The North American IT recruitment market is extremely competitive, and professionals with highly desirable skill sets may find themselves in the enviable position of having companies clamor to secure and retain their expertise.
In its 2014 Compensation Best Practices Report, PayScale identified compensation as a critical component of retention. The online salary, benefits and compensation information company singled out real-time compensation benchmarking as an important tool for firms to make roles at their organizations stand out among the rest as particularly viable options.
“More than ever, real-time market data on compensation has the ability to give businesses a competitive edge as they grapple with a more dynamic talent economy and employees who are looking for a bigger, better deal,” said Tim Low, vice president of marketing at PayScale, in a statement.
Benefiting from real-time insight
The real-time aspect of compensation benchmarking and data analytics offers a significant advantage over relying on official government figures that are already outdated by the time they’re released.
Rebecca Bottorff, chief people officer at Internet and telephone service provider Bandwidth.com, noted that her company is up against particularly stiff competition because of its location. Bandwidth.com is headquartered in the Raleigh-Cary area of North Carolina, which was ranked by Forbes as the No. 5 new tech hot spot in the United States after STEM employment in the area rose by nearly 18 percent between 2001 and 2012.
“Because most of the data from competitors, or even from the Bureau of Labor Statistics, is outdated, it’s hard to find data on which to base pay decisions,” Bottorff told CIO.com. “And then the candidates you’re looking for don’t trust that the data you’re using is accurate. It can really be a mess … When we started to benchmark in real-time, it made us so much more agile, nimble and much more attractive to the developer talent we’re trying to attract.”
Companies based in Canadian tech hot spots face similar technical staffing challenges. In Ontario, which has the highest level of IT employment in the nation, competition is fierce in the Greater Toronto Area and the Technology Triangle of Cambridge, Kitchener and Waterloo.
How can real-time compensation benchmarking help?
As outlined by CIO contributor Sharon Florentine, using real-time compensation planning and benchmarking tools can benefit firms in a variety of ways, including:
- streamlining the process of finding qualified new talent
- making existing talent compensation more competitive
- determining the value that individual employees represent to a business, and facilitating the appropriate salary adjustments as needed
- reducing the chance that professionals currently on the payroll will jump ship in favor of working for a rival that makes a more lucrative offer
Looking beyond compensation-related benefits
McKinsey principals James Kaplan and Roger Roberts, along with associate principal Naufal Khan, outlined other tactics that leading IT organizations have successfully deployed to recruit, develop and retain quality workers:
1) Rotate high performers (for instance, by moving tech professionals into business or operational functions) to mitigate career staleness, widen fields of specialization and groom managers with multifaceted views of the company.
2) Expand tech staff training by integrating information pertaining to areas of the company, such as customer relationship management, marketing and products.
“Providing training that helps technology personnel understand the business – in some cases, all the way to the front line – makes technology’s value more tangible and provides invaluable context for interacting with non-technology managers,” wrote Kaplan, Rogers and Khan.
3) Set up mentorship opportunities to facilitate the transfer of knowledge to the next generation.
“Many technology organizations have found that the opportunity to interact directly with the institution’s most senior leaders is an irreplaceable motivator for high-performing technology staff,” the experts noted.
4) Encourage innovation rather than enforcing uniformity. Tech pros who are passionate about their work often exhibit higher levels of engagement and company loyalty that make them less tempted to bring their talents elsewhere.
“With all the focus on top-down management of IT project portfolios, individual innovation and experimentation are easily discouraged or lost,” the McKinsey trio acknowledged.
There are numerous ways that companies can improve their chances of onboarding and retaining the right technology talent. They may elect to focus on real-time compensation benchmarking or deploy softer tactics such as mentorship programs and more extensive training. The important thing is to realize IT staffing is growing more competitive and acknowledge the need to address this shift in some capacity.