Upskilling the Workforce

By Paul Hutter, SPHR, HR Answers Sr. Consultant

Employee Development, Training, Cross-Training: What we call this process has changed over the years, but the concept remains the same; how do we assure the viability of our business and our industry during a tight labor market?  Most industries today are experiencing major challenges in recruitment and retention of employees, but the high tech, construction, healthcare and manufacturing industries are the hardest hit. Why? Because over the past few decades popular opinion in the United States has emphasized the importance of higher education over the trades and technical education.  Much of the challenge found in the labor market presently is among the trades.

Changing the executive mindset around this has been a challenge, but the cost of employee turnover (costs range from 75% of salary up to 200%, proving that it is more cost effective to train and motivate your employees, then it is to replace them) and lost business potential is forcing the issue.  Yet, even in the midst of these challenges, some have reverted to the mindset that “this too shall pass,” in reference to the threat of a cooling economy.  Innovative organizations are not relying on this short-sighted notion and instead are wrapping the concepts of “Upskilling” into their strategic planning process.

Upskilling is an investment in three areas of employee development: 1) Securing the most current, industry and technology specific training for your new hires; 2) identifying and enhancing the technical skill sets of your existing employees; and 3) improving the soft skills (emotional intelligence) of your management.

Potential Benefits of Upskilling Include:

  1. Improved employee retention. When you can’t hire them, you need to ensure you are keeping them.  Surveys show that employees often do not leave because of money (although it is a factor) but primarily because they do not feel valued.  Feeling “Valued” is a bit different for everyone, but the items that fall into this arena are related to: 1) a great (or at least good) work culture; 2) ability to improve their skills sets, and 3) the ability to then use those new skill sets (among others). It can be statistically shown that organizations with a great work culture have not only reduced turnover, they become known as an employer of choice, making it easier to attract good talent.
  2. Improves employee engagement. An employee is unlikely to be satisfied with a job without being engaged in that job.  Employee engagement is much more than being content with pay.  An engaged employee is an employee who is deeply involved and invested in their work.  Organizations with genuinely engaged employees have higher retention, productivity, customer satisfaction, innovation, and quality.  Engaged employees can also require less training time, experience less illness, and have fewer accidents.
  3. Improved Customer Satisfaction. Engaged employees = satisfied (return) customers. When employees perceive they have value and are working for an employer with a great work culture, that engagement is directly transferred in how customers are taken care of.  Additionally, employees with enhanced skills are better able to “speak the language,” leading customers to believe in the employers’ products and services.  In fact, satisfied customers become better brand advocates for your organization.
  4. Attracts new talent. The reality of the current labor market is that the talent we attract is already working somewhere else. When employees feel valued, engaged and have a strong sense of their skillsets, your organization becomes known in the marketplace as an “employer of choice.” Who doesn’t want to work for an organization with a great work culture? In essence, your employers advocate for your organization and are instrumental in its recruiting efforts.

However, upskilling is not as simple as sending your staff to training.  Providing education of any type to employees, without accurately understanding the skill gaps, needs and reasons for the education, is a waste of time and money.  Simply, it does not have the effect your desire.  Upskilling begins with a gap analysis.  A training gap analysis is a measurement of the level of skills possessed by employees at any given moment in relation to the optimal level of skills they need for optimal productivity, or the level of skills the organization needs to meet the constantly changing demands and changes in technology.

The reason for an assessment of a training gap is to help organizations discover inconsistencies within their current talent pool.  Gaining an idea of what type of skills their employees have will help these organizations know how to tackle the issue of further training for workers.  Since the objective is not just to enable the employee to gain certain areas of expertise to perform at their current job, the goal analysis must be closely aligned to the organizations strategic plan for growth.  What new or additional skills will allow our employees to move us into the future?

Employee development programs that are created in a vacuum (by managers or training professionals only) are destined to fail.  Once skill gaps are discovered and training opportunities are aligned with the organization’s strategies, employees who are going to be retrained need to be made part of the design.  Their involvement is critical.

One size does not fit all. In order to be successful in increasing your employee’s skill sets, your development plan must be very flexible. Different personality styles and different generations learn differently. Part of the gap analysis is to discover how people learn, and then to employ as many different learning styles as possible.

Lastly, a word about emotional intelligence.  A leader’s job is to “make a place where others get the work done.” When we do not create value, which translates into a great work culture, we simply don’t make a place where people can get the work done, much less desire to stay.  How employees see themselves as valued or not valued is directly affected by management.  When managers and leaders do not have a complete understanding or accountability for their own personality styles, how they manage given those style, how they communicate, and their effectiveness in managing conflict, they are not likely to contribute to a great workplace culture.

Soft skills development for managers is directly linked to the technical upskilling of employees. One cannot (successfully) be done without the other.

The value of upskilling is the benefit of improved employee retention through value and, ultimately, increased customer satisfaction.  This directly creates greater success for the organization’s profitability and long-term longevity.  Upskilling allows companies an opportunity to not only provide better services and products, but to also leverage their employee’s engagement and satisfaction to enhance their reputation in the market.