The need to build organizational and workforce resilience has been on the C-suite’s radar for years. In fact, words like “agility” and “adaptability” have been used so often in board rooms and town hall meetings that they have almost become meaningless—buzz words that garner more discussion than action. The dialogue, while well-intended, has failed to translate into the productivity gains organizations expected. The culprit? Underinvestment in the workforce and in the workforce’s ability to embrace new ways of working.
Workforce resilience during COVID-19
The COVID-19 crisis thrust the workforce into rapid change and the workforce responded in kind. During the pandemic, we have seen workers quickly assume new roles, contribute to opportunities in different fields and industries, and leverage their strengths to effect meaningful change both inside their organizations and within their communities. These shifts spotlight the value of workforce resilience and highlight the importance of understanding what workers are capable of doing rather than relying solely on what they have done before.
Now, as crisis response efforts evolve and organizations begin to think about staging the return to work, the question becomes whether they can sustain these shifts and the innovation and ingenuity that allowed them to survive the most dynamic business environment in recent history. Key here will be a renewed and concerted focus on workforce reinvention and resilience. This is not an issue for the HR organization to solve alone. It is, however, an opportunity for HR to take the lead and expand its focus and influence across the enterprise to impact the business strategy and bottom-line results.
Lessons learned from other moments of upheaval
Some parallels can be drawn to the Great Recession of 2007-2009, the last time that organizations were forced to be assiduous about their budgets, allocations and investments and to make hard decisions about their workforce. But organizations cannot afford to make the same choices they made during the recession, when workforce investments took a massive hit, as the current crisis is unprecedented. Then, the global workplace training industry shrunk from $302.2 billion in 2007 to $244.4 billion by 2009 and would not recover to pre-recession highs until 2013, according to Statista research. In the United States, average training expenditures per employee fell 11 percent in the first year of the recession, from $1,202 per learner in 2007 to $1,075 per learner in 2008, a 2009 study by Bersin & Associates shows.
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With the scale and rate of change in the business world today, organizations cannot afford to pause on workforce investments and should reconsider cuts to learning and development budgets as a cost-cutting measure. In fact, investment in the reinvention of the workforce has never been more critical. In Deloitte’s 2020 Global Human Capital Trends study of nearly 9,000 business leaders, 53% said that between half and all of their workforce will need to change their skills and capabilities in the next three years. Yet only 16% expect to make a significant investment increase in the continual reinvention of their workforce and one-third say that lack of investment is the greatest barrier to workforce development in their organization.
The COVID-19 crisis has not slowed the necessity for workers to reskill, but instead it has accelerated organizational change and placed new demands on the workforce. During a recent Deloitte webcast, we asked nearly 1,600 global attendees how their role is changing due to the health crisis. Twenty-six percent told us that they expect to have additional duties and another 12% expect to do more than one role (their job and an additional job) as a result of COVID-19. As jobs become increasingly more dynamic and workers are asked to assume new roles, organizations and individuals need to do more than simply reskill, they need to build resilience.
Building resilience to meet uncertain futures
We believe there are five key shifts organizations can employ to build resilience. All five shifts are anchored in workers’ ability or potential—giving workers opportunities and incentives to grow and adapt not only based on their resume, skills, certifications, or even role in the organization but also based on their capacity to develop in new areas and ways.
- The first and most foundational is a shift from focusing on building skills to a commitment to cultivating capabilities first and skills second. Those enduring human capabilities—attributes that are universally applicable and timeless, such as curiosity, collaboration, creativity, and empathy—provide workers and organizations with greater flexibility to meet both today’s and tomorrow’s needs. In fact, in environments where enduring human capabilities are cultivated and nurtured, workers can reskill and reinvent faster and with more sustainability.
- Second is a shift from developing specific workforce skills to meet short-term needs to tapping into workers’ passions to help solve unseen and future problems. Cultivating workers’ passions could mean fostering workers’ desire to make an impact, encouraging workers to seek out challenges to improve their own performance, or promoting a collaborative environment in which workers team up and build relationships with others to gain new insights. By implementing these measures, organizations can translate worker passion into sustained organizational performance.
- Third is the shift from a focus on formal training to an emphasis on learning in the flow of work, meeting workers in their place and time of need. Research shows that learning through experience yields better learning gains and retention than traditional classroom instruction. The integration of learning into the flow of work makes it more personal to the individual and allows for learning to be delivered at preferred times and in targeted ways, allowing workers to better receive, digest and leverage the content.
- Next is changing how the organization rewards individuals. Given the importance of continual reinvention to business survival in today’s turbulent world, organizations need to create incentives that motivate people to continuously learn, adapt and improve. Organizations can do so by rewarding workers based on capability development, rather than solely on work output. Very few do this today. Our 2020 study found that only 45% of organizations reward workers for developing new skills and capabilities, and even fewer, 39%, reward leaders for developing the skills and capabilities of their teams.
- The final shift to build resilience is anchored on a new organizational reality—the rise of ecosystems. As the world becomes more connected than ever before, traditional boundaries are blurring and giving rise to different models of work. At the organizational level, we have seen the rise of the social enterprise—an organization whose mission combines revenue growth and profit-making with the need to respect and support its environment and stakeholder network. A key competency of the social enterprise is its ability to listen to and invest in its broader stakeholder network. From a workforce resilience standpoint, that means employing a workforce development approach that extends beyond the organization itself. Doing so could mean helping prepare your existing workers for high-demand occupations in their local areas or in making investments in capability building outside of the walls of your organization to better support the community at large.
As organizations look beyond their initial COVID-19 response to recovery and establishing a new normal, they need to deploy workforce strategies that will not just help them return to work, but help them accelerate to the future of work. That means making investments to maximize worker potential. To do so, organizations need to add another word to the corporate dialogue around adaptability and agility: ability. During the COVID-19 crisis, workers have demonstrated the scope and power of their abilities in spades. Organizations that capitalize on those abilities—on workers’ potential to grow, innovate and reinvent—will be able to build resilience that sustains both the individuals and the organization throughout the disruption that will likely be all of our ‘new normals’ in the future.