IT Competence Short Survey March 2020

KEY QUESTIONS ASKED: “Are you seeing a general decline in the competence of internal IT people and contractors at large companies? Do you see this as temporary / cyclical (e.g. nearing end of economic expansion) or more permanent?”

STUDY METHODS NOTE: This research was cut short by the Co-vid virus of 2020. I (Tom Ingram of Tom Ingram and Associates, Inc.) emailed these two questions on March 6, 2020 to 100+ key IT colleagues and received 21 substantive responses and conversations. I suggest you skim the bolded comments - I found them useful.

Tom’s Summary Answer:

1. Yes, the competence of internal, external IT people is down in big companies and contractors / outsourcers and it will continue for what I call “commodity / hygiene work”. Internal cost pressures, technology fascination, profit motives of vendors and consultants, failures of human nature and immaturity of IT as a industry will continue to devastate projects for the foreseeable future. The true project success rate (on time, on budget, percent of features promised vs. delivered) will remain at 33%-35% until maturity emerges.

2. High value / high impact work (10x and higher payback) will continue to get competent people.

3. The competence decline is a result of complex and near irresistible forces as IT matures as an industry. I suggest you skim the bold items in all responses below to get a sense of the forces at work.

4. Bottom Line: As individuals we are going to have to regularly retool with relevant skills to find work over 50 – likely - on our own (employer won’t pay.) Opportunities will emerge where we can bring excellence, focus and maturity to IT non-performance (not by accident. Will be intentional – and hard to do.)

1. EXCERPTS / OBSERVATIONS I FOUND MOST RELEVANT (did this quickly during covid virus – pardon the typos)

a. the certified resource is the Account manager (not the IT delivery team) & the work was done before by a 3rd party

b. if you want many skills in one person you are very limited on what level of skill you receive

c. staying in the glass house too long and they are not doing hands on work

d. Companies are using AI, Machine Learning, Big Data, and Block Chain to reduce the need for employees

e. Companies have stopped training for anything other than minimum skill necessary to perform. They're expecting employees to learn on their own

f. Due to technical focus, lacking is general critical thinking, problem solving, and communication skills

g. The incompetence that clients put up with in contractors and employees is astounding. (A former EDS VP, who has administered hundreds of outsourcing contracts, confirms this. Root issue is IT types managing contracts or employee performance are terrible – compared to business people who have enforced contracts under other conditions. I just had a major project devasted by this.)

i. TOM NOTE: I was just on a project where client lost (arguably) $100 million of incremental profit for these reasons.

ii. I SEE OPPORTUNITY IN EVERY LARGE COMPANY THAT IS OUTSOURCING IT – The forces driving toward incompetence are unstoppable.

h. Extremely short on business / industry knowledge. Language barriers become significant. Fully 25% of respondents are of this view.

i. Costs in IT Easy to Measure, Value Hard To Measure

j. Becoming employee’s responsibility to retool to new technologies regularly and many do it poorly or not at all.

k. The dominant corporate behavior is to lay off older, more costly people and hire younger, cheaper people with the needed skill of the moment.

l. Profit Margins as Root Issue, New Frontier: (Tom has documented elsewhere) What appears to be irrational cost cutting or under funding (using cheap, marginal people) is actually a symptom of unprofitable companies.

m. Ongoing Senior Management IT Oversight Failures Problem: (Tom has documented elsewhere)

n. The Churn of new technologies that contractors and employees have to learn.

o. Evolution of IT Industry vs. Predictions from 1998: (Tom has documented elsewhere – book published by PMI in 1998)

iii. Commoditization is expected

iv. Separating 10X from Hygiene/commodity

v. The 10X work (e.g. 33% of projects) will break out with these attributes (Hygiene/commodity work will be left to in-house and least cost contractors)

1. A for-profit, P&L contract to accomplish specific outcomes (not just managed service / outsourcing)

2. A single, competent leader at the contractor with Authority to match the Responsibility to produce specific outcomes

3. Repeatable with severely limited customizations and new technologies Profitable enough to attract and hold capital. Barriers to competition

4. Industry focused (“develop horizontally but market vertically”)

5. Consistently delivering the specific outcomes

6. Leadership that is not pulled off focus by financial pressures

p. FGIC Problem (Financial Guys In Charge) : (Tom has documented elsewhere)

q. The good people are attracted to small companies, startups, other places where the mediocrity is less.

2. Some Opportunities / Go Forward Suggestions I See:

a. Business / industry knowledge. Language barriers

b. Cultivate 10x high value habit. Decide if 10x or not

c. Focus where value is clear, measurable, clearly exceeds cost

d. Good IT Job / Bad Job concept

e. 66% consolidate commoditize nonsense burned away

f. Fed govt model. Some Merit in predicting what big company IT will move to over time

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Below are full excerpts that I found helpful – the text is as-submitted – pardon the typos:

Finding infrastructure and network management talent or even competent service companies seems near impossible now

It’s not declining overall, while the perception of such decline definitely is.

