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The world economy is rapidly shifting to a new services-led model that requires rapid development and broad flexibility to accommodate a highly demanding consumer. While technology is certainly vital to this transition, organizations should also recognize that the workforce is badly in need of new skills and new organizational structures — and this will prove to be far more crucial to success in the years ahead.
According to Infosys’ Modernization Radar 2022 report, most CIOs have identified a lack of skills as the leading deterrent to modernization. More than 88% of enterprise assets are expected to receive substantial upgrades within the next five years, which will produce high demand for in-house skills across virtually every aspect of existing business models. In order to successfully manage this transition, organizations will have to implement a multi-faceted strategy aimed at people, processes and technology.
But how can organizations implement these changes in time to take advantage of the new opportunities that the emerging digital economy presents? And more importantly, how can this be done without disrupting the carefully honed relationships that exist within the current business model?
To effectively make this transition, organizations should implement a skillset modernization strategy around three key elements:
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Upskilling is a key enabler for driving the technological growth of any organization, but if it is not done in a coordinated, strategic fashion it can lead to wasted time and expense, and to the development of skills that are not fully beneficial to the business.
One of the most effective ways to upskill is to create a digital talent pipeline that guides both the retraining of existing employees and the hiring of new ones based on targeted skillsets for the digital age. Using a combination of continuous learning, digital reskilling, specialized programs and collaboration with learning institutions and other organizations, the enterprise can create a more holistic approach to employee development that builds on existing knowledge and the natural inclination to self-improvement.
Upskill programs should start with a foundational model that first identifies critical needs in the workforce and then develops a strategy to fulfill them. This requires a careful analysis of the skills that will be in demand on both near-term and medium-to-long-term bases, as well as detailed plans to implement and scale these skills into the business model.
Keep in mind, however, that upskilling should benefit both the worker and the employer. Things like professional certifications and awards are helpful, but a clearly defined career path within the organization that allows workers to plan for advancement according to the skills they’ve mastered will go a long way toward building loyalty and reducing turnover.
Some skills will be highly specialized and therefore difficult to acquire and maintain. But it is these niche areas that will provide a competitive edge.
One particular area that deserves attention is software and application re-engineering — a crucial tool in the transition from legacy environments to next-gen, cloud-native architectures that feature micro-services, containers and a wealth of emerging technologies. These environments demand a steady stream of re-purposed applications, as well as entirely new ones, that focus on key capabilities like high-speed/high-volume transaction processing.
Artificial intelligence (AI) should be high on the list of desirable skillsets, even as this technology quickly sheds its niche status and joins the enterprise mainstream. The need to derive insights quickly from massive volumes of data will be a clear competitive advantage going forward, allowing the enterprise to capitalize on emerging opportunities, optimize revenue flows and deliver more robust security and compliance in a rapidly changing world.
Organizations should also provide opportunities for knowledge workers to hone a wide range of open-source skills, even those that might not seem readily applicable to the business model at the moment. This includes any number of emerging development techniques like DevOps, UI/UX design and mobile, omnichannel and personalization methodologies.
The gig economy
Not only is the gig economy expanding at a rapid pace, it is also fostering new approaches to hiring, staff management and retention. At a time when finding enough workers is a challenge, let alone those with the right knowledge and talent, gig workers can fill crucial roles as both temporary and permanent employees.
Part of this transition will require changes to enterprise cultures and hierarchies. Rather than a strict top-down approach to job responsibilities and authority, the gig economy will likely create a more flattened, democratized organizational structure, one that stresses cooperation and rapid, dynamic inter-mingling of specialized skills to quickly address issues and capitalize on emerging opportunities. Central to this change will be a redefinition of performance metrics and the way success is defined and evaluated, as well as new measures to protect data and preserve intellectual property.
For well-established enterprises with lengthy histories, upskilling the workforce will not be easy. Entrenched practices, technologies and centers of power are resistant to change under normal circumstances, let alone when it must be done in dramatic fashion and in relatively short periods of time. But the emergence of new service-based business models like ecommerce and ride-sharing have shown how easy it is to upset long-standing industries with little more than an app.
At the moment, modernizing the workforce is a defensive move for many enterprises. If handled appropriately and in a timely fashion, however, it can quickly be used to go on the offense by accelerating a forward-leaning business model that seeks out new markets, and even defines them from the start, while others are still trying to right their ships.
The need to upskill is both a sprint and a marathon, however. It is important to put the process in motion right away, considering the speed at which the digital economy is evolving, but this is not a one-and-done type of upgrade. It must evolve over the long term with an eye toward improving both the individual and the organization so that everybody wins in the end.
Gautam Khanna is the vice president and global head of the modernization practice at Infosys.
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