Even before COVID-19 turned the world topsy-turvy, the rent-to-own marketplace was evolving as a digital age emerged. The pandemic shifted this evolution into high gear, revealing a shortage of digital skills among retail and RTO businesses.
Many, many workers were laid off last year as stores were forced to close; many have been rehired, but the jobs they’re returning to aren’t necessarily the ones they left. Additionally, a limited labor market is making it harder to hire hourly staffers, while demand continues to escalate for computer scientists, engineers, and information technology experts.
Adapting to this digital age requires companies to equip themselves with new capabilities. The issue facing many organizations: their current workers lack the necessary skills to address modern business challenges – like artificial intelligence and machine learning, both of which are playing huge roles as shopping continues to shift online.
According to McKinsey & Co., by 2030, up to 40% of all workers in developed countries worldwide might have to move into new jobs or at least upgrade their skills significantly. McKinsey also estimates that replacing a worker can cost 20-30% of an annual salary on average, while retraining an existing employee costs less than 10% of annual pay.
So the solution becomes clear: Develop the talent you already have in hand – “reskill” or “upskill” your existing employees, providing them with new skills that will also upgrade your company’s capabilities.
Transforming your workforce from within is greatly beneficial to you as an employer. Compared with hiring new talent, it’s faster, cheaper, and better for both your organization’s current worker morale and its attractiveness to new recruits. And adult learning is less expensive and more effective than ever, thanks to new techniques and new technologies [of course] – like gamification, microlearning, simulations, and virtual coaching.
Even conducting such training in-house – via on-the-job training, training sessions, mentoring or coaching – is easier than ever, and offers distinct advantages over external training programs. Internal training, when possible:
- can be presented in language and terminology your employees can relate to;
- uses real-life examples, challenges, and issues that your workers encounter every day on the job;
- hones in on the exact knowledge and skills your workers need to succeed in their jobs and to prepare for success in their next position; and
- reflects and reinforces your company culture.
Many leading corporations have already begun to invest in upskilling:
- Amazon.com pledged $700 million to retrain 100,000 employees for higher-skilled technology jobs.
- JPMorgan Chase made a five-year, $350-million commitment to develop technology skills already in high demand.
- Levi’s put together “boot camps” designed to teach coding and statistical analysis to workers who have no experience in these realms. More than 350 applicants went through a three-month interview process; those selected left their jobs for two months to attend virtual classes full-time – studying coding, statistics, neural networks, and other machine-learning skills.
- Verizon Communications, which closed most of its retail stores during the pandemic, has retrained 20,000 employees to handle new jobs – from sales to customer service — and is teaching another 100,000 workers new skills this year to help them be ready for the future.
These are massive efforts by global corporations, but even small rent-to-own businesses can begin to put the right people into the right positions today, and treat the challenges posed by AI and automation as an opportunity, rather than a threat.
The McKinsey Quarterly outlines a three-phase plan for companies to begin the reskilling process: 1) Scouting – Examine future needs – rather than past – to identify the most important skill gaps and assess your company’s readiness to deliver; 2) Shaping – Redesign work to meet the demands of a digital future and create your upskilling programs accordingly; and 3) Shifting – Move your company’s suite of talent-related activities onto a bigger scale.
Take some concrete steps now to build an infrastructure that supports both your existing employees and the future of work, and you’ll be setting your RTO business up for success in this new digital era.