Mind The (Skills) Gap


The “skills gap” in the workforce has worried CEOs as well as HR leaders for several years, and the gap is about to become a chasm – and a much bigger threat to your competitiveness. Four experts joined a Workhuman Spotlight webinar to describe the chasm and the three critical questions leaders must consider to address it.

According to McKinsey’s James Rappaport, as many as 375 million workers globally might have to change occupations soon to meet company needs. That’s the chasm between where your workforce is today and where it needs to be in a few years. Faced with this, leaders have to re-train and grow the roles and capabilities of their people (known as upskilling).

Artificial Intelligence is accelerating the trend, and not only in technology jobs. Dr. Raffaella Sadun of Harvard Business School says there’s a basic supply-and-demand problem: “All the leaders want social skills, which I call power skills.” She emphasizes learning agility, outcome focus, inclusive leadership, and digital fluency. “They’re intrinsically much more difficult to measure than technical skills.”

Chase the problem, not the technology

AI is going to be part of most jobs, so start with the interaction between human and machine. For example, effective use of large-language program tools like ChatGPT call for learning how to ask questions that will yield rich answers, a skill Dr. Sadun calls being a “prompt engineer.” Skilled questioning will be part of jobs as diverse as copywriter, vacation planner, and tax economist.

AI also puts a premium on the human skill of discernment and focus – knowing what is most important in an ocean of information. An organization’s goals, and the path to reaching them, can be lost by chasing novelty. Employees can keep focused on what will and won’t solve a customer’s problem, or creating new value through innovation, that makes the most of novel tech.

Dr. KimLoan Tran, Vice President and Head of Talent Management at Allstate, cautions leaders “not to over-index on the technology piece [so] we lose sight of the human connection… Shifting to a skills-based organization is really about putting skills at the center of all your talent practices, from skills-based hiring to learning and development, to internal mobility and rewards. How do you interject those human connections in the critical moments that matter for our business, for our customers, for our employees?”

Three critical questions

Strategic upskilling begins with three questions: Why are we doing this? Who needs what skills? And How will they acquire them?

Why is obvious: Organizations upskill their workforces to stay competitive, increase profits, become resilient, and attract the best talent. The best people want to grow in their jobs, and they want to know that a company is aligned with that. As AI accelerates change, the most productive employees will upskill faster and further than their peers; the implication for management is that fast, curious, creative learners will create a commanding edge in delivery of products and services.

Dr. Sadun notes that it took 30 years after the lightbulb was invented for 20th century businesses to see productivity gains, because that’s how long it took for organizations to redesign their production processes around the new technology. And so, a key challenge posed by AI is, “What’s the best way to organize work so these new tools achieve our Why?”

An upskilling culture

The second question, Who needs what skills, is about the transition to a skills-based, continuously learning organization. Are your job descriptions only about today’s skills and goals, or are you projecting what your skills base will need to be two and three years from now? The second approach positions your organization for growth without churning constantly through talent (more on that below).

A strategic use of social recognition programs and data is key here. Instead of relying on quickly outdated skills lists, social recognition chronicles the skills people demonstrate by crowdsourcing a narrative about how work gets done. And it’s the best way to learn who is adapting to change, and helping others adapt.

Here are a few of the insights social recognition could provide to upskilling initiatives:

  • Who is noticing innovative behavior and awarding it?
  • Who are the “quiet mentors” – people who share their expertise freely?
  • Who is ambitious to learn, asking the right questions and stretching themselves in the course of their work?
  • Who is succeeding in raising the skills of the team(s) they lead?
  • How are we identifying the skills gaps that exist around the organization, to deploy our resources in the right places?

Culture management addresses the How of upskilling, and again, social recognition has a role to play. As Workhuman’s Tom Libretto pointed out during the Spotlight webinar, 70% of skills learning happens on the job (not in a classroom). When managers and peers recognize people for applying new skills, everyone gets the message that upskilling is part of their job. AI has great promise as a way for people to get better at what they do while they are doing it – think of using ChatGPT for research and OpenAI for coding right at the moment they are needed.

Surveys show that one of the main reasons people leave an organization today is lack of professional opportunity and development. People need to know both what skills they should acquire, and how adding skills makes them more valuable. By connecting a small amount of pay to recognition (1% can move the needle), the culture sends an unmistakable signal that upskilling is part of a strong career – and in the process creates a resilient organization.

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