At the same time, this strategy downplays the necessity of having academic credentials. The three primary goals of this strategy are:

Goal #1 To increase the percentage of new hires who perform at above-average levels.
Goal #2 To speed up your hiring process. By reducing your sourcing delays by proactively increasing the size of your qualified applicant pool. You broaden your candidate pool by expanding qualification criteria, dropping most degree requirements and replacing them with individual skill assessments. Under most SBH processes, your recruiters then calculate the years the candidate has provided each of your required skills under this job title and completely unrelated job titles – as well as in situations completely outside the work environment.
Goal #3 To increase the number of your diversity hires in this job, by suddenly allowing the two-thirds of the working population that doesn’t have a degree to now have their skills evaluated.

If your organisation opts to pursue SBH, expect little impact because out of 100 jobs that drop the degree, only four will be filled by people without a degree.

In addition to expecting few recruiting and business effects, I realise the painful truth that individual hiring managers have often replaced this degree requirement with what I call ‘voodoo candidate assessment practices’. These have included astrology, graphology, numerology and, in Japan, even a candidate’s blood type.

Unfortunately, the use of any non-validated assessment practice will likely result in numerous mis-hires and a number of legal challenges. Be critical when you assess this practice. Because try as you might, you won’t be able to find a single case where a company has convincingly shown (using the split sample model) that this practice has directly produced either more diversity hires or better-performing new hires (ie. quality of hire).

Obviously, before you purposely discard established practices like college degrees and counting the years of experience in this job family and then replace them with a skills assessment, you first need to be aware of both the benefits and the negative consequences that we have identified over the last several years.

As an academic, I warn the reader that this SBH practice is based on academic theory. It’s especially important to approach this strategy with a questioning perspective. The top learnings that you must be fully aware of are listed below. The highest impact learnings appeared early on the list.

With a less than 4% non-degree hiring rate, don’t expect many recruiting or business effects – Unfortunately, the data reveals that out of 100 jobs that dropped the bachelor degree requirement, only 3.5 were actually filled with a non-degreed candidate (HBR). With this extremely modest volume of non-degree hiring, you should realise upfront that this SBH process probably won’t significantly improve your business results, your quality of hire or your diversity of hiring. It is important to note, however, that research shows new hires without degrees are 20% more likely to remain in their positions compared to degree-holding counterparts.

Even with the degree requirement removed, managers will often secretly use it – Under this approach, many companies have only been able to hire a small percentage of non-degreed candidates. That low success rate may occur because many hiring managers, consciously or unconsciously, still allow a candidate’s degree to influence their hiring decision. The best way to limit that from occurring (and to get your interviewers to stick to the stated skill requirements) is to require each interviewer and CV evaluator to use a prepared evaluation sheet that only lists the allowable skill assessment factors.

Widespread use isn’t proof that the SBH process is effective – even though 81% of employers now report using skill-based hiring. It’s important for smart recruiting leaders to realise that widespread use in no way means that a practice is effective. So, make sure that SBH is not just the latest passing fad that doesn’t use clear success measures. Be cynical of anyone who champions this practice without providing ‘before and after data’, which clearly shows that after implementing this new practice, they hired a significantly higher percentage of better-performing and/or more diverse hires.

Most fail to use an objective process for identifying their required skills – Unfortunately, I have found that in most cases, the list of the required skills for each job is compiled primarily on intuition. To make matters worse, often, the selected skills for a job opening merely reflect the skill set of the current incumbent in the job. In fact, your required skills selection process should only be identifying the skills that correlate directly with success on the job. So, it is unfortunately possible for a candidate to actually have all of the required skills listed without being able to do the job effectively. The best way to ensure that your required skills are the right ones is to utilise an after-hire feedback process. Ideally, it reveals that the majority of the best-performing new hires in this job actually possess a significant percentage of your required skills.

Realise that defining and measuring a skill is really hard – even after you’ve identified the right skills to assess for this job. Most soon realise that many organisations aren’t very good at identifying the most accurate and cost-effective way to measure that skill. Many simply ask the candidate during an interview to list their skills. And then, for some puzzling reason, they stop there and mistakenly assume that the candidate actually possesses each of the skills that they listed. The next problem that most encounter is that those involved in the hiring won’t be able to agree on what to name and how to define each required skill. Then, the team will face difficulty determining an acceptable (passing) level for each skill. 

In the absence of credentials, there will be an increase in the use of the weakest current assessment approaches – As I previously mentioned, the elimination of credentials sometimes results in the use of voodoo hiring practices like graphology (ever wonder why they want a cursive writing sample?). Unfortunately, rather than using data to identify new, more effective skills assessment approaches, most hiring managers end up simply increasing their emphasis on existing assessment measures, which are questionable at best. Those dubious assessment approaches often include Myers-Briggs, fit assessment, age and gender-related stereotypes, emotional intelligence, body language assessment, brain teaser questions, most personality tests and those ‘I would like to have a beer with’ assessments. The use of personality tests is especially problematic, as most implementations lack objective methods for identifying genuinely job-relevant personality traits. And, of course, the accurate measurement of any personality trait is always an imprecise science.

Measuring current skills may be less impactful than assessing a candidate’s ability to develop future skills – In our rapidly changing business world, the skill sets that are required for success may be a moving target that changes on a yearly basis. In my experience, that means that no matter what method you use to assess a candidate’s current skills, you need to realise that it may be equally as important to also assess their ability to learn and develop future skills that your organisation will eventually need. 

You won’t be successful unless your entire SBH process is objective, scientific and data-driven – Unfortunately, most currently used skills assessment processes are intuitive and not very scientific. In my experience, it is simply impossible to operate an effective SBH process that is not rigorous and data-driven. To make matters worse, most of these current processes also lack objective performance metrics for each individual SBH process goal. And, of course, without these performance metrics, continuous improvement or the use of AI won’t be possible.

If you only do one thing – Work with the manager of each of your new-hire failures in a targeted job family. Estimate if the primary cause of that hiring failure was a lack of experience, a lack of education, a lack of skills, or an attitude factor. Then, use that information to improve your SBH hiring process.

Final thoughts
Nearly 20 years ago, I was considered a pioneer when I first publicly advocated this skills-focused practice. However, even though I am still an advocate, over time I have grown to be more cynical now that there is more data available on the many problems associated with implementing this practice. Concurrently, I have also publicly written about why it’s a mistake to generally require any university degree for a job.

As a final note, I have found that rather than skills-based hiring. The absolute best way to assess the capabilities of a candidate is by providing them with multiple “solve this problem” opportunities throughout the hiring process. 

Dr John Sullivan is an internationally known HR thought-leader from the Silicon Valley who specialises in providing strategic talent management solutions with high business impact to large corporations.

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