Indian firms investing in 'power skills' see higher profit margins

Indian companies that prioritise so-called “power skills” such as problem-solving, collaboration and adaptability report profit margins that are about seven percentage points higher than those that don’t, according to a new global study by upGrad Enterprise.

The finding comes at a time when enterprises worldwide are grappling with the disruptive impact of artificial intelligence, shifting workforce expectations, and rising productivity pressures.

The study, titled 'The Power Skills Imperative – Global Outlook 2026', suggests that leadership capability, rather than technical expertise alone, is emerging as a key differentiator for long-term business performance. It is based on responses from more than 1,600 HR and learning and development (L&D) leaders across India, the US, the UK and the European Union.

In India, the link between power skills and business outcomes appears particularly pronounced. According to the report, organisations that actively invest in these capabilities show higher profit-before-tax and net margins compared to peers that deprioritise them. However, the study also flags a structural gap: while awareness of soft skills is widespread, more than half of Indian respondents said they were unfamiliar with the term “power skills”, even as they acknowledged their importance.

Globally, power skills have moved from the margins to the mainstream. A decade ago, only about 25% of large Indian firms invested in soft skills. By 2024, nearly nine in ten L&D leaders said such skills were now at the top of their skilling agenda, the report said. Over half of professionals surveyed believe these capabilities are critical for individual career growth, while 50% see them as essential for organisational success, pointing to a growing alignment between employee aspirations and employer expectations.

Missing balance

Yet, the way these skills are prioritised varies sharply by region. While there is broad consensus on core competencies - problem solving, collaboration, adaptability, communication and resilience - India shows a stark skew. Problem-solving dominates the Indian focus at 93%, but influence ranks lowest at just 8%, far behind the US (53%), the UK (77%) and the EU (62%). Empathy, another key leadership trait, also remains underemphasised in the Indian context.

Investment momentum, too, is uneven. While 88% of UK organisations and 78% in the EU plan to increase spending on power skills over the next two years, only 43% of Indian firms indicated similar intent. Meanwhile, the US stood at 75%. 

Measurement remains a weak link globally, the study noted. In India, 93% of organisations rely primarily on manager ratings to assess power skills, raising concerns around subjectivity. This compares with 87% in the UK, 79% in the US and 81% in the EU.

Training effectiveness is another area of concern. The report found that 34% of power skills programmes underperform expectations. Nearly half of employees spend less than five hours a year on such training, and perceived impact varies widely, ranging from 67% in the EU to just 13% in India.

“Leaders across the world now accept that technical excellence alone does not build resilient organisations,” said Srikanth Iyengar, CEO of upGrad Enterprise. “The real differentiator is whether leaders can influence, align, and lead through ambiguity.” He added that previous surveys showed 60% of Indian companies allocate less than 5% of their HR budgets to skilling, calling it a worrying trend.

Ultimately, the report argues that as Indian talent becomes increasingly global, leadership expectations are being set by international benchmarks. Power skills, it says, are no longer optional. They are fast becoming a strategic necessity for companies across the board.