Businesses across the world are facing a shortage of professional talent and expertise in digital and IT skills and capabilities.

Over the past decades, the standard response to dealing with this issue has always been “outsourcing”. The huge revenue growth over the last 15 years of companies such as Tata Consultancy Services, Wipro, HCL, Infosys, Accenture, Capgemini, and Atos underlines how prevalent the “just outsource and offshore” solution has become.

Yet, while outsourcing will always have a place as part of the solution to the provision of digital skills and capabilities, it is no longer the panacea it used to be. This is because digital skills are now at the core of business operations. Approximately 90 percent of all operations in an average organization today are supported by software, and digital skills will become increasingly core with the further “softwarization” of products, services and experiences. Competence in digital channels, and in creating and managing omnichannel customer journeys, are crucial for both B2B and B2C businesses

All of this means digital skills are now one of the key determinants of competitiveness, value creation and business resilience. Therefore, from a strategic point of view, simply outsourcing digital and IT is becoming much less desirable – leaving aside the commercial implications of paying a third party to manage increasingly large parts of core operations.

Talent cultivation for critical roles is more important than ever in today's tough labor market. Here are some creative approaches to building a top-notch team from within.

1. Hire attitude, aptitude, ability

Employers can widen the talent pool by stepping outside the box. A win-win approach is to tap employees who may not have the traditional skill set (technical certifications, academic qualifications, and work experience) but who do possess the drive and ability to learn new things. Think older employees with high school or community college diplomas, part-time or remote workers passed over for new opportunities, and employees from underrepresented communities.

Certain technological developments are lending support to inclusive hiring. For instance, artificial intelligence and machine learning models can identify employees who are likely to succeed in a certain skill or function and should therefore be trained on priority. Also, low code/no-code platforms make it possible for enterprises to deploy even non-technical or business users in application development roles.

2. Nurture continuous training and drive lifelong learning

Since technology skills are becoming obsolete at an increasing rate, employers need a new training approach matching that pace. Clearly, the old model of one-off training does not work anymore. In fact, the education construct itself – where people learn for the first 20 years or so and apply that learning, updated periodically, during the next 40 – is due for a change.

In place of intermittent training, we need lifelong learning. Employers must establish a framework so employees can access learning on demand, in small capsules, throughout their careers.

But tools alone will not suffice. Enterprises need to inculcate learnability so their employees can learn new content in new ways. Cultural change can be supported by intelligent solutions such as smart assistants to guide employees toward the sources of knowledge most appropriate to their context.

3. Make employees want to stay

The pandemic has reshuffled work and life priorities for most people. For those working from home, the trappings of corporate life such as company brand and majestic campuses have receded. Instead, employees are seeking belonging and a path to personal and professional development. Organizations that meet these altered expectations with clear career roadmaps can look forward to a robust pipeline of in-house talent.

Organizations that offer flexible benefits matching individual needs – childcare, elder care, affordable housing, and wellness benefits, for example – are more likely to retain their talent. Opportunities to make a difference through work, for instance, writing software applications to promote public health, can also persuade employees to stick with their companies.

Looking inward going forward

The digital skills shortage presents a tangible risk to every business and organization – especially since “software is eating the world” and every organization is now practically a technology company. The skills shortage is a risk to both business resilience and growth and innovation, as there is a near-constant drive for adoption of new technologies for organizations to compete and grow. Simply outsourcing is becoming undesirable as the sole solution as digital skills become increasingly core to maintaining competitive advantage and ensuring business resilience. There are a few tactical moves to help with the digital skills shortage in the short term – such as constantly raising compensation – but those eventually become unsustainable. The real change needed is to transform the culture and practice around digital, diversifying and broadening the technical expertise of the workforce, nurturing a business sense among digital and IT resources, and enabling employees to focus on problem solving. Companies can not only address the skills shortage, but also create more business value, by managing digital resources more strategically. This involves focusing on a combination of measures around better accessing and retaining resources, improving skills transformation practices and, most importantly, managing the digital estate to reduce skills demand.

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