2022 CIO study reveals business impacts of the tech talent crunch.
In February 2022, CIO (formerly IDG Communications) conducted a study to examine business and technology challenges among Oracle and SAP enterprise software customers. The survey provided a window into challenges resulting from the IT/technology skills shortage. They included respondents from a variety of IT roles and organizations from $250 million to $10 billion or more located in 10 different countries.
What they found is that the technology skills shortage is a real problem that is having a global impact on the business’ ability to thrive and grow. The impact goes beyond internal IT project delays and productivity issues – nearly one-quarter (24%) of U.S. respondents cited customer churn resulting from a lack of available IT/technology talent.
Takeaway 1: Tight Tech Talent Market Is Holding Back Innovation
As technology modernization ramps back up post-Covid, many CIOs are looking at increasing staff to work on digital projects. CIOs understand that business process transformation is a key ingredient for digital success. But for many, that transformation is a hinderance to attracting talent that expects hybrid and remote options.
The pool of talent that understands the business and how technology enables it is the sweet spot that many CIOs struggle to recruit. The issue is actually broader than finding enough tech talent. It’s finding tech experts that also understand the business and having the right technology in place to accommodate their preferred way of working.
Takeaway 2: Enterprises are Running Older SAP and Oracle Releases
While cloud, AI, and machine learning may be some of the hottest topics in technology right now, 45% of the surveyed organizations are supporting older versions of SAP, Oracle, and PeopleSoft software even as they modernize.
The tech talent drain is hitting support teams for these legacy deployments especially hard since many of the experts are being removed from the workforce due to retirement (as opposed to changing jobs). The shrinking pool of experts that remain in the workforce to support these systems portends a highly competitive market.
Takeaway 3: Hiring Focus is on New IT Skills
It seems candidates aren’t all that excited about working on old technology, or they don’t have older technology expertise. As a result, some enterprises have created an imbalance in how they focus staffing and retention activities for tech talent — over-indexing on new skills versus legacy skills. The survey also showed that Oracle customers are more likely than SAP customers to cite a lack of the needed technology expertise among available talent.
“An overwhelming 86% of the respondents anticipate it will be challenging to hire individuals with expertise in on-premises technologies, such as enterprise resource planning (ERP) and customer relationship management (CRM).”
Takeaway 4: Cybersecurity Tops the List of In-Demand Skills
Although skills are necessary in all areas of IT, the study shows that cybersecurity and cloud/multi-cloud skills are the highest priority for respondents over the next 12 months. Recruiting these difficult-to-find (and likely costly) skills may eat into the enterprise software support budget and headcount.
Legacy Tech Talent Is Critical to Accelerating Innovation
Enterprises need a mix of strategies to address the technology skills shortage. Almost 60% of respondents indicated their organizations are likely to leverage vendor or service providers to address IT skills gaps. More than half (55%) report it’s likely their organizations will shift resources from bespoke technology management to assist with other projects over the next 12 months. Although bespoke system talent is just as hard to find as digital talent, only 1 in 3 CIOs plan to outsource enterprise software skills, leaving plenty of opportunity for third-party support to help solve the tech talent shortage.
“Top-of-mind technology challenges such as cybersecurity protection and moving the IT infrastructure into the future elevate the question that CIOs face more frequently than ever before: how are we going to find the technology talent needed to keep existing systems operational and also grow the business?” says Brian Slepko, EVP, Global Service Delivery at Rimini Street.
Tune into his conversation with CIO analyst, Tom Schmidt, about findings from the 2022 CIO IT/Technology Talent Shortage survey and their proposed strategies for meeting business priorities while balancing needs for new and legacy technology skills.