HCM GROUP

HCM Group 

HCM Group 

a very tall building with lots of windows
15 May 2025

How to Build Governance and Operating Models for Skills Development

In the context of organizational transformation and the rise of skill-based talent strategies, the need for effective governance and operating models for skills development has never been more urgent. As businesses confront the realities of digital disruption, sustainability imperatives, evolving customer expectations, and hybrid work models, strategic alignment between HR, L&D, and business leaders is crucial. Building a coherent governance and operating model ensures that reskilling and upskilling efforts are not only strategically aligned but also operationally sustainable.

This guide outlines a comprehensive approach to designing and implementing governance structures and operating models that enable scalable, enterprise-wide skills development. The goal is to integrate these initiatives deeply into the organization’s planning cycles, decision-making structures, and transformation roadmaps.

 

Establishing the Strategic Imperative for Skills Governance

Any governance structure begins with purpose. In the case of skills development, governance provides the scaffolding that ensures learning and development (L&D) investments are:

  • Closely aligned with strategic business goals,
  • Coordinated across functional and geographic silos,
  • Adaptive to emerging skill needs,
  • Equipped with oversight mechanisms to track progress and impact.

 

Governance, therefore, is not just about accountability—it is about orchestration. It is about ensuring that learning is no longer treated as an adjunct HR activity, but as a business-critical lever for transformation.

 

For example, a global manufacturing company undergoing digital transformation may identify automation and advanced analytics as critical capabilities. Without governance, individual business units may develop disjointed programs that lack consistency or strategic alignment. With a centralized skills council and defined governance model, however, these programs can be synchronized, reducing duplication, enhancing ROI, and accelerating readiness.

 

Define Roles and Responsibilities Across Stakeholders

Effective governance begins by clearly delineating roles across HR, business units, and L&D. This ensures that ownership of skills development is embedded throughout the organization, rather than being siloed in the learning function.

  • Executive Leadership must define the vision for a skills-based organization and sponsor key investments. Their role is to champion the shift from job-based to skill-based workforce planning.
  • HR Leadership is responsible for integrating skills strategy with broader talent processes—succession, recruitment, performance management, and compensation. This requires aligning skills data across systems and breaking down historical silos.
  • Business Unit Leaders must own the identification of strategic capabilities within their functions. They are essential in contextualizing what specific roles require, what skill adjacencies exist, and how learning should be sequenced with business operations.
  • L&D and Capability Leaders translate capability needs into development pathways. Their remit spans from architecting learning journeys to sourcing delivery partners and measuring learning transfer.
  • People Managers act as the on-the-ground enablers of learning. They support learners, create psychological safety for stretch assignments, and integrate learning goals into regular performance conversations.

 

Build Operating Models with Steering Committees and Agile Learning Squads

Once roles are defined, a layered operating model ensures execution. A strong approach typically combines top-down alignment with bottom-up agility.

 

1. Skills Steering Committee (Executive Level) This committee provides strategic oversight and investment prioritization. It usually includes CHROs, CIOs, business unit heads, and transformation leaders. The committee reviews enterprise capability maps, signs off on critical programs, and ensures alignment with business strategy and workforce plans.

For example, a financial services firm rolling out ESG reporting capabilities may use the committee to fund a cross-functional learning academy on sustainable finance, integrating finance, legal, and compliance perspectives.

 

2. Skills Council or Capability Forum (Operational Level) This working group, typically made up of HRBPs, functional capability leads, and L&D program owners, manages the day-to-day execution. It maintains skills taxonomies, develops playbooks, and facilitates cross-functional capability building.

The council meets quarterly to update on progress, adapt programs based on business feedback, and report on learning impact. It may also oversee pilots of new learning technologies or credentialing standards.

 

3. Agile Learning Squads (Delivery Level) These are cross-functional teams formed around specific skills themes (e.g., AI literacy, inclusive leadership). Squads are empowered to design, test, and iterate learning interventions. They include subject matter experts, instructional designers, digital technologists, and learner representatives.

This agile model reflects how modern L&D operates—in short cycles, with frequent feedback, and in alignment with business sprints. A global retailer, for instance, may deploy an agile squad to build data literacy pathways for store managers, co-designing with frontline employees to maximize adoption.

 

Align Skills Development with Budget and Transformation Cycles

Governance must extend into enterprise planning processes. Too often, reskilling initiatives are reactive, launched in response to crises or talent gaps already visible. Instead, they should be built into multi-year transformation agendas and annual budgeting.

