What Is a Skills Inventory in Human Resources? (Plus Benefits)

A skills inventory is a compilation of the skills, education and experiences of current employees. Organizations use these inventories to assess whether current staff can meet company goals. Understanding the company’s pool of current skills/talents and future skill requirements aids in strategic planning efforts.

As businesses become increasingly competitive, Human Resources (HR) teams must understand the importance of developing a comprehensive skills inventory system. A skills inventory provides HR departments with the information needed to accurately assess the abilities of current and potential employees. This information is often used to identify areas of improvement and development, create job descriptions and assign tasks to employees. Furthermore, using a skills inventory system allows employers to quickly identify and hire personnel with the right skill set or qualifications needed to fill positions in their organization. This blog post will discuss the importance of skills inventories and provide guidance on how to create and manage a successful system. The post will also discuss how to make use of skills inventories to develop and monitor employee progress, and how to ensure that the skills inventory is kept up-to-date. With the right skills inventory system, HR teams can gain insight into the skills, qualifications, and experiences of their existing and potential workforce and make informed decisions when recruiting and managing personnel.

Skills Inventory

Purpose of skills inventories

In order to streamline its operations, a human resources department may use its skills inventory for a variety of tasks. Some main purposes of a skills inventory include:

Consistent improvement

There might be observable areas for improvement as the department creates and updates the skills inventory. Consider a marketing firm with 50 employees, but only a handful of them are proficient writers. Since the majority of staff members participate in marketing proposals, the HR department might advise the marketing manager to hold a workshop to help staff members write better proposals. This helps the business foster a culture of ongoing improvement and can aid in producing better results.

Recognizing gaps

A skills inventory can be used by the human resources division to identify workforce gaps. Consider a scenario where a business only has one employee who is proficient in coding. The HR team may decide to hire a team of expert coders rather than teaching current employees how to code. When a workforce gap is identified, the department can take action to close it and improve the company’s capabilities.

Succession planning

In the field of human resources, succession planning is another application for skill inventories. In order to determine which employees might be prepared for a promotion should a position open up, HR departments use succession planning. By using a skills inventory for this, the HR department is ready to internally fill roles as needed, with the assurance and information to support their choice. Consider a scenario in which a sales lead exhibits exceptional performance and gains the knowledge and abilities required to advance to the position of sales manager. When a sales management position opens up, the HR department might keep track of this employee.

What is skills inventory in human resources?

The human resources division of a company uses a skills inventory as a tool. It is a database that records and keeps track of the qualifications and experience of workers within a business. Usually, it’s a comprehensive and ever-changing list of knowledge, training, experiences, and skills. Depending on the sector, your workforce may have a mix of technical and soft skills. All of these abilities are advantageous to the workforce, but skill inventories can show human resource managers which abilities the company lacks. This offers a framework for creating training programs or making plans for the kind of workers to hire during the upcoming hiring cycle.

How can HR professionals use skills inventories for strategic HR planning?

Skills inventories can be used by human resource departments to support their strategic planning in particular. Some of these strategies may include:

Make data-based decisions

When an HR department has a skills inventory, they can decide on strategic objectives based on data. These choices might include what topics to train employees in, what skills the business needs to look for next, or how to concentrate on developing a few key skills across the entire workforce. Decisions can be based on information from the skills inventory when the department suggests promotions, develops a departmental budget, or aims to meet the company’s hiring objectives.

Prepare the company for changes

The skills inventory can occasionally be used by the HR department to strategically plan for changes within the business. Imagine, for instance, that a company’s management decides to phase out the use of paper in the workplace by the end of the year. The skills inventory could indicate that more staff with digital skills are needed to help with this transformation. With this knowledge, the human resources department can start hiring software developers and other digital and technical specialists. The department may identify this gap early thanks to the skills inventory, giving it more time to plan the recruitment and hiring process.

Create well-rounded teams

The HR department may use the skills inventory to support its strategic planning when forming teams at work. For instance, the HR department can use the skills inventory to assign 25 employees to five different teams. The inventory could reveal which employees possess particular skills required by each team. The department can then assign one of these workers to each of the five teams in order to maximize the likelihood of each group’s success. This kind of strategic planning can improve organizational team performance and produce more productive business outcomes.


Recruitment is yet another way that human resource experts can use a skills inventory for strategic planning. The department can identify the company’s strengths and weaknesses because the inventory is constantly updated. Afterward, a recruitment strategy can more successfully target the company’s areas for improvement using this data.

Career mapping

Another area of strategic planning where human resources can use a skills inventory is career mapping. When employees perceive opportunities for advancement and growth within a company, many of them may become more motivated. Career mapping aids workers in comprehending the knowledge and expertise required for a raise or promotion. The skills inventory can be used by the HR department to illustrate the skills that might be required for a specific career path within the organization. People may stay on the job longer as a result because they believe they have room to advance their careers.

Benefits of skills inventory in human resources

Implementing a skills inventory in your human resources department has a number of advantages. Some of these benefits include:


What are skills inventories?

An organization’s employees’ skills, education, and experiences are compiled into a skills inventory. Employees are an organization’s greatest assets.

What is a skills inventory give an example when it is use?

A skills inventory can be used by the human resources division to identify workforce gaps. Consider a scenario where a business only has one employee who is proficient in coding. The HR team may decide to hire a team of expert coders rather than teaching current employees how to code.

How do you write a skills inventory?

How Do I Create a Skills Inventory?
  1. Step 1: Determine Skills to Be Included. Work together with executive leadership to determine the skills that are essential for the company to have in order to achieve its objectives.
  2. Step 2: Assess Skills. …
  3. Step 3: Build a Matrix. …
  4. Step 4: Create a Plan to Strengthen Weak Areas.

What is management and skill inventory for?

A 360-degree profiling tool called the Management Skills Inventory provides managers with an understanding of their current skill level as well as the expected skill level for the work they do from the perspectives of themselves, their managers, their peers, and their direct reports.

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