In a perfect world, talent pros would be able to quickly find the perfect candidate for every open role.
But we don’t live in a perfect world, and, in the next three years, roughly 40% of employees will need to reskill to meet the demands of AI in the workplace, according to the World Economic Forum.
In anticipation of a skills shortage, there are strategies that HR leaders can use to ensure their organizations have the talent they need to succeed, according to Cy Wakeman, best-selling author and founder of leadership consulting firm Reality-Based Leadership.
While upskilling and reskilling—or “building,” as Wakeman calls it—is certainly an option, she suggested that HR also ask if “buying” or “renting” talent might better align with their company’s business needs by assessing the short- and long-term costs and benefits associated with each strategy. Ask: “What do we need? How long do we need it? And how will it change going forward?”
Buy, buy, buy. Buying, or hiring, talent may be the quickest way to solve a skills shortage, but it can also be expensive and may only fill current demands, Wakeman said. And if the talent needed is highly sought after, recruiters may need more resources to attract them away from competitors.
“We’re buying a hot commodity, [so] we usually have to pay bigger than market share for it…and recruiting has so many upfront costs.”
Wakeman also noted that “[buying] is really risky, because not all new hires work out.” Gretchen Jacobi, SVP of enterprise at tech talent firm General Assembly, echoed that sentiment, noting that hiring quickly for in-demand talent can also be risky because they may not be a good fit in the long-term or may have “misrepresented [their skills.].”
Rent, the talent (not the musical). Renting, or hiring consultants or gig workers to temporarily fill talent needs, can also be expensive, Wakeman said. It also “doesn’t often lead to knowledge transfer,” because the new expertise will likely leave with the temporary talent.
While renting isn’t likely to solve a problem, it can be a good starting point. “When I [rent] an expert, it’s not going to help me hire, which is buying talent, it’s not going to help me grow talent…but sometimes we need to start there,” she said.
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The big chill build. Building talent takes planning, resources, and long-term vision, Wakeman said. But it requires leaders’ willingness to “use money now for payoff later,” which many companies, especially those that are public, aren’t willing to do.
With a build strategy, Jacobi told HR Brew, there are benefits that external hiring doesn’t guarantee, like increased employee loyalty and retention.
“[These are] folks who are already proven that they can work well within this company, that they know how to get stuff done in this company, which means that they are going to ramp faster in their new role than an external hire,” she said. “Whenever you are putting investments into people like this…you’re going to get a better retention statistic at the end.”
While some countries offer subsidies to help companies build talent, the US does not, Wakeman said, so HR pros may face resource constraints. They may even have employees who aren’t interested in reskilling.
“My experience when I go to retool people is they want to hold out for as long as they can in their current role,” she said. “So, you take a metal worker or a welder, and you go, ‘I need to retool you to [be] a computer coder.’ And, the welder is like, ‘No, I’m going to stick with my union, and we will fight this.’”
Three-piece combo meal. Wakeman recommended using a combination of all three strategies: “I’m going to [rent] consultants, and I’m going to hire employees, and I’m going to grow people with capacity from this. So, I need to have things I’m doing in each of the boxes to best serve the organization.”
Each strategy will require HR leaders to constantly challenge the status quo, she added.
“We have to really stay up with the future and keep getting our mind blown, so we, ourselves, have to be like students of the future, for one thing,” Wakeman said. “Then, we’ve really got to partner with folks, and have some ongoing talks about what our needs are going to be, and what type of folks we’re going to need, and where we’re going to find those folks, and how we’re going to grow them.”