Emerging technologies such as Artificial Intelligence (AI), robotics, cloud computing, 3D printing, and the Internet of Things are changing the very nature of how individuals work. Klaus Schwabb, executive director of the World Economic Forum, introduced the phrase the Fourth Industrial Revolution, which heralds rapid change and disruption across countries, economies, industries, and societies.
Work Has Changed, but the Workforce Hasn’t
The Fourth Industrial Revolution, otherwise known as Industry 4.0, has had an impact on businesses which is clearly seen in the widening “skills gap.” This is the discrepancy between the in-demand skills employers value and depend upon, and the skills employees have. Current practices in hiring and training seem to run in conflict with what employers require to support business progression. Oftentimes, an organization is reacting to market trends and focusing too narrowly on current strategies and challenges, rather than predicting future ones.
According to a report for the US Chamber of Commerce Foundation, the healthcare, information technology, computing, and engineering industries particularly suffer from a shortage of workers in high to middle skilled roles. However, the widening chasm is also felt across several other sectors as the cycle of technological advancements continues to shorten.
This skills gap might cause concern for organizations that lack the necessary talent. As a result, they may accelerate new hires and training programs to address this deficit quickly. While this strategy may provide a short-term solution, the core underlying issues remain unaddressed.
Why a Skills Gap Analysis is an Effective Tool
The first and most important steps any business should take are to understand the potential reasons a gap may exist, what is missing, and what they need to do to realize their current and future goals. A skills gap analysis is an excellent tool to utilize in order to gain valuable insight into your organization’s talent needs.
A practical skills gap analysis will:
- Define the organization’s future goals
- Identify future work trends
- Determine the skills needed for the future
- Measure current skills
- Examine competencies at the individual, team, and departmental levels
When performed correctly, a skills gap analysis will present a clearer picture of any talent shortfalls in the organization, and determine the most relevant actions to address them.
Five Effective Strategies to Close the Gap
Organizations can determine how to fill vacant roles once they have a clear view of their employees’ current skills. It is also critical to gain a thorough understanding of the competencies the company needs in the future to realize business goals and overcome challenges. While training and other measures may vary depending on the industry, the following five areas are key to implementing new programs and practices.
- Reskilling your current employees with a new set of skills will provide them with an opportunity to take on new roles within the company. To do so will require you to identify responsibilities that will become irrelevant or redundant because of emerging technologies and redeploy employees to match any new systems and capabilities. This way, you retain team members who have valuable marketplace intelligence and company knowledge.
- Upskilling allows employees to expand their current skill set and enhance their impact in their area of expertise. Upskilling has the added benefit of showing employees that their existing skills are valued, and their employer is investing in their future. Upskilling can be accomplished with in-house training, external conferences, or online at Udemy, LinkedIn Learning, or Future Learn. Upskilling also provides the opportunity to retain top talent, increase job satisfaction, and reduce costs associated with hiring and training.
- Injecting diversity into an organization expands the workforce landscape, and develops a more creative and innovative work environment. According to a report from Gartner “highly inclusive organizations generate 2.3x more cash flow per employee, 1.4x more revenue, and are 120% more capable of meeting financial targets.” Hiring people from diverse backgrounds such as minority groups, people without college degrees, or older workers allows organizations to tap into a pool of promising talent that’s generally underutilized.
- Creating a culture of continuous learning ensures employees keep pace with changing workplace demands. For businesses, Learning and Development (L&D) are vital components for maintaining long-term relevance and competitiveness in the market. L&D must be entrenched in an organization’s DNA. Just as there’s no finish line to digital transformation, there’s no end to learning, and businesses can expect several reskilling and upskilling cycles throughout their employees’ careers.
- Engaging consultants will quickly reduce the skills gap in any organization. Consultants are experts in their field who can immediately add a specific skill to the organization and extend value to projects stalled by missing competencies. Because it will take time before companies see the benefits of their L&D programs, consultants can readily fill gaps to instantly provide a solution without distraction, bring in the required knowledge to complete projects, and offer leadership to propel innovation forward. Consultants also add diversity, enriching the organization with new perspectives and ideas, and providing much-needed objectivity when implementing new processes and practices.
Closing the skills gap in your organization may be a challenge, but it is important to remember it is not an impossibility. Consider starting or expanding training programs for all employees, increasing compensation to attract and retain talent with valuable skills, and empowering employees, especially those whose positions are at risk of redundancy due to technological advancements. Fill time-sensitive roles by tapping into the expertise of consultants to leverage their knowledge of current business trends, strategies, and methodologies. They will bring critical thinking, creativity, and leadership — important soft skills that are necessary to keep your business competitive now and in the future.
If you would like to know more about talent solutions to close the skills gap in your business, connect with a member of our team today.