What are the most sought-after skills in IT today?
In order to respond to the increasingly complex demands of today’s businesses, the information technology department, once almost entirely populated by skilled technologists, has morphed into a more flexible corps of business-savvy IT professionals. In filling more customer-facing roles, technical prowess (while far from obsolete) takes a back seat in many cases to skills like project management, business-process change or vendor management expertise. (For more on this trend and three roles that have emerged as critical—the project manager, the relationship manager and the business analyst—see “The New IT Department: The Top Three Positions You Need.”)
According to Gartner, six out of 10 IT employees will assume business-facing roles by 2010. The shift in IT needs has meant increased demand for certain IT hires and a decrease for others. (For information on more hot jobs like IT finance and internal consultant, see “More Hot Hires.”) Then there are positions that require both technological sophistication and business savvy, like the increasingly popular enterprise architect. (Check out “Wanted: Enterprise Architects.”)
If this all sounds a bit fuzzy to you, you’re not crazy. During a time of shifting roles and responsibilities (like now), everything is in flux—from titles to skill sets to pay. As a result, successful IT recruiting has become as much art as science.
Unfortunately, there’s still a discrepancy between what CIOs say they want in their candidates and the skill sets of those they actually hire. Business capabilities and project management expertise represented eight of the top 10 skills identified as critical to keep in-house, according to a 2006 survey by the Society for Information Management (SIM). However, the majority of respondents primarily sought technical skills in entry-level recruits. IT leaders who have spent years looking for technical proficiency may have trouble adjusting their hiring practices to net candidates with business and the so-called “soft” skills.
If your hiring managers are still looking solely at IT certifications or programming language capabilities, it may be time to rethink those practices. (For some new hiring tricks from veteran CIOs, scroll down to the “Rethink Hiring Practices” section of “How to Hook the Talent You Need.”)
If business skills are so important, can I poach job candidates from the business?
More and more, new IT hires are as likely to be brought over from the business side as they are to have been groomed in IT. Some CIOs and IT managers do find it easier to teach technology skills to business professionals than vice versa.
One potential problem is that, depending upon the reputation of IT in a given organization, business people may not be all that interested in jumping to the IT side. Diane Wallace, CIO of the state of Connecticut, pitches the perks of IT to the larger business community. “I know IT can be a very attractive place for them if I market it correctly,” says Wallace. “I tell them that the great thing about IT is that it’s one of the few places in any organization—from state government to the private sector—that touches every important project going on in the business.” Wallace pitches business recruits on the chance to get involved with large, strategic projects across all the state’s divisions instead of working on one initiative in a non-IT department. Her marketing mantra? “You don’t need to know how to code.”
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While the business may have poached employees from IT for years, they may not be so eager to be on the giving end of that relationship. So it’s important for CIOs to make it clear this is a give-and-take that benefits IT and the business equally. In an ideal situation, employees would rotate back and forth, giving them broad exposure to both the business and IT.
CIO’s recent staffing survey found only 11 percent of respondents offer job rotation programs. That’s a missed opportunity. (See “Launch Business-IT Rotation Programs.”)
How can I figure out what compensation is fair?
With all the ambiguity around job titles and responsibilities, figuring out attractive—or just plain fair—compensation can be tough. But if you can’t pull it off, you’ll be in a world of trouble. Recent Bureau of Labor Statistics data shows that tech employment has already risen above the 2001 hiring peak. If you’re not paying valuable IT workers a competitive wage, they can (and will) find it elsewhere.
IT salaries are expected to rise across the board in 2007, between 2.8 percent and 4 percent (depending upon which report you believe). The starting salary of a project manager is expected to rise 4.1 percent in 2007 to a range of $72,750 to $106,250, according to the Robert Half Technology 2007 Salary Guide. Application architects will see starting salaries rise 4 percent ($80,000 to $112,750) while IT auditors will earn 3.1 percent more in 2007 ($69,250 to $97,000), according to Robert Half’s survey. Salary increases can vary even more wildly from job to job. Workers in roles vulnerable to automation or outsourcing, such as call center, applications maintenance and technical support, may see their pay decline, according to the Forrester report, “Drivers of Salary Strategies for Today’s IT Job Market.” Those with skills in service-oriented architecture (SOA), business process re-engineering and project management, where demand for workers outstrips supply, may see double-digit salary growth.
