Talent Shortage Looms

By Chris Egizi

January 21, 2005: If you need help to complete IT projects in 2005, it’s best to start looking now since talent may soon become scarce, writes CIO Update columnist Chris Egizi of Kforce.

With the lion’s share of Sarbanes-Oxley (SOX) compliance projects nearing completion and the first reporting period already under the belts of accelerated filers, many companies are turning their first-quarter attention to previously-shelved IT projects.

In fact, deployment of many IT projects is being accelerated so benefits can be realized in early 2005.

Unfortunately, when combined with the staff reductions and/or freezes that characterized the past few years, the stepping up of IT initiatives leaves many CIOs faced with the challenge of completing mission-critical projects in half the time with half the staff.

And because so many organizations are operating under the same short deadlines, even those CIOs with the budgets to increase their IT staffs are faced with doing so in the midst of a run on available talent.

To help put the looming talent shortage into perspective, consider the results of a recent Forrester Research survey of IT decision-makers in companies with more than 1,000 workers. The survey indicates IT spending will increase by an average of four percent in 2005. When spending by small and medium businesses is factored in, that estimate jumps to seven percent.

At the top of the spending list are applications, with nearly six out of every 10 enterprises expected to invest in new or updated applications in the coming year. Most popular will be business intelligence (BI) and content management applications.

Security, PC replacements/upgrades (Forrester estimates that one in five corporate PCs will be replaced in 2005), Windows upgrades on the desktop and other technologies such as server virtualization and automated provisioning round out the list of top spending targets.

With so many organizations focusing on the same types of technology projects, it’s critical for CIOs to both anticipate specific needs so the necessary talent can be identified and determine the most appropriate balance between short- and long-term staffing.

The best approach is to develop a strategic staffing plan.

More expansive than the hiring plan discussed in my previous column, a strategic staffing plan will help determine the most appropriate mix of skill sets as well as the right balance of permanent employees with temporary consultants and total project outsourcing to meet both immediate and longer-term staffing needs.

Short v. Long Term

The first step is to determine the specific skills that are lacking in your existing IT talent pool and are necessary to complete the projects scheduled for implementation. As with the hiring plan, it’s important to first evaluate existing talent and, when possible, provide cross training and make assignment adjustments to maximize existing resources before embarking on any staff additions.

Once the missing skill sets have been identified, the next step is to determine whether it’s more appropriate to create a permanent position to fill gaps or whether staff augmentation or project outsourcing is more appropriate.

The best rule-of-thumb is to determine if your need for a particular skill will last beyond completion of the project at hand or if the needed skill is highly specialized and/or necessary for only a few months.
If your needs are long-term, seeking permanent employees is the right answer.

If that’s the case — and particularly if you require highly specialized skills — you should move quickly to activate your hiring plan. This will allow you to identify well-qualified candidates and move them through the interview and hiring process before another company plucks them off the market.

In fact, it’s often smart to grab top candidates immediately even if your actual need is a few months down the road. Waiting will likely mean you’ll be forced to settle for someone who isn’t the best fit for your needs.
The “need-for-speed” also holds true in the case of shorter-term needs.

Keep in mind that staffing and consulting firms are competing for the same talent base as you are. And while such firms typically start with a much broader pool of professionals from which to draw, even those sources will begin to dry up as demand increases. But before settling on a firm, you must first decide whether staff augmentation or project outsourcing is the better fit for your short term needs.

Contract Help

The most expedient way to make that determination is to look at two things: skill and scale.

Is the project something your team is comfortable with? For example upgrading from Microsoft Exchange Server 2000 to 2003, with the immediate need limited to additional help to get it done?

Is the actual implementation something beyond the comfort level of your team, but one they can successfully manage upon completion? Or is the scale of the project — for example upgrades in several hundred offices over one weekend — so great it’s impossible for your team to complete even with staff augmentation?

If you’ve got both skill and scale covered, then staff augmentation is the better way to go, whether it’s to help complete the work, backfill while your team focuses on the project or to handle a single project component such as design.

However, if you’re heading into unfamiliar territory or if the scale of the project is so large that it’s unlikely it can be completed even with a few extra bodies, project outsourcing may be a better choice. It not only puts the burden on the consulting firm to complete the project on time and on budget, but they can also train your existing staff to handle ongoing maintenance after their engagement is up.

With a little advance planning and some homework, finding the right talent to complete mission critical projects is possible. Even with an anticipated talent shortage looming, there is still time to plan for success. By identifying needs, maximizing existing talent and balancing short- and long-term needs, you’ll be well-positioned to meet your company’s 2005 IT objectives on time and within budget.

Chris Egizi is vice president, Technology Consulting Services, with Kforce Technology, a full service professional staffing firm.