Digital skills gap could cost UK £141 billion in GDP growth

03 October 2018 Consultancy.uk

If G20 countries fail to adapt to meet the needs of the new technological era, they could be in line to miss out on as much as $1.5 trillion in GDP growth over the next 10 years. A growing skills shortage means that much of the potential of digitalisation could go unrealised, with the UK facing forgoing more than £140 billion to that end.

At present, the UK is facing a major talent shortage. With the approach of Brexit threatening to stifle the flow of labour between Britain and the continent, the effects of an ageing population could see almost 3 million jobs left unfilled by 2030. This is a trend mirrored across the major economies of the world, which almost universally face the proposition of an ageing population, if not the problem of tightening borders.

Digital technologies, Artificial Intelligence (AI) and automation are often spoken of as a potential remedy for this, with the increased efficiency and accuracy of technological solutions compensating for the loss of a portion of the physical workforce. At the same time, however, many Human Resources (HR) departments still underestimate just what is required of them to make the most of technological progress, by way of re-training and up-skilling their incumbent workforce, as well as adapting their hiring processes to foster new, digitally savvy, talent.

If G20 countries are unable to adapt the supply of skills

Now, a new report from global consulting firm Accenture has suggested that should this failure to close the digital skills gap continue, the UK economy could forfeit as much as £141.5 billion of the GDP growth promised by investment in intelligent technologies over the next ten years. According to the study, in line with global figures, some 51% of workers’ time in the UK is subject to potential augmentation in the near future, while 37% of the work could be entirely automated.

While this impact is expected to vary between job roles and geographic markets, the majority of leading economies are anticipated to miss out on more than $100 billion in growth, each. At the highest end of this, failing to close the skills gap could cost China up to 1.7% of its average annual growth rate in the next 10 years, or more than $5 trillion. Economies with a stronger skills base could also still lose big, with as much as $975 billion in the United States and $264 billion in Germany being missed out on.

Accenture suggests that most of the skills needed for the future workplace are best acquired through practice and hands-on experience, meaning experiential learning techniques should be prioritised, as well as a focus on complex reasoning, creativity, and socio-emotional intelligence. For most roles, augmentation holds great promise. Business and government decisions will determine by how much and by when. In terms of the global market, Science and Engineering features the most possibilities for augmentation of human labour with technology, at 74%. This would require a concerted effort to prepare the workforce for augmented work, however, especially in the field of science, this could provide large amounts of growth to the global economy.

The predominant impact of intelligent technologies will be to augment work

According to Accenture’s analysis, in the US, Empathy and Support workers, such as nurses and psychiatrists, represent the largest single share of employment in the entire economy, but these roles are highly augmentable. 64% of their work time could be potentially augmented, yielding huge efficiency savings and freeing professionals up to improve other areas of service, with 14% augmentable within the next ten years. As this happens, we can expect an increase in demand for these roles, as much as 1.4 million workers. With the right skilling investments, this could offer a major boost to the economy – but if not, it represents a squandering of huge potential.

At the other end of the scale, manual labour is less likely to see large amounts of augmentation, and is largely in line for automation. This is largely where the fear that AI and automation will lead to widespread unemployment comes from. However, according to a mounting body of evidence, AI is likely to yield a moderate boost in jobs available. The problem is that, without intervention from governments, and co-operation between businesses and industries, this major realignment of labour could prove to be a major missed opportunity, as those moving out of manual labour will require substantial support in training for new, technologically augmented jobs. According to Accenture, there are three areas where governments and businesses can work to avoid missing out on large amounts of GDP growth.

What’s to be done

First, Accenture encourages the speeding up of experiential learning. Companies can apply new technologies including virtual reality and AI to help make the learning of staff immersive and engaging. This could include design thinking in the board room to simulation training tools for technical roles, as well as on-the-job training initiatives and apprenticeships.

At the same time, Accenture suggests a shift focusing on institutions to individuals. Incentivising each individual to develop a broader blend of skills, rather than only targeting the output of institutions in terms of graduates or certifications could yield improved results.

