Emerging technologies, including readily available, highly competent generative artificial intelligence (AI), have raised questions about the future of work. To adapt to these changes and stay ahead of future challenges, companies should evaluate their approach to workforce allocation and employee training, including upskilling, reskilling, and outsourcing.
McKinsey & Co. recently published a report discussing the role of companies in “upskilling” their workers to better meet these challenges. In a general sense, upskilling is undertaking intentional learning to enhance existing skills to increase your capabilities within your current role or industry. For companies, upskilling their workforce involves assisting employees in enhancing their existing skills to meet their job requirements in the face of the changing technologies and labor market needs. Currently, upskilling initiatives are primarily focused on training workers to incorporate new technologies into their workflow, particularly related to the use of AI.
While acknowledging certain barriers to upskilling—namely, a lack of relevant work experience, missing credentials, and the need for re-education—the report finds that workers are enthusiastic about participating in upskilling programs. Forty-two percent of respondents surveyed by McKinsey reported interest in participating in upskilling related to their current employment. Companies that are proactive in offering upskilling opportunities to their workers can tailor these initiatives to their immediate business needs and incorporate their existing processes into the training and development in a manner that allows them to gain targeted benefits and achieve their objectives.
In a similar vein, many companies are also considering the more drastic step of “reskilling” their workers, as the Harvard Business Review described in this article. In contrast to upskilling, reskilling involves training current employees on new skills to serve in entirely new roles with new requirements. Reskilling is often responsive to technological disruptions to employees’ job functions, like those posed by generative AI. According to a Boston Consulting Group study cited in the article, 68% of employees surveyed are aware they will likely need to reskill and are willing to do so to maintain their employment. Reskilling allows for companies to utilize what is essentially an alternative to traditional recruitment and develop talent in-house that is not readily available elsewhere in order to respond to the changing needs of the business.
Companies that wish to upskill or reskill their employees need to consider barriers to these initiatives. Both require significant time, investment, and reprioritization of resources while workers are trained in either new or additional fields or processes. Instead of upskilling or reskilling in house, companies can also consider outsourcing tasks that present new or greater challenges in the current landscape to external resources that are already equipped to deal with these challenges, as discussed in this McKinsey article.
The decision of whether to outsource as opposed to reskill or upskill is dependent on many factors, and, among other things, companies should evaluate the level of technical skill and expertise needed to accomplish their goals, the speed with which they need employees who possess the requisite skills to address new technical challenges, and the comparative value of meeting short-term needs quickly versus long-term employee development. In many cases, outsourcing can allow companies to more rapidly and flexibly respond to the demands of this shifting landscape.
How We Can Help
Our team of lawyers draws on experience in outsourcing and managed service transactions to support companies in evaluating their strategies related to upskilling, reskilling, and outsourcing to best respond to the challenges they are facing in the current technological landscape.