A shortage of technical personnel combined with intense demand for new skills and bidding wars have made recruiting and retaining staff a difficult task. According to the Information Technology Association of America (ITAA), one IS position is unfilled for every 10 employees at large and midsize IS companies in the United States today; that translates to more than 190,000 vacancies. To make matters worse, demand for technical workers in corporate America keeps rising. About 80 percent of large and midsize companies expect to add to their IS workforces this year, according to a recent ITAA study, "Help Wanted: The IT Workforce Gap at the Dawn of a New Century," which focused on about 2,000 companies, evenly divided between IT and non-IT industries. With the lure of higher salaries from the company across the street, many companies are experiencing tremendous turnover in staff. The IS Staffing Crisis: Trends and Solutions, a CIO magazine survey of 316 U.S. companies with average annual revenues of $2.6 billion, shows that average IS staff turnover is 14.5 percent (see below). This means that at any given time, IS staffs have almost 15 vacancies for every 100 positions. It's not likely to improve any time soon. Fifty-eight percent of the survey respondents-who represent a range of industries, including manufacturing, finance, wholesale and retail trade, and insurance-expect turnover to increase over the next two years; 29 percent say it will stay the same (Fabris, 1998).



Source: www.cio.com 1/1/98

With this framework in mind, it is essential for companies to implement effective and successful recruiting strategies. Furthermore, it is essential that CIOs and Human Resource Departments establish a coordinated, and sometimes innovative, effort in recruiting IT talent.
Background
What Created the Tight IT Labor Market? The GartnerGroup offers several factors which have contributed to the current state of affairs (D. Tunick Morello, E. Zidar, B. McNee, C. Smith, 1998)
• A comparatively strong economy - Although Asia, Russia and other parts of the world are experiencing economic lethargy or depression, the United States and western European markets have been buoyed by economic prosperity. In a high percentage of enterprises, nevertheless, IT professionals are still getting salary increases and merit raises more aligned with recession than with prosperity. Recession-era thinking does not mesh well with a high-demand labor market.
• Dependence on IT - Enterprises worldwide have increased their dependence on IT and their strategic investment in IT. GartnerGroup predicts that the worldwide volume of IT work will increase by 45 percent between 1998 and 2003. IT spending, buoyed by year 2000 conversions and installation of enterprise applications, will peak worldwide in 1999 at nearly 9 percent of revenue in North America, declining to a more reasonable level of 5 percent to 7 percent by 2003.
• Weak leadership - Enterprises want their employees to be loyal, to grow with them, to share the corporate vision. Meanwhile, informal surveys indicate that 70 percent of IT professionals cannot articulate a corporate strategy. Adding to the problem, shrinking profit margins squeeze compensation packages, inhibit the hiring of adequate staff numbers and render IT training and education programs - among the clearest investments in human capital - as disposable.
• Poor risk analysis - Decisions to bring in large-scale application suites to transform the business and put its practices in order are part of a high-minded goal; the failure to match that vision with the practicalities of a tight labor market undermines those decisions.
• Lack of foresight - Enterprises, many accountable to demanding shareholders, try to watch their short-term expenses, and in so doing they fail to invest appropriately in IT infrastructure, equipment, tools and people, a situation that makes their long-term prospects for cost management worse.
• Insufficient generation of IT expertise The pursuit of engineering- and math-based disciplines has been on a downward slide. Although some universities now report an increase in IT-related enrollments, IT professional service providers have, through scholarships, already reserved many of the new students. Many enterprises do not promote IT awareness, do not contribute time or equipment to schools and communities, do not help academic institutions strengthen their curriculums, and do not create learning environments appropriate to new graduates.


Key Issues in Today's IT Hiring Environment
B. Guptill in Value in IT: Staffing Issues for 1999 (B. Guptil, GartnerGroup, 1999) identified several key issues in today's IT hiring environment. The issues were the results of the responses of 200 participants at a GartnerGroup symposium.
• IT is difficult to find staff with useful knowledge of multiple IT disciplines. Most people in IT today are focused on a particular technology or application. Individuals with a solid IT foundation across multiple disciplines are particularly scarce. Cross-trained IT staffers will continue to be hard to find.
• "Well-rounded" staff members – technically competent and good at customer interaction – are especially difficult to find. Those individuals who excel at technology tend not to excel at "relationships". Acquiring resources that can manage both the technology and the social skills can be daunting.
• Consulting firms are raiding IT departments to a significant degree. For the most part, a consulting firm can offer more money than generally in-house IS managers can afford. This will more than likely continue. To compete IS managers will need creative compensation and benefit schemes to maintain personnel.


Methods and Strategies for IT Recrutiment

Because of the scarcity of skills and the vast complexity of distributed computing compared to legacy mainframe systems, IS organizations must change their approach. They will have to create a combination of internal and external resources by finding motivated IT professionals able to work in a collaborative environment and possessing the necessary critical skills. The shortage of relevant IT skills is not just a problem for the IS organization but for the business as a whole.

