The ROI on upskilling, reskilling, and skills-first practices
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We’ve been talking about the war on talent and the smaller workforce for several years. Baby boomers have left the workforce in large numbers. Hybrid and remote work make it more difficult to fill some roles. Many employees don’t want to work with the general public or work fixed hours. Childcare costs have driven employees out of the workforce. Pay compression is driving up our cost to hire. This is all true, but it’s old news.
What is new in the search for top talent?
Upskilling, reskilling, and skills-first practices are the hot topics that your leadership team should be discovering and implementing as an integral part of your talent acquisition strategy.
Let’s define these terms.
Upskilling and reskilling are different strategies for training your workforce.
Skills-first practices emphasize filling roles based on the knowledge, skills, and competencies that external or internal candidates have over their years of experience, formal education, or credentials.
According to LinkedIn, Upskilling is when an employee undertakes learning to expand their existing skill set. These additional skills enhance the worker’s performance in their current role, potentially advancing them along their career path. This often results in an upward path. Think of climbing the proverbial career ladder.
Employee reskilling involves learning new skills outside of the worker’s existing skillset. These skills are often closely adjacent to their current function but may sometimes be geared toward a different path entirely. This is more of the jungle gym approach — not necessarily up, but often more lateral movement. Both paths are necessary for succession planning and to ensure a trained pipeline ready to meet the company’s needs.
Companies that do this well implement a long-term strategy that involves identifying the skills needed and assessing where there are gaps in those skills on their team. This involves dedicating more energy and resources toward creating learning and development opportunities, career pathways, and tracking internal talent and transferable skills on your team.
The number one attribute that attracts new employees and retains your best talent is a strong learning and development program. Challenging employees with new opportunities helps to keep employees engaged and interested in their work. If they get the itch to learn and grow, make sure that they’re learning and growing in your company so they don’t seek that stimulation elsewhere.
Talk to your HR team about how they are approaching upskilling, reskilling, and skills-first practices.
- What does a well-rounded learning and development program look like? Is it a combination of internal training, learning management system (LMS) modules, programs, and external training programs?
- Do you have specific career paths with learning opportunities that support an employee’s progress along that path?
- Do you have an LMS? Are you utilizing it to its fullest potential? You could use it for onboarding, product and service training, personality assessments, safety training, career path training, and more.
- Are you tracking and talking about transferable skills? Would an employee showing strong attention to detail benefit from a project management certification or be well-suited to the accounting department? If they show great relationship-building skills, might they be great on the client success or account management team?
- Do you have a database of skills, certifications, interests, etc.?
This might include items like bilingual skills, project management, customer service, sales, operations, accounting classes, writing ability, and more. Consider housing it in your LMS.
- What type of benefits support learning and development? It could be supported through tuition reimbursement, payment for credentials such as a Project Management Professional (PMP), and more. Would you reimburse your office manager or pay for their Society for Human Resource Management (SHRM) certification if you are moving them to an HR generalist role?
- Are you offering career coaching services to employees? You could pay for a recruiter to get career coaching training. This would be reskilling for the recruiter and might add some interest to their job, especially if they are in a rigorous recruiting cycle with jobs that have high turnover.
- Consider career coaching as a benefit. Hire a third party, recruiter, or internal coach to have those conversations. Equip managers with the skills and questions to ask employees during check-ins and performance management meetings so they can hone in on skills, interests, etc.
- Consider offering a management or other training program. Earlier in my career, I was part of a bank management training program that helped the bank staff its branches and provided a pipeline of internal talent for other roles within the bank. I applied through an internal job posting program for a recruiting role that capitalized on my experience in the branches. I used my communication and customer service skills (transferable skills) as a professional recruiter and later was promoted to lead the college recruiting program.
- Promote an internal job posting program and understand the competencies required to excel in the roles.Are they relevant and inclusive?
- Do you have outdated or restrictive policies that prevent employees from moving into roles? Does everyone need a bachelor’s degree, or do they have to have a certain amount of time in their current role?
What kind of out-of-the-box thinking should a company have?
It’s easy to see the progression in some career paths. The Accounts Payable Clerk moves to Accounting Specialist, to Accounting Manager, to Controller, perhaps to CFO. Along the way, they may need some education, training, or even certifications. The classic mistake we see is promoting the Salesperson to Sales Manager but providing no management training. This might be an occasion where you have to go outside the organization for that training or perhaps build your own management mentoring program.
Having a dedicated learning and development professional will help create and support career paths and should be open to a host of possibilities such as apprenticeships, mentoring programs, cross-training, job shadowing, third-party training, job enlargement programs, book clubs, and even career coaching. On average, companies that excel at promoting internal mobility keep employees almost twice as long as companies whose learning and development efforts fall short.
Skills-first means that you are serious about opening your talent pool up by looking at competencies, not just credentials. Does a Client Success Manager have to have a four-year college degree to be effective in their role? Is a CPA a necessary credential for a Controller at a small organization that uses a public accounting firm? There are many talented accounting and finance professionals who didn’t want to work in public accounting but may be amazing financial leaders. Who are you missing out on when you require eight years of experience in manufacturing? There might be a great candidate with seven years of experience in a warehousing or logistics company. How are the stringent requirements and the way your job ads are written disqualifying top talent? Skills-first hiring is important to have a diverse pool of candidates. It applies to your own internal talent pipeline and your external applicant pool.
Do you put more importance on an Ivy League degree than on a similar degree from a local college or state school? What top talent, diversity of thought, grit, and perseverance are you losing when you value achievements that might be based on access and privilege? According to Forbes, research now supports the role of diversity in business. A McKinsey report, “Why Diversity Matters,” finds a direct relationship in the United States between racial and ethnic diversity and better financial performance. Adopting a skills-first approach helps to widen the applicant pool and invite more applicants from diverse backgrounds. Offering learning and development opportunities in addition to a focus on career paths will attract more applicants as well.
All of these concepts and practices are linked to attracting and retaining top talent. There is an ROI and evidence that these practices can positively impact the bottom line. Is it time to examine your company’s policies, practices, philosophy, and strategies with an eye on the future?