Following the launch of the FastFutures Employer Network, Sir Peter Estlin shares his thoughts on the digital skills gap in the UK, the power of networks and how we can bring everyone into the digital economy.
FastFutures: Could you share with us some of the details about your career journey and experiences that have motivated you to address the digital skills gap in the UK?
Sir Peter Estlin: My career started when I joined ‘Deloitte Haskins & Sells’, a predecessor firm to PwC, as a trainee-chartered accountant. In the 1980s, technology was becoming more important, and I switched to computer auditing and got involved in tech consulting. Ultimately, I left the partnership and joined Citigroup and later Barclays.
Post the 08 financial crisis, Barclays was focused on digitizing its retail customer engagement. We had deployed the debit card and mobile banking, and were encouraging customer use and take-up. The focus on digital skills resonated with the work that Barclays started, leading to the creation of ‘Barclays Life Skills’. Addressing the skills gap, was looking at this from a social purpose perspective to support communities in developing digital skills and engaging with modern technology.
Looking back, I had many incredible experiences in my career, but it was the work to develop and deliver solutions to help people in their everyday life – whether through shopping, saving, or communications – that led me to address the digital skills gap.
FastFutures: It’s interesting to hear you describe the disconnect between new technology in the market, and the actual ability of consumers to use this.
Sir Peter Estlin: It’s not so much a disconnect, but a question of perspective. History is a good educator in this. As the Industrial Revolution took hold in the UK, in the 18th and 19th centuries, it became apparent to politicians and businesses that the workforce did not have the numeracy and literacy skills to engage with modern manufacturing. The 1870 Education Act brought primary education into force in the UK and introduced what became known as Reading, writing, and arithmetic at scale, the three R’s.
Fast forward to the 21st century. Technology has been around for a while now. But the ubiquity of it is far more evident in that it really does touch virtually everyday life. Not just the world of work – but our life as a whole and we need to ensure that as a society we are taking everybody with us. An example is Universal Credit, where the government has launched a programme that is ostensibly a digital service. How do you ensure that people who are benefiting from that programme actually have the tools and capability to access the service?
FastFutures: What do you think will be the long-term impact of technological innovation on the digital skills gap in the UK?
Sir Peter Estlin: The honest answer is no one can know for certain. But, it is evident that the pace of change is only going to accelerate. Once ideas are formed, you can’t put the genie back in the bottle. Look at the development of AI and robotics and the digital society we live in – it’s pervasive. We have to focus on ensuring that everybody can access technology, and can use it safely. If we provide digital services or solutions, we have a moral responsibility as businesses to support people who use them and provide the education needed for these services to be used safely.
Recent research, such as the Lloyds Banking Group ‘Consumer Digital Index’ and the Government’s ‘Essential Digital Skills Framework’ shows that there are still millions of people in this country who do not have the skills to use much of the technology and to stay safe online. Although the majority of people today have some form of smart mobile (although there are still cases of no physical access), it’s not just the dexterity with which you use it. It’s understanding the implications of what you’re doing – the footprint and the personal data you’re leaving behind. Unfortunately, some people will use that to their own advantage and not yours. We have a moral responsibility to ensure that technological innovation continues for the benefit of all.
How do you use robotics in the future? How do you engage with a driverless car? All this may be figments of the imagination today, but they are ultimately going to be realities. And if you want everybody to feel that they’re part of society, you’ve got to ensure that everybody has the ability to use essential technology.
FastFutures: A FastFutures example, since Chat GPT became publicly available, we had a big uptake in the office and it’s already very clear who is using it – because they are twice as fast! It’s impossible to compete if you’re not using it.
Sir Peter Estlin: This illustrates the point that some people have a genuine ability to adapt at a far faster pace. But many people find it difficult, especially older generations. A big challenge today is how do you keep people engaged in the workforce, especially when they have vital experience and contributions to make. How do you make them productive members of society where the alternative is they retire?
FastFutures: What do you think are the biggest threats to organizations that don’t address the skills gaps that don’t take on that moral responsibility? What can leaders do?
Sir Peter Estlin: All businesses must look at the strategic threats that face them specifically. While the future will have its specifics, the past can reveal where businesses have not looked at what is happening around them. While businesses go bust because they cannot hire talent or they have no access to capital, they also go bust if they don’t keep pace with changes in world. Good examples are some of the photographic businesses that did not keep pace with the digitization of the industry.
Going forward, there will be very few businesses which will remain completely in the analogue world. The reality is that most businesses will experience a high degree of technological invasion and the inability to attract talent to maintain a talented workforce and continue to invest in the businesses, will gradually add further and further challenges. As you said, if you’re using Generative AI technology you can probably get twice as much productivity.
