Blog Article

Do you have the right skills for tomorrow?

Posted by Christian Weiss

Christian Weiss

Could assembly line workers become electronics specialists? Workforce management is about much more than just projecting numbers. In the third blog post introducing the ‘5 RightS’ of strategic workforce planning, we look at ‘Right Skills’. Does your organization have them today, and more importantly, for the future?

Electronics made up just 15% of a car’s cost in 1990. By 2010 it had risen to 30% and by 2030 it’s expected to account for 50%. An industry that was once all about mechanics will soon be mostly about computing and electronics. The shift in skills this implies is enormous and is reflected by new entrants in the automotive industry, such as Tesla, Google and even Apple.

Dramatic change everywhere

Most industries are being dramatically transformed, leaving many established players playing catch-up. Traditional retail is being battered by the Internet and the concept of omni-channel. So are banking (with mobile payments), transportation (with Uber-like applications) and telecoms. Healthcare is becoming radically more sophisticated. Few sectors are immune from sweeping changes driven by technology, customer empowerment and globalization.

In Europe, for example, heating providers have struggled with the shift from simple oil and gas boilers to more complex systems that combine these fuels with renewables like biomass and solar. Firms anticipated this trend, adjusted their strategies, and acquired specialist companies accordingly. But when they came to put their strategies into action, one important thing was missing. They lacked the ‘integration managers’ who had the ability to integrate the different technologies in the complex systems the companies now wanted to sell. Because they had not been looking far enough into the future, a critical skills gap opened up.

It’s as important to retain critical skills as it is to acquire them. When a multinational food manufacturer made its cheese-makers redundant following a failed foray into an emerging market, it was in trouble when it later tried to enter other markets. Why? Because the alchemy of making cheese is complex and the expertise the company had now lost takes 10 years to acquire.

Take the long view

No one likes playing catch-up. Which is why a more focused, long-term view of the ‘Right Skills’ is essential if you are to fight disruption and prepare effectively for the future. Put another way, if you identify the need for new competencies too late, you run into trouble.

Skills – or competencies – have not typically been a core part of workforce planning, which has traditionally focused on issues like age, demographics, the need to build up or reduce regional jobs, or pay issues. Our experience shows that accurately forecasting skills over a significant time period is essential to good workforce planning. This time period has to be long enough to take into account the new technology cycles and the time it takes to recruit new talents.

Find critical capabilities

An important start point is to find identify the critical capabilities. These are either:

  • skills or competencies without which a company simply can’t function in its industry, like oncologists in cancer R&D or lithium experts in the nuclear industry; or
  • skills that are difficult to procure, for example because universities are not producing enough geologists or graphene specialists.

Not all of these critical capabilities are technical. Some like the integration managers in heating, are broad in scope. Others can be behavioral, such as the ability to cooperate in development teams. A critical part of strategic workforce planning is to identify and manage the gaps for these roles.

Model the skills you’ll need in the future

By looking at this essential first of the ‘5 RightS’, strategic workforce planning answers the questions that traditional talent management often misses:

  • Does your company have the right skills to deliver key processes in the long term?
  • What are the skills your organization couldn’t do without?
  • Which of your job families need these pivotal competencies?
  • Where do you have a critical skills gap – now and in the future?
  • How will the demand and supply for critical skills change?
  • What are potential feeder jobs for new roles that will be created your organizations?

Don’t let changing skill requirements take you by surprise. By building in the capability you need to succeed in the future, modeling skills gives you a major advantage over the competition.

It’s people and their capabilities, not numbers, that change the course of the world.

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