The New Tools That Can Improve Workforce Training

This year companies plan to invest $1.5 trillion in AI initiatives, with forecasts showing that investments will rise to $2 trillion by 2026. Gartner research predicts that most of this spending will not meet expected returns. The issue isn’t the technology; it’s our failure to help people utilize it.

Here’s what I observe across organizations when I consult on AI, big data, talent analytics, and leadership strategy: A company implements AI-powered analytics with big hopes for revolutionizing workflows, but six months later employees are still exporting data to Excel because they don’t understand the new system.

This pattern reflects a harsh reality about workplace learning: According to research on the forgetting curve, employees forget about 50% of new information within an hour of training, and by the end of the day they’ve forgotten roughly 70%. After a week, they may only remember around 10%. These aren’t unmotivated people. Their brains just aren’t wired to absorb complex ideas through passive listening.

The real issue here is that we’re using outdated training methods for modern technology. Using slide decks to master AI is like using textbooks to master surgery; they might help you grasp the theory, but they won’t teach you how to actually do the work. This creates what I call a “capability mirage”: Organizations believe they’ve upskilled their workforce because they’ve conducted training and issued certificates, but when employees encounter real-world situations, that mirage vanishes.

A new approach is emerging, however, in the form of extended reality (XR). That’s a broad term that includes virtual reality (VR), augmented reality (AR), and mixed reality (MR), all of which are technologies that deliver experiences in which employees physically interact with systems, move data with their hands, and see the immediate results of their decisions.

Understanding the differences among these technologies is crucial for their implementation. VR creates fully immersive virtual worlds using head-mounted displays, making it perfect for high-stakes scenario training where complete focus is essential. AR overlays digital information onto the real environment—as is the case, for example, when technicians see repair instructions directly on the equipment they’re working on. MR combines both approaches, enabling workers to manipulate virtual objects anchored in real-world locations.

The choice of technology depends on your upskilling needs. For customer-service training, where emotional responses are crucial, VR’s full immersion is most effective. For technical skills that require workers to see actual equipment, AR provides the ideal overlay. For collaborative problem-solving where teams need to work with both digital models and physical prototypes, MR provides a way of bridging the two worlds.

In my work at Harvard and in my role co-chairing the UN’s Global Initiative on AI and Virtual Worlds, I’ve seen firsthand how VR, AR, and MR are reshaping workforce capability. Through advising Fortune 500 companies and in writing Building a Thriving Future: Navigating the Metaverse and Multiverse (MIT Press, 2025), I’ve worked closely with teams implementing these tools in real organizational settings. The company cases discussed throughout this article reflect that work, supplemented by publicly available disclosures from the organizations themselves. In this article, I’ll highlight where XR creates the greatest impact and drives real performance gains, and how leaders can put these tools into practice.

Emotional Activation

When Bank of America’s branches closed in 2020 at the outset of the pandemic, they faced an impossible choice: Delay hiring or compromise training quality. Instead, they sent VR headsets to new hires that gave them access from home to virtual replicas of actual branches. The new hires were then able to take part in trainings that exceeded expectations. They practiced everything from routine transactions to responding to robberies in environments their brains perceived as real. Within weeks, 2,000 of them had achieved 97% confidence scores, surpassing the highest scores ever achieved through traditional training. Building on that success, the bank scaled up the program enterprise-wide, making headsets-based trainings available to all 200,000 employees.

Why did this work when everything else failed? Our brains encode virtual experiences as real memories. When someone handles a demanding customer in a virtual world, their stress response mirrors reality. That emotional activation turns abstract concepts into embodied knowledge; what you remember is not being trained but rather doing the job. PwC’s research confirms this: VR learners complete training four times faster than classroom participants and demonstrate 275% higher confidence in applying skills. Most compelling for CFOs is the fact that at scale, virtual training costs less per employee than traditional methods instruction.

A Transformation Across Industries

Bank of America has made headlines with its VR headsets, but in recent years a deeper story involving different XR approaches has been unfolding: Organizations around the world and across sectors are discovering that immersive training can succeed where traditional approaches routinely fall short.

Consider Walmart’s experience. After they deployed VR to 1.6 million associates across 4,900 stores as part of an upskilling initiative, something unexpected happened: The associates began requesting additional training. These same workers who once hurried through mandatory e-learning were now competing for headset time, seeking opportunities to practice Black Friday scenarios and crisis responses. The company saw both faster training and a boost in employee confidence (employee turnover dropped by 15%), along with higher customer satisfaction scores during the holiday season.

Boeing had a similar experience when it turned to AR for technical upskilling. Their technicians now wear AR headsets that overlay assembly instructions directly onto aircraft components, eliminating the need to look away at manuals and translating 2D diagrams into 3D reality. The results have been impressive: a 90% improvement in first-time quality and a 30% reduction in task time. Here the technology isn’t replacing human expertise; it’s augmenting it in real time.

