From credentials to capabilities: Why skills-based hiring is the future and what CEOs need to know

As global uncertainty intensifies and digital disruption accelerates, executive hiring is reaching an inflection point, writes Laura Grierson.

The spotlight is shifting away from credential-heavy CVs towards something much more meaningful: demonstrated capability.

While skills-based hiring has gradually become more common across mid-level roles, adoption at the executive level is only just gaining momentum. And increasingly, boards and leadership teams are recognising that credentials alone don’t define a great leader.

Adaptability, strategic judgement, cultural alignment, and the ability to lead in complex, fast-moving environments are proving to be far more telling in today’s modern workplace.

Looking at an executive through a skills-based hiring lens allows candidates to shine a light on their practical, real-world skills that apply not only directly to the position but also to the company and the industry. These are skills that in the past might not have looked that good on paper, but we’ve found that time and again, these often overlooked “soft skills” can make a candidate a perfect fit.

I believe this thinking is embedded in how we assess leadership potential. Over the years, we’ve refined an outcomes-based approach to executive search that places less weight on traditional markers and more on the ability to drive impact. It’s become key to how we define success in a role, and, more importantly, how we identify who we think can deliver it.

Throughout our executive hiring process, we examine not just experience but also what’s been delivered. We look at cognitive ability, motivation, and leadership behaviours to help clients access a broader and often untapped pool of talent. This approach enables us to eradicate the biases that may have prevented high performers from being considered previously.

Some of the most effective leaders we’ve placed weren’t the most obvious candidates on paper, but they were exactly what the organisation needed. Considering a more diverse and differentiated talent pool allows us to show clients the potential of those beyond the limitations they set.

This shift is supported by data. A recent Harvard Business School study with the Burning Glass Institute showed that when skills-based hiring is implemented properly, the upside is material.

Non-degree holders placed into roles that previously required degrees earned 25 per cent more and had 20 per cent higher two-year retention. That’s not just good for individuals; it delivers clear commercial benefits in engagement, continuity, and reduced turnover. To put it simply: it’s good for business.

Of course, shifting to a capability-based model isn’t just about removing degree requirements. It’s also about clarity.

Defining what outcomes matter in a role and aligning hiring processes to identify those who can deliver on it requires us to challenge longstanding assumptions. And in doing so will unlock access to a deeper, more diverse pool of leaders equipped for today’s challenges.

To execute effectively, begin by pinpointing core skills and behavioural traits needed to drive business objectives. Focus on the outcomes the role should deliver and assess whether their prior experience and style will align.

In interviews, look beyond just qualifications and “tick-the-box” questions. Prioritise delving deeper into how the candidate approached different situations and navigated complexity, resistance, and challenges.

Skills-based hiring isn’t just for candidate selection; it must be applied throughout the assessment process. Thorough reference checks are critical to our process. We go beyond surface-level feedback and into personality traits and outcome delivery. This provides us with the confidence to recommend appointments.

As 2025 unfolds, organisations that embed this thinking into their executive hiring strategies will be better positioned to attract high-impact leaders.

Not because they tick conventional boxes, but because they can do the work that matters most. And that’s exactly the kind of leader that every company should want at its helm.

Laura Grierson is the director of Acacia Executive Search.