It is permanent and expect more gap

Business skills and knowledge are key weaknesses.

Too many small Mom and Pop shops who have the entrepreneur in the US and has the programming off shore.

What usually happens is that the US company (as in the case with my daughter) has to provide the subject matter expertise in dealing directly with the programmers (who have weaker language skills)

partially cyclical and partly the brain drain from experienced boomers leaving the market

if the budget for a particular position is $70K per year, but the job qualification really requires a $100K per year person, the hiring manager will accept a lower level of technical knowledge, experience, work ethic, and emotional maturity in order to satisfy the budget.

Particularly prevalent for people 50 years old and older

haven’t figured out yet is that a few REALLY qualified workers can accomplish WAY MORE that a bunch of cheaper, marginally qualified workers. I believe this is a permanent change

IT hiring managers’ first priority is making sure the staffing budget isn’t exceeded.

The IT field has become commoditized.

The fair rates that contractors and consultants were paid a decade ago have permanently vanished

it’s a decline in executive leadership in business process innovation.

Just doing “me-to” a little better than the next guy

all I’m seeing is the same business process software (install or SAAS) with a new “sexy skin” on top.

Definitely a decline in competence of contractors especially H1 contractors

What drives good people away is management, which I personally find mostly ineffective and self-serving, at large organisations

plenty of really good, technology people who like to work, do keep their skills current and enjoy challenges

their dislike for bureaucracy, company politics, "kissing ass" to get things done or get ahead

they leave large companies for the adventure and challenges offered at small and start-up companies

when companies go to new technologies they don't train "good" employees any more

They let old employees go and bring in new employees or contractors or temps that are trained in the new technology.

Companies are using AI, Machine Learning, Big Data, and Block Chain to reduce the need for employees

making a mistake because I valued employees who understood the company's business and knew how to use technology to make it better

don't see these short-time employees learning the business that well

companies try to keep a small core of extremely capable people but these are the "perfect fit" people

the best IT professionals are attracted to work at startups and smaller companies

Hard to see what will turn these trends around unless the VC world collapses like it did in 2000.

Tech changes are happening a bit more rapidly and the competency of knowledgeable personnel up-to par with these rapid changes seem to be decreasing.

most people in the market are at best half baked

not clear on their core skills

too specialized in one skill

People who are technical, are not prepared to face a customer.

Sometimes the “newer” offerings require more interaction (work)

more sever decline with internal IT people who are employees

staying in the glass house too long and they are not doing hands on work

More are becoming Service Delivery Managers or people managers than actual experts

Contractor skill is limited by the benefits, pay and location

client's who take a staff augmentation point of view

if you want many skills in one person you are very limited on what level of skill you receive

I do not see an end

They learn their systems and they are good within their domain. It is when they have to step outside of that domain that their experience (or lack thereof) is noticeable.

The internet is evolving rapidly, and those people who do not invest in themselves, and learning these new techologies will eventually become dinosaurs, and thus eventually extinct

I hope it is temporary. I’m not sure if it is cyclical or evolutionary.

Salesforce will often say we've done this before & have certified resources, but the certified resource is the Account manager (not the IT team) & the work was done before by a 3rd party. Salesforce is good at defending the software, but must instead sacrifice its people

Paper based certification or degrees, which flood the market with staff that on paper is qualified (while disqualifying skilled people).

Due to having less of an IT background or not knowing a variety of similar systems, these types of people will defend the system because one can always claim to need an experts help

over all declining with cloud, devops, AI and ML tech.

large population in IT is not able to quickly cross train and move on

employers are not encouraging the existing resources to cross train

laying off existing work force and hiring niche/up-skilled candidates

a lack of well-trained, highly functioning people and contractors across the spectrum – IT and other

permanent rather than cyclical

inadequate career and job ascension development

Yes, due to an almost complete lack of training on both fundamentals and details of their environments

fungible and temporary rather than long-term.

seeing an explosion in technology that developers and contractors aren't able to keep up with!

companies are trying to implement new technologies before those platforms/frameworks have been fully developed

This is such a relevant question. I'm seeing a general decline of talent but it's broader than I've seen in the past. I think generally there's a general lack of depth that I would expect to see. It's in pockets, but across infrastructure, application development, and data skills. The more troubling skill that seems to be lacking is general critical thinking, problem solving, and communication skills. I think there are a few patterns of cause around this:

- Big companies are sucking up talent, leaving a gap. Big consulting firms are getting bigger, but big tech is throwing money at the best talent and retaining better over time.

- University/College programs have focused so much on technology and functional skills that they've practically become trade schools. They're not teaching kids to think.

- Companies have stopped training for anything other than minimum skill necessary to perform. They're expecting employees to learn on their own, and it's tough for employees to keep up with the market beyond their companies and get deep enough to be useful.