All sorts of companies are starting to choose XR tools for their upskilling needs. Delta and Air France-KLM now use VR for pilot training, creating virtual cockpits where crews practice scenarios involving catastrophic failures. Ford gives VR to assembly workers so that they can learn in virtual factories. Bechtel chose AR for construction sites, allowing workers to see complex blueprints overlaid onto physical environments. Shell has combined approaches, using VR for emergency response training and AR for equipment maintenance.

Despite these breakthroughs, leaders should understand that XR is not a one-size-fits-all solution. The technology still faces issues related to accessibility, motion sensitivity, and content-creation costs. Not every skill or worker group benefits equally from immersion. Sometimes, too, the novelty can overshadow learning goals or, if experiences are poorly designed, cause fatigue. In the end, the value of XR lies not in replacing traditional training methods but in integrating them using immersive tools where they add value, and in supporting them with peer learning and feedback loops that reinforce real-world application.

It’s worth noting, though, that XR can teach more than just skills. When data analysts use VR to manipulate 3D data visualizations in virtual space, they gain an understanding of relationships that no spreadsheet can teach. When managers use MR to see AI decision-making overlaid on real business scenarios, adjusting parameters and watching outcomes unfold in real time, abstract concepts become intuitive. The technology that makes work complex can also simplify learning if we choose the right XR approach. For AI upskilling specifically, MR often works best: Employees can see their actual work environment while virtual overlays demonstrate how AI tools can improve their workflow. Even in isolation, these employees are learning in context.

Three Forces Reshaping Everything

Why does XR training succeed where everything else fails? Three key shifts have come together.

The neuroscience is clear. Our brains don’t tell the difference between virtual and physical experiences at the emotional level. Whether in VR’s full immersion or AR’s enhanced reality, when someone handles a crisis, their amygdala reacts just as it would in real life. That emotional response helps create memories that are more likely to stick.

The economics have shifted. Three years ago, XR required significant capital investment. Now, providing an employee with VR gear costs less than providing them with an office chair. AR runs on smartphones that employees already own. Cloud platforms have eliminated most IT obstacles. The financial barriers that maintained the old system have disappeared.

The workforce has already evolved, too. Younger employees grew up with AR filters and VR gaming; these are their natural environments. Senior experts need quick ways to share decades of knowledge before they retire. XR bridges this gap, engaging digital natives and capturing expert knowledge through recorded AR procedures or VR simulations.

Getting Started

If you decide to adopt XR for your training needs, the key is not to try to solve everything at once. Focus on one difficult problem where traditional training has consistently fallen short, and then select the appropriate tool. Start with 50 to 100 volunteers and match the XR technology to the skill gap.

For emotional intelligence and soft skills, that’s probably VR, because of the immersive experience it offers. Marriott has adopted it for customer-service training, for example, and now exposes trainees to a range of scenarios from medical emergencies to irate guests. For technical skills involving physical equipment, however, AR is likely to be your best option. Bechtel uses it for its construction workers, who see blueprints overlaid on actual sites. Similarly, GE Healthcare technicians receive AR-guided maintenance instructions that appear directly on MRI machines. MR, for its part, is most useful for complex problem-solving. Accenture consultants, for example, use it to simulate virtual business models while discussing real-world client challenges—the tool allows them to see both the person they’re talking to and the digital framework they’re building together.

As you begin to work with the technology, keep these key principles in mind:

Focus on context. Some employees need extensive reskilling with intensive VR programs. Others only require light AR-based training for specific tasks. Complex decision-making may require full VR immersion. Strategic thinking could benefit the most from MR’s combination. One size does not fit all.

Scale carefully. Once you’ve successfully identified the right tool and piloted it, think about expanding tenfold—but be prepared for different challenges with various technologies. VR requires private spaces and sufficient bandwidth. AR needs device standardization. MR calls for more advanced content creation. Address these issues at 500 participants, not 50,000.

Make it stick. Tie XR achievements to performance reviews but differentiate by type. VR scenario completions could indicate readiness for customer-facing roles. AR-guided task times might be used to determine technical certifications. Make achievements visible in ways that are meaningful for each skill set.

Let the system learn. Modern XR platforms generate all sorts of insights. VR tracks emotional responses and decision-making patterns. AR measures task efficiency and error reduction. MR reveals collaboration dynamics. Use each dataset to enhance your specific upskilling strategies. . . .

XR technologies reshape not only how we work but also how we develop human potential. VR eliminates traditional barriers between learning and doing, AR turns every workspace into a learning environment, and MR creates unprecedented opportunities for collaborative skill development. Companies that understand this will build learning ecosystems that adapt at the speed of change and will transform capability development from a cost center into a competitive advantage.

Copyright 2026 Harvard Business School Publishing Corporation. Distributed by The New York Times Syndicate.

Explore AAPL Membership benefits.