Published on

April 5, 2024

Skill Matrix: Definition, Instructions, Template


Marius Vennemann

Managing Director


Learning Hub

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Skill Matrix Template

For most consultancies and agencies, it has always been a necessary tool – but nowadays, it is also gaining popularity in other industries: the Skill Matrix.

In this blog article, we will delve into the basics of the Skill Matrix and explore in detail the different types of Skill Matrices. We will specifically focus on the instruments of the Qualification Matrix, the Competency Matrix, and the Skill Matrix, highlighting the differences between these concepts.

You will also see what a Skill Matrix looks like, how you can develop one for your company, and we will even provide you with a practical Excel template.

What is a Skill Matrix?

What exactly is a Skill Matrix? A Skill Matrix is a strategic tool for visualizing and analyzing the skills and competencies within selected teams or the entire company. The goal is to capture, structure, and make available the company's skills as a basis for data analysis.

This is particularly useful for targeted personnel selection within the company for projects or client inquiries, but it also improves transparency regarding existing and missing competencies in the company. Additionally, companies can use it to support the identification of training and development opportunities for employees, as the skills indicate areas where further training may be needed.

While skills and skill management currently occupy HR teams, the basic concept of the Skill Matrix is not new. Concepts such as the Competency Matrix or the Qualification Matrix have been around for many years. But what is the difference between a Qualification Matrix, a Competency Matrix, and a Skill Matrix?

About Competency Matrix

The Competency Matrix is a strategic tool used to systematically represent, structure, and visualize the various competencies needed for a specific task or position. The difference from the Skill Matrix lies in what is being measured: competencies compared to skills.

Competencies are the knowledge, behaviors, attitudes, and skills that enable a person to successfully or efficiently perform a task. These fundamental characteristics contribute to a person's ability to excel in a particular role or function within an organization.

The difference between skills and competencies lies in the fact that skills are more practically focused, representing learned and applied abilities. In contrast, competencies are more value-based, specific to the company or project, and often associated with the corporate culture.

Many companies further differentiate competencies into technical competence, methodological competence, and social competence, and reflect these categories in the Competency Matrix.

About Qualification Matrix

The Qualification Matrix, on the other hand, includes clearly defined skills and abilities, especially so-called hard skills, required for performing a specific task. Therefore, you often find the Qualification Matrix in production and manufacturing environments, typically in the "Blue Collar" sector. Here, the Qualification Matrix is used to systematically capture and map the existing qualifications of employees. This ensures that each task is performed by appropriately qualified staff.

Certifications and formal qualifications also play an important role, as they certify clearly defined skill levels, some of which may be legally required. The Qualification Matrix often serves to manage and verify these certifications, ensuring compliance.

For many companies, compliance with standards such as the ISO 9001 norm is relevant. This quality management standard mandates proper qualification management, including the use of a Qualification Matrix.

In summary: the Qualification Matrix manages evidence and formal qualifications, the Competency Matrix focuses more on behavioral, often interdisciplinary skills, while the Skill Matrix provides a comprehensive overview of the learned and applicable skills of employees.

But how do you create such a Skill Matrix?

Building an Effective Skill Matrix

What steps should be taken when building a Skill Matrix? It requires firstly a list of skills, a so-called skill taxonomy or skill catalog, the evaluation scheme to be used for the skills, and the Skill Matrix itself, often created in Excel. To create the list of skills, one should first answer the question of what a skill actually is.

What is a Skill?

Skills are learned and applied abilities that enable a person to effectively utilize their knowledge in execution or performance. They can be specific and measurable, such as computer programming or project management. Thus, skills are generally different from competencies, which are much more behaviorally oriented. We advise our clients to formulate skills simply and according to a standardized syntax.

Building the List of Skills

To capture the list of skills in your company, there are various approaches and strategies depending on the existing data basis in the company. There are various providers of skill catalogs or skill taxonomies that you can build upon. Alternatively, you can start from scratch and define your own skills completely. However, it is often recommended to build on a basic taxonomy. There are several different providers ranging from open-source variants like ESCO to closed source ones like ours at edyoucated. Once you have chosen a base, you should start with the basic structure of your skill catalog.

Defining the Basic Structure

To ensure that the matrix is uniform later on, it is strongly recommended to define the rules of skill nomenclature in advance. The following decisions should be made in advance to ensure that everything is uniformly defined later on:

Granularity of Skills: At what level of detail do you want to define the skills? The more detailed, the more skills will appear in your matrix. The less granular, the more blurry the picture of your employees' skills in the company will be later on. Our recommendation is to have at least a two-level skill system, with a supercategory and several subcategories.

Evaluation Scheme: How do you want to evaluate your skills later on? Typical evaluation scales range from 1-5, which are also implemented in many software solutions for skill management.

Type of Evaluation: How do you ensure that skills are actually recorded later on? Should this be done through self-assessment by employees or should only managers assess through external evaluation?

Once these fundamental decisions have been made, the next step is to bring together the skills for your catalog. There are various ways to effectively bring together the skills relevant to your company in the catalog.

Option 1: Manual Compilation

The skills included in your catalog should reflect the necessary abilities in the company that are essential for the successful operation of the business. A good starting point is often your own job architecture or the various job profiles that already exist. Use these as a basis and derive skills mentioned in these documents.

You can also approach your departments and ask for their help. Provide the basic structure of your skills to these teams and let them add initial skills to the matrix. Include a sample file that you have already filled out, such as for your HR skills, and send it as an example to your specialists – this greatly helps ensure the response rate and uniformity of the skills.

This approach takes some time and cannot be completed within a day. Fortunately, there are also other options that leverage technology to help you save time.

Option 2: Automatic Skill Extraction

Modern AI-powered technologies now enable the automatic extraction of skills from, for example, your job architecture. Here, you provide the software with your Excel files or lists of PDFs of your job postings, and the system derives the skills contained in the text documents. This saves a lot of time in creating your skill catalog. At edyoucated, we use our own tools as part of our skills services, reducing the time required to create the catalog to about 5%.

Categorizing and Removing Duplicates

After you have manually or automatically captured the skills, all skills should be brought into a suitable structure. This means that you will likely need to consolidate skills, adjust various supercategories, and change names and descriptions of the skills again. Also, be sure to remove duplicates.

Get started now with our Skill Matrix Template

Choosing the Right Software for Your Skill Matrix

To successfully manage the skills and your Skill Matrix later on, it is recommended to invest in skill management software rather than relying on Excel in the long run. The following disadvantages arise when relying on Excel in the long term:

  1. Error-prone: Excel lists are not write-protected and can be changed by anyone. Therefore, the skill catalog is often modified, or formulas that you painstakingly built may not work anymore because new rows or columns have been added.
  2. Costly in Maintenance: Many people in your company need access to the Skill Matrix, and sending a new version every time there is a change is very cumbersome.
  3. Problematic Data Access: Presumably, your Skill Matrix should not be available to every person in your company. This means that access to the document must be regulated. Documents should only be made accessible to selected employees or managers, which is often not possible.

Instead, it is advisable to invest in software solutions that make setting up the skill catalog as well as later skill capture particularly easy and efficient. You benefit from predefined evaluation options and thus always have a full overview of the skills of your employees – without the negative consequences of an Excel solution. One possible option could be our skill management software at edyoucated.

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edyoucated is funded by leading research institutions such as the Federal Ministry of Education and Research (BMBF), the Federal Institute for Vocational Education and Training (BIBB), Federal Ministry for Economic Affairs and Climate Action (BMWK).

Bundesinstitut für Berufsbildung (BIBB)