Why Workplace Hierarchies Matter in Skill Transformation

With the increasing availability of sophisticated analytics, AI, and robotics, corporate leaders are reconfiguring their workforces to meet changing technical demands. Indeed, by 2022, 54% of all employees will require significant upskilling, according to the World Economic Forum.

But leaders engaged in workforce transformation are running into unexpected roadblocks as they attempt to keep their employees’ skills in sync with rapid digitization and automation. The introduction of new technologies into the workplace often upsets existing status hierarchies based on tenure, role, or expertise — factors that dictate the amount of respect, assumed competence, and deference an employee receives from others in the organization. Upsetting fundamental status hierarchies can impede learning, particularly when senior employees perceive that those junior to them are benefiting the most from a workforce transformation.

With co-researchers Jenna Myers from the MIT Sloan School of Management, Lindsay Gainer from Mass General Brigham, and professor Sara Singer from Stanford University School of Medicine, I studied corporate leaders’ efforts to transform the technical skills of employees at five different primary care sites over the course of nearly two years. Frictions between digital natives at the junior level and their more senior coworkers initially led employees to struggle to pick up the skills they needed and slowed digital transformation efforts. When junior employees benefited more from transformation than did senior employees, this created backlash, especially among more senior employees who saw their status undermined. But at sites where leaders systematically attended to existing workplace hierarchies during skill transformation, employees were more successful in learning digital, critical thinking, and communication skills.

Our new study found that corporate leaders who are engaged in skill transformation need to be mindful of workplace hierarchies during three types of skill transformation: upskilling, reskilling, and “newskilling.” Here’s how.

1. Upskilling. Upskilling initiatives target employees who need additional technical training to remain relevant and continue to deliver value. Leaders can personalize learning for these employees by providing peer-to-peer training in new technologies and related work processes.

Most leaders’ first inclination is to choose as trainers those employees who seem best able to grasp new ways of working. Often, these employees are those who have grown up using digital technologies and are on the lower end of the organization’s hierarchy — which can ultimately result in senior employees feeling slighted. This trainer-selection strategy might seem to be the most efficient, but it can in fact hinder learning.

Instead, leaders should create peer training programs that rotate both senior and junior employees through the role of trainer. While this may not seem to be the most efficient training method, the alternative is likely a recipe for failure.

2. Reskilling. As sophisticated analytics, AI, and robotics automate many existing jobs, the workers who formerly did those jobs will need to learn entirely new skills rather than merely add to their current skill sets. Many employers are thus attempting to rapidly retrain employees to enter new roles such as technical customer support or IT support rather than trying to hire new talent in a tight labor market for technical skills.

We found that employees who have held their positions for many years — and have been well rewarded for their efforts — were more concerned about uncertainty around jobs, skills, and future qualifications than were employees who had recently joined the organization. The more junior-level employees often saw reskilling initiatives as opportunities to learn valuable technical skills while keeping their day jobs, rather than as a threat to their authority and control over key resources.

Leaders can more effectively accomplish reskilling when they speak to these different interests and concerns — security versus advancement — when selling employees on the training. Leaders may also need to emphasize to front-line managers how to handle such concerns while encouraging their front-line employees to stretch beyond their comfort zones in order to stay current and competitive in the job market.

3. Newskilling. When corporate leaders adopt new technologies that automate various kinds of work, some jobs and tasks are eliminated while others emerge. Many new roles involve technologies that require considerable work to develop, implement, maintain, and change over time. For instance, digital marketing firms have introduced the role of search engine optimization manager, high-tech companies have introduced the role of data scientist, and professional services firms have introduced the role of AI translator to communicate the value of predictive analytics tools to various groups in the organization.

However, the introduction of new roles that help with technology development and implementation often requires a redesign of existing roles that more experienced employees currently fill. If experienced employees perceive new roles as threatening to the relevance of their hard-won expertise, their desire to maintain their high-status positions may outweigh their acceptance of role redesign.

Leaders can most effectively introduce new roles by establishing separate meeting spaces for supporters of change across status positions to develop new role expectations. Separate meeting spaces can play a critical role in facilitating the experimentation needed for role redesign. When defenders of the status quo are present, supporters of change are often uncomfortable trying out new tasks, discussing nontraditional ideas, or challenging the existing order for fear of retaliation, as defenders of the status quo may try to quash experimental efforts before they get off the ground. Spaces that allow for interaction among less-powerful group members, apart from everyday activities, can better support transformation by facilitating the questioning of traditional activities and the development of new ones.

By attending to existing workplace hierarchies during skill transformation, leaders can best ensure that their organizations and employees gain the skills they need to compete amidst rapid digitization and automation.

Editor’s note: An adapted version of this article appears in the Fall 2021 print edition under the title “Workplace Hierarchies Matter in Skill Transformation.”