4 reasons why reskilling must become a business priority

As companies race to build skills, many leaders recognize that there’s more than one type of learning to prioritize. While most executives are familiar with upskilling initiatives designed to help employees progress in their current domain, cross-skilling and reskilling also deserve spots at the top of HR’s agenda.

The former refers to building skills that can be used across the organization, while the latter is about developing competencies that will enable employees to take on new roles within their company. Reskilling is going to be particularly important as AI innovations promise to transform the way we work. Over the next five years, the World Economic Forum predicts that nearly a quarter of all jobs will change significantly and 69 million new roles will be created.

Given these forecasts, it’s easy to understand why so many organizations are kicking their reskilling efforts into overdrive. Since all skill-building initiatives aren’t created equally, it’s up to HR leaders to devise an impactful reskilling program that will unlock all of the potential benefits these programs have to offer.

The benefits of reskilling for employees

Reskilling has many benefits, both for workers and employers. From an employee’s perspective, one of the top advantages is that reskilling enables them to continue to prove their value to the business, even as consumer demands and priorities change. Rather than having to fear for their jobs, employees who work at companies that prioritize reskilling can feel confident that they have the pathways needed to build knowledge that will enable them to move into another role within their organization.

Additionally, reskilling initiatives pave the way for upward mobility. Employees who participate in reskilling initiatives to expand their scope of knowledge will be able to take their careers in new directions that align with their ambitions and eventually qualify for more senior roles within their company.

Finally, reskilling is a surefire way to improve employee satisfaction and engagement. Developing new skills gives people a sense of accomplishment and reinforces their value, both inside and outside of their organization. Participating in reskilling initiatives helps employees stay open to new schools of thought and ways of doing things, which will serve them well as they adjust to the shifts that are reshaping our working world.

The organizational benefits of reskilling

In addition to offering employees an array of benefits, reskilling is also a smart business decision for a handful of reasons, including a reduction in training and hiring costs. When companies don’t prioritize reskilling, they usually need to rely on external hiring to bridge emerging skill gaps. However, this often comes with a high price tag because it’s 1.7 times more expensive to recruit, train, and onboard new talent than it is to promote from within.

Companies that prioritize reskilling are also generally more efficient. Instead of letting skill gaps delay internal processes and limit employees’ ability to pitch in on various tasks, organizations with effective skill-building programs can ensure their workforce has the knowledge needed to lend a hand to other departments and tackle high-priority challenges as they emerge.

Additionally, reskilling is a proven way to keep retention rates in check. While most employees will switch jobs when they decide it’s time to take their careers in a different direction, companies that focus on reskilling can empower people to take on new roles within their organizations.

4 best practices to create a successful reskilling plan

If you’re looking to take your reskilling plan to the next level, here are a few tips to get started:

#1. Perform a skills gap analysis

Before launching a reskilling initiative, leaders need to take a step back and assess where skills lie, what knowledge gaps are emerging, and the areas of expertise that will be most valuable to hone. To create this in-depth understanding, many executives will conduct a skill gap analysis to pinpoint which learning and development initiatives should be prioritized.

Once leaders are aware of their organization’s knowledge gaps, they can use AI-powered tools like Gloat’s Skill Foundation to identify employees with transferable skills who can be reskilled to fill high-priority roles. The systems can show different ways to bridge existing talent gaps by reskilling internal talent, as opposed to relying on external hiring.

#2. Launch or revamp mentoring

Mentoring is one of the most efficient ways to help employees learn new skills because everyone involved in the program will benefit from it. Mentors will gain leadership skills while their mentees build knowledge in new areas of the business.

To maximize the success of your mentoring program, leaders must ensure that matches are based on the skills employees want to learn, rather than letting job titles or seniority become the deciding factor. For reskilling specifically, mentees should work with mentors who have different skill sets than their own so they can build knowledge outside of their domain.

#3. Prioritize experiential learning

While content-based lessons can help employees get familiar with a subject, hands-on experience is essential for building genuine expertise. To help employees deepen their knowledge in various areas of the business, everyone should be encouraged to participate in projects and gigs within other departments. Many visionary companies are harnessing talent marketplaces to generate suggestions for projects, gigs, and even full-time roles that align with employees’ current skill sets and career ambitions.

#4. Make it easy to find development opportunities

Even when leaders invest in pathways for learning and career development, many employees struggle to take advantage of them because these resources are dispersed among a wide array of tools and systems. Since companies have an average of 70 different applications for employee development, there’s often uncertainty about where to go to find various skill-building resources.

Instead of letting siloes and bottlenecks hold people back, leading companies are utilizing an opportunity hub to centralize all volunteering, learning, and training resources—in turn, encouraging employees to take advantage of them.

What reskilling challenges should leaders be aware of?

As leaders prepare to launch or upgrade their reskilling plans, there are a few reskilling challenges that they should keep in mind, including ensuring that their entire workforce has access to learning opportunities. In the past, reskilling and upskilling were often reserved for a select few employees. Since everyone can benefit from learning new skills, executives should encourage people across their organization to participate in skill-building activities. Talent marketplaces can drive participation by generating suggestions for projects, gigs, and full-time roles that are tailored to an employee’s skills and interests.

Another challenge some organizations face during their reskilling journeys is uncertainty about which skills to prioritize. Rather than guessing what knowledge may become more important in the future, leading companies use skills intelligence tools to ensure their learning and development processes are future-fit. Skills Foundation even includes job and skill benchmarking, allowing leaders to see which skills are on the rise and on the decline, as well as how the competition is positioning their jobs so they can gain a leg up.

In addition to determining which skills to prioritize in the future, some companies may also struggle to identify the capabilities their workforce currently has. While human capital management systems (HCMs) provide a sliver of this information, they rarely reflect the expertise your people build over time and the skills that fall outside of their job’s domain. Skills intelligence tools give leaders a 360-degree view of their peoples’ skills so they can tap into all of the knowledge their workforce has to offer.

If you’re eager to see what a successful reskilling strategy looks like in action, check out HSBC’s case study to learn how the leading financial services institution is empowering its people to develop new expertise.