Talent wars: Are your IT staffers being poached?

Dan Herrington says his first inkling of a brewing IT talent war came early this spring, when he noticed that "college kids weren't accepting our offers on the spot."

This was a first for Herrington, who is executive sponsor of college recruiting for IT at USAA, a San Antonio-based Fortune 200 insurer and financial services company that has been No. 1 on Computerworld's Best Places to Work in IT list for two years in a row.

Herrington adds that another disturbing new trend is a "marked increase" in the number of college hires who accept job offers but then later change their minds. "We've seen college students reneging on internships as well," he notes.

USAA has responded by expanding its out-of-state college recruiting efforts and stepping up communication with interns between the time they accept an internship and their first scheduled day on the job. So far, the approach appears to be working, as evidenced by nearly 200 college hires -- both full-time employees and interns -- in 2011.

In Melbourne, Fla., Vinay Patel, senior software engineering manager at Harris Corp., has been seeking experienced software developers for three or four months. So far, only two applicants have passed both telephone and in-person interviews. Both were offered employment, but one turned down Patel's offer and the other accepted but subsequently reneged a week before he was due to start. Apparently, he received a better offer, Patel says. "The job seekers seem to be in the driver's seat right now," he notes.

A quick scan of numbers from the U.S. Bureau of Labor Statistics confirms this about-face in the IT job market. In May, it pegged the IT unemployment rate at 3.8%, significantly lower than the national average unemployment rate of 9.1%. At the same time, 65% of 900 hiring managers surveyed by Dice.com said they expect to hire even more tech professionals in the second half of this year than they did during the first six months of 2011. "The growth has reached a level where positions are staying open for months due to a shortage of qualified technology professionals," according to the Dice report, which went on to suggest that now may be a great time for IT job candidates to ask for more money than they're offered initially.

"Technology professionals are the basis for innovation, efficiency and creating an agile workplace," says Tom Silver, senior vice president of Dice.com. "Now is the time to ask for more money. Negotiate hard at the outset of a new job, because that initial salary may set the base for the next three years."

Talent Pipeline

Building Bench Strength

Long-term IT workforce planning and job rotations are two of the best weapons in the war for IT talent, say many CIOs.

After conducting a demographic study and realizing that 35% of the IT workforce at Guardian Life Insurance was eligible for retirement in the next decade, CIO Frank Wander and his team got cracking on the company's new Talent 2020 program. Among other things, the program analyzes the skills of all IT employees and then pairs newer employees with veterans to facilitate knowledge transfer.

At Medtronic, CIO Mike Hedges has established an IT Talent Council, which is headed on a rotating basis by IT vice presidents from Medtronic's various business units.

"The council consists of directors and senior managers who look at talent across the organization and come up with new ways to attract and retain," Hedges says. One of the programs involves moving 30 to 40 managers from the business units to the company's shared services unit "to make sure that people are not getting stuck in a rut," he says.

Hedges also has identified the company's top IT talent, which he defines as "people we'd have a significant challenge replacing because of their interpersonal, leadership and planning skills."

Hedges meets with at least five of these employees monthly and has them all meet regularly, sometimes for dinner, as a way to practice their interpersonal skills and forge closer relationships.

"It's the softer skills -- like teamwork and communication, problem-solving and analytical skills -- that we'd find harder to source," he notes.

Harris Corp. rotates employees through various departments and roles so they can gain broad first-hand knowledge about the company's lines of business across its commercial and defense units. The idea is to give employees a chance to see opportunities for growth and what kinds of work might most appeal to them.

"I want to make sure I can provide an environment where employees feel they can grow their skill sets and professional characteristics and be in an engaged learning environment," says Vinay Patel, senior software engineering manager at Harris. "We constantly push people to different roles and give them different projects. I can't think of a single person on my team who has been in the same role for more than two to three years."

— Julia King

A surge in corporate use of social media, mobile tools and cloud technologies, coupled with loosening IT purse strings and pent-up demand for IT-based business projects, are all big factors driving the escalation in need for IT talent -- and the related escalation in competition for that talent. The shrinking size of the pool of qualified college graduates and the ever-expanding surge of baby boomer retirements are also key contributors.

Earlier this year, 48% of CIOs said it is very or somewhat challenging to find the skilled IT professionals they need, according to the Robert Half Technology IT Hiring Index and Skills Report.

"The reality is that as technology pervades every aspect of personal and professional life, the need for technical talent is huge," says Shawn Banerji, managing director of IT recruiting company Russell Reynolds in New York. "People on the service provider side are looking to hire, and traditional corporate IT departments are also looking to hire. There is absolutely a war for talent."

Wanted: Deep Experience

But it's not just any IT professionals they're after. What most companies want are IT people with experience in newer technologies they're looking to deploy or those with very deep technology and business experience in a particular industry. Experience with developing mobile and social media applications, using newer programming languages like Ruby, and deep integration skills for linking on-premises computing systems to cloud-based services are at the top of recruiters' wish lists.

Harris' Patel, for example, says the application development openings he has are for highly experienced professionals. "For these positions, which are for new projects, we need people with five to 10 years' experience. They are not positions for new graduates," he says. "It has been very difficult to fill them."

