Skills are the new currency of work. Yet we measure and reward managers and employees for delivering results, not for building the skills that ensure long-term success.
No wonder we have a skills gap.
While organizations pour resources into fostering innovation and meeting quarterly targets, they often overlook a critical driver of success: the continuous development of their workforce’s skills. Traditional approaches—sporadic training programs and annual performance reviews—fail to keep pace with the relentless speed of change. It’s time to embed learning into the fabric of work itself.
This isn’t just about providing employees with access to courses; it’s about creating a culture where skill-building is constant, personal, and seamlessly integrated into daily workflows. And measured. Measured in the performance reviews of the managers. Because at the heart of this transformation, or lack thereof, are managers, who must evolve from task supervisors to skill architects.
And currently they’re not.
A critical gap exists between what organizations think they’re delivering in terms of employee development and how employees perceive it. Despite 77% of executives agreeing that their organization should help workers stay employable, only 5% strongly believe they’re investing enough to keep pace with change, according to a Deloitte survey. The Betterworks Skills Fitness Report 2024 shows a similar disconnect: 70% of organizations claim to measure skills in performance reviews, yet most do so only once or twice a year—far too infrequently for today’s fast-moving workplace.
Why would they? You get what you measure.
The Skills Gap: What We Measure Is What We Get
The way we measure and reward in organizations is through performance management. Which is why performance management needs to move from a backward-looking evaluation process to a forward-thinking tool. Currently, it remains rooted in assessing outputs: sales targets, project completions, or customer satisfaction scores when it should be including what employees are learning and how they’re growing. As Doug Dennerline, CEO of Betterworks, puts it: “A skills-focused approach values employees based on what they bring to meet current challenges rather than just their roles and goals.”
Skills aren’t just a ‘nice-to-have’; they’re critical to organizational survival. This isn’t just about retaining talent—it’s about unlocking potential. Companies that prioritize skill-building experience tangible benefits, from increased retention to greater agility and innovation. With the half-life of many skills now just a handful of years, organizations that ignore ongoing development are working with a depreciating asset base. In other words, today’s high-performing employee risks irrelevance tomorrow unless skills are continuously built and applied. Lack of skills-focused conversations between managers and employees also impact the organization’s ability to understand and map its skills and with that it’s ability to use skills to match employees with work based on potential.
The Betterworks report found that 98% of HR leaders and managers believe integrating verified skills data into performance management could improve internal mobility. And Deloitte’s survey again shows the gap when 89% of executives say skills are becoming important in deploying talent while at the same time 59% of workers say their organization values the traditional job experience and degrees over skills and potentials.
Only manager-employee conversations can solve this gap. To make skills development a reality, organizations must track not only what employees achieve but also their progress in building the skills they need for current roles, future aspirations, and lifelong adaptability. Employees who set clear career goals are four times more engaged in learning, according to the LinkedIn Workplace Learning Report 2024. Yet this engagement hinges on managers being equipped and incentivized to prioritize growth alongside delivery.
Can Managers Do It All? It’s Time to Rethink Their Role
Managers today are tasked with delivering business results, keeping teams motivated, and ensuring employees grow and develop the skills they’ll need for the future. But this broad responsibility often results in a focus on immediate deliverables at the expense of long-term growth. The Betterworks report underscores this gap: while 75% of employees see their managers as key to their development, only 56% feel supported in reaching their skills goals. If we measure, recognize, and reward for work, why are we surprised that managers and employees aren’t paying attention to skills development?
But maybe we’re asking the wrong question. Is it fair—or realistic—to expect managers to succeed at both work oversight and people development?
Perhaps the solution lies in separating these roles entirely. By creating dedicated “development managers” focused exclusively on coaching, skills assessments, and tailored growth plans, organizations can ensure employees receive the consistent support they need for both work and deveo.
A New Model: Skills Growth as a Strategic Priority
Development managers would work alongside traditional managers, who would remain focused on achieving business objectives. This division of labor not only relieves the strain on task-oriented managers but also positions employee development as a strategic priority, rather than an afterthought. This approach also addresses the systemic issue of inadequate skills data. Development managers could play a critical role in building accurate, verified skills inventories that help organizations deploy talent effectively and enable business agility.
Critics might argue that separating these roles creates unnecessary complexity. But consider this: we already have specialized roles for strategy, operations, and finance because we recognize their importance to business outcomes. We sometimes also have matrix organizations for specialized functions, customer or regional perspectives. Why should talent development—a driver of long-term success—be treated any differently?
Development managers would ensure that skills are not an afterthought but a priority. By mapping, measuring, and closing skills gaps, they would equip employees with the capabilities needed for today’s challenges and tomorrow’s opportunities. Traditional managers, freed from the impossible task of balancing work oversight with deep people development, could focus on achieving immediate business goals. Together, these roles would form a dynamic partnership—where operational success and talent growth reinforce each other.
This isn’t just about simplifying management structures. It’s about creating a system where employees don’t just keep up, but stay ahead. It’s about understanding that, to succeed, organizations must embrace a new social contract between managers and employees—one that acknowledges the critical importance of skills in an ever-changing world.
Skills are the new currency of work. Organizations that invest in them today will shape the economy of tomorrow. Managers have a choice: remain taskmasters or become builders of talent. The stakes couldn’t be higher—because the future of work depends not just on what we achieve today, but on how well we prepare our people for what’s next.