Neglecting Skills Can Sink IT Companies

itcompAfter 20 years in systems development at Belk Department Stores Inc., Don Harris has gotten used to taking care of other people’s needs. These days, however, Harris is nurturing something other than Belk’s myriad users. He’s catering to the internal IT organization, hoping a little self-help will go a long way.

Harris, Belk’s first-ever manager of IT staff development, is now in charge of assisting the Charlotte, N.C., retailer’s IT department in taking command of its most coveted resource–its staff. His approach: taking inventory of the group’s skills and creating a skills management database. Armed with this critical data, Harris believes IT can do a better job of hiring, training and retaining employees with the ultimate goal of improving Belk’s business.

Sounds like common sense, but amazingly, carefully monitoring and managing the skills within an IT organization is an area many IT organizations neglect. According to a December 1996 study by Forrester Research Inc., in Cambridge, Mass., only 6 percent of 50 IT executives interviewed kept a catalog of their staff’s skills. Partly to blame for this oversight is IT’s past–in the days of big iron, there simply wasn’t enough variety to warrant this type of skills management. Not so in today’s IT shops, where executives are juggling a constantly changing, diverse set of needs amid a worsening skills crunch. Here, skills management becomes a crucial element in running a healthy IT organization that can deliver crucial projects on time and on budget.

“We aren’t asking the CIO to do anything that any [other part of the business] isn’t doing,” says George Tillman, vice president of the IT consulting group at Booz, Allen & Hamilton Inc., in New York. “This is what planning is all about.”

Getting started

Conducting a skills inventory isn’t very complicated. Information can be gathered through formal or informal surveys, in-person or anonymous interviews, on paper, or online. Belk’s Harris, for instance, is using skills management and assessment software from SkillView Technologies, of Plaistow, N.H., to track the expertise of 115 employees in the company’s systems department, a subdivision of Belk Stores Services’ MIS group.

In addition to SkillView, vendors such as Bensu Inc., Global Knowledge Network Inc., Hewlett-Packard Co. and IBM also sell products called “just-in-time learning tools” that include skills assessment features.

Going this route will require an investment on the part of the IT shop, experts say. According to the Forrester study, companies can expect to spend between $6,000 and $8,000 per person per year on skills management. That includes the expense of deploying the skills assessment software and database, the time employees will spend populating the database, and maintenance. The cost also encompasses compensation and benefits for a skills point person like Harris, who can command between $90,000 to $110,000, depending on the size of the IT organization.

Just throwing money at the problem won’t help, however, unless there’s a goal beyond tallying who’s doing what in the IT group. “You’ll have a very slim chance of succeeding … unless there is some broader process happening,” cautions David Foote, managing partner at Cromwell Foote Partners LLC, an IT management consultancy in Stamford, Conn. For instance, outsourcing, mergers and acquisitions, as well as new alliances or partnerships, can all drive the need for a skills inventory. More subtle issues, such as improving customer satisfaction by doing a better job of allocating staff to IT projects, is another catalyst.

Putting a skills inventory in a larger context also helps calm workers who may feel threatened by the process. “It’s a very bad idea to just announce blindly that [you’re] going to do a skills assessment,” because people immediately worry that their jobs are on the line, explains Foote. The actual inventory should begin only after re-establishing IT’s mission, determining specific goals for the organization and deciding what resources are needed to reach those goals. “In the course of doing that, the writing is on the wall,” says Foote.

Bring in the recruits

In Belk’s case, the retailer decided to inventory the skills in its IT group in part to improve its recruiting efforts. “Charlotte is a really competitive market. … We were feeling the crunch,” says Harris, who went live with SkillView this fall. Harris is using the tool to define models for specific positions that recruiters can match against applicants’ qualifications.

Likewise, managers can proactively find internal candidates for jobs. By keeping abreast of their skills, “we can invite [specific] people [for certain jobs] because we’ll know what their skill set is,” Harris explains.

Harris hopes senior management’s attention to the IT skill pool and career issues will encourage employees to stay with Belk’s IT department longer. To that end, he also plans to use the skills management system to improve the organization’s training offerings. Until now, training was arranged by individual managers who had no way of knowing whether other people in IT might need similar education, Harris says.

Since starting the skills database, Belk has been able to secure group discounts for on-site training. Belk, which annually spends an average of $2,000 to $2,500 per IT employee for training, has also caught the attention of training vendors looking to pitch their solutions to the company. “A lot of times now, some of the training companies will call me,” says Harris.

For Carol Bynum, second vice president of Protective Life Corp., in Birmingham, Ala., skills management is a fundamental business practice that all other parts of a company expect–and one that IT must adopt. Bynum joined Protective Life four years ago after a long tenure as a consultant in project management for Perot Systems and Arthur Anderson. “In Perot, we did fixed price deals. If I didn’t get my estimates right, I was out of a job,” says Bynum, who since August 1996 has been using a tool from PlanView Inc., of Austin, Texas, to manage the skills of about 250 IT employees at Protective.

The insurance company wasn’t doing a good job of planning projects, largely because IT didn’t have a complete picture of its staff, explains Bynum. After protests from the business units–which pay for all their IT services–a steering committee comprising senior IT and business executives was established to begin a skills inventory and project management overhaul.

With PlanView, the business units now have much more precision in controlling what they will spend on a given IT project. Customers can view all their projects online, for example, getting access to data such as what they have spent to date and detailed project plans, including information about the staff working the project.

Bynum hasn’t yet quantified how much money Protective Life has saved by developing its skills management program. But she’s in the process of conducting an internal study to find out, and she is extremely optimistic. “We have learned so much,” Bynum says. “It has had a serious impact on the bottom line and will continue to. Now [we] are getting the whole picture of everyone–who they are, what they do and what they do well.”

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3 Responses to “Neglecting Skills Can Sink IT Companies”

  1. Ellen J. Delamora says:

    I spent almost 10 years in an IT company. Recently, I decided to shift career. I felt like the management failed to nurture its employees with promotion or even just with simple complements. I lost the interest to do well at work because the management does not seem to appreciate it.

  2. Sue M. Gagne says:

    In any industry, it is very important to know what the employees are capable of doing. Know wherelese they are good at. Sometimes, they can perform tasks that may not be included in their job description but this can really be of help for the company’s advancement.

  3. Erin says:

    Skills management can help a lot, in my opinion. Instead of hiring people from the outside, IT companies better focus on figuring out and developing the capabilities of the men they already have.

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