What is Digital Transformation?

Digital transformation is the process by which an organization leverages digital technologies in its operations, business model, work culture, and customer experience to drive innovation,  efficiency and stay ahead of the competition.

Through digital transformation, businesses can minimize costs, achieve data-driven decision-making, increase revenue growth, and enable scalability. For example – Tech giant Amazon has revolutionized its business by using AI-driven robots in warehouses for better inventory management and offering personalized shopping experiences to clientele by incorporating machine learning into its recommendation engine.

Digital transformation is a continuous and long-term journey for organizations, which raises the question of how employees prepare for it. Upskilling and reskilling help navigate digital changes as they facilitate employee engagement and retention, meet industry regulations and compliance, and enhance workforce adaptability. They are also a great way to enhance an organization’s brand value and contribute to being a ‘best place to work’.

Upskilling Vs Reskilling

Suppose a renowned bank decides to adopt AI-based customer service tools like chatbots — In that case, it can upskill by teaching its customer service agents how to leverage chatbots for handling routine queries while solving the complex problems by themselves. The bank can reskill by shifting tellers and back-office staff into specialized roles that require managing digital financial products or customer relationship management.

Upskilling involves training employees to acquire or sharpen their existing skill sets to improve their performance. In contrast, reskilling involves training employees in new skills to place them in different organizational roles.

Upskilling and reskilling are invaluable in developing a sense of loyalty among employees, carving new paths, and increasing the chances of promotions and higher pay scales. They are also a great way to attract new talent, as prospective employees would appreciate a workplace that provides training facilities and helps them ease into their roles steadily. 

How to Prepare Teams for Digital Transformation

Upskilling and reskilling are essential in creating a focused and well-laid-out approach to training, change management, and building a culture of adaptability. 

Assessing skills and identifying gaps

Start your journey to prepare your team for digital transformation by conducting skill assessments through surveys, assessment tools, peer reviews, and a 360-degree feedback system. Compare the results of the skill assessment tests to competency or industry-standard frameworks to gauge the employees’ strengths and identify areas for improvement. 

Based on the results, companies can create personalized training plans to help employees upskill by adopting new technologies like AI, IoT, or Cloud, improving their project management skills or customer service skills.

Supplementing training with practical experience

Practical experience creates a learning experience amalgamating real-world application, mentorship, and continuous feedback systems. This experience is invaluable in preparing an employee for a different job position. Thus, garnering practical experience is a great way to upskill and reskill.

Here are some ways for organizations to evaluate their employees on their newly acquired skills:

1. Internal projects

Internal projects are an excellent way to help employees test their understanding of concepts and skills in real-time projects and solve organizational-level problems. Hence, they help develop hands-on experience and boost employees’ confidence by putting theory into practice.

For example, A corporate communications specialist who earns certification in digital marketing can identify new platforms to run ad campaigns, offer creative ideas to social media teams, and generate new leads by collaborating with content marketing teams.

2. Cross-functional roles

Cross-function roles enable employees to think from fresh perspectives, delivering creative and impactful solutions. They also help develop a holistic overview of how organizations function across teams and optimize resource use. As a result, employees participating in cross-collaboration roles have a broader picture of how technology supports overall business objectives.

For example, an HR professional can work with an IT team member to run a cloud-based HR management system and gain experience in technical skills like configuring HR software and generating reports to track essential metrics like employee turnover and engagement scores.

3. Enhancing soft skills

While preparing your team for digital transformation, investing in soft-skill training, such as written and verbal communication skills, leadership, Emotional Intelligence (EQ), and negotiation skills, is also important. 

Organizations can conduct soft skill training to help with both upskilling and reskilling by partnering with external agencies for interactive workshops and running micro-learning modules. For example, while employees receive training on new technologies, they conduct short learning sessions focusing on specific soft skills like “communicating effectively for remote work” or “resolving conflicts in digital collaborations.”

4. Encouraging out-of-the-box thinking

To embrace digital transformation, organizations need to think differently, which involves encouraging teams to brainstorm, test new tools, and find unique approaches to work. Organizations can also run competitions and innovation-based challenges to offer solutions for issues arising during digital transformation. Follow up these with prototyping initiatives and pilot testing projects to develop hands-on experience and test the viability of innovative solutions through real-time application.

5. Rewards and Recognition

Celebrate your team members’ progression and achievements as they finish training and acquire new skills. Share their success stories and milestones in company newsletters, email campaigns, or company case studies to recognize their contribution to the organization’s digital transformation process.

