Filling the digital transformation skills gap

Success in the digital era requires the right blend of business, IT and soft skills. IT leaders are rethinking their hiring and training strategies to truly transform.

Filling the digital transformation skills gap
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As someone who doesn’t have a technical background, Phil Bertolini, CIO for Oakland County, Mich., knows he needs to surround himself with people who have tech skills — but he believes it’s almost more important to find ones with business-oriented skills.

“The other belief I have is that nothing makes a bad business process worse than putting a bunch of tech around it,’’ he says. “Our goal is to tear the business process apart, make sure it’s optimized and then build the proper enabling technology to make it efficient.”

To do that requires people with a blend of technical and so-called soft skills, yet that is something Bertolini struggles with. Still, that is a core mandate for the people he is looking to hire today.

“They may be very astute technically, but if they don’t have people skills they can’t work here,’’ he notes. “If I need programmers or database people and networking people, I can rent them in the contract market. But what I can’t always find are the people who can actually work closely with people and engage with them and understand their business process.”

Demand is greater now

As organizations get deep into digital initiatives, many are experiencing the same thing: It is a challenge to find workers with so-called soft skills that help bridge the divide between what business users want and the technology to make it happen.

cio digital transformation soc chart CIO / IDG

CIO’s annual State of the CIO Survey asked about skills needed for digital transformation. The top responses were strategy building (40 percent), project management (32 percent) and business relationship management, user support/training, success measurement and risk management, all at 25 percent, respectively. Other business-oriented skills that IT leaders are seeking include product management, financial/cost management and vendor management.

The digitalization of work is absolutely a factor — and one that isn’t going away as 67 percent of business leaders agree that if their company does not become significantly digitalized by 2020, it will no longer be competitive, according to Brian Kropp, group vice president in Gartner’s HR Practice.

Gartner’s 2018 Shifting Skills Survey asked over 7,000 employees to self-assess their level of proficiency in in-demand skills such as Six Sigma and oral and written communication. The firm found that 70 percent of respondents said they haven’t mastered the skills they need for their jobs today. Additionally, 80 percent said they lack the skills they need both for their current role and their future career.

“Those are big numbers and signal that organizations on the whole have work to do to ensure they can build their leadership bench and that workers have the needed skills,” Kropp says.

“The effects of the digital revolution are causing companies to reexamine the way their IT and technology departments fit within the company, the impact in each department and their value to the overall organization,’’ agrees David Armendariz, general manager of the IT practice group for executive search firm Lucas Group. “Because of this shift, IT talent now must have both a business and relationship acumen in order to be truly effective in the current and future marketplace.”

The skills IT leaders most want

Technology skills are always going to be top of mind and at the forefront of what hiring managers are looking for when recruiting for tech teams, but business skills and soft skills are a differentiator for candidates, says Ryan Sutton, district president for recruiting firm Robert Half Technology. “Those who can come in [and] manage projects or help with strategy will add value to a team, and managers will definitely see it as an advantage.”

When thinking about planning for digital transformation, business skills are not necessarily what come to mind first, says Joan Holman, CIO of global law firm Clark Hill PLC.

“But if you take a step back and look at your business model and [think about] changing how you do things to be efficient and effective and deliver the particular service for your organization in a digital manner, often that goes beyond the technical stuff,’’ she says. Echoing Bertolini, Holman adds, “You can get an engineer to build things, but if you haven’t listened to the stakeholders, then whatever you’ve built will not be successful and meet the needs of the organization.”

In Holman’s world, the skillset most needed is business analysis; “people who can understand what the business process is, what attorneys do and how do we engage with clients,’’ she says. “So from a technical perspective, we can offer solutions and processes to complement the work now — but you have to have a good handle on what the work is.”

At Clark Hill, this means understanding the steps required to support a client and the demands that attorneys are getting from clients, she says.

“A certain level of business acumen, quite honestly, across the board, helps from an IT perspective,’’ Holman says. “The better we understand the business and what our users are trying to accomplish the better job we can do to provide support.”

The criteria for candidates at Massachusetts-based car research site CarGurus has changed over the years, observes Kyle Lomeli, CTO. In the past, IT leaders looked for candidates with experience in areas such as strategy, project management and building relationships. Now they are upping the ante and looking for software engineers who also have good communication skills and who are good collaborators, he says.

“We don’t want someone to disappear into a void and come back three months later with a product that doesn’t resonate with the market,’’ Lomeli explains. “We want someone who figures out how to make those pragmatic decisions and focuses on measurement and iterating fast.”

