Mind the Skills Gap: Moving From Skills-Based Pay to Skills-Based Reward

Abstract

The focus on attracting retaining, engaging, and rewarding talent with critical skills will only increase in the rapidly changing world we are living in. Organizations are in the best position to thrive when they understand, build out, and leverage the promise of skills-based reward. This article lays out the value proposition and framework for skills-based reward, the challenges inherent in this area and areas to focus on for successful implementation. Skills-based reward applications cover the following: (1) Hiring talent based on skills. (2) Use of job architecture and job leveling processes that utilize skills. (3) Use of career architecture processes that leverage skills. (4) Performance management processes that utilize skills. (5) Base salary increase and pay promotion systems based on skills.