The world comes down to economics – if one business can be twice as productive as the other that puts that other business under enormous economic strain. It’s not to say it can’t operate. For example, there are supermarkets that are highly automated, where you just walk out with your shopping and it automatically charges your credit card. The local corner shop might not have that technology and will operate in a more manual environment and its pricing will probably reflect that. It’s not to say that all businesses that don’t digitize will go bust, but realistically the direction of travel is such that it will become increasingly expensive.
It’s not a blanket answer for all businesses in all sectors. But it is an answer for many of our industries that are digitizing at pace, and where the disruptive technologies are coming in. You either have to have a clear strategy that avoids those because you have something else to offer, or you have to look at how you will adopt and implement them within your workflow.
FastFutures: Looking ahead, what do you see as the future of apprenticeships and how they can help to address the skills gap for businesses that may struggle to rapidly upskill the workforce?
Sir Peter Estlin: Taking a step back, we had apprenticeships for over one thousand years – apprenticeships are not new. Going back to some of the early learnings in this country and across Europe, we created guilds and livery companies, organizations that established ultimately two things: standards and talent succession. With standards, the goldsmiths had hallmarks to demonstrate the quality of their gold, which we continue to use these today. More importantly, guilds looked at how we develop succession and took on apprentices to teach the trades.
Fast forward to the 21st century – we are focused very heavily on academic development and encourage many people to go to university. University is academic and it’s not for everybody. Some people are much more practically motivated. Apprenticeships in the modern context, are a different pathway into the world of work for people to continue to reskill themselves as they go through their career – earning and learning at the same time.
In the contemporary construct apprenticeships are also very much a qualification. Some would argue that qualifications are becoming less relevant, but I would challenge this, because qualifications have value, as does experience and in some cases, they go hand in hand. For example, if you have a medical procedure and you need to go to a surgeon, you will look for qualifications and experience; if you are looking at an artwork, I suspect the first thing you will focus on is the impact of the art, rather than the qualification of the artist.
The point is that different professions lead towards a different balance of qualification versus experience. Apprenticeships play a vital part in the development of our population, and in helping businesses attract talent and increase their own productivity. Evidence shows that businesses that work with people to develop them have higher job satisfaction, which leads to higher productivity and greater employee loyalty, becoming a real positive reinforcer. To my mind apprenticeships are a vital part of the jigsaw puzzle.
FastFutures: What role do you think digital technology will have in supporting and enhancing apprenticeships as we go forward?
Sir Peter Estlin: That’s a more difficult question – there are many angles to it because different industries and roles will have a greater depth of technology as part and parcel of that job. Go back 200 years ago, when numeracy and literacy were critical components.
Today, at the foundation level, in addition to these, digital capability is a necessity. Many people are very dexterous in their use of technology and can access information anywhere in the world at speed. But does it actually help them to differentiate between fake and real information? What are the other skills that you need to go with that? They’re not necessarily digital – they are the more human skills about how discerning and resilient you are.
Coming back to the apprenticeships, some will have a higher component of digital capability. The question to ask is how do we learn how to use technology? How do you use virtual reality to help train people and put them through experiences? Airline pilots use simulators to train, so that they are better prepared to deal with the challenges in the real world.
The short answer is it’s both the job itself but it’s also the methods of training. As a society, we are using more and more technology. It is embedded in such a way that we need to ensure that everyone can both leverage and use it.
FastFutures: We are looking at simulation training and development – it’s an exciting space. There are of course challenges when you don’t have the software, for the building and development.
Sir Peter Estlin: Exactly so. For example, British Airways, have major bases in Heathrow and they have 1520 simulators – very expensive pieces of equipment. They share them with other airlines and it’s not competitive – it’s more important to ensure that all pilots who are flying around the world have the same standards. In this case, you’re collaborating and working together. We can look at how we partner together to develop really exciting, valuable means of training people that smaller firms may not be able to do individually, but by coming together, everyone can benefit.
FastFutures: That’s something we hope to achieve! How could employers enable cultural change to get greater uptake on training, and support people on that journey?
Sir Peter Estlin: It’s a very good question. It’s difficult to change cultures, both in society and in business. There are examples of organizations that put training and investing in people at the heart of their business. It’s not cheap, but it’s not an expense – it’s an investment in talent. There is a high correlation between making investments like this, higher job satisfaction and better staff retention, which economically pays dividends.
But how do you change that culture across society as a whole? I think it’s through many routes. It can’t simply be one. It’s lead by example and through organizations that are working to share capabilities with others. This is where constructs like FutureDotNow, a charity around digital skills, come into play.
You need to get into people’s psyche to understand the motivations behind enabling cultural change. Some people are motivated by economic factors, some by sheer pragmatics. Pre-COVID we had a big digital skills gap in this country of 70-80 million people who really didn’t have basic digital skills. Two years on that number has reduced dramatically to 10 million. It’s still a big issue, but in the world of lockdown the ability to shop and communicate online became essential – and so people had to learn these skills.
