience levels should specialize in what skill clusters.
4. Know where talent is deployed: A&D talent management assigns only 44% to critical roles and can quickly reallocate only 6% to strategic projects. They must identify their 50 most strategically important roles and use skills and performance data for talent distribution.
5. Develop reskilling plans for future critical roles: Talent management could create personalized learning journeys allowing employees to apply new skills. They could focus on helping employees with digital skills in non-digital roles, including soft skills.
6. Use data and analytics to perform targeted sourcing – A&D talent management can create talent heat maps and examine university curriculums to find those that produce skilled graduates, assess the density of diverse talent pools by location, and evaluate interest.
Companies could also measure talent pools at trade shows, career fairs, and schools in specific locations. Focused recruiting with the right diversity mix can build talent pipelines that supply key skills for years.
Skills will provide new strategic directions or ambitions to create value for humans, a vital component of stakeholder capitalism.
A stronger focus on skills in A&D organizations can give:
- Higher employability for all,
- More efficient labor markets enablement, and
- Greater opportunity, fairness, and equity,
as people are defined more by their skills than by pedigree or subjective judgments.
Join Draup’s Co-Founder and CEO, Vijay Swaminathan, for a discussion over breakfast on ‘Building Skills-Based Architecture in the Aerospace and Defense Industry.’
He will address the following as the sector undergoes disruption:
- The need for a skill-based job architecture,
- How the Aerospace & Defense sector can identify emerging and diminishing skills, and
- Optimizing skills-based talent management and reducing talent costs.