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The trainer's dilemma

Can SA break out of the headhunting and job-hopping spiral?
Paul Furber
By Paul Furber, ITWeb contributor
Johannesburg, 11 Aug 2008

Everyone complains about the skills shortage, but no one does anything about it. But is that true? ITWeb gathered as many skills and training experts as it could find and asked them some pointed questions: How bad is the skills crisis? Is it as bad overseas? How can government help? How do we stop poaching and start looking at the bigger picture?

Cisco and Accenture are going on active recruitment programmes to get people from the UK.

David Ives, developer and platform strategy lead, Microsoft

Present to share their insights were: Stephen Bracher, business delivery manager at IQ Business Group; Haseena Parak, MD of Staff IT; Teryl Schroenn, MD of Accsys; Gary McHugh, director of Brighthouse; Lucas Mothupi, director of Satreno; David Ives, developer and platform strategy lead at Microsoft South Africa; Johan van Jaarsveld, MD of EOH Outsourcing; Steve Randles, MD of Khanyisa Real Systems; Sean Petersen, national resource manager of M-IT Mthombo; and Peter Clark, CEO of iSolve Business Solutions.

ITWeb: How bad is the skills shortage in the rest of the world?

Peter Clark, iSolve: Last year, we attended the worldwide Microsoft partner conference and could see that it's a global problem. Australia, for instance, is about 50% short of the IT skills it needs. The governments of Britain, the US and Australia are putting down lots of cash to try to solve the problem. In India, there are 400 000 graduates per year, of which none leave the country. India needs them there.

Lucas Mothupi, Satreno: Last year, we opened an office in the US and can't get the positions filled there.

Gary McHugh, Brighthouse: The estimates from SAP are that the industry is about 30 000 consultants short worldwide. That's work that has been allocated and budgeted for - it's just waiting to be done. Our problem is that SA is not the most glamorous destination in the world and staff from offshore countries like India are saying they can go to Asia or the US. We're competing with the rest of the world for skills.

Johan van Jaarsveld, EOH Consulting: I think what's key is the difference between normal skills and experienced skills. You still get young guys coming through the ranks, but very experienced people tend to move a lot and relocate more easily. We've picked up that there's the biggest skills exodus from SA happening right now and it's purely because the guys can move. Companies and other governments are attracting our people. So, yes, there is a worldwide shortage, but our people are leaving and that doubles the impact on us.

Steve Randles, Khanyisa Real Systems: There's also a shortage of management and management structures around the world. And a certain number of more senior IT people are moving into management as well, so the gap is widening from the top and the bottom.

McHugh: Statistics from Dimension Data show the gap is from 22- to 34-year-olds. It's almost like a lost generation. DiData has tracked that it's when they are between those ages that people are most likely to emigrate.

Stephen Bracher, IQ Business Group: Pay is also a factor. A lot of young, single guys go off to work in the UK for two to three years. And the thing is, they never come back. They used to come back after earning a few pounds. Now it's rare. And when someone does come back, it's with an overseas company and they're earning dollars or pounds.

David Ives, Microsoft SA: Academia is very concerned about this. We churn out about 5 000 ICT graduates. Those who aren't sucked up get re-skilled through some of our programmes. What a few international companies are doing is targeting the reverse situation: they're going to the UK and asking people whether they want to trade mud island for [South Africa] because you can buy security and the sun shines often. Companies like Cisco and Accenture are going on active recruitment programmes to get people from the UK.

ITWeb: Who is investing in long-term training strategies? How bad is job-hopping?

