Only one in three leaders think they have the right skills in their organization to drive future success.

That’s according to a new report from Workday – the tech giant surveyed 2,300 business leaders in North America, EMEA, APAC and Japan.

Plus, Workday found that half (51%) were concerned about future talent shortages, while only 54% say they have clear visibility of the skills in their organization.

This is a real concern for organizations who want to stay ahead of their competition.

The solution is to rethink traditional workforce management strategies, and instead become skills-based, particularly in this AI-powered world.

Speaking exclusively to UNLEASH, Workday Chief Learning Officer Chris Ernst states: “Skills are essential for your current talent strategy, and they’re imperative for your future talent strategies.”

The good news is that 81% of leaders agree that transitioning to a skills-based approach will increase the organizations potential for economic growth.

Credit: Workday, The Global State of Skills.

Of course, becoming a skills-based organization is much easier said than done.

The question that remains is what actions leaders need to take to become better at skills?

Don’t let perfect be the enemy of good with skills, says Workday CLO

The challenge for leaders is that when it comes to skills-first work “this is a not light switch you can turn on and off”, notes Workday’s Ernst.

“Skills-based takes time and attention”.

A key piece of the puzzle is for employers to truly leverage AI, including the newest iteration: agents.

For Ernst, “there’s this really symbiotic relationship between AI and skills”; “AI is both the catalyst and enabler” of the skills-based transformation.

Skills are the language of work, they help take out “the complexity out of work, understand it and organize it in a way that AI can interpret, and more importantly, can then take action on”.

However, AI can also automate routine and repetitive tasks (52%), enhance decision-making in organizations with data-driven insights (52%) and help predict future skills needs (45%) driving a more resilient, competitive business.

However, Ernst also reminds UNLEASH that while AI is crucial, “it is your people that are your differentiator”.

He continues: “Organizations that really embrace the skills-first mindset, they’re not only going to unlock AI’s potential, but they’re also going to be able to harness human ingenuity…in ways that will help them compete in today’s marketplace”.

While 55% of leaders surveyed by Workday are already making moves around skills-first, and an additional 23% plan to follow suit in the next 12 months, Ernst fear is that they are “not moving fast enough”.

“The time for skills is now”.

His advice is for everyone to “start somewhere simple soon”, and then pilot, iterate, learn, experiment.

Rather than trying to solve everything all at once, “just think of skills as a helpful companion to do what you’re doing in talent better”.

Being skills-first is not just about technology – AI is far from a silver bullet when it comes to this work – it is also about having the right mindset.