The previous decade served as a proving ground for Information Technology (IT) Strategies. With the recession of 1990-1992 forcing corporate America to streamline staffing, many IT departments entered the 1993-1994 period with little or no excess people capacity. At the same time, there was a major shift in platform selection, development, and planning – the emphasis migrated from mainframe toward Client/Server and LAN/WAN. Emphasis was also placed on RDBMS and Groupware. Consequently – and with the phenomenal growth today of the Internet – multiple change variables are simultaneously affecting current systems planning, legacy systems demands, and future requirements. This adds up to an overall state of turmoil and resource upheaval.
The demand for IT professionals with “New Technology” skills, as well as “Traditional” skills, exploded in 1993. This came at a time when demand/supply curves were off balance to begin with. Therefore, today we have a market that is in a hyper state. The demand for “New Technology” skills is sky-rocketing, and there are not enough qualified unemployed Information Technology professionals to meet this demand!
In an effort to meet the skills demand, clients have built their Information Technology strategies around three choices: hiring contract services, hiring new permanent employees, or training existing staff. The results have produced some trends which are very different from the past.
Hiring contract services
The contract world is exploding. Clients are realizing the advantages of only paying for what they need and receiving exactly the skills they desire with no training, which results in immediate productivity. And, with the true cost of permanent employees continuing to spiral upward, this alternative is highly attractive.
Hiring new permanent staff
This has always been an option and will continue to be one. However, as a result of high demand, new people with “New Technology” skills are very expensive and hiring them may create a salary compression problem with existing staff. For example, while an existing Visual Basic Programmer staff member makes approximately $60,000, a newly hired Visual Basic Programmer/Analyst with Client/Server and RDBMS skills might command a salary of $70,000. Thus, managers are confronted with Human Resources troubles such as decreased job satisfaction, turnover, and so on.
Training existing staff
Training courseware and classes on “New Technology” are very expensive. Some retrained technical people make the transition; others never make it or simply reject it. And those who become trained are in very high demand and may take other jobs – permanent or contract. One MATRIX client trained and certified three P/As in PowerBuilder. Within eight months, all three were gone; two to contracting and one to a vendor. All three increased their incomes more than 50%. The client not only lost its training investment, but was also left with a failing project and three open positions.
These circumstances have produced a new trend that leading-edge companies and vendors seem to be in tune with – the Core Group Strategy (CGS).
The essence of a core group strategy
Essentially, CGS advocates building an IT organization with two types of people: the first type has current technical ability, strong interpersonal and judgmental abilities, and a desire to excel into leadership and management roles. The second type has current technical skills and a desire to continue being very technical; management is of no or minimal interest to this group.
The leaders of the first type become the Core Group. They comprise key roles as analysts, project leaders, resource managers, and fill niche technical leadership positions such as DBAs, Data Analysts, Security Analysts, Network Managers, Quality Assurance Specialists, Technical Writing Managers, etc. These people merit investment with training, job enrichment efforts and mentoring. They are always upwardly promotable, adaptable, and mobile (from one role or area to another), and they desire to move “up the ladder.” Over time, their internal company knowledge will be invaluable and their probabilities of leaving will continually decrease.
The “resources” to supplement the Core Group come via contract services. These people provide expertise in an exact skill, are utilized for only the time needed, and are then either terminated or moved to another project, if appropriate. On rare and not pre-planned occasions, a contractor may convert to permanent status and join the Core Group.
The CGS structure helps organizations succeed in:
- Maximizing productivity
- Minimizing turnover
- Increasing throughput
- Boosting morale
- Meeting deadlines
- Allowing partnering with vendors to realize best case skill procurement for dollars expended
- Servicing users while retaining technical continuity
- And more...
CGS is not outsourcing, loss of control, or experimentation. It is smart business that will increase profitability and meet every new technology, economic condition, internal technical issue or opportunity squarely and head-on. It is a sound strategy that addresses the future and always changing technical landscape.
The CGS trend is being widely accepted by many. As a result, more and more individuals who have strong technical skills, the ability to take some risk, and the desire for top income are becoming contractors. This will not change. Individuals who desire managerial roles – and who possess the capabilities – want to become aligned with their organizations. They have permanent jobs and want career growth and stability. They comprise the Core Group.
With people resources better matched with their respective desires and skills, the end result is more focused and productive Information Technology professionals – whether contract or permanent. And, because the Core Group Strategy provides an optimum match for individuals as well as companies, all indicators point to an IT world that will quickly become more and more virtual.
About the Author
William Gower is a founder of MATRIX Resources, Inc., an Information Technology staffing firm serving the Atlanta, Dallas, Phoenix, and Research Triangle Park, NC, markets. His IT industry experience spans 30 years, including positions with IBM and Comshare, Inc. He has been counseling permanent and contract IT professionals since 1981. He can be reached at Bill_Gower@MatrixResources.com. |