<B>Should</B> <B>you train people to leave?</B>

Companies that harness talent and intellectual capital are going to be globally competitive.
Finding the right skills in the South African IT industry is an ongoing challenge, primarily because the demand is constantly changing, says Ivor Rimmer, MD of Bateleur Resourcing.
"South Africa's chronic skills shortage exists on two levels," he says. "Finding the skills you need when you need them is the first aspect. Secondly, companies need good black skills, which are always in short supply."
It's much less about the certificates behind your name than an enquiring mind, willing attitude and the ability to learn and adapt.
"A client-centric culture and understanding of customer requirements is more critical than the latest trendy qualification. In theory, it's all very well to ensure you have the right skills on board to meet the challenges of the future, but in practice, it's preferable to have flexible staff with the experience, attitude and talent to adapt to changing customer needs."
Rimmer believes it's impossible to have all the right skills in place all the time. As soon as a company has finished training its staff in one area, something new is on the market. Some professionals have an affinity for learning new technologies and skills, and those are the people to look out for. In line with this approach, Rimmer believes organisations should adopt a strategy of training people to leave.
"Although this sounds like an oxymoron, the opposite is true," he says. "The main reason people change jobs is because they believe their skills are stagnating and they need to expand their horizons. By keeping them at the forefront of their fields, so they could work anywhere, they will probably stay with you because they can achieve their objectives." Employers should also examine their selection processes, he says. "Briefing the recruitment consultancy correctly is the first step towards finding the right people. I believe that line managers should have a say in selecting the right person for the job, as they know exactly what skills and culture fit are required."

Teryl Schroenn, Accsys: A lot of companies look at contracting people for some kind of payback for the training they've given; it's like a bursary, but an internal one. The problem is that contracts aren't worth the paper they're written on. You contract someone, train them for a period of time and they are supposed to work for you for a year or two after that. But, unless you're prepared to spend your life in the reverse CCMA in terms of litigation, you just have to let them walk away. It's not worth the time and trouble to chase them. Our current legislation is against companies that do massive investment. Once you've hit your 60%, you can't get any more back anyway.

Sean Petersen, M-IT Mthombo: We have that same problem. Because of the shortage, you spend time and effort skilling people up. Not even a month after the training, you find that the guy has another job. The company he goes to gets the benefit of your investment because they are willing to pay the money he was supposed to pay back.

Clark: We've tried to enforce that. We've got global lawyers involved to [develop] a proper contract. Once, we put trained guys into the field; within a month, three of them jumped ship and we received their resignations via SMS. The guy signed a contract to pay back R100 000 worth of training, but you can't enforce a restraint of trade.

Mothupi: The reality is that even if you invested R12 000, you will never get back [that money]. You don't get time back, for instance. If someone took six months to train, you will need to take another six months to train someone else.

McHugh: In the SAP world, particularly at the more mature clients, they will dictate they want more senior skills. If we go through a learnership programme, we will have to pay for that ourselves, especially in a professional services environment where you can't sell learners, even for admin functions. It's another angle of the problem: is it worth investing in skills that are going to sit on the bench or at a cost to us?

Petersen: It depends on the market you play in. In the telco industry, it's very small and the shortage of skills is great, so guys hop from one to another very quickly. What we need to start doing is say we've had enough. But the flip side is that those clients need skilled resources. The only ones available are already working in the industry, so it's a catch-22 situation.

Schroenn: A lot of companies are offering sign-on and retention bonuses. That, again, makes it very hard for people who can't pay up. Companies are not going to look too deeply at restraint if they're desperate for skills. Even if you have a legal restraint, it's virtually impossible to enforce.

Haseena Parak, Staff IT: Where I am, we're getting companies offering sign-on bonuses only to get counter-offers from their current employers. So it's a vicious cycle.

Bracher: A lot of guys do that to get the money they want. They'll come to you and say they've had an offer to see if you can match it - and we end up overpaying. And the non-solicitation clauses we have in place are with our clients. If you have a R10 million contract in place, you don't want to put that at risk just for one person.

The problem is that contracts aren't worth the paper they're written on.

Teryl Schroenn, MD, Accsys

Van Jaarsveld: The current cycle is supply-driven - and that will change. The suppliers of the resource are in command. When it does change, a lot of contractors may decide they want to be permanent employees. We don't know what a downturn in the economy may do. If our selling rates increase up to a certain point, then the inflow of foreign resources will be big enough. We've already seen that in a number of different markets: European, South American and Australian people are prepared to come here because the rate there is lower than here. The system will work itself out over time. I know that juniors are costly, but we do need to keep training new people and throwing them into the pool.