The ideal candidate has a broader view of what’s needed to make products a success, he says, “and for that we need someone with a lot of those strategy and project-building skills sets.”

Relationship management is an important skill gap right now for David Lloyd, director of IT at Minnesota-based Park Industries, which manufactures saws to cut stone and metal.

“We have a very large strategic initiative around customer experience,” he says, and that requires people with “the ability to leverage data that exists today for internal business decisions and also making that [data] available to customers’’ on a self-service basis.

Lloyd says project management and business analysis are other skills he could use to ensure that input on specifications comes from every functional area within the organization as well as coordinating that representation.

Armendariz says the business-oriented skills his clients are looking for include success measurement and strategy building. Clients also want people with “the ability to listen to the true needs of the internal stakeholders, a desire to understand the value technology and data bring to the department, communication skills needed to influence decisions and the overall mindset that they are a business partner and key in driving the business forward,” he says.

In today’s world, he adds, those are equally as important as the baseline technical skills required to do the job. “Without the technical expertise, solutions can’t be developed, and without business-focused skills, those solutions will never drive value.”

Finding the blend of skills is hard

Of course, finding people who have a blend of business and tech skills isn’t necessarily a cinch. “A lot of people in the tech space are used to working in environments that are rigidly defined and don’t have room for making strategic decisions,’’ says Lomeli.

Many engineers are used to being “cogs in a machine,’’ he explains, and CarGurus wants people who can operate in a startup mindset and facilitate change and have a say in how a product is conceived and evolves over time.

“Pretty much everything we’re working on requires soft skills,’’ Lomeli says.

This has made it a constant struggle to find people with the right blend of both, he says. But Lomeli says “people who yearn for the ability to effect change” are out there.

It helps that although CarGurus has become a large company, it “still operates like a startup, which a lot of these candidates look for in the end,’’ he says. “They’re looking for environments … where they can have an impact. Large companies generally don’t provide that proposition.”

Lucas Group’s Armendariz says the shortage of candidates with a blend of tech and soft skills is something they hear about from clients every day. “There is already a war on technical talent due to the low supply of qualified candidates and the high demand for those candidates,’’ he says. “In addition, when you look at the available candidate pool with both the technical and business acumen needed in today’s marketplace, the pool is even shallower.”

He attributes this to baby boomers exiting the tech industry, the lack of STEM graduates entering the marketplace and the rarity of candidates who bring both highly skilled technical attributes and business-focused skills.

How to find business-focused IT people

What most leaders are questioning right now is whether to buy or build talent, says Gartner’s Kropp, meaning whether HR should go outside the organization and find new candidates, or if the company should develop current employees. Gartner research found that companies should continue to do both, he says.

“However, these strategies alone will not help them achieve their digital transformation goals,’’ he cautions. “Organizations must also change the company from within to allow digital innovation to occur.”

For example, they should build a culture of “network-based innovation” and give current employees more visibility into and ownership of which ideas to pursue to more actively engage them. They should also consider increasing collaboration and provide guidance on who they can work with to push ideas forward, he says.

Armendariz suggests that organizations identify the high-potential technical talent within their firms and invest in developing their business acumen.

“It may not be the traditional routes of paying for an MBA, but hands-on mentoring from key leaders who can build and develop their business-focused skills is critical,’’ he says.

Organizations can also invest in outside training and development programs from consultants who bring best practices from outside the organization. It is also critical to develop “a robust recruitment and retention strategy, including creating a culture that attracts this type of talent, partnering with outside consultants who specialize in developing a network of this type of talent and establishing open feedback channels that provide information organizations can use to increase employee engagement and retention,’’ Armendariz says.

Oakland County’s Bertolini says finding people is especially difficult for him because he has to compete with private industry, which tends to pay better. So he has taken a four-pronged approach: hiring a recruiter to recruit candidates nationally; conducting compensation studies and making salary changes to key positions where they are trying to find people; and offering flex time and the ability to work remotely as well as implementing a 4 x 10 work week, where employees have the option to work four 10-hour days. This gives them a three-day weekend, which he says is very attractive to some people.

The fourth step is revamping their physical space to “create a modern work environment” by removing cubicles and bringing in sit-to-stand desks and building collaborative work spaces, while also still providing private work spaces when required.

Bertolini also prides himself on his marketing approach. “We do innovative things here in Oakland County and believe we’re just as innovative as the private sector, but in the end you can go home and have dinner with your family,’’ he says. “I’m not going to work you 100 hours a week.”

So far, his approach has been working. At one time, Bertolini had 32 vacancies in IT and he’s now down to eight in an almost three-year period.

Copyright © 2019 IDG Communications, Inc.

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