The Lack of Digital Skills – not just a Scottish Problem

A workforce skilled in online & digital tools & technologies is key to developing an organisation’s digital agenda. From the more specialist digital-specific & IT / IS / ICT roles, through to the generalists who may need up-skilling and re-training on average every 3 years… the hiring and development of skills necessary to take forward your online roadmap is not something to take lightly. In fact, the lack of digital skills could be one of the greatest factors in why your digital change strategy fails.

I've previously blogged about the lack of digital skills in Scotland and highlighted the lack of technical, marketing and associated skills (design, user experience, content, etc.) ‘North of the border’ where I live. But this skilled and empowered workforce isn't just missing in Scotland, or even across the UK. In a digital skills presentation today from ScotlandIS, the Scottish IT Trade body, I was actually shocked to hear the fact that there is a shortfall of 1 million digital jobs across the EU.

Scotland is therefore only a drop in the ocean compared to this, with only 10,000 people a year needed here to fill the gap.

So what is being done about it?

• Are schools, higher education and further education producing the right courses and talent?
• Are companies investing enough to drag seasoned employees (who may have previously resisted or ignored the use of digital)?
• Are cities and even governments doing enough to encourage digital enterprise in specific areas that need it most?
• Are boards hiring Chief Digital Officers to champion online excellence?

I fear not.

Organisational eBusiness Maturity

Thankfully, a growing number of organisations are looking to improve their digital channels. Consequently they are looking around for others who have already made a step forward and to learn from their innovations (without hopefully copying their mistakes).  Consequently I have seen certain trends appear over the years that may act as a model of not only where companies have come from, but also where they can grow and develop in the future.

Note: Like most of my work on this blog, this model is a ‘work in progress’ where I post my thoughts before they are completely refined and documented. It is therefore submitted with the aim that it will not only be refined by my own further understanding and application, but by wider feedback (either via comments on this blog or by other means).

 

Here’s how I see the organisational maturity of a company progressing (typically in the retail, financial services and travel markets, but potentially in others where this model can be applied):

Individual
Online initiatives originally sprung up thanks to the innovation and inspiration of specific people. Historically this may well have been a young-ish or passionate person who saw the opportunity to utilise some form of digital technology to improve something or interest to them.  Based in the IT, Marketing or other part of the company, they would initially have had very little influence, but potentially the opportunity to create and learn by themselves.

Department
As the individual has grown in their knowledge, they may well have caught the eye of senior individuals. Aligned with a growing understanding of the possible benefits of digital channels for communication, acquisition, commerce and engagement…  this one-man initiative may have grown into a team of people who have specialist knowledge of digital (marketing, eCommerce, User Experience, Analytics, etc.). From experience this has usually been the ‘land grab’ stage, with different high-powered players staking their claim to know all about modern technologies and taking this department under their wing.

Enterprise
Eventually the rest of the company wakes up and realises it is not just the digital team that either needs to understand and use digital tech, but that the whole organisation has become an e-ebusiness, with a digital eco-system around it… enabling everything from new customer influence and marketing through to existing customer self-service and HR connectivity (e.g. automatic postings to job sites, etc.)

Extended
For a company to truly ‘live’ digital however, it needs to move beyond the connected state (e.g. creating a bunch of fixed  digital connections with its customers and suppliers) it needs to extend some of its functions outside the organisation and embrace co-creation as a way to generate a flow of sustainable new ideas and talent.  API’s and XML interfaces enable these companies to allow 3^rd parties (individual developers, agencies and sometimes even entire industries) to build upon their data and functionality, to reach a new audience or to connect to other web services in ‘mash-ups’. Don’t get me wrong, this isn’t easy stuff and very few companies have the will, ability and braveness to venture into this territory. But for those who do (e.g. Amazon, Google, etc.) the rewards are obvious.

Does Scotland have a digital skills issue?

I see a huge digital/eCommerce/online opportunity available to Scotland. There's people doing great things here and I'm impressed with a lot of what I see.

But Scotland can only truly take advantage of the new digital economy if:

1. There is a decent supply of brains
Academia has its part to play here, by educating and training the best to not only gain qualifications. but to be employable. However the digital industry also has another part to play here, rather than just rely on the cream of the crop from the top universities…..by recognising where it can cross-train slightly more experienced people from alternative disciplines. I did this in the late 1990’s when all the online start-ups had exhausted the supply of programmers, digital project managers, etc. It worked then, it can work now.

2. There are roles available
A actually think that entrepreneurs are doing a lot in Scotland to move things forward and from what I’ve seen so far they are given a fair amount encouragement and resources. But they can only generate a certain amount of new roles. IMHO more traditional businesses must also step up to the plate and realise that the world is moving fast, very fast…… and that older models of working, selling and distribution are not necessarily the ways of the future.
The figure I quoted in an earlier blog posting from the Scottish Enterprise report into eCommerce showed how little IT jobs contained the word ‘eCommerce’ in them.
Surely this isn’t the fault of the labour supply, who (with the right education, exposure and training) can be highly useful digital resources?….. To me is shows a lack of general demand for digital roles up here.

Which if it is true, is more worrying!

eCommerce in Scotland

As friends and readers of this blog will know, I've now relocated my business and family to Scotland. I've therefore taken an obvious interest in the online retail scene north of the border.

The UK is now a world leader in the field of eCommerce and over the last few years has seen double-digit growth (despite the worst recession in living memory). Furthermore recent figures from the Boston Consulting Group have predicted that the UK’s Internet economy will continue to expand at around 11% per year for the next four year. This means it should reach £221bn by 2016, or a whopping 12.4% of the UK's GDP!

However it is clear that (except for a few notable exceptions) that Scotland does not have an eCommerce economy to fully match that of other parts of the UK. In fact, in a recent report by Scottish Enterprise it said that Scotland had the lowest proportion of any nation or region in terms of advertised IT jobs mentioning eCommerce..... just 2% compared to 11% in London and 10% in the East Midlands.

But ecommerce is a huge part of business today and is a growing industry within the Scottish economy in 2012.  It also contributes an estimated 200,000 jobs, worth £31 billion in sales (of which about £8 billion was actual sales using websites, compared to other online transactions such as direct B2B connections).

Clearly there is a lot of ground to make up. Or put another way, there's a huge eCommerce opportunity in Scotland for those companies who want to move into this market.