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Contractors key to IT sector delivering on demands for innovation

IT contractors are expected to play a pivotal role in driving innovation as IT service providers struggle to meet the requirements of the ever-evolving IT department model.

Tomorrow’s Tech Teams, the latest report from IT resourcing specialist Experis, warns that new thinking around how IT teams are built is essential for progression and innovation in a range of sectors. Experis surveyed 1,000 IT workers and 200 senior managers offering IT services across numerous industries, including tech, finance, manufacturing and the public sector.

Currently, few companies possess the necessary combination of skills and qualities amongst their ranks. Some IT managers indicate that staff overhauls are required to remedy this, with an increasing reliance on the services of contractors expected over the coming years.

“The digitisation of various industries has put a lot of pressure on the IT sector to evolve quickly,” notes ContractorCalculator CEO Dave Chaplin. “Clients want the best of the best, many of whom will be plying their trade as contractors.”

Companies struggle to source right blend of expertise

“IT teams now have a big opportunity to innovate and contribute so much more to the wider business. However, in order to build departments that are fit for the future, rigorous, industry-wide change in how tech specialists are recruited needs to take place,” the report reads.

With firms now demanding that professionals possess a better-rounded skillset composed of soft and hard skills in equal measure, the talent shortfall is intensifying. 76% of managers claim they struggle to source professionals with the necessary blend of legacy and emerging tech skills to meet the increasing demands of the IT sector.

Experis concludes that there is currently an even split of IT professionals with each skillset. 48% possess emerging or innovative skills, whilst 52% have traditional or legacy skills. Most importantly, very few workers are considered to hold a combined skillset, a quality that is prioritised by 62% of IT managers.

The perceived outcomes of a continued shortfall in talent are a loss of competitive advantage (cited by 40% of respondents) and reduced staff retention and recruitment (38%).

Lack of well-rounded candidates impacting progression

The survey paints a bleak picture for the sector, but one which could work to the advantage of contractors. 67% of managers are concerned that their ability to carry out progressive work is hindered by a lack of the right skills mix in their teams. Only 33% believe that they have the necessary combination of skills and resources to facilitate any sort of transformation.

As a result, on average, managers estimate that 29% of staff will need to be replaced to enable firms to drive tech innovation. These factors all indicate that contractors who continue to upskill can expect to find themselves increasingly sought-after as firms tap into a depleted talent pool to source the required skills.

Demand is only going to intensify as firms also report problems with regards to retaining knowledge when staff move on. Two thirds of respondents state that important tech skills are lost when workers retire, adding that they are impossible to immediately replace.

Experis points towards better management of the transfer of knowledge within firms and placing more emphasis on in-house training, although these are both long-term solutions. The ability to draft in contractors with the necessary expertise to pass on knowledge offers an effective shot-term fix.

“We’ve been emphasising the importance of upskilling for contractors in the IT sector for years, but now it’s more vital than ever,” comments Chaplin. “Firms want candidates who are the complete package, and contractors who possess the necessary qualities will be able to command substantial fees.”

Tech teams struggling to meet industry demands

Soft skills are becoming an essential quality for IT contractors. The increasing demands placed on the sector mean ideal candidates are no longer simply required to carry out the practical aspects of the job, but rather to contribute to strategy and business development.

When asked what they want from their IT teams, 57% of businesses identified strategic input to decision making and 51% highlighted the ability to turn data into insight. Project management and leadership skills are also in high demand, which is where more experienced contractors may hold an edge.

The report continues: “The success of Tomorrow’s Tech Teams rests on recruiting well-rounded professionals, or people with the ability to acquire the skills they don’t have.

“Businesses need more from their tech teams, with almost three-quarters (71%) of IT worker and manager respondents reporting an increase in skillset requirements from their organisation over the last year. Cloud computing, mobile enablement, strategic insight and influence on whole-business decision-making is the future for IT departments.”

Clients anticipate rising contractor engagement

Looking ahead to 2020, the majority of tech teams will continue to be permanent employees. Whilst the study places emphasis on finding long-term solutions to managing innovation, primarily in-house, it acknowledges that an increasing reliance on contingent staff is a certainty.

Overall, the portion of contractors as the overall workforce is expected to rise from 24% to 28% over the next four years, whilst 69% of managers plan to engage more with contingent staff.

In return, managers have pinpointed flexibility (52%), the ability to provide a fresh perspective (49%) and unique skills (44%) as the primary benefits of hiring contractors.

Chaplin concludes: “As more professionals recognise the benefits of flexible working, and as clients increasingly acknowledge the value of engaging with contractors, a rise in contractor numbers is inevitable. The ability of contingent staff to provide unique expertise on a short-term basis will prove essential to ensuring that the sector is able to meet demand for innovation.”

Published: 16 May 2016

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