For your best innovation ROI, look to the ‘regulars’

Part of the whole: The best ROI for a company often comes from investments in recruitment, training and other people-based principles, according to workforce-development champion Rosalie Drago.

From the technological advances of the Bronze Age to the evolution of Artificial Intelligence, innovation requires people. It follows then that the capital investment with the most innovation ROI is the investment in human capital.

Businesses are eager to innovate, but more often than not this is approached with investments in departments or initiatives or a select cohort of innovation experts. Real innovation – the kind that enables us to sustain and improve our ability to be innovative, competitive and economically successful, both locally and globally – comes from “regular” people, from everyone who works at a place.

And that means developing the talent on hand – and the talent not yet there.

Last year, the top challenge cited by employers was finding enough skilled workers to fill open positions. So, where should we be investing to power our local business with the best talent?

One comprehensive guide comes from the central U.S. banking system, which holds human capital investment critical to a successful financial portfolio. Recently, the Federal Reserve Bank of New York released a three-volume book, “Investing in America’s Workforce: Improving Outcomes for Workers and Employers,” with national and regional workforce experts examining systemic barriers to employment and discussing how further workforce investments can overcome them.

While the books profile many initiatives that are working across the country, three tangible steps stand out: a critical shift in thinking, changes in job postings/candidate screenings and strengthening the relationship between education and industry.

First, the mindset. Tony Davis, community affairs officer and director of community engagement at the Federal Reserve Bank of New York, notes that one of the first steps workforce stakeholders should consider is shifting perceptions of workforce training – an “investment in the economy,” Davis says, and not “a social service cost.”

“By investing in workforce systems that match employers’ needs with a skilled workforce, communities and businesses can thrive and contribute to a region’s overall economic growth,” Davis adds.

Rosalie Drago: People power.

Next come those job postings, and a renewed focus on skills-based hiring. When you ask your senior operations manager what he or she needs from a worker, skills and experience top the list – but job postings often require a bachelor’s degree or more.

This “Up Credentialing” trend – asking for greater credentials than are relevant to the job – is keeping some of the best innovators out of the workplace. And skills-based hiring doesn’t require going back to paper resumés, either, with a variety of online tools available to help companies screen for core competencies.

“With 40 percent of New Yorkers having a high school diploma or less and business facing the lowest unemployment rate in decades, we need to ensure there are no workers are being left out of the labor market,” notes Melinda Mack, executive director of the New York Association of Training and Employment Professionals, who believes companies are missing the boat by ignoring experience and up-credentialing their staff requirements.

“Employers are missing out on talented workers by using only credentials, not experience, to screen candidates,” Mack says.

Also important are connections between industry and academia. In many places around the country and the globe, industry works with educational systems – including K-12 schools and colleges – to help teachers learn how STEAM subjects translate into careers, shape experiential learning and give students the skills they’ll need to begin working immediately after graduation, from high school or college.

On Long Island, BOCES and our community colleges offer this type of contextualized learning. Public Long Island high schools are also starting to integrate this practice into their general curriculums. And industry is delighted: Partnering with local school districts creates an ongoing flow of qualified candidates.

While the steps are clear, like any investment, it takes time to see the returns. Davis considers understanding this – that investing in the systems that support a skilled workforce and a strong economy is a long-term process – to be “the greatest challenge for workforce stakeholders.”

“It will take time to see the benefits,” Davis says. “And this work is a dynamic process that will continue to change with an evolving economy.”

Rosalie Drago is Long Island regional director for the Workforce Development Institute, a statewide nonprofit focused on job-creation and retention. The WDI pilots, supports and scales workforce-development initiatives that foster empowering careers for Long Islanders and a talented workforce for Long Island businesses.