How AI and Data Analytics can help personalize the learning experience

AI-based customized learning paths

Through Artificial Intelligence-based skilling platforms like Tekstac, organizations can continuously assess and offer tailor-made learning solutions based on the employee’s:

• Patterns in learning behavior and past performance 
• Knowledge level, career goals, and learning preferences
• Performance in assignments and quizzes 

Predictive analytics for tracking progress

Organizations can integrate data analytics into their learning platforms to identify skills gaps, track progress, and forecast learning needs. Here are some ways through which analytics tools help:

• Assess and offer insights on which aspects employees excel at and where they face challenges
• Analyze overall engagement and completion rates to evaluate employee performance

Challenges in upskilling and reskilling during digital transformation

1. Being reluctant to change

One of the primary reasons organizations struggle while undergoing digital transformation is that employees may not welcome change or resist upskilling/reskilling efforts. This could be due to several reasons, such as feeling complacent with their existing role and skill set, lack of time, especially while balancing existing workload with training, and a fear of failure.

2. Budget limitations

When organizations undergo digital transformation, a significant portion of their budget is allotted to replacing legacy systems and digitizing operations. It leaves organizations, especially small and medium-sized enterprises, with strained budgets to allocate funds for upskilling and reskilling initiatives.

3. Rapidly evolving technology

With the fast emergence of technologies like Artificial Intelligence (AI), Augmented Reality (AR), and cloud computing, employees find it difficult to keep up with the pace at which they must undergo training. Also, skills required for particular tools or technology become obsolete when newer versions are released. These constant changes may overwhelm employees as they try to balance their day-to-day roles and responsibilities with upskilling and reskilling training.

Case studies — Successful digital transformation via upskilling and reskilling

Are you an organization aiming to upskill and reskill to facilitate digital transformation? Here are some organizations that have made the successful transition and an insight into how did they do it:

1. IBM

IBM launched its famous “New Collar Jobs” initiative in 2015 to reinvent its workforce and train them in emerging technologies like AI, cloud computing, and data science. This initiative was a game-changer for those without a college degree, as they could still receive training to develop skills in new-age technologies.

They trained their workforce in software development, blockchain, cybersecurity, AI, Data science and analytics, and cloud computing. This was instrumental in creating a diverse and larger talent pool, minimizing the need for external hiring, and meeting the market’s demands.

2. Nike 

They transitioned from a traditional sports shoe business to a digitally driven client-centric ecosystem. Nike invested in training its employees on data analytics, predictive analytics, and customer segmentation. 

Based on this, the employees worked on user data from apps like Nike Training Club and Nike Run Club to run highly targeted marketing campaigns and offer personalized client experiences. Employees also underwent training in e-commerce platform management, inventory management, and digital payment systems to increase digital revenue. 

Leaders were also reskilled in adopting new-age technologies like Augmented Reality (AR) and Blockchain to create digital-first strategies.

Conclusion

Global digital transformation is forecasted to reach $2.8 trillion by 2025. This is an excellent indicator for organizations to prepare their leaders to create a sound vision and strategy for digital transformation. The onus lies with the leadership establishing continuous learning that encourages employees to upskill and reskill. Since digital transformation marks a cultural shift in an organization, leaders must guide employees through regular meetings, offer constructive feedback, resolve their concerns, and promote its benefits.

Upskilling and reskilling benefit employees and the organization, promoting increased job satisfaction, increasing brand reputation, and creating an agile and versatile workforce.

Take an initial step in your digital transformation journey by assessing your employee’s digital skills and empowering them to stand out in a constantly evolving digital landscape.

Upskilling and Reskilling FAQs

1. What is the difference between upskilling and reskilling?
Upskilling enhances an employee’s existing skills to keep up with industry advancements, while reskilling trains them in new skills for a different role within the organization. Both are crucial for workforce adaptability and career growth.
2. How can AI help personalize the learning experience?
AI-based platforms offer personalized learning paths tailored to organizations goals, learning requirements, and performance.
3. What are some key takeaways from case studies like IBM and Nike?
Investing in training for emerging technologies, focusing on data analytics and customer experience, and reskilling leaders.
4. What are the benefits of upskilling and reskilling for employers?
Increased employee retention, improved workforce agility, enhanced brand reputation, and a larger internal talent pool.