In a survey conducted by the World Economic Forum in June 2020 with 347 risk analysts across the globe, top 31 risks were identified with economic, societal, geographical, technological, and environmental implications. Some of the most worrisome concerns for corporates were prolonged recession, failure of industries, disruption of global supply chains, weakening of major economies, increase in inflation, high unemployment, abrupt adoption and regulation of technologies.
Are we facing these risks for the first time? We have faced global recession, unemployment, weakening of economies, failing of industries, higher inflation during several crises in yester years due to South East Asian crisis in 1997-98, dotcom bubble in 2000-01, global financial crisis in 2007-08, and Euro debt crisis during 2012-14. Several corporates survived these crises and thrived thereafter to commendable heights. In this article, we try to understand the significance of reskilling in the times of crisis through a case study of Microsoft Inc, and highlight future skills required to be relevant in the next normal.
Why Microsoft is a stellar value creator
Microsoft Inc was founded in 1975 by Bill Gates and Paul Allen, both exceptionally talented and hardworking. It started developing BASIC language compilers for microcomputers that were emerging on the horizon.
Microsoft adopted a strategy called ‘Cornerstoning,’ where starting with its terrific initial position in BASIC built during 1975-80, it leveraged on an outstanding initial strategic position into an economically logical opportunity that offers great profit potential. Microsoft progressed by reinventing and upskilling its workforce from time to time offering products like BASIC, DOS, Windows, MS Office, Explorer, NT, Xbox (gaming), Office 365 (cloud-based solutions), Azure AI, and MS Teams. It also added hardware products such as Surface Pro (laptops) and Microsoft Mobile.
Market capitalisation is one of the robust indicators of enterprise value determined by large investors in the capital markets. In terms of market capitalisation, Microsoft has been consistently among the top five companies in last three decades thriving even amid major global crises such as dotcom bubble, financial crisis, and Covid-19 crisis.
Graphics by V Visveswaran
How did Microsoft manage these fatal crises consistently? The answer lies in Microsoft’s ability to demonstrate resilience and agility by reskilling, upskilling and new skilling their workforce from time to time to be relevant for the evolving contemporary market needs. Aspiring business leaders in corporates can learn to invest in reskilling to be relevant in the market. Jobs for life, stable industries, slower technological growth, skilled up once in lifetime, are trends of the past and learning imperative in the present and future exists due to multiple careers in a lifetime, rapid technological change, and need for reskilling continuously. In 2017, McKinsey Global Institute estimated that as many as 375 million worker or 14 per cent of the global workforce would have to switch occupations or acquire new skills by 2030 because of automation and artificial intelligence.
Reskilling, upskilling and new skilling
Reskilling involves training employees on an entirely new set of skills to prepare them to take on a different role within the company. This typically occurs when workers’ previous tasks or responsibilities become irrelevant, often due to advancements in technology. Reskilling may involve obtaining a new degree or certification in a different area of expertise.
Upskilling occurs when workers improve upon existing skills and deepen their abilities within their area of expertise. By expanding their knowledge, employees become better positioned for additional responsibilities and higher-level roles on a career track.
New skilling represents all types of continuous learning to help build high-demand skills. A new skilling mindset keeps both a workforce and a company agile by ensuring learning initiatives are relevant to future business objectives and tailored to the needs of learners. Business survival depends on reskilling and upskilling initiatives of the workforce.
According to World Economic Forum Skill Report 2018, aspiring business leaders should be able to demonstrate skills or attributes such as complex problem solving, critical thinking, creativity, people management, coordinating with others, emotional intelligence, judgement and decision making, service orientation, negotiation and cognitive flexibility. Also, in a recent survey of 800 executives across the globe conducted by Mc Kinsey reveals that acceleration of automation, digitisation, and focus on hygiene safety would disrupt workplaces. The roles that may see the greatest increase include jobs that involve health and safety, technology and automation, and digital learning.
It has been more than one year since Covid-19 disrupted economies, industries, corporates, and individuals, across the globe. The accelerated digital transformation, improved focus on hygiene and safety, and achievement of Sustainability Development Goals (SDGs), will characterise the ‘next normal.’ During these times, progressive professionals will have to invest time and effort in reskilling, upskilling, and new skilling to face the ensuing challenges of the ‘next normal.’
(The writer is Professor and Dean at IMT Hyderabad.)