The Tech Talent Challenge – Growing and Hiring at the Speed of Light
The technology industry is facing extreme global competition for talent, creating a need for new, innovative approaches to securing the best types of talent from across the globe.
As industries continue to face an agile environment full of consolidation, divestitures and rapid growth, employees in the tech sector are increasingly in demand and taking advantage of opportunities in the market place.
In particular, technology firms are looking for the next wave of talent to enhance their capability in emerging technologies – artificial intelligence (AI), machine learning and virtual reality, to name a few.
For these sectors, top talent is few and far between, and comes at a premium. Firms in many cases need to explore a ‘build or buy’ strategy when it comes finding talent to grow their emerging business.
Growing an Ecosystem – One Classroom at a Time
ChapmanCG recently interviewed one senior talent acquisition executive in a Fortune 500 company regarding the growth of AI and the need for talent to support its go-to-market strategy.
The company has put itself on an aggressive plan to develop and commercialize AI applications for the consumer market. However, the talent pipeline remains far short of what is needed for the company to meet its future growth.
To address this issue, the company has launched a forward-thinking strategy of participating and investing in local and nationwide education initiatives, from university to K-12 education programs, to encourage more students to enter emerging technology fields.
This is a long-term strategy where the company works with local universities and colleges, including actively partnering with institutions to build curriculums. Ultimately, the company hopes these efforts will yield a critical mass in talent for both their own organization and the broader industry.
However, many companies may not have sufficient resources for this approach, and remain skeptical about the ability to recoup investments in efforts to build a longer-term talent pipeline.
The talent acquisition executive we spoke to says this long-term talent pipelining strategy as being critical to the future of the industry.
“If companies don’t invest in the ecosystem, the talent in demand is going to be more expensive. If there’s a scarcity with a skillset within an organization – for example, junior engineers who are coming in with a substantial equity package – it’s because of an overall market shortage.
“From a business perspective, it’s not a challenge that many companies can afford to continue with over the longer term.
“From an ecosystem building perspective, it doesn’t cost much compared to the potential longer-term costs of simply leaving it up to the market. What’s critical is for partnering companies to work together to get to a common solution.”
Recruiting at a Premium – Competitive Compensation is Just the Start
For companies looking to source talent to lead business units in the emerging technology space, the competition can be extremely fierce.
In highly competitive markets such as the San Francisco-Bay Area, Boston and New York, the long-term incentive component of a package is important in making an offer attractive. The value and makeup of the equity component needs to be appealing enough to tempt the very best talent into initial discussions.
However, compensation is not the only factor, with employees increasingly seeking to improve work life balance and remote working options. This is understandably easier to implement in certain functions where the need to be omnipresent is less of a key requirement.
As such, Talent Acquisition as a function has undergone tremendous pressure to find talent at a cost competitive level, particularly with organizations that do not possess the same brand equity as organizations such as Facebook, Google, and Amazon.
We often see this as a key challenge for European or international headquartered companies that are growing quickly in the US, but do not have the tenure or brand connections to the local talent pool. This is further exacerbated for some privately-owned companies, where equity eligibility is less transparent and highly discretionary for employees within the organization.
Hiring at the Speed of Light with a Highly Selective Eye
As talent needs in emerging fields become more pronounced, talent acquisition leaders face additional challenges aside from growing and compensating talent in the marketplace.
This includes the need to follow process and rigour in selection methods, versus being agile and responding to the broader market.
Many engineers, developers, and other technical talent disappear from the market at a rapid rate, with multiple offers and recruiters working to compete for talent.
For global businesses experiencing rapid growth in regions such as Asia, more robust and lengthy hiring processes can mean that Talent Acquisition teams even in large, well-recognized organizations may lose out on candidates to competitors with faster hiring processes, and may not be able to keep pace with the hiring requirements of business units.
As a result, there is a risk calculation all organizations need to take: the trade-off between taking a candidate through a robust selection process, versus making an early and calculated offer to secure talent from a competitive marketplace.
The talent landscape has become increasingly competitive at its current state, and is set to further intensify with organizations creating strong business cases to develop and recruit talent in emerging spaces where technologies have yet to be fully commercialized.
Meanwhile, organizations grapple with the balance between a selective and robust hiring process, while making hiring decisions at rapid pace.
These factors will continue to create a challenging talent acquisition function in the technology space for the foreseeable future.