Companies and their CEOs had to pivot almost overnight in response to the COVID-19 pandemic: Businesses had to go virtual to keep their operations running, and that meant going digital. This quickly changed how people worked, where they worked, and what skills they required.
The rapid move to a predominantly virtual world exposed gaps in the capabilities of companies and of their people, something that leaders were already struggling with before the pandemic. PwC’s Talent Trends 2020, which was based on survey data from late 2019, showed that 74 percent of CEOs were concerned about the availability of key skills.
But just as the pandemic served to highlight the biggest skills mismatches between companies and their people, it also provided an opportunity for CEOs to further develop strategies to build the workforce they need for the future. And given the urgency to rapidly find the right talent with the right cultural fit, more and more companies are realizing the benefits of upskilling the people they already have. This makes clear that upskilling people should not be a sideshow to the other efforts CEOs are making in order to stay solvent and recover from the economic downturn. Upskilling should be a priority in a world where the speed of change is unprecedented and the path ahead is ambiguous and uncertain.
CEOs can set the budget and measure the ROI on investing in their people. These investments will also provide concrete proof of those statements of purpose that insist taking care of employees is a top priority.
So, our advice is to focus on people, because they have proven to be surprisingly good at adapting and learning. The panic about lost productivity that came in March had subsided by June, when companies realized that many of their employees were adaptive and could cope with working from home — at least in the short term. Recent data has shown that superachievers have filled in the gaps when others struggled. (The results are drawn from data collected from more than 2,000 users of our Perform Plus management tool — about 30 percent of users were clearly outperforming others, whose productivity dropped.)
The return on investment
CEOs who have made investments to create a skilled and engaged workforce are already enjoying the payoff. In PwC’s 23rd Annual Global CEO Survey (conducted before the COVID-19 pandemic), 93 percent of CEOs who had introduced upskilling programs said these programs increased productivity; they also helped attract and retain talent and helped deliver a resilient workforce. However, only 18 percent of CEOs who took the survey said they had invested in upskilling; the opportunity for those who haven’t yet made the investment is significant.
The message that upskilling initiatives are well worth the investment still needs amplification. And now is a good time to dust off that business case. According to our latest check-in with global chief financial officers, the strong majority (93 percent) are confident their companies can build employee skills for the future.
Here are four areas in which CEOs can make the case for upskilling.
Focus on upskilling that delivers business strategy. When we asked more than 22,000 people around the globe their hopes and fears about work, more than three-quarters said they wanted to improve their skills. Now is the perfect opportunity for leaders to take advantage of this aspiration and align it with their upskilling initiatives and business goals. That means assessing where everyone is with regard to tech and other crucial skills, such as problem-solving and the ability to work effectively in cross-functional teams. The CEO may need some upskilling, too (and PwC has a free app that can help).
Just as the pandemic served to highlight the biggest skills mismatches between companies and their people, it also provided an opportunity for CEOs to further develop strategies to build the workforce they need for the future.
There is no one-size-fits-all solution in upskilling. Companies are expected to spend close to US$4 trillion globally this year on technology. In the past, this kind of investment did not result in the productivity gains most leaders would expect, according to Cambridge, Mass.–based market researcher Forrester. If upskilling is done well, there will be people able to take advantage of the money companies are spending. Productivity will rise, which will validate the spend.
Unilever is one of a small number of companies that have proven this point. The company created about a dozen digital hubs, which bring people from different parts of the business together to collaborate and learn from one another. Unilever analysts study data on consumer traits and trends, creative teams design and write content, marketers monitor performance, and data privacy experts make sure customer data stays secure.
Prioritize employee engagement and experience. There’s a measurable connection between successful upskilling and employee engagement. Among CEOs who took part in the latest PwC Annual Global CEO Survey and who had introduced an upskilling program, 60 percent said their program was highly effective in improving culture and employee engagement. In the PwC 2020 Global Digital IQ survey, 86 percent of respondents said their digital training and education programs have improved employee engagement and performance. And according to Gallup, highly engaged business units have a 41 percent reduction in absenteeism and a 17 percent increase in productivity. Additionally, they receive better customer ratings and log higher sales and profits than those units with lower engagement.
In financial services, the message is getting across. For example, in 2017, Citigroup announced a partnership with Cornell Tech to develop digital talent in the New York City labor market. PwC’s most recent reportPDF on upskilling in financial services highlights examples of firms offering their employees ways to improve their capabilities. For example, a leading investment bank has set up a center of excellence dedicated to coaching teams on how to deliver new products more quickly.
Boost productivity. In a recent global survey of office workers by software company UiPath, 80 percent of workers said they would expect to be more productive if they learned new skills, and 88 percent said they’d be more willing to continue working at a company that offered upskilling and reskilling opportunities. Daniel Dines, CEO of UiPath, says that enabling technologies such as robotic process automation are “the core of upskilling. If we liberate people from their repetitive chores, they have time to learn new things, to connect better with customers, to develop their soft skills.”
At PwC, for example, we are offering training to all staff on a variety of tools. More than 275,000 employees around the world, in 157 countries and regions, are participating. The digital hubs that have been created to support this effort now document thousands of new ideas created by people to help solve their day-to-day problems. For example, in one case, an auditor in the U.S. developed a tool that reduced the time needed to perform a transaction-testing process for a transportation industry client — from between 20 and 30 hours to just minutes. “I felt like Superman,” he said. Other teams were able to customize the tool for use for their client audits.
Embrace a growth mindset to inspire lifelong learning. Upskilling is a medium- to long-term effort. We live in a world beset by disruptions that will continue beyond this pandemic. The megatrends PwC has identified as key challenges for the 21st century — such as the speed of technological change — will require an agile workforce and agile management. Being prepared to weather crises with a flexible, knowledgeable workforce and culture built on resilience will stand you in good stead.
CEOs can both have and lead with a growth mindset and should encourage their workforce to evolve. They can start by upskilling personally and communicating what they are doing to their people. This doesn’t mean learning to code, necessarily, but it does mean understanding what new technologies can do and what they can’t. A CEO who doesn’t know the potential of blockchain or artificial intelligence will be less likely to make the best decisions about those technologies’ use in the company.
Savvy leaders who value and nurture their workforce’s innate talents, ability to learn, and desire to do good work will have a great chance of boosting their business and retaining and attracting talent. They will beat the skills gap. So while you’re taking steps to keep employees safe and healthy, it’s important to ensure they have the skills to thrive as they contribute to the organization’s overall success.
- Carol Stubbings leads PwC’s New world. New skills. program. She is PwC’s Global Tax and Legal Services Leader. Based in London, she is a partner with PwC UK.
- Nicole Wakefield is PwC’s Global Leader for Financial Services Advisory and is part of the global People and Organization practice. Based in Singapore, she is a partner with PwC Australia.