Why IBM Chooses Skills Over Degrees

You don't need a college degree to have a very good job at IBM. In fact, 50% of its U.S. jobs are open to anyone with the right skills or a willingness to learn them.

IBM's CHRO, Nickle LaMoreaux, says this skills-over-degrees approach to hiring was a response to a global shortage of skilled tech workers. There are a lot of ways people obtain those skills, IBM realized, and requiring degrees eliminates thousands of candidates with the skills for the job.

But, as LaMoreaux says, "the half-life of skills is shortening," which means all workers require constant training. To that end, IBM created structured apprenticeship programs and an internal learning platform -- a "Netflix for learning," as she puts it -- tailored to the individual's skill set and IBM's needs.

This approach to hiring and upskilling allows IBM to hire a vastly expanded universe of top employees -- so many, in fact, that people reentering the job market and those who have never been in it, like high school graduates, can be hired and quickly skilled for IBM jobs. And not just for tech roles. Indeed, LaMoreaux's HR organization has hired many people without a degree (and she says former retail managers make extraordinary recruiters), which topples a barrier to entry that's kept minority groups out of future-forward jobs for a long time.

"Future-forward" is the operative term. LaMoreaux is proud of IBM's leadership in DEI and proud that IBM's learning platform is so effective -- but, as she relates in this CHRO Conversation, the skills-over-degrees approach was engineered to propel IBM into the future. And by finding talent where tech companies rarely look, IBM is creating a future for itself that may become a pattern for the whole industry.

Emond: Tell me how this started.

LaMoreaux: They say necessity is the mother of invention, and that's essentially where we found ourselves about 10 years ago. We were staring at a shortage of skilled tech employees, the half-life of skills is shortening, and two-thirds of the U.S. adult population doesn't have a bachelor's degree. So even if four-year colleges continued to admit and grow students at today's rate, the number of qualified applicants is never going to catch up with the demand, at least in the short to medium term. And it's very apparent that employees need to constantly re-up their skills as well.

So we decided to attack the problem from two ways. The first was looking at the requirements of our roles. When you break down what people actually do every day, whether it's software development, or digital design testing, or security, or even artificial intelligence, you have to ask if that role needs a four-year degree or it's a set of skills that's needed. And if it's skills, maybe people are getting them outside of college, such as in the military, or in shorter periods of time, like in coding boot camps. When you think about it, skills are often what you need, not degrees.

Emond: That opens up a lot of possibilities.

LaMoreaux: Yes, and that brought us to the second part, which was to redouble our own internal efforts on training. We started bringing in candidates who may not have had the exact perfect profile for the job description, but had maybe four out of the five skills. That made us think about how they could get that fifth skill and how quickly. That's where ways to quickly upscale candidates come in place, things like structured apprenticeship programs.

Emond: So now you're hiring for roles, a lot of roles, that don't require a college degree?

LaMoreaux: That's right.

Emond: How many roles?

LaMoreaux: Right now, 50% of our U.S. jobs do not require a four-year degree. We're working toward that percentage in the rest of the world. Now, a lot of people assume non-degree roles are entry-level roles. That is absolutely not the case. There are certainly opportunities at the entry level, particularly for somebody who might be changing careers, but we're making sure the ladder is open to all.

Emond: Are these all IT jobs? Have you hired people into HR without a degree?

LaMoreaux: Yes! Several! Particularly in our talent acquisition function, like our sourcers and recruiters. You know, managers of retail stores spend a lot of time interviewing, and they come out with amazing skills in that area. That's not a place where a typical CHRO would look for talent, but we've found they transition in seamlessly and can talk to candidates in a very real way about the culture of IBM.

Another area is analytics. Every HR organization is becoming a data-focused organization and seeking skilled people to help drive that transformation. Those hires are often great role models for managers who might have some doubts about skills over degrees. But we have hired from a wide range of other prior jobs. We've had nurses, dog trainers, cooks, firefighters -- all kinds of roles. A software engineering executive vice president on our Raleigh campus, David Green, got to know a barista, Tony Byrd, at a coffee shop on our campus. One day, David suggested Tony join the IBM apprenticeship program, and now Tony's a software engineer.

Of course, some professions such as our medical staff obviously require certifications. But not all roles require a degree, including in my own HR profession. That's not to say degrees aren't needed anymore; this is not me pitting college graduates against nongraduates. This is about opening the aperture to find skills from whatever backgrounds people have. For me, getting a four-year degree was the best way to learn skills. But it is not the right thing for many professionals, and we need to open the aperture for them.

Emond: Tell me more about upskilling. I understand IBM is starting job training even at the high school level?

LaMoreaux: Even before we doubled down on skills over degrees, we were thinking about ways to improve the pipeline into tech jobs. One way is to work further down the pipeline, not just with colleges and universities, which we've been doing for a long time, but at the high school level. That led us to collaborate with the educational system in New York City to create P-TECH [Pathways in Technology Early College High School]. In P-TECH schools, students graduate high school in four years and they earn a two-year associate degree in a STEM field as well. And during that time, they have an opportunity to do internships with different companies, like IBM. We work with P-TECH schools on their curricula so students get the fundamentals that they wouldn't ordinarily get in high school, but also opportunities to learn things like cloud security or cybersecurity, where we see there's going to be increased demand. There are now 242 P-TECH schools in 28 countries, partnering with governments and businesses. Forty percent of the students are girls, and 90% of IBM's P-TECH internships have gone to students from underrepresented minority groups.

