Future-Proofing Your Workforce
What Every Business Leader Needs to Know
This blog is based on a Fireside Chat held by Iain Fitzpatrick, Chief Strategy Officer, Archetype, who interviewed Ranjit de Sousa, Founder and Managing Director at The Coalyard, on April 28, 2022 to discuss future-proofing the workforce.
Reinventing the modern workplace to attract, retain, and develop digital skills is top of mind for every business leader today – and for good reason. Companies are facing some of the biggest challenges in decades. With COVID-19, they shut down corporate offices for a year or more. Now, many knowledge workers don’t want to go back to the office ever, or at least not full time. Others have retired altogether or resigned en masse for better opportunities, creating one of the most competitive hiring markets ever. Many markets are seeing wage inflation rates that are unprecedented.
At the same time, supply chains have been radically disrupted to such a degree that even your local deli shop is having to take an omnichannel approach to sourcing product. Combine these challenges with skyrocketing inflation, as well as rising energy prices and an escalating war in Europe, and it’s no wonder business leaders are struggling to figure out how to afford their office spaces – and fill them with skilled workers.
These macro trends have exacerbated skills shortages, especially critical digital skills that businesses must have to thrive in the digital economy. Data scientists, digital marketers, coders, and cyber specialists have never been more in demand. In addition, as businesses have pushed more processes to the cloud and automated manual processes, demand for basic digital skills for all types of workers has intensified. It’s estimated that the pandemic accelerated workforce plans for digital skills requirements by three to five years. So, this is no longer HR topic – it is a topic for CEOs and board members.
The question is, how will your organization respond to these challenges? And what can you do today for future-proofing your workforce?
Focus on the biggest people issues
The first step in future-proofing your workforce is to focus on what’s most important. In a recent interview with Ranjit de Sousa, Founder and Managing Director at The Coalyard, he explained that business leaders report their biggest people-related concerns are:
- Bridging the digital skills gap: For companies across all industries, 30-50 percent of their workforce will be redundant in the next 2-3 years due to digitalization and automation. Whether it’s banking, insurance, or auto manufacturing, automation is making highly skilled workers redundant. At the same time, your business will need more digitally skilled workers – no small challenge to address given today’s tight labor market. Where will these workers come from?
- Navigating the hybrid workplace: Studies show that between 70-80% of workers, across all developed economies, do not want to return to the office five days a week. At the same time, you need to cultivate the communication, collaboration, and community needed to drive innovation, solve problems, and develop new hires and even existing staff. Should you mandate people to be in the office two or three days a week? Will more impact your ability to attract and retain the talent you need?
Learn from best-in-class companies
One thing is clear, notes De Sousa: “There is no silver bullet or one-size-fits-all approach to addressing these challenges. Success will take time and experimentation.” You can also jump-start success by looking at what industry leaders are doing – starting with diagnosing where you have the biggest skill gaps, thinking creatively about which can be easily addressed, and tackling these gaps first. “It’s best to test your ideas with small experiments before rolling things out companywide.”
For example, insurance companies need more workers with sophisticated digital skills. Rather than paying high market rates to “buy” outside talent, management could potentially reskill their claims adjusters that are being displaced by digitalization. Much of their work has been made redundant through automation, mobile apps, and digital photos and forms. Yet because these workers are mathematically skilled and have strong cognitive abilities, many could be reskilled in areas such as data science and data analytics; their skills gap is not so large that it can’t be closed through education and training.
The key is to start with a small group of interested employees, learn, revise, and improve before expanding a reskilling initiative. It’s also important to get buy in from business leaders; start by performing an ROI calculation as part of the planning process. “Decision makers need to know how to measure success at pilot stage so they can better understand impact of an initiative at scale.”
De Sousa cautions that such efforts shouldn’t be technocratic exercises. “These are human beings, and they may have very different points of view of their transferrable skills. We know people tend to underestimate their transferable skills.” So, they may need help to accurately assess their skills and envision a dynamic new career path.
Equally important, assess for attitude. “People must be willing to put mind and time to reskilling. 93% of people who start an online course never finish it.” Success rates improve in instructor-led environments that are more supportive and connective. You can also help by cultivating a broader cultural framework for continuous learning and training within your business.
Balance the need for business growth with an employee-centered approach
According to De Sousa, when people are asked why they left their previous employer, it’s rarely for increased pay. It’s almost always for the same three reasons – and you can address them by creating a more employee-centered environment:
- To escape bad leaders and managers: People don’t leave jobs; they leave bosses. De Sousa recommends addressing this issue with coaching services for all layers of management. “You’d never see a professional athlete without a coach – they simply won’t be successful and win. Venture capital firms have made virtual coaching one of their largest spend categories over the last five years. Why? Because when they improve leadership, they see outsized returns.”
- Lack of career advancement: Large organizations usually have more career opportunities than employees are aware of; this lack of awareness makes the grass at other firms seem greener. De Sousa recommends using online talent marketplaces to create more visibility around internal opportunities. This will not only make it faster and easier to fill open positions, but also improve employee retention.
- For more work flexibility: For most businesses, there’s no going back to 100% full-time work in the corporate office. A 2020 Harvard study indicates that the ideal time in the office is one or two days per week, notes De Sousa. To balance business needs for face-to-face collaboration and innovation, he recommends explaining why you need people in the office on certain days and what is expected when they are there. “The last thing people want is to commute just to sit in a cubicle and be on Zoom calls.” So, set new work expectations and goals. Adapt layouts in offices to facilitate more coaching, collaboration, and communication – the three Cs. Make coming into the office an experience – and a productive one they value.
Some organizations are going so far as to deconstruct the large enterprise. “By slicing and dicing their business into smaller teams of 20-30 people and into smaller organizations, each with their own business plan, companies can be more agile, and people are freer to be more entrepreneurial.”
Want to Learn More About Future-Proofing Your Workforce?
Watch the webinar for the full conversation between Iain Fitzpatrick and Ranjit de Sousa.