Ultimately, changing cultures requires motivation. Sometimes it could be incentives by government and local authorities, it might be pressure from customers and from stakeholders, or other reasons that resonate with the organisation. Fundamentally, if it’s a good thing, people will largely follow the cultural activity.
We are seeing this increasingly with ESG, where the focus is on putting the right values at the heart of business. We are far more aware that business isn’t just about making money. It is about serving or doing something for a purpose, one of the by-products of which is making money. The real question is what you do with that money. Do you reinvest it in the business? Do you distribute it to stakeholders? Is there alignment to a genuine purpose that is of societal importance?
FastFutures: This really resonates – at FastFutures we are focused on our mission, vision and purpose, which are the ‘North Star’ driving us forward. What advice would you give to someone who’s building out a cultural change strategy to secure buy-in from senior stakeholders?
Sir Peter Estlin: The answer is that there is no single bullet. Creating change comes from leadership through clarity of communication and vision as to what you’re doing and why you’re doing it. Even if you have all of those, whether you’re in a leadership position or middle management, you need to have the rationale behind it. It’s a question of taking people with you – it can be through your colleagues, or convincing management that it’s the right strategy, or looking beyond your own organization at what impact it will have on your stakeholders and what’s happening competitively.
That’s when we reach into our networks because in practice that’s how we develop ideas – by talking to a wide variety of people. I was fortunate to be in Manchester recently, as a guest of Manchester Metropolitan University, and hear Andy Burnham speak about how businesses and schools could look at opportunities for apprenticeships within Manchester. How can young people look at that as a career option? These sorts of networks and collaborations are positive things and critical both for our own individual development and corporate survival.
FastFutures: You have done a lot of work with FutureDotNow and the Association of Apprentices, focusing on networks and unlocking opportunities. What are some of the things that you are most excited about?
Sir Peter Estlin: FutureDotNow was a network we started in 2019, when I was fortunate to be Lord Mayor of the City of London, with representatives from businesses to address the common challenge of improving digital skills across society. We created a common purpose that grew with more businesses joining and seeing the benefit, to the point at which we created a charitable organization. We engaged with governments, local authorities, and more businesses, who then reached into communities directly. Nearly five years on, that network is thriving, and we meet regularly and share ideas.
In 2019, we also set up the Association of Apprentices – at that stage apprenticeships were business-led and growing. We felt that a community to support the apprentices themselves was lacking; some employers were very good, others less so, but what they genuinely all missed was peer-to-peer engagement. We created the Association of Apprentices and an app that enabled apprentices to connect with one another to have private conversations and get the answers they needed to help them on their journey.
The power of networks is in their multiplier effect. Many of us have a network that we developed through school, then as we went into employment, and through extracurricular activities and interests. If you know 5 people, you know 5 people; but if you know 5 people who know five people and you connect, you actually know 25 people through the multiplier.
Whether it’s right or wrong, a lot of what happens in the world is who knows who – if you know people, you know where to get an answer to a question. Those networks become very powerful. Unfortunately, they are not universal, but where there are gaps, the advantages of organizations like the Association of Apprentices come in. This network creates a level playing field for everyone who is an apprentice – whether you are in one industry or another, a big firm or a small firm, one part of the country or another.
In a finite world it is about how we collaborate, particularly if we want to tackle the big issues that affect everyone, such as the environment and migration. We can look to solve them individually – but our efforts will be greatly accelerated by working together.
FastFutures: Recently, you joined us for the launch of the FastFutures Employer Network, which focuses on creating connectivity amongst large organizations. What do you think will be the impact of initiatives like this in the future to help bridge the skills gap at scale across the UK?
Sir Peter Estlin: As we look at the challenges the UK is facing, it’s about ensuring that everyone can be effective and contribute to the world of work. The pathways to getting there are not just going to university, and they are not just being an apprentice. FastFutures, and similar initiatives, create a blend and an acceleration of the earn-and-learn capability that you can have through apprenticeships.
Gatsby did some evidence work several years ago that looked at how young people accelerate into the world of work. Those that had work experience had 100% more chance of getting employment. Virtually every human being learns from the experiences that they have – some can be positive, which get reinforced, some negative, which used in the right way become positive motivators for learning.
I’m not a big advocate of the word failure. I’m a big advocate of the view that not everything goes right. As long as we learn from our mistakes, we become richer individuals. Initiatives like FastFutures combine the ability for businesses to gain access to talent, accelerate an individual’s pathway into the world of work, and open up more opportunities which could be growing within an organization or moving to another organization. Evidence is showing that people who are given that level of investment develop loyalty with their organizations and provide a much stronger work ethic.