Companies can’t wait to upskill their workforce

As featured on BusinessMirror: Companies can’t wait to upskill their workforce

Time is of the essence for companies managing a combination of issues starting with the ongoing global shortage of workers and an imminent economic downturn. Organizations are hindered in their ability to transform, drive efficiency, lower costs and find and attract people with niche skills to meet business growth aspirations—all while competing with others for the same scarce talent.

The workforce is changing, our environment is changing, and for companies to stay competitive, they need to focus on their internal pipeline and people. Chief Human Resources Officers (CHROs) are tasked with helping the businesses they support to transition their employees to do more with less as quickly as possible.

Organizations need to move quickly to compete for employees in an increasingly shallow talent pool. When the economy reopened after the height of the COVID-19 pandemic, demand outpaced supply and continues to do so—a phenomenon economists refer to as “labor hoarding.” Baby boomers are retiring, and many workers never fully returned for a host of reasons, including ongoing physical and mental health issues.

Costs to recruit and retain employees have only increased, and companies can’t simply wait out the talent shortage. According to KPMG Economics, labor market challenges will not easily subside, and the staffing squeeze may get worse before it gets better depending on the trajectory of a global recession.

Business leaders have turned to CHROs for help with finding talent that can keep pace with growing demands even as HR departments face the same talent shortages. Upskilling/reskilling as part of a talent development and retention program is business critical.

In the Philippines, talent attraction and retention are crucial considerations in a post-pandemic economy as businesses strive to recover and rebuild. The disruptions caused by the COVID-19 pandemic have significantly impacted the labor market and reshaped the dynamics of the workforce.

The labor shortage only intensifies the need for employees to expand their skills.

In the past, employees labored as cogs in a wheel, learning skills to complete a series of tasks and developing competencies around that same set of tasks. The world moves faster today. Needs are dynamic, and learning must be agile enough to meet changing demands. More workers are asked to expand skills outside their immediate tasks as well as take on additional responsibilities and think critically.

Trends driven by technology, generational dynamics and other factors also are likely here to stay and are bolstering the need for continuous rapid upskilling.

First, new demands on the business—including artificial intelligence and other technologies, shifting business models and new ways of working—require employees to think, interact and behave differently. Second, companies need to shift and train employees for where they are needed, often by enabling career mobility through an internal talent marketplace to respond to rapidly changing market conditions. Third, certain talent gaps and niche roles are often best filled with internal resources. And fourth, upskilling is an important component of career development for attraction and retention strategies.

Meanwhile, employees increasingly seek more meaningful work that is aligned with their values and aspirations. On-the-job learning done well can keep employees excited and help them learn new skills to improve efficiency so that they focus on more creative and enjoyable work.

By 2025, more than 60 percent of the global workforce will comprise millennial and Gen Z employees who prioritize continuous skills development and meaningful growth opportunities at work.

Upskilling the existing workforce to expand capabilities can deliver what business leaders demand and CHROs need by improving employee engagement and retention, increasing productivity and lowering hiring costs. CHROs are the driving force behind upskilling for talent and, ultimately, growth. With so much to get done, this is how a CHRO can start organizing the effort:

• Build a skills strategy and integrate existing technologies across the talent ecosystem (e.g., learning, human capital management, recruitment).
• Determine what types of skills and critical roles are needed across the enterprise to enable business strategy.
• Rapidly assess current capabilities and identify gaps in addressing business upskilling needs.
• Develop specific learning interventions and programs to meet needs.
• Look outside to leading practices and adopt technology to innovate.
• Buy not build for greater speed to market and predictable outcomes.
• Define and integrate critical skills as part of career paths.
• Create alternative career paths by providing mobility and cross-learning of skills.
• Integrate upskilling efforts with overall workforce planning to strategically plan for upcoming needs.

According to 57 percent of human resources leaders surveyed, understanding how the shape, size, skills and organization of the workforce need to change to meet future needs three years out is a critical capability; yet only 25 percent said they have such capabilities today.

Finally, CHROs recognize the value of upskilling for engagement, retention, productivity and savings, but many training techniques and programs are outdated, ineffective, and not scalable. The rush to virtual during COVID-19 led to haphazard and suboptimal learning technology implementation, resulting in increased costs and decision fatigue from learners.

Correcting these issues is one of the CHRO’s first tasks in launching an upskilling program. Planned and implemented well, digital learning enhances the employee experience, increases productivity and helps companies meet their business goals by driving overall cost efficiency through upskilling and realignment of learning resources and interventions.

As the demand for skilled professionals continues to outpace supply, businesses are recognizing the urgency of upskilling their workforce to remain competitive and drive growth.

KPMG in the Philippines' Innovation Summit this July 20 offers a unique opportunity to gain insights from industry experts and thought leaders on the critical importance of advancing skills in a post-pandemic and technology driven world. Learn about innovative approaches to advancing skills and leveraging on technology gains to drive productivity and meet business objectives.  With the launch of the Digital Government Center (DGC), gain valuable insights and strategies on automating services and processes, utilizing emerging technologies, and delivering citizen-centric solutions that will aid in upskilling civil servants through relevant training programs.

Let's unlock the full potential of your workforce and seize the opportunities that lie ahead. Visit our website to know more: https://kpmg.com/ph/en/home/events/2023/07/innovation-summit-2023.html

Registration is free but slots are on a first come, first served basis.