The standard method for figuring out how to compensate someone for a particular role is to begin by looking at salary surveys. However, those once tried-and-true surveys are tied to job titles. And titles may not reflect an IT hire’s full responsibilities anymore. In addition, in today’s IT department, those responsibilities can change quickly and often. As a result, workers may find themselves seriously under-compensated for the work they’re doing, even though their salary is in line with their title. That leads to tension, resentment and, ultimately, valuable employees “ripe for the picking by executive recruiters,” says Foote Partners CEO David Foote.
Rather than update those titles and job descriptions, Foote Partners has found, most employers address this conundrum by tying base pay to the dominant skills or role and incorporating additional compensation for the ancillary work and skills that are also part of the job. In Forrester’s “Salary Strategies” report, analysts also warn against adopting a one-size-fits-all approach to human capital management, particularly in the area of compensation.
Bottom line: The key to figuring out fair compensation is flexibility.
Besides money, what will attract the best and brightest?
Not surprisingly, money is what workers most want from their employers. But not every IT department can compete on cash. And when it comes down to two similar jobs similarly compensated, it’s the non-cash benefits that may woo the talented IT employee.
Accommodation is the operative word. Given their druthers, most employees would choose a more flexible work schedule (33 percent) and additional family benefits such as parental leaves and personal days (22 percent), according to Hudson Highland Group’s “Transforming Pay Plans: 2006 Compensation and Benefits Report.” Those benefits trumped job training (13 percent) and supplemental insurance (16 percent). “Employees are more willing to forgo additional cash in order to have a more improved work-life balance,” says Peg Buchenroth, Hudson Highland Group’s managing director of compensation and benefits.
Flex time is also the most common benefit used to motivate or retain IT workers, according to CIO‘s mid-year staffing report, with 61 percent of organizations employing it.
Should I enlist the help of a third-party recruiter?
CIOs tend to be do-it-yourselfers, and that can be a problem when it comes to recruiting. They don’t take advantage of all the resources at their disposal, says Katherine Spencer Lee, executive director of Robert Half Technology. But human resources professionals and recruiters can be a CIO’s best friend.
Granted, Lee may be a little biased; she’s a professional recruiter. But generally speaking, you and your hiring managers should enlist all the help you can. However, in order for any relationships you create with either internal or external HR resources to work, you must work closely with the experts.
Internal HR resources can be a great help, particularly when you’re up against a wall trying to find talented employees to fill sudden vacancies. But an HR generalist often may not be enough. Their knowledge of IT-specific needs may be limited. Many CIOs have seen value in hiring an HR resource specifically for the IT department or at least a corporate HR resource that is dedicated—at least part time—to technology recruiting, hiring and retention issues. In smaller companies where that may not be feasible, extra communication and due diligence when working with HR is key.
Making the best use of third-party recruiters takes some extra effort as well. GM CIO Ralph Szygenda, lamenting the fact that recruiters seemed to bring him the same candidates over and over for his hardest-to-fill roles, has had more success now that his hiring managers meet with the recruiters more regularly. “[Recruiters] go to whoever screams loudest,” he says. “We set aside time to meet with them every week and put pressure on them to come back with someone outside their database.” (For more tricks on finding employees in the evolving IT talent market, see “How to Hook the Talent You Need.”)
Chris Stockley, CIO and VP of $4.2 billion building contractor Skanska, invites recruiters to his annual vendor event, where he unveils his three-year plan for IT. As a result, recruiters started sending him viable candidates before he even needed them.
That’s the Holy Grail, whether you’re working with your own HR people or a resource outside the company: “just in time” hiring. Working more closely with HR experts (not just when you need them, but long before you do) should help you develop and maintain a solid network of potential hires you can go to when you have an opening instead of scrambling just to find someone to fill a spot.
What about college recruiting?
You can’t throw a rock at an IT conference without hitting a CIO standing around the buffet table bemoaning the lack of real-world business skills in the “kids” he hires out of college. But there’s a relatively easy fix for that problem: Quit whining and get involved.
At no other level can you have the kind of influence on your future employees than at the university level. Most IT-related programs at the undergraduate and graduate levels in computer science and business departments are eager to get IT leaders involved on campus. There are opportunities to sit on boards, visit classes, offer business-specific training…the list goes on. (See “Go Back to School” if you need some inspiration.) Getting involved in college recruiting efforts takes time and effort, but it will only strengthen your position on job fair day at the local university.
