From coding to robots and AI, the new world of work requires new skills for innovation. To help keep pace with the speed of change, employers are embracing digital upskilling as essential training to help existing employees evolve their skills and knowledge.
Because without the skills needed to apply, maximize and transform digital innovations into real revenue for the business, organizations risk getting left behind. In fact, one study of 825 global business leaders found that 70% of digital transformations(opens new window) do not reach their objectives due to digital skills gaps.
By helping employees learn new digital capabilities using your own tech stack, digital upskilling can help turn those numbers around and deliver greater ROI on tech investments.
What we’ll cover
- What is digital upskilling?
- The benefits of digital upskilling
- What makes a digital upskilling program effective?
What is digital upskilling?
Digital upskilling refers to training and education programs that help employees elevate their digital skills and knowledge to align with modern business demands.
Not to be confused with reskilling, which prepares individuals to take on new roles, upskilling ensures employees can continue to succeed in their current positions and professional fields as technology changes and the business environment continues to evolve.
Upskilling is nothing new. For decades, technology has been advancing at a pace that has required most employees to upskill at some point in their careers.
Today, however, digital upskilling has shifted from a periodic professional requirement to an ongoing process that companies must facilitate and employees must embrace in order for both to remain successful.
A workforce fit for the future: The benefits of digital upskilling
One of the key questions in today’s workforce is whether new technologies such as automation and artificial intelligence will one day replace human jobs completely. Experts from Harvard Business Review(opens new window) and Gartner(opens new window) (among others) agree that the answer is no — digital technology should augment and enhance human intelligence at work, not replace it.
Ultimately, companies and strategies will remain people-led.
But in order for employees to leverage new technologies and drive business value, they need regular digital learning opportunities. Without digital upskilling, companies risk being left with high costs of technology ownership and no practical ways to earn ROI from those investments.
Fortunately, research shows that upskilling programs can change that. Research from PwC found that companies with the most advanced approaches to upskilling see 3X(opens new window) the improvement in innovation.
But greater innovation isn’t the only benefit of digital upskilling. Let’s take a closer look at some of the other ways the right upskilling program can deliver greater outcomes and ROI.
Higher retention rates
Just as employers are seeking new ways to sharpen their competitive edge through the use of digital tools, today’s employees are also recognizing the need to upskill.
And they’re ready to tackle the challenge head on.
- More than three-quarters(opens new window) of employees are ready to learn new skills or even completely retrain in response to new technologies.
- 80% say they’re confident(opens new window) in their ability to adapt to new tools.
- Employees have a 64% chance of remaining(opens new window) with an organization after three years when provided with pathways for internal mobility.
While implementing a digital upskilling strategy for your company will require time and energy, the alternative is much more costly. According to Gallup, replacing an employee costs up to 2X(opens new window) their annual salary — and that’s a conservative estimate.
In times of uncertainty, internal career mobility and increased retention through digital upskilling presents a mutual win for both employees and organizations.
Stronger employee engagement
Another key benefit of digital upskilling is that it builds confidence in your employees and helps them embrace necessary change rather than resist it.
As more employees develop their digital skills, organizations can begin building a stronger overall culture around digitization and data literacy, developing new knowledge, and transforming those findings into increased revenue outcomes for the business.
Greater employee engagement is a natural byproduct of those activities.
In one CEO survey(opens new window), executives reported employee engagement as the most quickly realized ROI factor at every level of upskilling maturity, including those just beginning their efforts as well as those with advanced upskilling programs already in place.
This points to a virtuous cycle in which digital upskilling helps employees feel more engaged at work, which then leads to greater outcomes for the business.
Increased agility and innovation
More than any other time in recent history, the last few years have taught us valuable lessons about the need to remain agile and innovative, even on the fly.
Technologies like AI, intelligent automation, and data analytics are just some of the tools that can enable companies to achieve increased operational agility, and employee digital upskilling is the key to unlocking the potential to execute.
With access to digital upskilling opportunities, employees become better able to:
- Utilize digital resources to make data-driven decisions
- Pinpoint opportunities and build proactive revenue strategies
- Make strategic adjustments more quickly
- Take fast action in response to unexpected challenges
Collectively, an upskilled workforce creates a more productive and resilient organization — one that’s able to succeed in any market conditions.
Ability to attract new talent
Both passive candidates and new entry-level professionals recognize the importance of skills development.
Research conducted by Amazon and Gallup found that nearly two-thirds(opens new window) of workers believe upskilling is important to evaluating both their current job and potential new ones. In fact, they rate it the third-most important employee benefit behind health and disability insurance.
The next generation of talent is actively looking for companies that offer ongoing skills training and with an average of $24,000 in student loan debt, they want pathways to access digital upskilling at no cost to them.
Our research has found that 6 in 10 young adults believe workforce experience is the most crucial element to prepare for a successful career. Rather than paying for another expensive degree or certificate, employers can help employees prepare for the roles of the future by:
- Clarifying the impact of digital upskilling to win internal buy-in
- Aligning employee upskilling initiatives with key digital lighthouse projects
- Mapping digital upskilling targets to internal skills gaps
- Defining clear goals and KPIs to measure digital upskilling effectiveness
- Integrate digital upskilling into the wider digital transformation roadmap
Companies that want to build a robust pipeline of future talent can begin by offering digital upskilling programs, then using them to attract the best future talent in the market.
From financial services firms to tech startups, many businesses still suffer from a lack of representation at the top of their org charts. This is largely due to degree requirements that filter out(opens new window) professionals from historically marginalized communities at a disproportionate rate, keeping them stuck in low-growth or entry-level roles.
This is especially true when it comes to racial diversity. McKinsey & Co. found that while Black US employees make up a representative 12% of entry-level jobs, a mere 7% are managers(opens new window).
To get the full benefits digital upskilling has to offer, think of it as a pathway towards creating a truly diverse, equitable and inclusive workplace.
Here are some key questions to consider:
- Which parts of the businesses are lacking in representation?
- What are we doing to develop and grow our team members, particularly those who come from underrepresented backgrounds?
- What transferable skills do employees have that could work well in a more digital role?
- Is there an opportunity to upskill individuals and help them move into higher-paying roles?
- How can we ensure we’re prioritizing the ‘inclusion’ and ‘equity’ part of DEI in our skills training programs?
Despite the well-established benefits of DEI, gender diversity moved up by just one percentage point(opens new window) and ethnic diversity by merely two percentage points in the global workforce from 2017 to 2020.
Employers who succeed in making genuine traction toward building an inclusive workforce will be those who dare(opens new window) to take a skills-first approach — one that includes the use of digital upskilling to help talented individuals advance in their careers.
What makes a digital upskilling program effective?
For companies making plans to implement a new digital upskilling program, McKinsey offers valuable firsthand insight from their own experience upskilling 500 colleagues(opens new window) in various AI and machine learning roles.
Here are a couple of their key learnings.
Digital upskilling must be customized
When it comes to digital upskilling, a one-size-fits-all approach simply won’t work.
Employee upskilling programs must be tailored to employee groups based on current skills and experience, as well as the needs of their particular roles.
McKinsey categorized their employees as “AI Aware,” “AI Ready,” and “AI capable.” The content and methods of the upskilling programs were then customized according to the needs of each group.
Through this approach, they found that upskilling is most successful for employees already in highly relevant roles (e.g., technology product managers to AI product managers). However, it’s important to point out that with the right approach, reskilling employees into completely new roles can also be a viable route for closing digital skills gaps.
Applied learning is key
Apprenticeships are on the rise as a top option for executing this method.
They yield faster time to value and higher ROI for companies because employees are learning on the job. They’re also attractive to employees themselves. Our own research found that more than 75% of employees say they would be interested in apprenticeships if they were available to them.
Upskill your employees with digital skills for the future
Multiverse’s apprenticeship programs are designed to help organizations build diverse teams by offering an outstanding alternative to four-year degrees and corporate training.
We can help identify your business's data, tech, and digital skills gaps and upskill existing team members to meet your business goals. From data literacy to software engineering, our team of expert coaches will help you mitigate risk, save costs, and increase productivity through the power of professional apprenticeships.