By Viren Patel, Industry Strategist, Financial Services, Workday
The world of work and how people enter it has changed. Continuous disruption in the job market over the past five years, alongside new expectations from employees, means our workplaces are being rapidly reshaped.
This is an exciting prospect for future employees, but it can be challenging to navigate for the companies looking to hire them. This is only exacerbated by the fact that leaders now face a talent drought, one which globally could cost $8.452 trillion in unrealised annual revenue by 2030 – equivalent to the combined GDP of Germany and Japan.
Meanwhile, with growing employee expectations around flexibility and progression, leaders are seeing skills and talent walk away for – ostensibly – greener pastures. Combined with the urgent need for skills, this is forcing companies to rapidly rethink strategies. While unemployment continues to hover near the one million mark, it is vital businesses take action now, before long-term negative impacts from the skills shortage become irreversible.
What can leaders do, then, to burst the dam on talent and ensure they’re prepared for the future? The key is looking inwards – to sources of new skills from the talent that already exists within the organisation, and using new technology like AI to untap them.
Identifying the causes of talent gaps
With typical routes to sourcing the right skills for the job falling short, including graduate schemes, companies need to get creative. Leaders must start looking at their organisations from top to bottom, identifying what talent shortages exist and why, conducting pulse surveys of department managers to assess the types of employees that are needed for lateral or vertical talent moves.
Building on this, Human Capital Management (HCM) technology will play a role in this evolving people strategy. Through data-driven insights, using information on employee tenure, skills and sentiment, companies can drive people strategies, manage talent reviews, forecast skill gaps and train teams in an optimised and targeted manner.
Galvanised by HCM technology with people analytics functions, leaders can maximise internal mobility and cost-saving. Meanwhile, managers can use those same platforms to easily track the daily conversations they’re having about career aspirations and goals. In a positive feedback loop, those insights then can be fed back into the strategy, ensuring ongoing improvements and refinement.
Identifying skills opportunities with AI
With Gartner finding that less than one third (31%) of employees are engaged at work, AI can act as a much needed catalyst, connecting people with the personalised upskilling opportunities that benefit them and the business.
Layering AI into HCM platforms can further empower leaders to unearth skills and identify staffing pressure points. With its ability to crunch data rapidly, AI can provide holistic employee profiles, pulling together insights to see where they stand developmentally in their careers, and what their goals are for their next role. What’s more, it can do this without draining the manual resources of busy HR teams.
AI is highly promising for internal mobility and HR leader sentiment reflects this. As part of Workday’s C-Suite Global AI Indicator Report, we found 44% of EMEA HR leaders are excited to use AI and ML in the HR function – the highest of all the regions – and they are also the most likely to say that it will bring new opportunities to leverage skills across the business. In other words, it offers a rapid route to unlocking the skills potential of both individuals, and whole organisations.
Rethinking internal talent strategies
There are many rewards to rethinking internal mobility. To start with, it’s much lower-risk than external hiring. That’s because existing employees are a known quantity, meaning managers can be clearer about productivity levels and abilities. What’s more, onboarding (and its associated costs) is significantly streamlined.
For employees, internal hiring gives stronger incentives to perform, too, as efforts are being rewarded. Likewise, it encourages long-term workers to develop specialised skills and knowledge, making them a greater asset to the business.
As a final benefit, an internal mobility strategy, bolstered by AI, drives organisational agility. It makes it easier for a company to reallocate a workforce across job levels and empowers them to adapt to changing markets, new technologies or novel challenges.
Bolstering mobility for the future
For most businesses, internal mobility should be a key pillar of their people strategy. However, before entertaining this approach, it’s important to identify what skills gaps exist and what internal pools of existing talent there are that could be drawn from to fill them. Once this is known, internal mobility can become a reality. Deploying AI solutions can accelerate these strategies and the businesses that deploy them will quickly reap the rewards – from more engaged teams to fewer skill gaps.
Because in workplaces and job markets where those skills are becoming the rarest commodity, nurturing the talent and resources you already have available is vital for long-term success.
