Pinpoint the essence of the novel or novel scene that you want your skit to share. For example in "The Wizard of Oz," the essence of the story is that Dorothy is trying to find her way back to Kansas, while the evil Wicked Witch of the West tries to stop her. It's impossible to cover an entire novel in a skit, so focus on the main point of the story or a key scene or moment.
Identify the conflict of the skit. Every skit should have a conflict: something a character wants, but can't immediately get. In "The Wizard of Oz," Dorothy wants to get home, but the witch tries to stop her.
Identify the climax of the skit. How is the conflict resolved in the novel? Do something like that for the skit, but again, you have to abbreviate it to fit it in a short skit.
Identify the key characters that need to be in your skit. Some characters from the novel can be cut or combined into other characters in order to speed things up in your skit.
Write an outline of the skit. Make a list of key moments you want to have happen in your skit. Plot how the skit starts, such as Dorothy walking along the road, and then plot the conflict, such as the witch appearing, attempting to stop Dorothy, and then plot how the conflict resolves, such as how Dorothy overcomes the witch and gets back home.
Write out dialogue and actions for your skit, using the outline you made earlier. You can improvise dialogue and actions with the other actors in your skit. It's up to you whether you'd rather write everything out or improvise it together with the other actors.