Smart CIOs are also doing what they can to preach the gospel of IT careers to the next, next generation of workers. “There’s much more work to do in the K-12 environment to encourage math and science,” says Phil Zwieg, who recently retired as VP of IS of Northwestern Mutual. “The numbers there are depressing, particularly with girls.” (For more on K-12 IT education, see “Computer Education’s Failing Grade.”) CIOs may be disinclined to spend their already-limited time with young students because there’s no near-term ROI, but the long-term benefits could be priceless.
And what about your plans for after you hire that freshly minted college grad? Unfortunately, many IT departments drop the ball on entry-level training programs even though such programs help the kids develop faster, impart a more in-depth understanding of the business and instill company loyalty. To read about three CIOs who have developed robust entry-level training programs for three different reasons, read “The Kids Are All Right.”
Should I invest in an internship program?
Far too many IT departments fail to take advantage of the opportunity an internship program can provide.
Like entry-level training, internship programs were quick to fall by the wayside as we entered the age of outsourcing and cost controls. According to CIO‘s annual staffing survey, only 13 percent of IT leaders have an internship program in place. A well-structured and closely managed internship program can be a win-win for CIOs (eager young minds for cheap!). But the key words are “well-structured” and “closely managed.” Who’s got the time?
Savvy CIOs are making the investment. Juniper CIO Alan Boehme has always been a big believer in them. Interns are on the job at Juniper’s offices in Sunnyvale, Calif., and Europe. They’re not all the usual suspects; one is studying journalism and has taken charge of the IT newsletter. The program required investment in training and management oversight, but Boehme says it pays for itself. It costs less than bringing in contractors to do the same work, and he’s able to build a pipeline of future full-time candidates.
Harrah’s CIO Tim Stanley was a fan of graduate school recruiting but initially resisted an undergraduate internship program. “I wrestled with it,” he says. “Young people flip-flop quite a bit before they figure out what they really want to do.” Growing concern about the future supply of IT workers changed his mind. “Kids are coming out of school without the skills necessary to be productive,” he says. “They may be brilliant at code, but they’re not coming out fully experienced for customer-facing roles.” Harrah’s IT internship program is now in its third year. The program has grown 25 percent year over year, and between 20 percent and 50 percent of interns have gone on to accept jobs at Harrah’s.
To learn more about how to set up a successful internship program, see “Six Degrees of Hire Learning.”
You should probably start out trying to do both. You want as diverse and talented a group of candidates as possible, and that will likely include applicants from inside and outside the company (if they qualify).
What’s most important is that when a position is awarded to someone (whether inside or outside the company), you be as transparent as possible about how the decision was made (without violating any privacy concerns).
That’s because a big concern for today’s IT professional, both within his own company and generally speaking, is his career path. As IT staffing needs have shifted, career paths have become fuzzier. Once upon a time, a computer science grad went from programmer to analyst to systems analyst to project analyst to project manager to manager. Today? Who knows? Maybe I’m a programmer for a while. Then I’ll take that job in marketing. Then maybe I’ll come back and manage a project. Then what? Smart CIOs will attempt to make career progression less of a mystery and work with employees on individual career development plans. IT workers are more likely to walk out because they see no opportunities for advancement than for any other reason, according to Hudson Highland Group’s “2005 Retention Initiatives Report.”
And if you can’t offer prized employees a promotion or more interesting work, some CIOs advise trying to help them find a larger role outside the organization. Career progression is the biggest issue for U.S. Tennis Association CIO Larry Bonfante: “For some, the only thing they can aspire to is me getting hit by a bus in the parking lot.” Bonfante naturally offers upwardly mobile employees more compensation and responsibility. But at a certain point, it’s up or out. So he sometimes uses his connections to help them find new jobs. It’s beneficial all around. The employee moves into a bigger role (albeit at a different company), an opportunity opens up within IT, and that inevitably leads to referrals from the worker you helped.
For more on cultivating leadership, read “How Stars Are Made.” And to find out how American Airlines CIO Monte Ford cultivates innovation by moving high-potential employees around, up and even out of his IT organization, see “Let Talent Bloom.”