Guardian Life Insurance in New York recently conducted an IT workforce assessment and found that 35% of its IT staffers are over 55 years old. "Almost half [of our] IT workforce will be eligible for retirement in 10 years," says CIO Frank Wander. "It's staggering. These are our most experienced people."

What Guardian is looking for, he says, are young IT professionals to whom extremely high-value senior IT employees can pass on their experience and knowledge about Guardian's business and processes (see sidebar). On the technology front, Guardian -- like just about every other company that's hiring for IT -- needs professionals with data modeling and design skills and mobile application skills. The insurer is also seeking IT workers with data center consolidation experience.

"Fifty percent of Fortune 500 companies will be modernizing their a href="https://www.computerworld.com/s/topic/154/Data+Center">data centers over the next five years. The reason is that devices are becoming more powerful. They take up less space and need less electricity," Wander notes. "We're doing a data center modernization and consolidation initiative, and we want people who have been through this. It's very hard to get. It's one of the hottest areas."

Healthcare IT

Hospitals Compete for IT Talent

Healthcare providers in the U.S. are encountering a shortage of qualified IT job candidates as they race to meet federal government deadlines for converting paper charts to electronic health records.

At stake is $25 billion in funding allocated in 2009 by the American Recovery and Reinvestment Act for spending on EHR technology and other forms of healthcare IT. Medical providers will be compensated for the cost of these systems if they meet certain implementation deadlines.

"You can imagine there's going to be a fair amount of hiring," says John Halamka, CIO at Beth Israel Deaconess Medical Center in Boston and a Computerworld columnist.

To manage the hospital's EHR rollout, Halamka opted to outsource the task to a firm that specializes in EHR implementation and practice transformation. The healthcare facility is also developing a private cloud, which required hiring IT professionals with backgrounds in database development, wireless networking, security and server administration.

Equally critical are employees who grasp how introducing technology into medicine changes how care is administered.

"I need an analyst who really understands how it is you can take a paper-based office environment and then move it to this new world of using electronic records, because it isn't just digitizing paper," says Halamka. "So they really have to understand how you leverage the technology and change processes in order to move doctors from what they may have been doing for 30 years to a new world."

Beyond IT skills, Halamka looks for candidates who "have a working vocabulary of healthcare" and are familiar with the industry's privacy, security and regulatory compliance needs.

Halamka has found, however, that his organization must compete with EHR vendors for staff. Candidates may find these vendors' fast growth and lucrative salaries more appealing than what a nonprofit hospital can offer, he says. But, he adds, Beth Israel's connection with Harvard University's medical school gives him an edge in the talent wars.

— Fred O'Connor, IDG News Service

This version of this story was originally published in Computerworld's print edition. It was adapted from an article that appeared earlier on Computerworld.com.

Also high on corporate IT recruiting wish lists are any and all skills having to do with cloud and software-as-a-service (SaaS) technologies, as well as the business process and technology integration know-how needed to link these newer technologies to legacy computing environments.

Recruiting experts say this particular need is both a blessing and a curse for corporate IT departments. On one hand, IT professionals want to work with these newer technologies, so in-house cloud and SaaS projects can help corporate IT departments attract and retain the best and brightest.

At Purdue Pharma, a privately held pharmaceutical company in Stamford, Conn., CIO Larry Pickett says a modern IT infrastructure that includes cloud technology is a big reason the company is able to retain its most talented IT employees. "We're right in the middle of implementing state-of-the-art technology and doing things that are innovative and building [IT employees'] skills, so it increases retention," Pickett says. "We are implementing a private cloud infrastructure across two data centers, so there's an opportunity to learn those skills without leaving Purdue."

Competing With Vendors

On the other hand, corporate IT's need for IT professionals with cloud, SaaS and integration skills pits corporate IT directly against technology companies themselves in the escalating war for talent.

"Vendors look at people who have worked at [user companies] as bringing institutional and cultural knowledge with them and a hands-on knowledge of workflows," says Russell Reynolds' Banerji. This makes corporate IT employees prime poaching targets for technology vendors.

What puts IT shops in an especially tough position, experts say, is that job seekers typically view technology vendor companies as more innovative and better able to offer opportunities for growth.

"If you think of corporate IT budgets and the way they spend, 80% is usually going to maintenance of old stuff and maybe 20% goes to innovation," notes Woodson Martin, a senior vice president who heads recruiting at Salesforce.com. IT professionals "want to work on cloud and languages like Ruby. They want to work on the future, not the past, but the fundamental mechanics of that 80/20 means it's hard to keep the talent happy."

Big budgets for research and development give vendors another advantage, says Steven John, strategic CIO at Workday, a SaaS vendor based in Pleasanton, Calif.

"Corporate America can't go as deep [into the technology] to challenge the best people. That's all happening on the vendor side," says John, who was previously CIO at specialty chemical maker H.B. Fuller; he joined Workday when Fuller became a Workday customer.

"Workday is doing some very cool technology. We're one of the leading cloud vendors out there, so this is one of the places high on the list of places to be on the cutting edge," he says.

1 2 Page 1
Page 1 of 2
It’s time to break the ChatGPT habit
Shop Tech Products at Amazon