The modern age of technology has exposed organizations to digital disruption in the workplace. Disruptive technologies have changed the expectations of the customers as well as the way organizations work and deliver products. New technologies also require new competencies in employees. Even the HR management courses are taking cognizance of this disruption and preparing HR managers in keeping their organization’s workforce updated.

The Impact of Modern Technology on Organizations

The companies are realizing that the world around them is changing faster than ever. To answer to the growing needs of a technology-based world, they also need to alter their ways of working by incorporating technology in their processes. Therefore, they are using technology like artificial intelligence, machine learning, big data analytics, etc to deliver better products and services to the customers.

For example, hospitals are utilizing the availability of hyper-connectivity, wearable technology and analytics to monitor a patient’s condition continuously. They are collecting an endless stream of data to identify the diseases that a patient may have. In this way, they can treat their patients in a customized manner. Similarly, online clinics have made it possible for people in remote areas to virtually access a doctor’s expertise and gain from it immensely. IoT or Internet of Things is providing seamless access to information about customer lifestyles and companies are launching products like virtual assistants that can completely change their customers’ lives.

On the work front, companies are using modern technology to streamline the workflow on their work floors, increase the productivity of their employees and reduce the associated risk with various processes. This improvement in efficiency has also led to significant changes in the workforce. Most companies are realizing a growing need for employees with new competencies. Many employees have outdated skills and need to be either re-skilled or replaced.

Why Replacing or Hiring New Employees is not the Best Idea

While replacing existing employees with more technologically fluent ones, is one of the ways to address this issue, it is not the best course of action.


  • Hiring new employees is far more expensive than reskilling the existing employees.
  • Replacing older employees with new ones can have a negative impact on the morale of the existing team and the brand reputation in the market.
  • Onboarding fresh talent requires both time and money.
  • There is always a risk of hiring the wrong person for a job
  • New hires are also bound to become obsolete over a period of time and hence it is only a short-term solution
  • By letting go of the older employees, an organization also loses the knowledge that the employees possess.


The Importance of Reskilling Employees

The strategy of re-skilling or up-skilling the employees is a better alternative in most cases. When a company chooses to invest in training the employees rather than hire new employees, it gains significantly on several parameters. Some of them are listed below –


  • A company can build a training system that continuously trains its employees according to the immediate or long-term needs of the business.
  • The company can keep on enriching human capital through continuous training.
  • Employees would like to stay in a company that cares for their growth and invests in them. Hence, they are less likely to quit the organization leading to lower attrition rate.
  • Such initiatives by a company lead to better employee engagement and create a positive atmosphere on the work floors.
  • The company can increase its value as an employer of choice.


The organizations of today know that there is a shortage of skills across industries. They are moving ahead with a progressive mindset and innovating in their efforts to upskill, reskill and cross-skill the employees. Old models of learning have become obsolete. As many companies are developing their own models of re-skilling their employees, there is a shift towards a learning-centric model. It has led to more opportunities for employees for personalized learning.

Digitalization, acceleration in the economy and automation is pushing people to learn more skills. They need to learn new skills in a fast manner. The old methods of classroom teaching, exams and feedback was a long drawn one. However, technology has enabled faster methods of connecting, collaborating and re-skilling employees at a faster rate. Technology has also opened up the learning content all over the globe through the medium of the internet.

Which one is Better: Reskilling or New Hiring?

A company can never choose only one option for workforce management. This has to be a two-pronged approach. There is a skill gap in the market and companies need to fill them according to the urgency of a position. Hence, they need to hire new employees in some positions while re-skilling the existing employees for other positions.

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