Is it better to focus on retention rather than recruiting?
It certainly costs plenty to recruit and train a new employee to replace a trained and valued employee who has left the organization. (Conservative estimates say it’ll cost you 25 percent of the defector’s annual salary plus benefits. And then there are the indirect costs.) Then again, there may be some employees who should go as your organization changes. (For more on dealing with underperformers, see “How to Find, Fix or Fire Your Poor Performers.”) And an IT organization with too little turnover may face problems due to a clogging at the top and a lack of entry-level positions at the bottom. So it’s safe to say that IT leaders should balance their efforts between recruiting and retention.
That said, it’s an especially delicate time for retention. CIO magazine executive coach Susan Cramm lays the situation out in her column, “The Worst Job in IT”: “CIOs are shaking up their departments, changing the rules of governance, architecture, process, costs and staffing under which they operate [and] turning up the heat on their organizations to make it all happen,” Cramm writes. “It’s not a whole lot of fun being on the receiving end of all these demands.”
Without a clear understanding of what’s in it for them, Cramm says, “People will assume that the future doesn’t include them.” And guess what? The labor market is currently in their favor. Your best and brightest will get by just fine. Just not in your organization. (On a cheerier note, Cramm offers her advice for sharing the upside of change with your hard-working staff in “IT’s Good News.”)
Providing training is another way to keep workers on board. Unfortunately, training budgets were slashed after the Internet bubble burst, and bringing them back remains a challenge. But some CIOs have coped by finding creative ways to fund training (see “Get Creative About Training”).
Another problem: One in three workers thinks the time he spent in his last training session probably would have been better spent elsewhere, according to a recent survey of employees. So it’s important to make sure the training you do invest in is valuable and useful. See “Time in Training Often Wasted” for training best practices to bear in mind.
Should I do anything special to retain baby boomers?
While they won’t all be retiring at once, and some will work into their 70s, the importance of the boomers to your operation is worth noting. They know a lot of stuff, and there are certainly a lot of them. Their numbers almost double Generation X, according to “Beating the Boomer Brain Drain Blues,” and unlike their younger cohorts, many boomers have spent a large chunk of their careers in one company building up experience and knowledge.
You should increase your efforts to leverage employees who want to work past the traditional retirement age. “Sixty-five is the new 40,” says a recent Forrester “IT Roles and Skills” report. CIOs should encourage their valued senior employees to stay on, at least in part-time, seasonal or on-call roles. According to a study by AARP, more than 60 percent of U.S. companies are currently bringing back retirees as contractors or consultants. (This could be worth considering as a personal option for you as well. According to a Robert Half Technology survey, 46 percent of CIOs are likely to consider consulting or project work as a way to “ease into” retirement.)
Unfortunately, according to CIO‘s staffing survey, only 18 percent of IT leaders are pairing up new employees with experienced workers. That’s too bad, because such mentoring relationships not only offer the opportunity for knowledge transfer (old dog = new tricks, new dog = old tricks), but also usually prove to be a motivating force for both mentor and mentee. (To learn how Raytheon pairs experienced workers with new employees, read “Teaching New Dogs Old Tricks.”)
Can I skip these recruiting headaches by outsourcing more of my shop’s work?
Nice try. But if you think you can insulate yourself from personnel problems, personnel decisions and personnel strategy by outsourcing, you’re sadly mistaken. That is, unless you want those outsourcing relationships to fail. If you don’t mind failure, then, yes, you can avoid all the headaches. In that case, however, you’ll soon be searching for a job yourself.
Mary Lacity, professor of information systems at the University of Missouri-St. Louis who has studied outsourcing best practices for more than 15 years, notes that with successful domestic outsourcing relationships, clients review the resumes of their suppliers’ employees before they are assigned to their delivery team. And when it comes to a successful offshore outsourcing arrangement, clients often personally interview each potential offshore-supplier team member.
And, as anyone who’s done significant outsourcing knows, it’s never long before any HR problems your supplier has (from recruiting to retention) trickle down to you. An outsourcing decision should never be made with the idea of removing all risk or responsibility for something—recruiting or otherwise. The work may move; responsibility stays. (If you have more questions related to outsourcing, refer to The ABCs of Outsourcing.)
Where can I find more information about recruiting and other HR issues?
Here are a few places to start: