Close the skills blindspot without the guesswork

You can’t fix what you can’t see. 

Skills-based hiring, development, and internal mobility are taking center stage—and for good reason. Agility, adaptability, and transferable skills are fundamental to building resilient, future-ready teams.

According to the 2025 SHRM State of the Workplace report, leadership and management development is the number one priority for HR professionals. Training initiatives like upskilling and reskilling are gaining traction as organizations increasingly shift their focus from hiring and retention to internal mobility and career progression.

Yet, as Lance Haun bluntly writes in Reworked, “most organizations don’t know the skills they have.” Even fewer have the tools to assess those skills effectively. McKinsey data echoes this, with 87 percent of executives acknowledging skill gaps in their workforce, but struggle to pinpoint where they are or how to close them. 

The result? Wasted L&D investments, stalled careers, and untapped internal talent.

We’ve already explored the value of new-collar hiring—tapping into potential and real-world expertise over traditional credentials. But without a verified understanding of what skills your workforce already has, even the best skills-first strategies can fall flat.

As Haun explains, “The promise of a skills-based workforce is that employees can move fluidly between roles based on their abilities. However, few companies accurately and effectively track internal skills. Without that visibility, career paths stall, talent is underutilized and engagement suffers.

“Even hiring remains stuck in old habits. A study showed that 81% of employers claim to prioritize skills over degrees in hiring, yet the results don’t back that up.”

The hard truth? Strategy built on assumption isn’t strategy. It’s guesswork. 

Verified data (not just good intentions) is key

According to RedThread Research, identifying skills isn’t enough. You need verify them with trustworthy data that’s nuanced and current.

Before expanding your L&D programs or launching new mobility initiatives, take a pause and ask:

1. Do we really know what our people can do today?
2. Do we have the tools to find out? 

Skills-based strategy is the goal. Skills data is the gap.

SHRM’s latest report shows that retention and internal growth are now higher priorities than recruiting. But to build successful growth paths, you need to know your starting point.

According to Deloitte, one-third of professionals feel their employers fail to recognize or use their full skill set. This kind of misalignment can land a blow to engagement and affect business performance. L&D budgets get misallocated, high-potential team members go unnoticed, and workforce plans fall short of actual needs.

The simple truth is that good strategy starts with good data. And right now, too many organizations are still operating in the dark—but there’s a way to switch on the lights.

The skills inventory you didn’t know you were missing

RedThread research has identified seven key methods organizations use to verify skills:

• Self-assessment. Team members rate their own skill levels. This is quick to implement but potentially biased.
• Performance feedback/informal observation. Managers or peers provide input based on experience. This is subjective but already embedded in many workflows.
• Formal observation. Structured evaluations with clear criteria are more reliable but resource-intensive.
• Formal assessment. Tests, simulations, or certifications used to validate proficiency offer precision but require lift.
• Comparison to external benchmarks. Measures skills against industry or regulatory standards. This can add context but is less granular.
• Inference from HR data. Uses existing data (e.g., roles, reviews) to predict skills. This is automated but requires oversight.
• Inference from work data. Analyzes completed tasks and outputs to assess skills. It’s rich and up-to-date but tech-heavy.

Most companies will gravitate towards the easiest methods to implement, such as self-reports and manager input, but they’re often obsolete, biased, and inaccurate. 

In fact, only 11-18 percent of organizations use more rigorous approaches like formal assessments or external benchmarks. 

The solution? Layer your methods. Because no single method gives you the full picture. 

Use simple methods as a foundation, then add more robust techniques to enrich and verify the data. Together, they paint a fuller, clearer picture you can act on confidently.

Why the skills data matters beyond L&D

Quality skills data drives value across the business. And stronger visibility into your people’s skills enables more effective strategies across the board:

• L&D: Invest in the right programs to close actual gaps
• Internal mobility: Help people grow into new roles and reduce turnover
• DE&I: Identify overlooked talent and support equity
• Workforce planning: Align talent and capacity with business needs

When companies don’t have the data or visibility it offers, they tend to fall back on outdated practices—even when they think they’re skills-first.

A case in point: Despite a fourfold rise in jobs that no longer require degrees, there’s been only a 0.14 percent increase in hires without degrees, and that gap between intention and reality shows what happens without strong data.

How HR can start fixing the skills blind spot

Bringing clarity to your workforce’s skills doesn’t take a complete system overhaul. It can actually be quite easy when you have a smart, phased approach. 

Here’s a practical, 4-step roadmap to building skills visibility into your workflow:

1. Audit what you have

Start with what’s already there. Review existing data sources: self-assessments, one-on-ones, performance reviews, LMS history. Where does the data come from? How old is it? Is it still relevant?

2. Layer in stronger methods

Combine high-volume, low-cost tools with more rigorous approaches. Blend self-reports with manager observations, inferred system data, and work samples. This mix helps balance bias and depth.

3. Align with the business

Don’t verify every skill. Prioritize what matters most to business success. Partner with L&D and business leaders to identify critical capabilities, then focus efforts there.

4. Make it continuous

Skills tracking isn’t a one-off project. Build skill tracking into regular touchpoints: performance cycles, goal reviews, talent mapping. Update the data, test it, refine it. Then repeat.

Turn visibility into action

The promise of a skills-based workforce is fluidity, mobility, and growth. But it starts with knowing what your people are capable of today.

When you have that visibility (not just headcount or roles, but real, verified, mapped skills), you can align talent with business needs, elevate overlooked team members, and build more inclusive, future-ready teams. That’s the foundation for smarter workforce development, stronger mobility, and more inclusive opportunities.

Because the most powerful skills strategy isn’t just about intent—it’s about insight.