These are scary times for U.S. IT professionals, many of whom are convinced that they’re this generation’s steelworkers. The growing reliance on offshore partnerships and the spectacular spread of the global marketplace are leading to the revamping of business models, the reshuffling and downsizing of IT outfits throughout the United States, and the shifting of workforces across continents. This rapid evolution is forcing tech workers to realign their skills to advance their companies’ core business needs while putting a premium on agility and international-business acumen.
The sustained upheaval in the IT labor market prompted the research firm Gartner to devote its May 2005 ITxpo to the thorny question, “Where Do We Go From Here?” (The consultancy predicted that by 2010, IT departments in large and midsize companies will shrink by nearly one-third of their size in 2000.) For years, business executives answered that question by hiring overseas. Matthew Bradley, vice president of corporate engineering at Hyperion, for instance, recently heralded offshoring as a “strategic imperative for the business to remain successful.” Kim Polese, CEO of SpikeSource, agreed, saying, “any forward-thinking company has built a global presence into their planning and strategy.”
As more and more companies seek their competitive advantage offshore, stateside technology workers are struggling to find what their edge will be in the years ahead. Fortunately, U.S. workers willing to adapt will find themselves with several options to stay gainfully employed. Hiring managers and outsourcing specialists point to an increased demand for managerial positions that incorporate broadened project-management skills. They also point to new titles, such as business transformation architects, and the prevalence of client-facing roles that simply cannot be outsourced.
“There are a lot of in-demand IT jobs in the U.S., but they’re more likely to involve product architecture, new products, and innovation,” says Gordon Brooks, CEO of Symphony Services, which manages globally distributed development centers in the software industry. Three years ago Symphony set out to help U.S. companies expand into foreign markets. It now employs roughly 2,300 workers worldwide, 99 percent of whom are U.S. citizens, according to Brooks.
Innovation as Birthright?
Industry Pollyannas typically point to the long history of U.S. innovation as the cure-all that will produce the next generation of jobs. This time around, however, opinions differ drastically, and caution is in the air when the word “innovation” springs up. India alone is conferring thousands of computer science degrees a year, and hiring managers there expect a lot of those graduates to be hard at work innovating. According to Shashank Samant, president of managed strategic services at Ness Managed Labs, India is indeed gearing up to take a leadership role in engineering and software development, but it’s not at the stage where it is wholly innovating yet.”
“It’s years away,” Samant emphasizes. “It’s still primarily a software factory.”
Historically, America’s response to drastic economic shifts -- such as the flight of manufacturing jobs overseas that began in the late ‘70s -- has been to transition into service- and design-oriented roles while creating more-efficient products and processes. Noted human resources authority Ed Rankin, BPO (business process outsourcing) practice leader at Alsbridge, an outsourcing advisory firm, says creativity, in addition to the agility required to adapt to rapid change, will continue to rank high among marketable job qualities. “Creativity still sets us apart. And creative technical people will still be breaking the mold,” he says. “There’s always going to be somebody around who knows more than you, with more expertise in a particular technology. So, even when you’re talking about a talent pool that’s expanding globally, you can still differentiate yourself by being a person of ideas.”
But John Hagel III, co-author of The Only Sustainable Edge: Why Business Strategy Depends on Productive Friction and Dynamic Specialization, warns against the notion of innovation as “a national birthright.”
“The situation now is a lot more urgent,” Hagel says. “You can’t just say, ‘Oh, we’ll keep innovating and somehow stay out front.’ What’s important now is to be building your capabilities faster than anyone else or you won’t be successful."
Calling All Business Majors
Success may soon come wrapped in a dual computer science/business degree. As IT departments are increasingly relied upon to deliver a substantial part of the business value of their organization, hiring managers will be looking for business skills in addition to core science, math, and engineering skills.
It’s no coincidence that many of the newfangled acronyms that dot the IT landscape -- BPO, BPM, and BAM (business activity monitoring) -- start with “B,” for business. Technology activities that are tightly connected to corporate strategy and processes are becoming highly prized, as are those central to large-scale system integration projects.
