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IT Skills Shortages Inside Companies Hamper Profitability, Productivity

CIOs who've been hard-pressed to make convincing business cases for increasing their training budgets may now have the data they need. Results of a recent survey conducted by the Computer Technology Industry Association (CompTIA) show the impact of IT skills shortages on organizations' profitability, productivity, innovation, speed to market, security and customer service.

The survey, conducted online between December 15, 2011 and January 23, 2012, asked 502 IT and business managers in the U.S. about skills shortages inside their IT departments, the impact of those skills deficiencies on their organizations, and how they attempt to address their IT skills shortages.

An overwhelming 93 percent of survey respondents report some gap between the technical skills their IT staffs possess and the skills their companies need. Eight-out-of-ten (83 percent) say that gap is small to moderate. Nine percent say their IT staffs' skills are not close to where they need to be. Only seven percent of survey respondents believe their IT staffs possess the requisite skills.

The skills that respondents ranked as the most important were core IT skills. The following IT skills received rankings greater than 70 percent:

  • networking/infrastructure
  • servers/data center management
  • storage/back-up
  • cybersecurity
  • database/information management
  • help desk/IT support
  • telecom/unified communications
  • printers/copiers/faxes
  • data analytics/business intelligence
  • Web design and development

How the IT Skills Shortage Affects Businesses

Eight out of 10 (80 percent) IT and business managers report that skills gaps inside their IT departments affect at least one business area. Here's a look at the impact of IT skills shortages on productivity, customer service, security, innovation, speed to market and profitability at small, midsize and large companies.

Productivity

Percent of respondents that say IT skills shortages inside their organizations hamper staff productivity:

Large companies: 44 percent

Midsize companies: 43 percent

Small companies: 41 percent

Customer Service

Percent of respondents that say IT skills shortages inside their organizations impair customer service:

Large companies: 33 percent

Midsize companies: 34 percent

Small companies: 26 percent

Security

Percent of respondents that say IT skills shortages inside their organizations negatively affects their ability to defend against cyber threats:

Large companies: 32 percent

Midsize companies: 39 percent

Small companies: 29 percent

Innovation/New Product Development

Percent of respondents that say IT skills shortages inside their organizations encumbers innovation/new product development:

Large companies: 29 percent

Midsize companies: 33 percent

Small companies: 23 percent

Speed to Market

Percent of respondents that say IT skills shortages inside their organizations impedes their speed to market with new products or services:

Large companies: 29 percent

Midsize companies: 33 percent

Small companies: 23 percent

Profitability

Percent of respondents that say IT skills shortages inside their organizations negatively affect their firm's profitability:

Large companies: 15 percent

Midsize companies: 15 percent

Small companies: 23 percent

CompTIA's report on the "State of the IT Skills Gap" notes that the business impact of a company's IT skills shortage is proportional to the size of the gap. In other words, the larger the IT skills gap, the bigger the impact it will have on a business.

Causes of the Skills Gap

Forty six percent of respondents believe technology's fast pace is the primary driver of IT skills shortages inside their organizations. Technology changes so fast that it's hard for IT professionals to keep up.

"Innovation occurs faster and on more fronts, product lifecycles are now measured in months instead of years and market competition has never been greater. Consequently, organizations and IT staff are put in the difficult position of having to decide where to invest their limited time," CompTIA notes in its "State of the IT Skills Gap" report. "A hedging approach whereby IT teams seek basic knowledge about a lot of technologies prevents organizations from becoming true experts in any one domain. Conversely, a focused approach exposes organizations to the risk of picking the wrong technologies and/or strategies."

Other causes of the skills gap include:

  • The lack of budget money for professional development, cited by 43 percent of respondents
  • The perceived lack of improvement that comes from training, cited by 39 percent of respondents
  • IT pay is too low in some areas, cited by 29 percent
  • Difficulty of providing on the job training, cited by 23 percent
  • Competition for a limited pool of skilled IT workers, cited by 20 percent.

How Companies Address the Skills Gap

Despite lack of funds for training and the perception that it doesn't pay off, training or retraining existing IT staff in areas where skills are lacking is the top way organizations try to address skills shortages.

The most popular training method IT departments use is online self-study, which 50 percent of respondents say they employ. The next most popular training method is vendor provided training, which 42 percent of respondents rely on. In-person classroom training ranked third, with about 37 percent of respondents supporting this traditional form of learning.

Nearly four-in-ten (38 percent) opt to deal with skills shortages by outsourcing work to third-party providers or contractors. Smaller firms are more likely to outsource while larger firms are more likely to invest in training, the survey notes. Slightly more than one-fourth (28 percent) try to address skills shortages by hiring new people with the desired skills.

"The primary way organizations address IT skills gap challenges is via training existing staff versus turning elsewhere for new workers," CompTIA notes. "Most professionals in executive or HR roles should already recognize that investing in staff training is typically a cheaper option than hiring new employees or outsourcing."

Meridith Levinson covers Careers, Security and Cloud Computing for CIO.com. Follow Meridith on Twitter @meridith. Follow everything from CIO.com on Twitter @CIOonline and on Facebook. Email Meridith at mlevinson@cio.com.


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