Upskilling: How to Stay Ahead of the Competition

If your organization is like most, you face challenges brought on by market changes, customer demands and rapid technological advances. Your first thought might be to hire fresh talent that brings in new skills and knowledge to stay competitive. But you’d be ignoring a faster and far more cost-effective solution — upskilling.

The Skills Gap

While net employment (hires minus quits) is slowly increasing, jobs requiring specific skills are going unfilled as employers have trouble finding qualified candidates. When a position remains vacant because the organization cannot find a qualified individual that possess the skills or knowledge required, there is a skills gap.

Several factors contribute to the skills gap we are facing in today’s business environment:

• A massive exodus from the workforce during the pandemic, which compounded the already-in-progress “silver tsunami” of retiring baby boomers.
• Organizations failing to making succession planning a top priority, resulting in the loss of a tremendous amount of institutional knowledge and learned skills.
• Lack of investment in employee training programs.

Additionally, advancing job requirements, skills and technology are occurring at a rapid rate. As a result, the knowledge acquired in pursuit of a college degree is not necessarily keeping pace or even needed in the current market.

While skill gaps have been a growing concern for many years, few organizations have positioned themselves to respond. In a survey conducted by McKinsey Global Institute in 2020, nine out of ten executives and managers said their organizations either faced skill gaps already or expected gaps to develop within the next five years.

By leveraging upskilling (or reskilling) programs, organizations can develop their current workforce to fill vacancies and prepare for future needs.

So what exactly is upskilling?

Upskilling is when an organization provides training programs and development opportunities that improve the employees’ current skill sets and reduces skill gaps.

There are many advantages to upskilling employees. Training and development opportunities lead to better employee engagement. Employees feel valued when an organization invests in their career development and are less likely to leave. And in a tight labor market, having employee training and professional development opportunities helps set you apart from your competition.

Upskilling also means your workers have the skills needed to quickly take on new tasks or fill open positions quickly. This in turn helps prevent losses in productivity while recruiting and training new employees.

Where do we start?

It’s important to put some thought and planning into your upskilling initiative. The following steps will help you make sure your personnel needs are covered.

Conduct a skills gap analysis. Inventory the skills your workforce currently possesses, and determine the skills that will be necessary in the future. Stay on top on emerging technology and market trends, as future needs may change quickly. This inventory should identify gaps in both hard and soft skills.

The top five skills most often identified for upskilling are technology, data analytics, critical thinking, leadership and interpersonal. 

Develop a strategy. The most effective way to fill gaps with upskilling is to utilize a mix of approaches for both training and recruiting. Ensure that training programs use a blend of learning methods. Provide one-on-one training, online courses and job shadowing options that allow employees to learn in the way most effective for them.

On the recruiting side, create a strategy that includes training hiring managers to consider candidates who may not have all the desired skills for the position but possess other valuable skills that can be developed for future needs.

Create a culture of lifelong learning. Leadership should communicate the organization’s strategy to employees and share their commitment to their growth and advancement within the organization. Supervisors should encourage employees to continue to learn new skills and allow time for them to complete their training. Provide incentives to those who have gained new skills to emphasize that continued learning is valued.

Keep in mind that upskilling programs will involve a financial investment for materials, time in training, etc. While these efforts come with a cost, however, the cost of failing to invest in an employee’s career development is much greater.

The skills gap will continue to impact all organizations for the foreseeable future. Upskilling your employees helps position your organization to best respond to future demands.

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