For example, IBM has added a new title to its roster: the business transformation architect. “In this new services-oriented era, we need business people who are fluent in IT and vice versa,” says Michael Liebow, vice president of SOA and Web services at IBM Global Services. “In broad terms, [the IT sector] has had a fairly hardwired, inefficient architecture. And it served pretty well. But with the emergence of composite apps, you can’t have any of that cement. That’s a huge shift.”
Liebow sees a rise in stature for the IT architect who has skills keyed to emerging architectures. “We’re talking about someone who can conceive of an SOA-adoption road map,” he explains. “Web-services design and architecture demands new skills,” including partner-management skills because of the multiple partners inherent therein.
Forrester Research analyst Stephanie Moore urges anyone who might view IT as a dead-end career to seriously consider acquiring or augmenting business expertise. When asked about safe havens in tomorrow’s labor force, she says, programmers who can turn into business analysts are going to be very successful because both their skill sets will play pivotal roles moving forward. She adds, “IT workers today, particularly those working in the programming space, need to develop project-management skills, program-management skills, and vendor-management skills."
Many IT professionals have already heard the call. According to the InfoWorld 2005 Compensation Survey, 19 percent of senior managers reported having an MBA, an increase of 6 percent over 2004 levels. “You’re not seeing anyone going back to school to learn how to code,” Symphony’s Brooks says.
Managing Third Parties
Knowing how to manage delivery from outsourcing firms and contractors will also be valuable in the years ahead, a role that “will gain ground, demanding strengths in … managing geographically distributed parties,” according to a recent Gartner report.
Technical leads — professionals who know so much about the technology that they’re able to manage an outsourcer or dictate to them what an architecture should look like — are crucial, says Forrester’s Moore. They should know how to manage the vendor better so they get better delivery.
Meanwhile, a cottage industry has sprung up to facilitate foreign partnerships and operations, which rely heavily on U.S.-based high-tech workers with strong managerial skills. A few of the powerhouse consultancies include Alsbridge, Everest Group, EquaTerra, Ness Technologies, and TBI. “We have tremendous demand and we can’t hire fast enough,” says Alsbridge CEO Ben Trowbridge, who plans to double his workforce in the next three months.
The qualifications? Successful candidates will be adept at managing programs; they also must be able to deal with complex, business-intimate questions and they have to have been part of a process that has included outsourcing and offshoring activities. “If going to work for an outsourcing facilitator sounds like aiding and abetting the enemy,” Alsbridge says, “IT workers are competing with the labor pool not the outsource providers.”
Rankin says the army of contractors willing to work on a project-to-project basis is growing. He points to shifts in the temporary-IT-staffing business, which regularly conducts online auctions to provide labor. Those contractors have to be managed. For now, the trend toward IT services as a commodity shows no signs of slowing down.
Adapting to Change
Many executives see the flux within the IT sector as déjà vu when viewed in the historic context of America’s transition from agriculture to manufacturing to services and product design.
“Transitions are difficult but resistance is harder,” says Saman Amarasinghe, CTO of Determina, a security solutions provider, and associate professor at MIT. “We’ve been through this numerous times in the past, whether it’s automobiles or textiles, and so on. And every time we thought we were losing the crown jewels, but we didn’t.”
Mark Lewis, executive vice president of EMC Software, says “any time an industry goes through globalization, and they all will eventually, a shift in roles takes place.” He notes that whereas an IT manager’s team was likely to consist of 10 workers in a cube farm, today it’s more likely to be 100 workers dispersed throughout multiple countries.
The flight of midlevel IT jobs, and increased competition for what’s likely to be a dwindling number of slots, due also in part to automation, has potential to be a catalyst for more senior-level, director roles. Judging by the widely varied and conflicting forecasts generated by the analyst mill, statistics in this realm are questionable, though earnest, when they set out to enumerate growth (or erosion) of jobs in the United States. Predictions range from dire to disquieting.
By its nature, coordinating employees or outsource providers across oceans and borders adds a layer of logistical complexity that demands a managerial mind-set.
“The classic bad news is, your manager calls a meeting and says, ‘Your department is being outsourced’,” Trowbridge says. “The IT worker with a better shot at success is the one willing to study how the work will be migrated, how that transition will be managed, and what all the steps are. Learn that and you’ve just made yourself more valuable.”