Business First Columbus recently wrote an article about the growing shortage of information technology talent. The article, titled “Plentiful job-seekers finding trouble matching plentiful jobs in tech,” highlights the widening skills gap between today’s job seekers and the available positions companies are trying to fill. Increasingly, IT consulting firms and IT departments of companies are looking for technology talent, and they’re just not finding it on the open market. As a result, competitors are poaching talent to fill the gap.
The Three-Legged Stool of Professional Services
One of the inherent difficulties of managing the professional services firm is the difficult balancing act that firm leadership must play between satisfying the needs of the firm’s clients, its people and the firm itself. At times, the somewhat competing needs of each threaten to tear the firm apart at the seams. Some examples: While clients prefer to hire experts with proven past experience solving their particular business problem, talent is drawn to the firm for the opportunity to work on diverse projects with diverse clients. While selling more projects like those we’ve done in the past drives near-term profit, failure to innovate into new services and offerings can wreck long-term profitability and the firm’s very viability.
The “Fee Squeeze”
A month or so ago, I had coffee with the Principal of a midsized IT consulting and staffing firm. I asked for her perspective on the market, and she gave me this very simple answer: “In the recession, IT spending was cut by 20% across the board. All that business has now come back, but clients want to pay 20% less for it than they did 3 years ago.” Simultaneously, finding the talent to deliver the work is becoming more difficult and more costly. So, which leg of the stool is suffering most? Clearly the firm and its profitability.
Ways to Respond
So, if clients want more for less, and employees simply want more, how can the IT consulting firm exist without bankrupting itself in the near term? Well, one approach is to take a close look at the firm’s internal brand. What does that mean?
- It means looking at your people the same way you look at your clients: understanding their needs, motivations and wants and developing “products and services” that align. Only, in this case the services may take the form of unique benefits, unique work environments and firm culture.
- It means building context for your organization by establishing a reason beyond profit that the firm exists: a brand purpose that connects with your people on a visceral level. People often work for below market wages when they believe in what the organization stands for and what it’s trying to accomplish.
- It means understanding the fundamental elements of employee engagement: autonomy, mastery and purpose, and training partners and managers in the skill sets necessary to ensure an environment that enables engagement to occur within the workforce.
Coming to a Professional Services Sector Near You
While this post is focused on the IT service sector, there is no doubt that other professional service firms are facing similar challenges now or will in the very near future. The engineering workforce is aging at a rapid pace, and there simply aren’t enough new engineers coming into the workforce to fill these jobs as they retire. Increasingly, engineering firms will be facing a much more challenging environment for employee attraction and retention. Building strategies to deal with it now is probably the best way to ensure the firm’s viability come 2015 when the Baby Boomer generation really starts to retire in full force.