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Training & Learning

Upskilling: The Key to Organizational Success in a Recession

Curiosity lies at the core of human experience. It’s why we travel, surf the internet, and watch hours of video content everyday. In the workplace, too, we seek fresh experiences, new skills, and to build our capabilities. In fact, research says employees are happiest when they’re engaged in tasks that are challenging, but doable. Simply put, humans want to learn.

This is great news for L&D leaders, who can channel employees’ need for learning through upskilling—helping them expand their industry knowledge and skill sets so they can be more productive and engaged. 

The importance and value of upskilling employees is growing. The effects of the COVID-19 pandemic shook the global economy–and subsequent budget cuts, hiring freezes, and layoffs have increased companies’ pressure to do more with less

Now more than ever, L&D professionals need to help their organizations adapt to rapid changes–and LinkedIn’s 2022 Workplace Learning Report revealed that upskilling has become a primary focus in executing that vision.

LinkedIn Learning Report 2022

In this article, we’ll explain how upskilling keeps your employees engaged and happy, while also meeting business objectives and supporting revenue. You’ll learn how this cost-effective strategy helps improve employee performance to drive business growth, especially in times of recession.

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What is upskilling?

Upskilling is training that gives employees new skills and knowledge to help them do their jobs better. This isn’t limited to the needs of an employee's current role, it can also be used to expand their skill set for career advancement and internal mobility.

This training can be supported with knowledge sharing, cross-team collaboration, and hands-on learning experiences. 

Think of upskilling like a stretch assignment: a project or task that requires a different skill and goes beyond the day-to-day tasks of a role. This could apply if your top performers excel in their current roles and want to take on the challenge of a new project. Or, if an employee is interested in responsibilities that aren’t currently a part of their job description. 

Take for example, a sales enablement professional that is interested in learning about team management or growth marketing. Upskilling could give them the right skills to mentor a new hire or lead a collaborative campaign between marketing and sales enablement. To go further, here are four real-life examples of companies who achieved greater L&D results and better business outcomes through solid upskilling initiatives.

Successful upskilling programs prove that employees don’t need to job-hop between companies to advance their careers–or change their career path. 

What is the difference between upskilling and reskilling?

Both upskilling and reskilling involve gaining new competencies, but reskilling is about learning skills to adapt to the changing demands of a job, as opposed to learning new skills to improve career performance and advancement

The pandemic accelerated the pace of automation and digital transformation, which made reskilling a necessity. The sudden shift to remote work meant businesses had to quickly equip their staff with the necessary skills and technology for them to continue doing their jobs from their homes. 

For instance, sales professionals had to learn to use Zoom to pursue leads and conduct calls, and organize their sales notes in customer relationship management (CRM) tools—skills that were previously nice-to-have, but have since become a necessity. 

With digitization taking a more permanent foothold, it’s expected that 50% of employees will need to be reskilled by 2025. 

Upskilling opportunities, on the other hand, is a bit like matchmaking—you channel an employee’s career goals and interests toward meeting business needs. This way, you give them development opportunities and serve your business objectives. 

Upskilling leads to business growth and profitability

Upskilling opportunities play a critical role in building a learning organization, filling knowledge gaps, making your employees more productive and capable, and boosting employee retention. Sounds like a mouthful but the benefits are real, especially if you bake upskilling into your corporate culture. We'll get into the concrete benefits of upskilling your workforce below.

Successful upskilling programs prove that employees don’t need to job-hop between companies to advance their careers–or change their career path. 

Promote a continuous learning culture

When upskilling is a part of the larger employee experience, it leads to a continuous learning culture at an organizational level. It helps your employees become lifelong learners, who seek opportunities to grow and innovate. Upskilling works best when employees can learn in the flow of work. Restricting your staff to a fixed schedule or specific set of skills can harm your resources and opportunities. For example, if you assign a batch of skills-based workshops too close to the holidays, or when employees are scrambling to meet a deadline, they won’t be fully engaged and likely won’t retain the material covered. 

Create more flexible and engaging learning experiences for your workforce. You could offer employees opportunities to shadow a manager for a week, engage in company-wide discussion about industry trends, or participate in workshops asynchronously. This way, employees are ready to immerse in skills at their own pace. 

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Reduce skills gaps

Upskilling is a reliable and efficient way to equip your employees with key competencies. Critical knowledge and skill gaps hurt employee engagement and stunt business growth.

According to Gartner, 70% of employees report that they don’t have the expertise they need to do their jobs. This is problematic because employees who don’t feel confident in their roles tend to lose interest and motivation—and eventually disengage from work. Poor-quality work lowers team morale, which in turn negatively impacts the business’s bottom line.

So, you need a quick and effective way to keep skills gaps from widening. An effective solution is microlearning content: short videos, quizzes, elearning courses, and simulations. This type of content enables employees to learn new skills without having to invest a lot of time at once. Plus, employees can access microlearning material at the point of need and apply it immediately, making it easier to retain knowledge from these lessons.

