“The Times They Are a-Changin,” the popular song of Bob Dylan has got a new meaning in today's globalized business world. Indeed, the rapid expansion of technology and fast-paced innovation have brought a sea change to the professional landscape. With these changes, old occupations are steadily giving way to new and emerging ones. Even skills and proficiency required for every professions are evolving fast. And amidst all, organizations of all sizes and domains are increasingly feeling the need for building a certain set of workforce standards, which will ultimately give credibility to their talent pools.
There is no concrete definition for workforce standards, as they are different for every industry. However, in a broad sense, workforce standards can be defined as the framework for work-based basic skills, delineating outcomes, competencies, benchmarks, expectations, or indicators that help organizations and employees measure, self-assess, and improve their performances and grow.
These standards give credibility to employees' ability to demonstrate their professional excellence and maintain high-end standards in their respective professions. Moreover, standards enable employers to find out whether or not candidates for employment are fittingly qualified.
Now the question is why companies should focus on workforce standards? According to an estimate, about 70% of an organization's valuation is based on its intangible asset-which is its workforce and the skills and proficiency it has. Given this, it has now become almost imperative for organizations to evaluate their intangible asset so that they can manage it effectively and align it with their organizational goals and objectives. Needless to say, the value of workforce is always on the higher side in profitable and growing companies.
According to a report titled “A Skilled Workforce for Strong, Sustainable and Balance Growth,” published by the International Labour Office, providing the workforce with skills needed for jobs of today and tomorrow is a “strategic concern” in the national growth and development outlooks of all G20 nations. The report has also highlighted how several G20 countries have adopted the training and retraining strategy to address employment challenges resulting from the global financial crisis (2008).
Another global survey of more than 1,300 CEOs in 68 nations, conducted by PwC in 2014, revealed that business leaders were more bothered about finding the right employees for the right position than ever. About 63% of the CEOs participated, considered the unavailability of key skills as the biggest threat to their companies' growth. Further, technology and engineering firms were found to struggle the most because of the paucity of skilled workforce.
In 2012, McKinsey & Company predicted a gloomy outlook for the labor market till 2020. The report outlined three types of talent shortages: about 40 million, very few workers with college education in the global market; a shortage of 45 million employees with secondary as well as vocational education in developing nations; and about 95 million workers lacking the skills required for employment in advanced economies.
Against the backdrop of the prevailing skills gap across the world, building workforce standards help both employees and employers in more ways than one. On the one hand, standards help employees demonstrate their abilities to prospective employers and on the other, these standards enable employers to recruit, train, and enhance the efficiency of their human resources.
Besides, according to a report, workforce standards help organizations assess the effectiveness of various training programs, enhance their recruitment process, and find training gaps, which ultimately result in improved productivity, efficient workforce, and employee retention.
Therefore, it is advisable for both employees and employers to give serious thoughts to build and implement workforce standards. It will ultimately help them to maintain as well as enhance their organizational or professional excellence.