Hard Skills vs. Soft Skills – Which Matter More in the Long Run?
Today, many young job seekers pursue a variety of different, perhaps less-traditional opportunities upon graduation. Gone are the days when large, multinational corporations, with decades of history, gobbled up all of the college graduates and encouraged them to build 30-year careers with a single company. Instead, many graduating students are torn between taking a traditional job with a "brand name" company, or going against the grain and launching their career with a new age firm. Included in this complicated, and often convoluted, decision-making process, is the concept of skill development. Many graduating students often get too caught up with ensuring that they are developing "hard skills" that can be easily quantified and listed on their resumes. However, what many of these job seekers fail to realize, is that in much of the business world, it's the "soft skills" that actually matter in the long run.
Stop and think for a moment. When is the last time that a managing director at an investment bank created a pitch deck, or built a discounted cash flow model (DCF)? Is the managing director the best Excel modeler at the firm? Oftentimes, as was the case in much of my experience as an investment banker, the best managing directors are the absolute worst modelers in the entire company. The reason that they have become successful is not because of the hard skills that they developed as analysts, but rather, because of the soft skills that they developed later on in their professional lives. There's a reason that leaders of organizations do not focus on tasks requiring hard skills; it’s because these tasks are not inherently valuable, and as a result, they can be "done by an analyst."
At most companies in the world, incoming Associates spend the first several years of their careers doing "grunt work" behind-the-scenes, focusing on the development of their hard skills. However, these hard skills have increasingly become commoditized, and their value has been substantially diminished. Take a moment to think … Do you know more 25-year-olds who have built an Excel model, or more who have had the opportunity to manage a team and drive revenue? My guess is that you know more of the former, and therein lies the problem. Many people think they should be developing these hard skills because that’s what all of their friends are doing; in reality, the people who are most valuable to corporations in the long run are the ones who are developing their soft skills earlier in their careers.
While many people think that hard skills are incredibly important to develop during their careers, they may actually be entirely mistaken. In fact, a recent article published by LinkedIn entitled "The 25 Hottest Skills of 2014," stated that the top five hard skills most likely to get someone hired were:
1. Statistical Analysis and Data Mining
2. Middleware and Integration Software
3. Storage Systems and Management
4. Network and Information Security
5. SEO/SEM Marketing
How many of your friends in business are learning those types of hard skills? I’d say the answer is zero to none, and that compounds the issue at hand. It’s not that hard skills are not valuable at all; it’s just that they are not all that valuable in the world of business. Hard skills are incredibly important in specialized careers, such as computer science or astrophysics, but there’s a reason that Excel modeling did not even make the list of "The 25 Hottest Skills of 2014" in the LinkedIn article.
At AlphaSights, instead of building Excel models and creating PowerPoint presentations, our graduates are learning the soft skills necessary to ensure that they become self-sufficient commercial leaders in the world of business. A Client Service Team member progressing through his or her career at AlphaSights will develop skills such as project management, client relationship management, time management, negotiation, talent development, recruitment, account management, and business development. And someone who is successful at AlphaSights should expect to be successfully running their own team and book of business within five years of joining the company. The skills that are developed early on in a career at AlphaSights are the same skills that successful entrepreneurs and Fortune 500 CEOs alike have nearly perfected. In the end, it's the soft skills that truly matter.
Alex joined AlphaSights in April of 2013 and serves as the Vice President of our Capital Markets Segment.