 

Linking to Transformation Programs:

Skills governance should mirror the organization's major transformation roadmaps. If the enterprise is investing in automation, for instance, the governance model should include reskilling initiatives for displaced roles and upskilling for new, higher-value roles. These plans should be codified in business cases and tracked as transformation KPIs.

 

Synchronizing with Workforce Planning:

Workforce planning should not operate in isolation. Skills data, especially when informed by capability platforms or AI-based insights, should feed into headcount and role design forecasts. For example, if future-state scenarios show declining demand for traditional customer support roles and increasing need for digital product specialists, learning investments should reflect that trajectory.

 

Embedding in Budget Cycles:

Strategic skills initiatives require upfront investment, from digital learning platforms to vendor partnerships. Governance bodies must ensure that budget proposals are substantiated by business cases, cost-benefit analysis, and alignment with strategic goals. Multi-year budgeting may be required for longer capability builds, such as leadership transformation programs or sustainability academies.

 

Ensure Visibility and Accountability Through Metrics and Reporting

Without visibility, governance fails. Operating models must embed measurement frameworks that inform both strategic decisions and tactical adjustments.

 

KPI Dashboards at the governance level should include:

  • Progress against capability build milestones
  • Learner participation and engagement rates
  • Completion and credentialing data
  • Application and behavioral change metrics (e.g., manager feedback, performance reviews)
  • Internal mobility and talent retention linked to learning participation

 

Regular reporting to the Steering Committee ensures continued executive sponsorship and resource support. Dashboards should also enable drill-downs for business units and functions, allowing them to take ownership of their respective outcomes.

An enterprise tech company, for example, might share monthly dashboards with regional GMs, showing how digital learning on cloud platforms translates into certifications and redeployments. This creates a culture of accountability and data-informed iteration.

 

Build Cultural Legitimacy for the Governance Model

Even the most elegantly designed governance structures will falter without cultural legitimacy. For governance to work, employees and managers must view the operating model as credible, relevant, and fair.

This starts with transparency. Skills taxonomies, learning journeys, and capability frameworks must be visible and understandable to employees. Platforms should allow self-assessment, career path exploration, and access to learning options aligned to their roles and aspirations.

 

Secondly, the governance model must visibly support inclusion. Skills programs should be designed with DEI principles in mind, ensuring access for underrepresented groups, removing bias from career progression criteria, and integrating inclusive leadership practices into all pathways.

 

Finally, senior leaders must model the behavior. When executives participate in learning initiatives, speak publicly about their development journeys, or reward teams for upskilling, they reinforce the legitimacy of the governance model.

 

Case Example: Designing Governance for a Global Engineering Firm

A multinational engineering company faced the dual pressures of digital disruption and sustainability transformation. Recognizing the need to modernize its workforce, it set out to develop an enterprise-wide skills development governance model.

Structure:

  • A C-level Steering Committee (CHRO, CTO, Chief Transformation Officer) was created to guide investments and approve capability priorities.
  • Skills Councils were formed for each major domain—data & AI, project leadership, ESG engineering—comprising business leaders and capability owners.
  • Agile learning squads were launched to rapidly design microlearning sprints, anchored in real business needs and supported by digital learning platforms.

Integration:

  • The council aligned initiatives with transformation roadmaps and fed insights into strategic workforce plans.
  • Governance included integration with finance to ensure synchronized annual planning and budget approval.

Results:

  • Within 18 months, over 5,000 employees completed new sustainability certifications.
  • Lateral moves across functions increased by 28%.
  • Capability maturity assessments showed measurable progress in digital readiness.

 

Sustaining and Evolving the Operating Model

Governance is not a one-time construct—it must evolve as business needs change. Effective organizations revisit governance models annually, asking:

  • Are the right leaders at the table?
  • Are skills priorities still aligned with the business strategy?
  • Are we measuring what matters?
  • Are learners experiencing friction or inspiration?

 

As learning ecosystems grow more complex—with AI-curated platforms, microcredentials, and internal talent marketplaces—so too must governance models become more dynamic.

A mature governance model treats skills development not as a one-off initiative but as infrastructure: embedded, reliable, and continually improving. It balances structure and agility, strategic oversight and grassroots innovation.

 

Conclusion

In today’s environment, where adaptability is the new competitive advantage, skills development governance is no longer a luxury. It is the architecture that enables learning to become a strategic lever rather than a tactical afterthought.

By defining clear roles, establishing agile and accountable structures, linking to business and budget cycles, and embedding cultural legitimacy, organizations can unlock the full value of their human potential.

When skills development is governed well, it becomes more than just training—it becomes transformation.

kontakt@hcm-group.pl

883-373-766

Website created in white label responsive website builder WebWave.