Ives: I hear a lot of negativity towards internships and skilling. I would be concerned if I was government because there are a lot of mechanisms in place: the SETAs, money back on the salary bills, the BEE scorecard with which we all have to comply. I presume people are spending money on their own channels, but you can and we have to spend the money anyway. We need to decide how we can de-risk this for ourselves. We don't have much of a choice - we need to invest because it's right for our country. How can we make this all more tangible?

If someone gets an offer and we counter-offer, we'll still lose him within three months.

Peter Clark, CEO, iSolve

McHugh: To give you an example, we [ran] an internship [programme] about three years ago to put 40 guys through SAP skills training. At the end of the programme, we had three guys left. Yes, we tried and went through the governmental avenues, but the bottom line is we benefited the economy as a whole, but we didn't see any return. Those guys were all snapped up. It was great for the economy, but not great for us as an organisation.

Bracher: After running an internship [programme] for two years, I came to the conclusion that it was cheaper for me to go out there and pay the fees to employ somebody for two years. That's the easier option, but for the industry, it's a bad thing. Plus, a lot of the senior guys get annoyed that they have taken time to train juniors, and then within six months, they're gone.

ITWeb: What about government's role? How could it make things better?

Randles: The SETAs aren't working. They need tons of grease and lubrication to get them moving at any decent speed. There are horror stories of people waiting years for things to get signed off and the barriers to entry are high for smaller companies. There are thousands of IT companies in the country, but some are only two- or three-man shows. I think the more initiatives, the merrier, but the incentives should be there, and they should be simple and easy, with quick comeback.

Petersen: Government should put things in place to protect the people doing training investment. The Constitution says everyone has a right to a job, but no one points out that people are stealing time and training from companies; the law needs to be tightened up. Then companies will invest and know that they'll get the benefit.

Schroenn: I don't know that we need any new laws, but we could certainly do with enforcement of the ones we have. Increased mobility and the drive to earn more money have created a situation where companies are not respecting the rights of other companies. We had someone who joined us on 12 May who sent the company he was working for his resignation on 15 May from our fax machine. We put him through a disciplinary hearing and let him go. If we adhere to the law of the jungle, it will bite us.

ITWeb: What are some ways companies can retain staff?

Clark: We've found that if someone gets an offer and we counter-offer, we'll lose him within three months. We had a database administrator who was getting paid about R25 000 a month. In a six-week period, he went to R55 000. He's messed up his career now because he's stuck in a corner doing something he doesn't really want to do because no one will pay him that in the market. We just try to make our guys' lives as easy as possible: no daily driving from 14th Avenue to Springs, for example. We place people in projects closer to home and give them more flexibility. Most of our senior guys have been here for 10 years because they're happy.

Van Jaarsveld: Traffic locations have become very important. The second thing is lifestyle. Money is critical, but it's not the driving factor because the assumption is they'll get paid well for their skills. The culture is important too: will the guys work together? Is it easygoing?

Bracher: I've had a lot of guys who've left and come back just because the environment is good and they get looked after. But I find that it's more in the zero to five years' experience that it's all about money. When they're a little older, it becomes about flexi-time, skipping the traffic, and being able to work from home every now and again.

McHugh: We've become flexible in remuneration as well. We don't necessarily pay them more, but we're more flexible in other things, like paying quarterly bonuses rather than annuals. Salary-wise, people get paid well, so it's about cash flow.

Cycle to the rescue

If economic indicators are anything to go by, both the US and large parts of Europe (including the UK) are in for a very rough time over the next five years. When that happens, will SA be in a position to offer overseas skills a stable environment with well-paid jobs? That would be first prize. But, the maturity of both our companies and employees towards the skills roundabout needs to improve.

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