How to create a skill matrix (with steps and examples)

Being able to identify key skill assets and gaps with a competency matrix is a crucial exercise for optimising your strategy. Ensuring each area of the business is equipped with the right people to accomplish tasks efficiently can boost productivity, increase profit and boost team morale. Understanding how to construct a skill matrix is an ideal way to identify the skills and competencies you have and plan strategies to overcome those that you need. In this article, we explain what a skill matrix is, why it's important for maximising your team and provide steps and examples for creating your own.

Defining a skill matrix

A skill matrix is a comprehensive HR tool that businesses use to map the necessary skills to complete a team project in a practical and data-driven way. These matrices identify the available skill sets you already have and highlight any gaps in skills that are necessary to complete a project. Although these matrices can look different from business to business, they all share a few similar features:

• You present them visually: Skill matrices visually present information, segmenting information using a grid format. This way, skills and skill gaps are easily identifiable and their importance within the context of the entire project is easy to see.

• They identify the necessary skills for a project: Every matrix requires careful consideration of the necessary skills to complete a business project in the most successful way possible. This step sets up your matrix by defining what the project needs so you can begin identifying those skills within the team.

• They're flexible and change with business needs: As any project progresses, your skill set may alter and change slightly and a matrix can help you identify and even predict needs before they cause delays to your project. Visually identifying new skill gaps with a matrix means you can find people to fill these gaps and stay on schedule.

Related: How to identify skill gaps in the workplace (with tips)

Benefits of a competency matrix

There are several key benefits to setting up this HR tool when planning your next project, and many of these benefits centre around driving team and business performance. Focussing your efforts on improving employee skills has all kinds of benefits for individual projects and business performance in the long run, including:

They help create effective employee learning plans

By using a matrix to fully comprehend each employee's strengths and areas for development, you can create comprehensive plans to help each team member become even better at their job. A skills matrix can help learning and development professionals identify individual learning gaps and then use this information to create specific development trajectories. In the long run, identifying learning plans can reduce training costs and even employee turnover.

Related: How to approach the 5 stages of team development (with tips)

They help to delegate resources

These matrices help businesses become aware of what skills they currently have and those that they may need in the future. With this level of foresight, it becomes easier to know where to allocate training resources and budget with confidence. Identifying coveted skills means businesses can invest their learning and development budget where it can help the business the most.

They can optimise existing talent

By creating a matrix for each area of your business, you create a detailed map of your existing team's skills. This can help you easily see where certain skills may overlap between team members, and help you communicate skill expectations to each area. That way, new employees come into the business with a better idea of what skills are necessary to excel and the business can redistribute existing talent to fill any skill gaps.

They ultimately help your clients

When employees know what skills are essential to do a great job and employers know what skills are available throughout the business at all times, the client sees the benefit. This visibility helps employees experience more confidence in their roles and ensures that there's an even distribution of the skills necessary to complete a job well. By using a matrix to prevent downfalls in skills, clients ultimately receive and experience a better service.

Related: Corporate development: Definition, types and strategies

How to create a competency matrix

Whether you're creating a competency matrix for a specific area and project or the business as a whole, the steps for making one successfully are the same. Here's our definitive step-by-step guide to creating a competency matrix in your business:

1. Define and identify relevant skills

The first crucial step in creating a matrix is to identify the skills that are necessary to complete a project or create a more successful team structure, and then gather all existing employee competencies into a skills database. Define the necessary skills for the team or project by listing them from most to least essential and compiling them into categories and subcategories, such as technical skills, communication skills, data analysis or problem-solving. Then, compile a similar list of the skills that your team or teams currently possesses and compare the two.

2. Create a grading system to assess current skills

It's important to know what skill level your employees can currently demonstrate with the competencies they already have. This step requires you and your team to determine exactly how you want to classify different competency levels (beginner, mid or senior, for example) and how you want to determine these levels among employees. You can simply ask employees, their peers and their manager for their level of competency in certain areas or employ more data-driven methods, such as competency testing.

3. Collaborate with your data

Once you determine the level of skill of each employee, you can then visually represent this data graphically to easily identify any competency gaps, both at an individual level and for overall business operations. A quick and easy way to do this is to assign a numeric value to each skill level you identified in step two and then simply graph this data. This can help you easily pinpoint the most skilled employees for particular tasks, determine where training gaps need filling, explore internal restructuring opportunities and demonstrate data-driven results to upper management.

4. Implement your insights

Once you identify all the skills your employees already have and all the skills necessary to complete a project with your matrix, it's time to turn these insights into actions. Whether this results in better personal development plans, team restructuring, retraining or even brand new training, implementing your matrix insights as soon as possible is the best way to mitigate skill shortages. Once your insights result in actionable results, you can restructure your matrix accordingly to keep continual visibility of all skills.

Related: 10 methods to improve employee development in the workplace

Competency matrix examples

To get a better idea of how to implement a competency matrix, it helps to see how they can look. Below are a few examples of a matrix to help pinpoint the competencies necessary for success in a particular role, and the existing employee skills that match these needs.

Example 1: customer service representative skills matrix

Competencies:

1. Written and verbal communication

2. Empathy and ability to listen

3. Problem-solving and critical thinking

4. Technical skills

5. Numeracy skills

Skill levels:

1. Novice - no experience

2. Learner - some experience

3. Intermediary - proficient skill level for success

4. Senior - above average skill level for success

5. Expert - above and beyond skill level

Employee name: Jane

Self-score

Manager score

Practical score

Metrics

Score %

Skill 1: Communication

4

4

4.5

5

85%

Skill 2: Listening

3

4

4

5

73%

Skill 3: Problem-solving

3.5

3

3

5

63%

Skill 4: Technical

4

5

5

5

93%

Skill 5: Numeracy

4

4.5

5

5

95%

Example 2: Leadership competencies matrix

Competencies:

1. Analytical decision-making skills

2. Project and time management skills

3. Problem-solving and critical thinking skills

4. Communication skills

5. Technical skills

Skill levels:

1. Novice - no experience

2. Learner - some experience

3. Intermediary - proficient skill level for success

4. Senior - above average skill level for success

5. Expert - above and beyond skill level

Employee name: John

Self-score

Manager score

Practical score

Metrics

Score %

Skill 1: Analytical

4

4.5

4

5

83%

Skill 2: Management

3

3

3.5

5

63%

Skill 3: Problem-solving

4

3.5

4

5

76%

Skill 4: Communication

5

4.5

4.5

5

93%

Skill 5: Technical

3

2.5

2.5

5

53%

Example 3: Marketing expansion project matrix

Competencies:

1. Communication skills

2. Creativity skills

3. Technical skills

4. Data analysis skills

5. Problem-solving skills

Skill levels:

1. Novice - no experience

2. Learner - some experience

3. Intermediary - proficient skill level for success

4. Senior - above average skill level for success

5. Expert - above and beyond skill level

Employee name:

Skill: Communication

Skill: Creativity

Skill: Technical ability

Skill: Data analysis

Skill: Problem-solving

Score %

Jane

4

5

3.5

3

4

78%

John

4

3.5

4

4

3.5

78%

Tabitha

5

4.5

3.5

3

3

76%

Scott

3.5

4

4

2

3

66%

Lionel

3

5

4

3.5

3.5

76%