Why is hiring important? It’s to bring in talent that delivers the most value to your stakeholders.
From an executive perspective, this is the value of adding to the bottom line by increasing revenue generation and decreasing cost. From a Talent leader perspective, it’s to ensure the divisions you hire for have individuals that can meet and exceed division goals.
As an IO, or as someone who has worked with HR for over 20 years, we tend to think about the outcomes we care about and forget the actual business value our work produces.
In this article, I’ll discuss how moving to a skills-based hiring organization will help achieve the goals that ultimately create business outcomes that improve value provided to your stakeholders.
What Creates Business Value?
At its core, skill-based hiring holds the promise that people are evaluated purely on their ability to perform the job and not selected based on who they know or where they grew up.
It democratizes work so it is purely a meritocracy and not based on nepotism.
For I-O psychology, this line of thinking is nothing new and is fully supported.
Before we dive into skills, we need to understand what creates business value. That starts at the end with performance.
All leaders (and individuals) want to perform the job well.
Sounds easy enough, but most organizations are not strong at how to define good performance and especially how to measure it accurately. Jobs that are easier to define are jobs with tracked KPIs.
Think about jobs where you have to produce something or sell something. Targets can be tracked, employees can be monitored based on output and there are differences in how the best employee versus the worst employee performs, so an organization can identify the difference between hiring and developing a top performer versus a low performer.
Now, let’s take jobs that are more knowledge-based.
There are no clear KPIs to track, but the manager knows who is a high performer and who is not.
The challenge is when they try to define it.
We also find that you can have two high performers in the same role, but they are high performers for different reasons (e.g., one is a great collaborator who produces their work in a timely manner but also spends time helping and guiding others versus another one who doesn’t necessarily help others but produces excellent work that sets an example for others).
The Link Between Skills and High Performance
So, we’ve established that high performance can come in many shapes and sizes. Next, we look at the skills required to achieve that performance.
If we continue with the same two individuals, they most likely share some overlapping strengths, but also have unique strengths that contribute to their success.
If we only look at the relationship between overall performance and these individuals, we would likely identify the common strengths and overlook the unique ones. Being able to identify and measure both shared and unique skills is how organizations create a competitive advantage with their people.
It helps avoid groupthink and, when done well, encourages innovation and creativity.
A Skills-Based Organization Is More Than Hiring
We’ve established that skills lead to high performance, which leads to business value.
But a skills-based organization is not just hiring the right skills.
It’s the ability to hire on the skills that are needed initially in the job and then have a complementary talent management process that develops these individuals based on their individual strengths and opportunity areas.
Once an organization understands this information, they can start identifying skills across the organization so their strategy can be twofold:
- How do I develop my workforce to make a greater impact?
- How can I have a mobile workforce that can transition to other roles and be successful because the skills they have meet the needs of other roles in the organization?
The Core Skills That Matter in 2026
As we look at most critical skills in 2026 and beyond, it’s really not different than the past 5-10 years.
It may feel more dynamic because of the speed at which information is shared today through media and technology, but in reality, the core skills remain consistent.
The top 5 skills continue to be:
- Communication
- Collaboration skills
- Problem-solving
- Critical thinking
- Digital agility
The Emerging Frontier: Human Skill + AI
The emerging skills that are being defined right now include the convergence of human skills with AI technology.
At Harver, we increasingly see organizations asking questions such as:
How do we interact with AI in a way that enhances, rather than replaces, human judgment and decision-making?
How do we most effectively partner with generative AI to increase efficiency while maintaining transparency and explainability?
If AI takes on more repetitive, entry-level tasks, how do we develop early-career talent when those traditional learning opportunities are reduced?
These questions are no longer theoretical. Organizations that can measure digital agility and AI readiness today, while meeting emerging regulatory requirements for algorithmic hiring will have a significant competitive advantage in talent acquisition and development.
What Can You Do Now?
Start defining stable skills in your organization.
Determine what skills are needed at entry to a job and select based on them and determine what skills can be developed and ensure you have opportunities on how to build those skills.
Define and measure how roles provide a return on investment to the organization by mapping out how they contribute to revenue generation or cost savings in the organization. When you overlay skills on these roles, you can start defining the skills that are most critical to select for or develop in the organization.
The more you understand the skills and how they relate to successful output, the more you can build a dynamic skills-based organization instead of an organization that only hires and develops within role.
The organizations that win will be those that treat skills as a measurable, dynamic asset, not a static checklist.