A list of 10 critical success factors (CSFs) has been created to measure a company's competitive condition (D. Tunick, 1998). Tunick has developed this list specifically for mid-size companies wishing to compete with more lucrative, larger companies. The greater the number of CSFs fulfilled, the greater the likelihood of success.
CSF 1 Innovative Compensation
Innovative compensation refers to how willingly and how quickly companies mobilize themselves for changes to base pay, bonuses, equity ownership, after-hours pay, compensatory time-off and counteroffers. Tunick quotes a statistic that IT professionals admit that they would willingly depart their employers for a 20 percent greater salary; so coming within 10 percent or 15 percent of market rates for relevant skills, disciplines and competencies gives midsize enterprises leverage.

CSF 2 Imaginative Benefits
Benefits go beyond the standard medical, dental and vision package or matched contribution plans. Because of dramatic changes in the work force, benefit programs that reflect and accept the growing diversification and responsibilities of the work force will fare better than entrenched programs that assume or enforce uniformity on the work force. Flex hours, telecommuting and compensation time are creative tools a business may offer a prospective employer as enticement.

CSF 3 Professional Challenges and Advancement
Like so many professionals in today's market, IT practitioners seek enrichment, excellence and advancement once they accept a position. Throwing people into the work flow with a "sink or swim" attitude is dangerous and will prompt many good people to depart feeling unsupported and unaccomplished.

CSF 4 Demonstrable Commitment to Training
According to Tunick, IS organizations typically spend about 2 percent to 3 percent of IT payroll on learning. Investing in training, and continually committing to that endeavor, can have significant impact on recruitment success.

CSF 5 Sound Company Image
Companies that have enjoyed successful recruiting project a quality image. People want to work with strong, healthy companies that have strong values, good ethics and respectful attitudes.

CSF 6 A Well-Defined Recruitment Process
A sound recruitment process has to be repeatable, manageable and predictable; overseen by people who understand the IT marketplace; powered by people who hunt aggressively and imaginatively for prospective candidates; and streamlined enough that an IS organization can make an informed job offer within five days.

CSF 7 Strong Management
How successfully midsize enterprises recruit, retain and prepare for the future will be a directly related to the quality of its management

CSF 8 Intriguing and Challenging Technology
What makes the world of IT so interesting is the degree of change. Quality professionals like to be challenged and engaged.

CSF 9 Broad-Reaching Hiring Networks
Company's must employ innovative techniques to reach prospective employers. Relying on standard methods of recruitment may result in many missed opportunities.

CSF 10 A Skill Management Process
Successful management of the IT work force demands a more systematic and coherent approach to assessing the shape of the work force. Skill management is the key to successful recruitment, retention, retraining and resourcing; it provides the necessary road map for IT practitioners, IT managers, HR professionals and business executives.

While the CSFs were created with the mid-sized business in mind, they are applicable for nearly all businesses wishing to raise their level of success in IT recruitment.

Guptil, in his study, asked his participants to share their successful strategies for recruiting IT personnel. Successful recruiting approaches included:
• Setting up programs with local technical schools, business schools, colleges and universities to identify good candidates, and sponsor programs to develop these candidates.
• Aptitude testing for individuals who are interested in entering such programs.
• Participation in university co-op programs.
• Offering IT personnel as guest speakers for local colleges and universities.
• Internal referral programs/bonuses.
• Building a good relationship with a few headhunters.
• Building a good relationship with consulting firms.

While some of these strategies may seem quite obvious, many businesses have not taken the initiative in implementing these ideas.

Emerging Trends


One of the emerging trends in IT recruitment is being driven by the Internet. At GartnerGroup's Symposium 97, Gartner Measurement surveyed a group of IT professionals about their most successful recruitment technique. Direct recruiting, including employee referrals, was successful in 88 percent of the enterprises; recruiting firms and headhunters in 51 percent; college recruiting in 26 percent;
the Internet in 5 percent. Although the Internet was low on the list, it had less to do with the Internet's potential as a recruitment vehicle than it did because few recruiters have fully exploited its potential. In the past year, usage and success rates have risen. Some businesses now report hiring 10 percent to 15 percent of new employees from the Internet. IT people, in general, appear to be more comfortable with a technology driven engagement.

Some companies are trying to build a new supply of young IT talent through school partnerships, even though this talent may not be available for years. Federal Express and General Electric focus on college-level programs. Cisco Systems and IBM are working to improve technology education in grades kindergarten through high school. The programs include volunteerism, training, and internships. (McGee & Mateyaschuk, 1999)

Another emerging trend is software development in the Human Resource organization. Companies such as Evolve Software, Skillset Software, and Icarian Software have developed applications that apply resource planning, principles of recruiting and managing personnel to the enterprise workforce management market. The software packages can automate candidate selection, forecast hiring demand, and manage the job-offer process. The software can be costly, however; Icarian Workforce pricing begins at $100,000.

Conclusion

This paper has focused on the problems facing individuals responsible for the recruitment, and ultimate retention, of IT personnel. In addition, the course of events that led to this situation and what strategies can be implemented in order to increase your level of success in recruiting have been discussed. The subsequent paper will discuss further emerging trends in this topic. Furthermore, examples of what some companies are doing to recruit IT talent will be introduced.