Retaining IT Talent Takes More Than Money

The question is not if recruiters will pursue your top IT employees, but when. Smaller businesses need to ensure that their valuable IT talent isn't lured away. The good news: It's not all about the money. IT professionals have been in the catbird seat the last few years, and the prospects are looking brighter for 2008. Propelled by business growth, CIOs have expanded their IT departments. But that expansion strategy collides with two emerging trends: Baby boomers, the vanguard of the technology revolution, have begun retiring; and thanks to the dot-com bust and offshoring, younger generations no longer see the IT field as a coveted career path. Add to those shifts the fact that many IT professionals abandoned the industry during its darkest hour, and it's not surprising that experts claim there are now more good technology jobs than qualified people to fill them. Even the declining economy has yet to take a toll on IT staffers' prospects. The latest Robert Half Technology IT Hiring Index and Skills Report shows that 13 percent of CIOs plan to add IT staff in the first quarter of 2008. By contrast, just 2 percent expect cutbacks. That's great news for IT labor, but not so good for IT management; particularly for smaller businesses that can least afford to see their most talented employees jump ship to competitors or larger companies that can lure them with not only higher pay but broader opportunity. The question isn't if headhunters will pursue top IT employees, but when. The challenge for smaller businesses is to smother those recruiting conversations before they tempt valued IT staff with money and alluring opportunities. According to IT and staffing experts, the key is to make your company a place that IT pros don't want to leave -- and it's not all about the money. Here's their advice. Be The Educator Most IT professionals want to learn new things. They need to continuously upgrade their tech skills to keep pace, but that thirst for learning isn't limited to technology. With business and IT becoming more and more intertwined, many want to improve skills such as project management, business writing, and communications. By providing IT employees with opportunities to improve their skills -- tech and otherwise -- and measuring and mapping employee development, employers show they value their staff by investing in their career goals. Smaller businesses may hesitate to train beyond "need-to-know" requirements because growth doesn't warrant a systems overhaul or limits the need to deploy new technologies. For example, a smaller, regional company isn't likely to deploy a global WAN. So, why spend time and money for IT staff to develop expertise in such backbone architectures? Experts contend that's a poor way of thinking. First off, smart IT leaders can usually find ways to apply even seemingly unrelated skills to advantage. But more importantly, "what statistics have shown is that in companies that invest in and value employee development, the employees don't leave and take that knowledge somewhere else," says Chason Hecht, president of Retensa Retention Experts. "They appreciate the company that supported them, and that increases the loyalty." On the other hand, "they're going to leave if you've got nothing left for them to do and you aren't letting them grow and learn." Be The Innovator Smaller businesses in all vertical sectors, not just IT, that take advantage of new technologies are more likely to keep their IT employees' interested and challenged -- and on board. "Attracting and retaining talent has everything to do with the technologies being supported," says Sean Ebner, regional VP at staffing firm Spherion. "You could be a really big organization, but if you're managing antiquated systems it won't be as appealing for technologists to work for you. An SMB with a solid balance sheet that's using cutting edge or emerging technologies will have more potential" to retain valued employees. That strategy works for online automotive marketplace Cars.com, a division of Classified Ventures. "We maintain talented IT workers by giving them what is, in our opinion, some of the most interesting and exciting work on world-class technology," says CTO Manny Montejano. The company, he says, relies on its technology, and that technology platform must be fed with new and exciting projects. Cars.com, for example, is in the midst of an architecture makeover that includes integrating Web services. "Make the work addictive," Montejano advises. "The work we're doing at Cars.com is very rewarding, interesting, and the team is highly cohesive." Be Business-Aligned Many smaller businesses are already working to better align business and IT goals, but not always with staff retention in mind. However, businesses that foster dialogue and close interaction between IT and business staff gain a step in the retention game, particularly with younger IT employees. "There's now a new breed of IT pro out there," says Katherine Spencer Lee, executive director of Robert Half Technology. "I've been involved in IT for almost 20 years now, and when I first got involved you were in IT and math because you weren't really a people person. Now there are more IT pros that actually like to work with end users." The good news for smaller businesses is that fewer layers of bureaucracy can make it easier to bring IT and business together. Better IT and business alignment also plays to another desire of most IT staff: They want to be recognized and have an impact, says Hecht. "Give them opportunities to make strategic recommendations versus being just the back-office infrastructure people," he says, "to make recommendations of how technology can be leveraged to solve business problems. If you do that as a midsize company, you create loyalty with IT." Be The Communicator -- About Everything Montejano, for example, recommends clear communication to all employees -- not just IT -- about how the company is doing. Cars.com, for example, holds monthly all-employee meetings where the president reviews the status of the business. For IT employees, in particular, it's important to communicate about career prospects, especially for companies with smaller IT departments -- typical of many smaller businesses outside the tech industry -- because those opportunities won't always be visible to IT staff. Driving retention also requires communicating about the business and the brand, according to Ebner. "Make sure that you continue to drive and encourage the brand of the organization -- make people feel they're part of an organization that is world-class and going places," he says. "Everyone wants to be on a winning team." However, communication is a two-way street. It's important for organizations to listen to their employees and act on their feedback, especially from departing employees. But if you really want to learn what's driving away IT staff, don't conduct exit interviews in-house, advises Hecht. "Doing exit interviews in-house is shooting yourself in the foot. No one will tell you the truth," he says. "That's the first thing to outsource." Not all IT managers have good communication skills. That's when Spencer Lee advises communication training. "You have to be thoughtful about how you communicate, about what you and your company truly stand for," she says. Be Generous Just because it's not all about the money doesn't mean salary isn't important. "Make sure your compensation is at market," says Ebner. "You don't need to overpay, but you don't want to give people time for pause. If you're dramatically outside of what the market is paying for a skill set, IT employees are much more likely to take a phone call from a head hunter." Hecht emphasizes that, although compensation is always a factor in why individuals join, stay at, or leave a company, it's never the No. 1 reason. "Midsize companies shouldn't be dismayed by the fact that they can't pay as much [as larger companies], but if they can't deliver the growth and development, if they can't deliver the technology, projects, and opportunities, then they'll never compete," he says. Heeding these suggestions can help smaller businesses improve IT staff retention. Plus, SMBs may benefit from poor practices at some larger companies in recent years that have left a bad taste in IT staffers' mouths. "No one has forgotten the offshoring of the last few years, and the hacking away at IT programs in 2003-2004. People are rightfully hesitant to go back to very large organizations for fear they could easily be out-placed again," says Hecht. "And large companies in general have still not escaped the damage that was done in the corporate ethics scandals in the early part of the decade." He expects that seasoned, high-caliber IT pros -- the kind smaller businesses need and want -- aren't eager to move to organizations with those risks or histories. So don't give them a reason to.