We really encourage other employers to join us in offering opportunities to the students. The conversation about skills over degrees started out as a very pragmatic business problem -- you need qualified employees and there's a shortage -- but it's become a major tenet of our social justice platform. It's creating economic opportunity and higher-wage roles. And by opening that aperture, your business gets a much more diverse pipeline of employees. It has a huge impact on your DEI strategies.

Emond: It sounds like IBM has become a learning institute and a tech company.

LaMoreaux: I believe that every organization has to become a learning organization and every company is a tech company. Banks need tech skills, airlines need tech skills, retailers need tech skills. It doesn't matter what industry you're in; the demand for skills changes at such a rapid pace, your organization has to keep learning. But it's not just tech skills -- think about our own HR function, about the difference between what an HR professional did 20 years ago versus what they do today. So whether the learning is internal or external, tech or non-tech, you have to have a continuous learning mindset or you'll get stale.

Our mindset has changed because of that. It's made us think a lot more about where talent comes from, how it grows -- we have a completely different approach to talent than we did a few years prior. And we bake upskilling into how we manage talent. Today, regardless of your background, if you've got the right skills for IBM, you are qualified for that role at IBM.

Emond: I imagine this had an effect on interviewing? And managing?

LaMoreaux: It did. So, at IBM, you're not allowed to conduct an interview or post a job unless you're certified in Select for IBM training. Even if your entire team quit yesterday, you cannot post a job to replace them if you're not certified. Part of that training is to reinforce skills over degrees and eliminate some of the bias -- sometimes a degree can be an easy way to screen candidates out. Big companies get thousands of applicants a day, so weeding out anybody who doesn't have a four-year degree simplifies the process. That's a built-in bias, and requiring a degree to unlock the door is the wrong approach to talent. But it does mean you need to clean up your job postings, transform your talent acquisition function and work with your management team to ascertain different skills on a resume. If you're interviewing a retail store manager, for instance, you need to know which questions to ask to see if they have the right skills.

Emond: That makes me curious about your internal upskilling program. A lot of big companies are really struggling to upskill effectively.

LaMoreaux: I do believe that we've had more success than a lot of companies. Our prior CEO, Ginni Rometty, started a cultural shift, and our current CEO, Arvind Krishna, really continued it. We talk very openly about the half-life of skills. We have been very transparent that one of the key attributes that we look for in all employees is the ability to continuously learn. A decade ago, we started requiring 40 hours of training a year. We publish lists of skills that are in demand and skills that are in declining demand. Managers talk to their employees about which of the employees' skills are in those categories during annual career conversations or mid-quarter performance reviews. Managers are evaluated on how well their teams are learning for their job roles. And we have an online learning platform called Your Learning, which was a game changer for us. I think of it as a Netflix for learning. It gives employees tools at their fingertips, serving up digital content, not just internal to IBM but from external sources as well, supplemented by classroom training. So if you want to be a certified cloud specialist, for instance, Your Learning gives you the road map you personally need to get there.

Emond: So if you're hiring someone with four out of five skills, they can tap into the Your Learning platform to get that last skill.

LaMoreaux: Absolutely. So can people entering tech jobs for the first time. We have a very structured tech apprenticeship curriculum that lasts from six to 12 months, and a tech reentry program for people who have been in tech jobs before but were out of the workforce for some time, usually for dependent care. We've found those employees usually have a very solid foundation of tech skills but need a refresher on tools methodology. So customizing their online learning during their employment means when they test out, they're fully deployed.

Now, IBM has a lot of entry points -- P-TECH, tech reentry and apprenticeship programs -- but you don't need to have that many. Pick one, if that's the right thing for your company, because you need critical mass to build up momentum and the right mentorship and sponsorship to get going. If you're going to focus on skills over degrees, those are the pieces you need.

Emond: That's a huge shift in the career paradigm at IBM, or anywhere.

LaMoreaux: It really is. To that end, we're partnering with the Business Roundtable on an initiative on reforming work, looking at expanding Pell Grants to apply to boot camp training and other things. Now, I will tell you, getting involved with the P-TECH program wasn't an HR-driven decision. It was more through our corporate social responsibility program, but it made a recruitment extension we wouldn't have had otherwise.

Our partnerships with community colleges have always been strong, and we've always recruited at that level, but now we're actively partnering on curricula that reinforce or supplement some of our own offerings. This skills-over-degrees approach solves a lot of problems, and hiring is one of them.

I think this is a real opportunity for other companies. I mean, how many discussions have we had during CHRO Roundtables about talent acquisition and talent retention? It's everyone's first, second or third priority, even before COVID.

We're all fighting over the same pool of candidates. And anybody who's done any type of software engineering says diverse teams come up with better products. Our clients tell us that too, whether they're building a mobile banking app or software to run their internal real estate. Our satisfaction evaluations are getting better on these diverse teams, and people with nontraditional backgrounds are a big part of it.

It used to be you could get a degree or learn a trade, and that would carry you for your career, but digital is constantly evolving. Business is constantly evolving. And if you shut the door to talent because it doesn't come with a degree, you are really closing off your potential for success.

Jennifer Robison contributed to this article, which was based on an interview conducted by Larry Emond.