How to Implement Skills-Based Hiring: A Step-by-Step Guide for Talent Leaders
Key takeaways
- Skills-based hiring reduces time and resources spent on recruitment, as evidenced by companies like WillowTree and InHealth, leading to significant cost savings and improved hiring processes.
- Transitioning from experience-based to skills-focused hiring helps uncover hidden talent and addresses skill gaps, with data from McKinsey and LinkedIn supporting this shift.
- Successful implementation requires the right technology stack and training for hiring managers to ensure consistent and quality evaluations, enhancing the overall recruitment process.
The beer test should come last.
You may call it the coffee test or the airport test, but the impact is the same. It’s when, as part of a hiring decision, someone asks… “would I have a beer (or coffee, or spend time in an airport) with this person?”
The answer is supposed to be an net promoter score-like analysis—a quick, effective question that determines whether someone is a fit.
It’s also a fallacy for assessing whether someone can do the job.
While fit is a critical part of team dynamics, it should not be part of the assessment process. Instead, your candidate assessment should be entirely skills based.
So, how do you effectively implement skills-based hiring? Here’s what you need to know.
Where experience or gut-based hiring falls short
If someone has done a job longer than another candidate, they are usually better at it. Right?
Data isn’t so sure. Despite experience-based (and “beer test”) hiring being the norm in the American corporate world, almost 90% of companies are reporting massive skill gaps.
Further, traditional hiring methods often come with hidden costs:
- Increased time to hire: When you’re spending a lot of time assessing someone’s vibe or experience, you may need additional interviews.
- Overlooking potential talent: Someone may not have the requisite years of experience in a specific job, but they could have transferable skills. Experience-based hiring overlooks these potential rockstars.
- Additional Recruiter time: Assessing subjective things what someone learned during their years of experience requires more interviews, more conversations, and more Recruiter time. Since most Recruiters are already working at the maximum, this is unlikely to yield great results.
- Breaks at scale: When you have hundreds or even thousands of candidates, you simply don’t have the time to meet everyone and assess based purely on experience. Or, if you use years of experience as an objective cutoff, you risk overlooking talent yet again.
In an experience-focused structure, there’s also a chance you’ll simply not get to every candidate.
How to bring skills-based hiring into your process
1. Identify core skills and create skills-based job descriptions
Before you can assess candidates, you need to know what you’re assessing. Here are a few steps to take.
Conduct a skills audit
This is when you underscore the minimum and ideal skills necessary to do a given job.
- Identify the core outcomes a role is supposed to produce (e.g. a marketing strategy)
- Define any required competencies (e.g. strategic thinking and stakeholder management)
- Name any specific skills that make up those competencies (e.g. research, synthesis, and communication)
A thorough audit ensures you focus on skills that truly matter for each role.
Convert experience requirements to skills
Let’s say your current job descriptions say “5 years of experience in X.”
That’s fine—what does 5 years look like for X skill? You’re not asking for 5 years’ experience for fun, it’s because someone with that much experience is supposed to be able to do something specific.
Name that thing. If it’s a skill, great! If it’s an outcome or competency, use the same framework from step 1a to round it out.
Identify must-haves versus nice-to-haves
Be honest… does a successful candidate really need that skill? Or is that an ideal?
By segmenting true must-haves (“You cannot do the job without them”) versus nice-to-haves (“This benefits the org in other ways and makes the job a bit more efficient”), you can more easily assess candidates.
Add skills-based language to job descriptions
In your job descriptions, under the “A typical day” or “The candidate will…” sections, structure it with skills-based language:
- Outcomes the person must deliver
- Any required inputs (e.g. “We use Microsoft 365”)
- Must-have skills for the required outcomes
- Nice-to-have skills for the job and overall organization
2. Create structured skills assessment methods
Assessing skills requires a different interview structure. Here are three quick wins.
Async video interviews
Develop a question bank for video assessments. Not sure where to start? Here’s our guide on video interview questions (with 40+ examples).
Even better: Within Willo, we have a question generator tool that can help you design a custom interview.
Develop a scoring rubric
It’s a bit like in school: What represents a failing, ok, good, and exceptional demonstration of a skill?
Design a scorecard to help you assess not just if someone can do the job, but if you’d advocate for their hire based on how they demonstrated a specific skill.
Let AI help you
AI can be a powerful tool. For instance, Willo Intelligence helps you:
- Summarize a candidate’s responses
- Categorize and search through candidates based on specific skills
- Help you draft custom follow up questions to learn more from candidates
3. Train your team for skills-based evaluation
Make sure your team is on board! Here’s what to keep in mind:
Equip your hiring managers with a comprehensive training guide. Address common resistance points and track success metrics to ensure alignment with the new strategy.
Develop a standardization framework to align cross-team evaluations. Implement a quality check process to maintain consistency.
Monitor the quality of your assessments. For example, Bott + Co’s leveraged Willo to help save over one hour of Recruiter time per candidate while improving the candidate experience.
4. Pick the right technology
There are a lot of video interview tools out there. Pick the candidate screening platform that works for you based on:
Recruiting goals: Volume? How much automation do you want? Are you planning to scale up or down in the near-term?
Recruiting process: How many steps do you have in your process? Where would you like to insert video? How can async video be most useful?
Platform capabilities: Do you need features beyond video? What integrations do you need? Does pricing work for your needs at scale?
5. Measure and iterate
So, how are things going?
We recommend tracking a few common recruitment metrics:
- Time to hire
- Interviews to hire
- Cost per hire
- Quality of hire
- Candidate satisfaction
These metrics will help you understand if your skills-based hiring approach is yielding results and where, if anywhere, you need to improve.
How to avoid common implementation pitfalls
1. Overcoming stakeholder resistance
Handle objections and manage change effectively. You can use success stories from other organizations—like MyTutor (tech), EDF (energy), or Bott and Co (legal services)—as examples to make your case.
2. Timeline expectations and milestones
Plan your implementation timeline with key milestones. Use a tracking system to monitor progress and mitigate risks.
3. Quick wins in your first 30 days
Identify immediate action items for quick wins. Track early success metrics and plan your next steps to ensure ongoing success.
FAQs about skills-based hiring
What is skills-based hiring?
Skills-based hiring focuses on a candidate's abilities rather than their past job titles or years of experience, using skills assessments to evaluate potential.
How do I start implementing skills-based hiring?
Begin with a skills audit to identify critical skills, convert experience-based requirements into skills, and design job descriptions that attract skilled candidates.
What tools are needed for skills-based hiring?
Essential tools include video interviewing software, skills assessment platforms, and an integrated HR tech stack to automate processes.
How can I measure the success of skills-based hiring?
Track key performance indicators, calculate ROI, and measure the quality of hires to evaluate the effectiveness of your skills-based hiring approach.
Better hires, better business results
Skills-based hiring is more than a trend—it's a strategic shift that can transform your talent acquisition process. By focusing on skills, you can uncover hidden talent, reduce biases, and make better hiring decisions.
Ready to take the leap? Schedule a demo with Willo to see how video interviews and assessments can enable skills-based hiring at scale.
