It’s Time to Rethink Tal­ent Strategy

31 05 2024 Article by Dr. Allen Baby

THE PACE and evol­u­tion of Arti­fi­cial Intel­li­gence (AI) and digital trends in the past few years has taken the busi­ness lead­ers by sur­prise. A recent global CEO sur­vey by PWC finds that 70 per cent of CEOs expect their busi­ness mod­els to be dis­rup­ted in the next dec­ade. If busi­ness mod­els evolve at such rapid pace in unpre­ced­en­ted ways, it’s high time that the CEOs and busi­ness lead­ers need to rethink their tal­ent strategy to ensure that their employ­ees can man­age the com­plex maze of the skills trans­form­a­tion.

Unlike the past, where the expiry of a tech­nical skill was at least a dec­ade, in today’s age of AI, tech­nical skills can change or become irrel­ev­ant in a mat­ter of months and years. A highly-skilled pro­fes­sional could pos­sibly become redund­ant in no time. Organ­isa­tions can­not solve this issue by hir­ing new tal­ent with new skills every time, cre­at­ing a pro­ductiv­ity conun­drum, drop in engage­ments, cul­tural mis­align­ments, risks, and an obvi­ous impact on the bot­tom line.

The boards, CEOs, HR, and busi­ness lead­er­ship need to now treat tal­ent strategy as a key busi­ness prob­lem than look at it through the tra­di­tional lens of an issue in a sup­port func­tion. If not, it is likely that the organ­isa­tion will have a demo­tiv­ated, highly anxious, and unpro­duct­ive work­force at a time closer than any­one would expect. A solu­tion to this prob­lem is the need for a futur­istic tal­ent strategy focused on twin pil­lars of reskilling and cross skilling.

Reskilling refers to trans­ition­ing employ­ees to a new role dif­fer­ent from what they have been doing while cross skilling is adding an extra func­tional skill­set to an employee in a new com­pli­ment­ary area which could be rel­ev­ant for the organ­isa­tion.

Many busi­ness lead­ers are often reluct­ant or slow to make major invest­ments in reskilling projects as they don’t real­ise the busi­ness case in this regard and view it from the prism of costs. While they acknow­ledge the skills chal­lenge, many feel it could be a bet­ter option to let go of the redund­ant tal­ent and hire new tal­ent with the rel­ev­ant skills. However, this is not a sus­tain­able busi­ness strategy as the new employ­ees can also have such skills issues in no time and your organ­iz­a­tion gets trapped in a vicious cycle of hir­ing and fir­ing apart from facing a drop in pro­ductiv­ity and bot­tom-line impact.

A study by the UK Fin­an­cial Ser­vices Sec­tor Com­mis­sion (FSSC) finds that the organ­isa­tion can save around GBP50,000 pounds per per­son reskilled when com­pared to costs and impact of let­ting them go and hir­ing a new tal­ent. The costs of exit pack­age for exist­ing employ­ees, cost of hir­ing, onboard­ing, pro­ductiv­ity loss in the mean­time and organ­isa­tional cul­ture align­ment cre­ate far big­ger fin­an­cial and organ­isa­tional issues.

A well-craf­ted reskilling strategy would be a rev­enue gen­er­at­ing value pro­pos­i­tion than a cost on train­ing apart from improv­ing the employee engage­ment, ser­vice stand­ards and Cus­tomer exper­i­ence. Reskilling, however is a com­plex maze which needs to be nav­ig­ated through a tal­ent strategy roadmap with detailed ana­lysis of the skills gaps, cre­at­ing reskilling and career jour­neys, cre­at­ing a tal­ent mar­ket­place, and ensur­ing employee buy-in engage­ment and com­mit­ment to the ini­ti­at­ive.

World Eco­nomic forum skills reports find 43 per cent of the cur­rent oper­a­tional tasks can be auto­mated by 2027, thus rais­ing an urgent need for reskilling the work­force to areas which are con­sidered more pro­duct­ive and busi­ness enabling.

Cross skilling is another tal­ent strategy which the author wishes to pro­pose, to help busi­ness lead­ers to improve pro­ductiv­ity, reduce costs and cre­ate rev­enue. An excel­lent case study here is the recent announce­ment of Eti­had Air­ways that their pilots are now trained to fly A350 and A380 air­craft inter­change­ably. This cross-skilling ini­ti­at­ive would sig­ni­fic­antly boost employee pro­ductiv­ity and fin­an­cial sav­ings for the air­line, which in other case would need ded­ic­ated teams for both air­crafts.

Now, a good use case for cross skilling oppor­tun­ity is on the ESG agenda which is now very crit­ical imper­at­ive for all the busi­ness func­tions of an organ­iz­a­tion. Instead of adding sig­ni­fic­ant costs by cre­at­ing new func­tions and lay­ers for ESG except for the con­trol and risk areas, an ini­ti­at­ive to by skill employ­ees in the busi­ness func­tions on the ESG aspects rel­ev­ant to their func­tions, the organ­iz­a­tion will have enhanced pro­ductiv­ity, faster res­ults, and sig­ni­fic­ant cost sav­ings.

The only option to sur­vive and thrive in the era of change is to become the agents of change. A futur­istic and hol­istic new tal­ent strategy can be the pan­acea for the cur­rent and future chal­lenges facing organ­iz­a­tions. It is high time the senior lead­ers take up tal­ent strategy as one of their utmost pri­or­it­ies.

The costs of exit pack­age for exist­ing employ­ees, cost of hir­ing, onboard­ing, pro­ductiv­ity loss in the mean­time and organ­isa­tional cul­ture align­ment cre­ate far big­ger fin­an­cial and organ­isa­tional issues.”