Reskilling employees in the age of transformative technology and complex business environments is fast becoming a critical mission. So how can you ensure your program gets cut-through?

In 2019, the Organisation for Economic Co-operation and Development released a report predicting that automation would eliminate 14 per cent of existing jobs and radically transform 32 per cent within the next 15 to 20 years. This sent shivers down many spines, from employees who felt they might be on the chopping block, to employers who worried they wouldn’t be able to keep up with the pace of change.

“Individuals will face deep and rapid changes: many will have to change not only their job but even their occupation, and most will have to modernise their skills and working practices,” the report stated.

In other words, workers won’t just need to be upskilled, but reskilled – and all of this before we’d even heard of generative AI. Unlike traditional AI, which is mainly used to analyse data and make predictions, generative AI tools actually create new data. This widens the scope of tasks generative AI can be used for, potentially displacing – or enhancing, depending on your view – even more jobs. 

The reskilling problem isn’t one for the future. Consider that about one-fifth of Australian employees are perceived to be “not fully proficient” in their jobs, according to AHRI’s Work Outlook report (September quarter, 2023). 

So how can companies ensure their employees are equipped with the skills to succeed in a modern workforce? One argument is that organisations must fundamentally rethink how they train employees in order to close the skills gap. 

Why do reskilling efforts often fail?

Professor Raffaella Sadun of Harvard Business School recently delved into the question of reskilling workers in the age of AI, along with colleagues from the Digital Data Design Institute at Harvard and Boston Consulting Group’s Henderson Institute. 

By interviewing leaders from 40 organisations investing in large-scale reskilling programs, the team sought to discover what’s working and what’s not when it comes to adjusting to rapidly evolving technology. They say companies have “a critical role” to play in helping employees reskill in this environment, yet only a small portion have been effective. 

One reason for this is a lack of engagement with employees about what they actually want – and how they learn best. As a first step, Sadun suggests surveying employees about what they value in training and ensuring they are involved in conceptualising any programs. 

“You need line managers to feel responsible for their employees, which includes their personal development and growth.” – Julian Birkinshaw, Vice Dean and Professor of Strategy, London Business School

The idea of reskilling can also be daunting for some employees. 

“People need reassurance about what comes afterwards,” says Sadun. “When you offer a training program as a black box, the only certainty people have is that they have to spend time doing it. 

“Obviously it depends on the type of program, but I think it’s important to say, ‘If you take this training program, these are the skills I’m giving you, and this is how having these skills will help your career or materially change your life.’” 

Julian Birkinshaw, Vice Dean and Professor of Strategy at London Business School, agrees. 

“The term ‘reskilling’ is a bit threatening to employees,” he says. “It makes them worry that they are no longer up to the job, and that ‘smarter’ people will take over. That’s one reason reskilling doesn’t always work, because people become defensive. 

“A related problem is that reskilling doesn’t just mean learning new techniques; it means learning how to apply those techniques in new ways.” 

Learning is a shared responsibility

Reskilling should be embedded in a company’s strategy and championed by leaders across the business, rather than siloed within Learning and Development or HR teams. 

While there is no doubt that reskilling takes significant work from HR leaders, the rest of the organisation must be invested.

“HR professionals often have the best intentions and the right expertise, but it’s hard for any program or new technology to be adopted if it doesn’t have support from the top, and without good communication about why people should be taking certain training programs,” says Sadun.

Middle managers in particular need to see the benefits of any reskilling efforts, as they can be fearful that a worker won’t have time to do their day-to-day work if they undertake training. 

They might also have a ‘talent hoarding’ mindset and worry that an employee will move to another area of the organisation – or another organisation entirely – after being reskilled. To address this, reskilling could be included in a manager’s KPIs. This makes it a collective responsibility, with everyone working towards a common goal.

“You need line managers to feel responsible for their employees, which includes their personal development and growth,” says Birkinshaw. “HR can provide a menu of options and some resources, but the manager has to lead by example. And he or she also has to provide mentorship and guidance.” 

New approaches to learning and development

One of the greatest hurdles for companies implementing reskilling programs is persuading employees to engage. This makes sense – reskilling takes a lot of effort and can result in a major change with no guaranteed outcome. But it might not be that workers don’t want to reskill, rather that the learning needs to take a form that works for them. 

“Of the programs we’ve examined, often a lot of thought has gone into them from a technology standpoint,” says Sadun. “For example, one digital learning platform I saw looked like Netflix. It was amazing; you open it and all these business school gurus talk to you. But put yourself in the shoes of the user – they want something that is useful and that they can apply in the flow of work.” 

In other words, design a program your employees want to participate in. 

“I think it’s important to say, ‘If you take this training program, these are the skills I’m giving you, and this is how having these skills will help your career or materially change your life.’” – Raffaella Sadun, Professor, Harvard Business School

A 2021 report from Boston Consulting Group found that 65 per cent of workers prefer to learn on the job, so hosting ‘lunch and learn’ sessions or sending employees on another two-day training course might not be the best way to implement a reskilling program. 

Instead, it can be more beneficial to build skill development into the day-to-day, such as employees shadowing their colleagues or conducting an internal apprenticeship. 

It’s also important to address barriers that prevent people from finishing a course – or stop them from enrolling in the first place. 

“You want to be systemic. If you decide people need to take a course, you need to think about how it will interact with the flow of work of your employees,” says Sadun. “I’m advocating for companies to really step up in how they think about implementation and allow the program to be a good match with the participants’ work and personal life.” 

This approach works for engineering firm Bosch, where employees are encouraged to engage in ‘lifelong learning’ in a way that suits them. Through its training centre, workers can earn degrees and receive training in emerging fields for free, and spend up to two days a week for an entire year studying. 

It even gives participants days off before exams to prepare. It’s an example of a company willing to heavily invest in its people’s future and position learning as a strategic imperative.

While there’s no silver bullet when it comes to creating an environment conducive to learning, Birkinshaw says it comes down to giving people adequate time, resources, guidance and facilitation to help them apply their new skills.

“To put it differently, to learn something properly, you need to embed that learning into your day-to-day activities, and the best guide to that is the people around you. Academics call this ‘situated learning’. So my advice is to invest as much in the mentors and the process as in the actual skills training.”

A longer version of this article first appeared in the Dec/January 2024 edition of HRM Magazine.

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