Finally, the researchers suggest empowering vulnerable learners. While older workers or those in traditionally more manual roles are in a difficult position when it comes to digital change, while having less access to training. Businesses should offer more guidance to follow appropriate training and career pathway. This can be done by providing modular learning to suit their life commitments, while providing new funding models, such as grants, to encourage personal lifelong learning plans.

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Why leaders must balance technical expertise with soft skills

17 April 2019 Consultancy.uk

Soft skills matter in the workplace just as much as technical expertise, writes Samantha Caine, Managing Director of Business Linked Teams.

For too long technical expertise has been seen as the marker of a strong candidate for development into a sales or leadership position. Sales and leadership candidates are tasked with demonstrating a diverse and wide-ranging set of technical skills, yet their aptitude in these technical skills or ‘hard skills’ cannot signify great leadership potential. This is why a healthy balance of soft skills and technical ability is required. 

So what exactly is the difference between technical skills and soft skills? In engineering, it’s crucial to demonstrate knowledge of physics as well as a strong grasp on mathematical equations. Yet, in any industry, it’s important for leaders to be able to interact with other people effectively with soft skills like communication, empathy and adaptability. 

Business Linked Team’s 2018 study into internal leadership development revealed that 69% of large organisations are prioritising the identification and development of future leaders from within the workforce. As more and more organisations begin to invest in sales or leadership development within their existing workforces, more focus needs to be placed on ensuring the right soft skills are in place. 

With those soft skills in place throughout the workforce, the business will benefit from a wider pool of potential leaders developing under their noses, and it should be the same where sales candidates are concerned. 

It’s not just about easier access to ideal candidates for these positions without the rigmarole of recruiting from outside of the organisation. The leadership development study also found that 89% of HR decision makers say succession planning has become a top priority. Those currently serving in leadership positions can’t lead forever and the same goes for those generating sales for the business.

Why leaders must balance technical expertise with soft skills

From people leaving for new opportunities or retirement, to people simply stepping aside to focus on other areas of the business, successful leaders and salespeople require experienced and capable successors that will be ready and able to confidently step into their shoes and pick up the mantle without the business experiencing any lapse in performance.

Soft skills make stronger candidates

When it comes to the soft skills required, a strong leader must be able to manage through clear communication and effective time management, coaching and goal setting. They must be able to demonstrate empathy and empower their teams to be successful, productive and fully engaged. And beyond simply giving direction, they must also be able to take direction from those above them and cascade the business strategy down through their teams. 

A strong sales candidate must possess the ability to communicate value to the customer, negotiate well and protect margin or the ability to increase the scope of a particular sales opportunity. 

With the relevant soft skills in place, the business will benefit from increased productivity, greater agility against changing market conditions and greater transparency. In turn, this will provide visibility on issues and inefficiencies while removing opportunity for miscommunication. All of this can transform the culture of a department, improving employee satisfaction and reducing staff turnover. 

Ultimately, developing leadership or sales candidates will require the business to strike the right balance between technical skills and soft skills, and this requires an effective and sustained learning journey.

A balanced learning journey

Facilitating and supporting the development of leadership and sales is best achieved by establishing training groups. By cultivating training groups, businesses are creating talent pools that will inspire and support each other on the learning journey. However, personal goals and learning objectives must be defined for each individual based on their own existing skillsets and the skills that each individual needs to develop. 

With the emergence of e-learning, businesses recognise the value of online-based learning activities, yet many make the mistake of opting for one-size-fits-all solutions which are solely focused on self-study. A development solution will only deliver true return on investment if it combines e-learning activities with group learning activities that provide opportunity for shared experiences and support.

A blended learning solution that combines self-study and face-to-face group learning activities will aid strong development of the talent pool through shared experiences. Through these shared experiences, those undergoing the training will organically develop a support network that supports the development of the group as much as it supports the development of each individual. 

The blended learning approach is supported by one of the seven principles of human learning that socially supported interactions aid the individual development of expertise, metacognitive skills, and formation of the learner’s sense of self. The strongest opportunities for development can be unlocked by blending workshops with online activities such as virtual sessions, peer coaching, self-study, online games and business simulations. But it’s crucial to provide a blend of one-to-one and group sessions too.

Beyond delivering a better learning outcome for the employee, the blended learning approach allows organisations to adapt their training quickly and easily to shifting business demands in an ever-changing landscape.