As Hiring Heats Up, Time to Keep Workers Happy

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Despite a U.S. economy that can't seem to make up its mind, there is little doubt in the minds of CIOs, hiring managers and industry watchers that IT hiring is poised to grow steadily in the next 18 to 24 months.

That's good news for workers who've experienced long bouts of unemployment since the Internet bubble burst in 2000. And it's good news for IT professionals who have hung on to their jobs but have been steadily saddled with additional duties, while their departments shrank. Such employees may have wanted to head for greener pastures -- but for the past few years, such pastures have been few and far between.

Well, things appear to be greening up.

And if you're in charge of hiring, managing or retaining IT workers, that means you face challenges that have been absent for years. As the IT job market heats up, managers are under new pressure to hang on to valued employees.

Hiring Increases

According to recent reports from Stamford, Conn.-based research firm Gartner Inc., U.S. IT spending will increase an average of 5 percent this year, with some industries (such as communications) boosting spending a whopping 17 percent. Moreover, enterprises are ''optimistic about spending more on internal staff,'' Gartner reports. And increasing staffing ranked high on IT managers priority lists.

It must be noted, however, that despite the optimism and overall spending increase, another Gartner survey finds that the percentage of IT operating budgets devoted to internal staff is continuing to shrink, from 33 percent in 2001 to a projected 22 percent this year. But that doesn't mean companies are not hiring; it just means that the trend toward using outsourcers and system integrators continues to grow.

But IT workers are being hired at a higher rate than in the past several years, and forward-looking CIOs and hiring managers have spotted this trend. They're responding quickly to make sure they can hire the most skilled IT workers -- and that once hired, those workers stick around.

RHI Technology, the IT business unit of San Francisco-based staffing firm Robert Half International Inc., found in a recent study that 58 percent of CIOs surveyed said keeping their best people is becoming more critical as the economy gains momentum. According to Katherine Spencer Lee, RHI Technology executive director, ''The job market is growing steadily -- good people are getting harder to find. One of our clients just told me [a programmer/analyst] just resigned, and we haven't seen much of that in recent years. People are starting to explore their options again.''

Seeking Experience

''No question, it's more difficult today to find qualified personnel,'' says Dave LaGreca, CIO at Harte-Hanks, a direct and targeted marketing company based in San Antonio, Texas. LaGreca cites several possible reasons, including the stronger U.S. economy and improved morale among IT workers who believe their employers may have ''turned the corner''. He says Harte-Hanks finds some positions much more difficult than others to fill.

''There are still lots of candidates available,'' LaGreca says, ''but more senior folks, like senior network personnel, are a lot tougher to find than a few years ago.''

Fortunately for Harte-Hanks, the company's 42 business units have not yet seen an appreciable rise in attrition, LaGreca says. But he knows that's a possibility if the overall IT environment continues to improve. On the hiring side, though, Harte-Hanks may be forced to become more aggressive.

''In the past three years, we could fill positions without a recruit firm,'' LaGreca says. ''But now we're mulling hiring a recruitment firm for senior positions.''

Most large IT organizations are in the same boat. Entry-level IT and network administrators are relatively easy to find, but specialists in popular enterprise applications are another matter. Experts in SAP AG's enterprise resource management (ERP) software, for example, or customer relationship management (CRM) tools from Siebel Systems Inc. and Peoplesoft Corp. are quite likely to be working for outsourcing firms or system administrators.

According to RHI Technology's Lee, the scarcity of experienced ERP, CRM and security specialists has forced some businesses to fill those positions with contract workers. However, she adds, savvy IT managers make sure that knowledge transfer is an integral part of the contract, so that when the hired guns leave, internal staffers can run ongoing operations.

Increased attention to knowledge transfer is one key way to stay ahead as the employment picture picks up. Another is internal training, mentoring and coaching. That sounds like common sense, of course, and it is. But the fact is that the past several years have been dominated by painful staff cuts and a focus on just getting through the day. As a result, many IT organizations got away from fundamental management practices.

One such practice is to track newer workers' progress, and groom those who are most promising. One way to do this is through ''stretch'' goals designed to push employees into unfamiliar territory. Harte-Hanks LaGreca says his organization uses stretch goals both to cross-train workers in new areas of technology (for example, a network specialist might be asked to learn database management skills) and -- even more importantly in an era in which IT and business are tightly intertwined -- gently push technologists into business-facing roles, such as business analysis or requirements gathering.

According to Dianne Morello, a Gartner analyst, this type of cross-training is invaluable to employer and employee alike, especially as it becomes more difficult to find experienced help.

''If they see someone with high potential, but for whom some skills are weak... for that employee's credibility to grow, they need to strengthen those muscles,'' Morello says. ''For example, if a manager sees that a person hasn't had the opportunity to present to the board, but wants to, you've got to make that opportunity available.''

In the end, what IT managers need to do in an era of increased employment is pay attention to fundamental hiring, training and retention practices. They've always been important, but the cold truth is that for several years, workers were afraid to leave their jobs, and overworked managers could get away with sub-par employee development. That has changed, and IT groups would do well to take notice.

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