Increase employee productivity 

When employees see how their efforts drive business impact, they feel more confident and engaged. But this doesn’t come from doing the same jobs the same way, day after day. Employees maximize their potential and productivity by continuously learning new skills to solve different problems.

Upskilling brings fresh perspectives and new ideas to an employee’s expertise, which supports faster decision-making and better problem-solving. As a result, employees become more productive and feel good about their work.

To help employees do this, put them in the driver’s seat. That means giving them the freedom to determine their own learning needs. After all, they are the ones doing the work. Self-directed learning enables employees to create personalized development paths that align with their interests and goals. Plus, it takes the guesswork out of which upskilling program your learners need. 

When people want to learn and know what they need to succeed, they are more likely to complete courses–which contributes to a successful upskilling program.

Employees maximize their potential and productivity by continuously learning new skills to solve different problems.

Support career growth

89% of employees say they are highly motivated to improve their skills in 2023. Career growth is a major priority for millennials and Gen Z workers, and upskilling plays a key part in achieving this. These two generations make up the largest part of the current workforce, and they want to work for companies that are invested in employee mobility

Show employees you’re invested in their growth with robust L&D initiatives that offer upskilling opportunities. In turn, upskilled employees become internal champions and subject matter experts (SMEs) who can share their knowledge through peer training and course authoring.

When employees gain deep expertise in a subject, they are empowered to help others upskill. And a comprehensive learning management system with the right features enables your SMEs to do that. Whether it’s creating a course on the topic, leading a discussion, or presenting a skillshare, your in-house SMEs can sign up for mentorship and growth opportunities, putting another experience on their resume.

Streamline succession planning

When a talented team member leaves, you may not have a ready replacement. As a result, teams flounder and the business suffers. An upskilling program that prioritizes internal movement keeps you proactive and your employees engaged. Instead of scrambling to recruit an external new hire to fill a vacancy, you have a roster of employees who can step into the position if and when necessary. 

Succession planning is especially important in uncertain times like the Great Resignation, when burnt-out workers left companies en masse, many without a next job lined up. And yet still, most companies fail to build an internal talent pipeline for critical roles.

Upskilling promotes talent from within the organization, significantly reducing heavy recruiting costs. A Harvard Business Review study observed that external hires are “paid more, perform worse, and have higher exit rates.” In addition, businesses incur heavier onboarding and training costs with each new employee. 

In lieu of external hiring, prioritize internal mobility through upskilling. A veteran employee is already familiar with the existing business processes and company culture, and has established relationships within the organization. This translates to major savings in time and money, compared to the onboarding and transition period needed for new hires.

A Harvard Business Review study observed that external hires are “paid more, perform worse, and have higher exit rates.”

Increase employee retention

Companies that make real upskilling efforts see a huge impact on retention. When employees see opportunities to stay up-to-date in their field, to get promoted, or to move to different departments within the organization, they stay for an average of 5.4 years. That’s twice as long as companies that struggle with retention. 

In another study on upskilling, 74% of millennials and Gen Z respondents said they would look for other jobs due to a lack of opportunities to develop their skills. 

This means upskilling needs to be a major priority to retain your top talent. And when organizations have to let go of staff, the remaining workforce reels under pressure, with 74% of employees reporting a decline in productivity after a layoff. 

Upskilling your employees during economic recession makes sense because the organization is in survival mode—and when every dollar counts, L&D teams need to maximize their budget efficiency. Give employees the tools to succeed in difficult times, and you'll win their trust and confidence in the company, which means increased employee retention and higher productivity.

Lead to deeper collaboration

Upskilling can make an organization more collaborative. Peer-based learning is more engaging and interactive for workers than sitting in a formal classroom setting. In fact, employees more often turn to their peers when they want to learn new skills, rather than asking their bosses or looking up corporate training programs. 

This means that your upskilling programs work best with a collaborative approach. That starts with identifying your organization’s subject matter experts that are best suited to create courses on in-demand topics, including both technical and soft skills. 

Compared to external agencies, your SMEs better understand the nuances of specific roles and their needs in your company. This helps them create training content that is more relevant for your learners, saving precious time and resources that would otherwise go to hiring external instructors and organizing virtual or in-person sessions. 

Internal asynchronous learning enables team members to ask questions or participate in discussion at any time, strengthening workplace relationships and a true learning culture. With a collaborative learning platform, co-authors and learners can create more engaging learning experiences with features like in-course comments and reactions. A rich, continuous exchange of ideas and a culture of peer feedback helps employees upskill faster.

Leverage your in-house experts to fill organizational skills gaps  

You want your training dollars to fetch the maximum impact, especially when budgets are tight and time is short. Whether it’s employee, customer, or partner growth, upskilling from within gives you a sure shot at success. Crowdsource your upskilling needs from in-house subject matter experts who can create courses, coach learners, and contribute to academies. This way, you save time, reduce cost, and keep your training relevant. Get a personalized demo to see how 360Learning can future-proof your workforce by upskilling from within.