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In-House Upskilling: Is Amazon’s Strategy a Smart Move?

Amazon has declared that in-house upskilling is its next corporate learning move. Will this bet pay off for the company's future? Should others follow suit?

EDITOR’S NOTE:  Because extended enterprise learning involves multiple disciplines, we sometimes ask other experts to share their insights. Today we feature advice from Daniel Newman, Principal Analyst at Futurum Research and CEO of Broadsuite Media Group. Daniel is an author, speaker, blogger and educator who works with leading technology brands to help businesses around the world embrace the benefits of digital transformation.


 

Is Corporate Learning Ready to Fill the Skills Gap?

For years, I’ve wondered if digital transformation would make today’s colleges and universities irrelevant. That day may be coming sooner than any of us think.

Case in point: Recently, Amazon announced that it’s investing $700 million to upskill 100,000 of its employees, so they can work more successfully in today’s fluid digital business environment. These upskilling efforts are expected to involve employees in all functional areas of the company and at all experience levels.

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This kind of commitment is bold. But here’s what’s even more impressive. Amazon isn’t sending these employees to graduate school or other external institutions.

Instead, participants will develop new knowledge and skills at the company’s own Amazon Technical Academy and Machine Learning University.

What Can Amazon’s Upskilling Plan Teach Us?

The concept seems straightforward enough. Amazon aims to make technical education more accessible by letting employees participate in relevant classes, pursue job-related apprenticeships and earn certificates that qualify them for new positions elsewhere in the company or beyond.

The scope of this initiative is huge. One in three Amazon employees will engage in upskilling to become more technically proficient in their current position – whether they’re a marketing professional, business analyst, warehouse supervisor or coding specialist.

Why is one of the world’s best-known employers making such a massive upskilling commitment? Amazon’s leaders realize that every job is essentially a technical job in today’s marketplace. The company’s future depends on the competency of its employees, and Amazon can no longer rely on other sources to train its workers effectively.

Breaking Down the Amazon Upskilling Investment

What does this new corporate learning strategy suggest about the future of work? And how is it likely to impact the rest of us?

First, let’s break it down. The $700 million Amazon upskilling investment is tied to a broader workforce initiative that includes employee benefits like a higher minimum wage ($15 per hour), 401K and parental leave. Even if the entire budget were applied to training alone, the investment would equal about $7,000 per employee – not that much, by corporate training standards.

This makes me wonder if the initiative is really as ambitious as it sounds. Or perhaps digital transformation will help individuals realize that they’re overpaying academic institutions for education that employers don’t need.

Either way, with such a low initial per-employee investment, Amazon will likely need to continue upskilling employees on a regular basis.

Will Non-Technical Workers Still Fit-In?

Amazon has made it clear that both technical and nontechnical employees will participate in training – but every job is becoming more technical. That means there will be a need to develop non-technical business competencies such as critical thinking, leadership, public speaking and other soft skills.

However, as Amazon sees it, people with soft skills will also need at least some technical acumen if they want to play a valuable role in advancing the company’s agenda.

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Of course, this is true for all of us outside of Amazon, as well. Data fluency and technical competency are essential for any organization that wants to embrace digital transformation. So employees who want to help their company leverage new technologies will need to develop technical acumen, regardless of their professional focus.

For example, consider human resources specialists. To be more effective, they should learn how to leverage automated tools and AI technology to recruit and retain employees.

Mastery of coding, itself, isn’t required. However, a new level of technical understanding is important for HR professionals who want to achieve better results.

This kind of technical comfort and capability is vital for anyone working in 2019 or beyond.

How Can Smaller Businesses Compete?

Clearly, not every company is Amazon. Many don’t have the resources to build their own on-campus technical university. But what happens when an employer can’t afford to offer this kind of upskilling benefit? And what if effective training programs aren’t available in the local community?

Let me frame those questions another way. Which employer would you choose?

  • A larger company where free upskilling is always available, so you can sharpen relevant skills on an ongoing basis, or
  • A smaller company that asks you to find your own skill development outside of the organization and pay for it yourself.

Truth be told, as digital transformation unfolds, the “haves” are separating themselves from the “have-nots.” It’s not just about having sufficient money to fund transformative efforts, but also about having the right people with the right skills.

And this need for technical acumen extends to the broader workforce at-large. For instance, demand is stronger for writers who know how to improve their content quality with apps like Grammarly, or how to increase their output with AI-powered productivity tools. Those who don’t master advanced technologies will ultimately accomplish less – and earn less – than technically savvy writers.

The same equation works for other functions. Jobs are becoming a challenge for anyone who hasn’t yet jumped on board the digital transformation skills train. That’s why employers are seeking creative solutions to close the gap.

Is In-House Upskilling Really The Answer?

Some believe Amazon’s upskilling initiative is just a bunch of hype. Cynics think it’s a PR stunt designed to get attention – which has happened. But as I said, $7,000 per employee isn’t a steep investment.

The result could be nothing more than a lot of static PowerPoint slide decks describing technical terms. On the other hand, it could lead to powerful learning experiences that revolutionize Amazon’s talent pool. Time will tell.

Meanwhile, here’s what we know:  Work is changing rapidly. Future-minded employers can’t afford to sit back and expect employees to prepare themselves for the coming skills mismatch.

Universities aren’t adapting swiftly enough. And Amazon is no longer willing to wait. So in a preemptive strike, the company has committed to bridging the skills gap on its own. This may not be easy for Amazon to accomplish. But acting now to develop a future-ready workforce could be a very smart business move, indeed.

 


EDITOR’S NOTE: This post has been adapted, with permission, from a post published on the Futurum blog.


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Daniel Newman
About Daniel Newman (3 Articles)
Daniel Newman is Principal Analyst and Founding Partner of Futurum Research and CEO of Broadsuite Media Group. Working with the world’s largest technology brands, he explores digital transformation and its influence on the enterprise. Daniel has authored 5 Amazon best-selling books and contributes to Forbes, Entrepreneur and other business publications. He also speaks regularly at industry forums and serves as Adjunct Professor at North Central College School of Business and Economics. You can connect with Daniel on LinkedIn or on Twitter at @danielnewmanUV.

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