No matter how exciting and beneficial a company’s a product and services portfolio appears to be, it doesn’t mean a thing if there’s no one qualified to deliver it. With the multitude of new technology and service opportunities that MSPs can add to their portfolio, the biggest stumbling block is often finding employees with the right skills to support a new practice.
Some say the workforce isn’t the issue, that a plethora of people are available for employment. But the real issue is finding those with the right skills, abilities and attitude. Another big problem is getting those prospective employees in the right place. A report by the Department of Health Information Management at Texas State University-San Marcos projects a shortage of 10,000 health IT workers by 2013 2013 to meet its goal of implementing and effectively using electronic health records (EHRs) —in that state alone! Could Texas find that many interested workers? Sure, but they’ll likely need to take a combined approach to filling those positions; training in-state candidates and recruiting skilled professionals on a national level. There’s no cheap solution to resolving the shortage of IT professionals.
A statewide issue is one thing, but how can emerging MSPs accomplish their business’ goals when they can’t find qualified personnel? Recruiting experienced IT professionals has never been an easy process for IT services providers. The difficulties start with writing an accurate job description and identifying the proper candidates, and proceed all the way through the onboarding process. Since the typical MSP business lacks a dedicated human resources department, the owner or office manager often gets saddled with those responsibilities—usually without formal training. When the hiring process is only used sporadically, the paperwork and onboarding procedures aren’t likely to become routine either.
With a shortage of skilled IT professionals, an MSP may also need to cast a wider geographic net to attract the right candidates, or settle for less qualified candidates. Both make the selection process more onerous, extending the time required to recruit suitable employees (reviewing resumes or on the road at colleges or more distant job fairs). Other costs creep in as well, from relocation and hotel bills for remote candidates to the extensive training expenses to bring less qualified candidate up to par.
The biggest issue affecting many MSPs is turnover. How often do providers give a prospect their first shot at a tech career and, after making investments in training and allowing them to cut their teeth, that employee leaves for a bigger company? Turnover is a killer to an MSP’s efficiency; reducing potential productivity through attrition. Contracts that include non-compete clauses may help minimize “job shopping,” but there are few things an employer can do to protect their training investments.
When MSPs add up all these potential personnel issues, one would wonder how they stay in business at all. Of course, the strongest survive and thrive—but many struggle to improve their productivity and overall business efficiency.
Personnel Challenges Threaten Productivity
Matching jobseekers’ skills to the needed expertise often becomes an exercise in futility. For managed services providers (MSPs), the challenge is aggravated by the need to employ technicians and engineers who will readily perform repetitive duties. Many activities outlined in service-level agreements (SLAs) are critical to the continued operation of the business, but completing those tasks can be quite monotonous and unrewarding for an IT professional.
How do MSPs find employees with the skills needed to perform these duties AND the patience to deal with the repetitive nature of many of the everyday responsibilities? It’s not easy, and retaining those individuals gets tougher every year. Most MSPs use incentives to satisfy their critical employees’ financial cravings and career goals, and make every effort to create a healthy work environment to meet their other employment needs. The difficult part of the equation is getting more productivity from these ever-escalating cost increases.
Even if a company can find suitable technicians and engineers, the dearth of skilled IT professionals may require an employer to pay much higher wages to attract the best and brightest prospects. That negatively impacts the company’s payroll costs and profitability, making expansion less attractive and causing many MSPs to rethink the way they do business.
So how do companies build their business in areas where skilled IT professionals are in short supply?
While Microsoft and Intel are pushing for an increase in the number of H-1B visas to fill the gap with more foreign talent, typical MSPs have to focus on the activities that will address their specific labor needs. The three typical approaches providers can take to solve a skilled personnel shortage include:
- Hire: continue to perform their own recruiting, onboarding and management
- Collaborate: share client projects/support with other MSPs and service providers
- Outsource: partner with a third-party agency that can provide the necessary skilled specialists when and where they’re needed
While the hiring concerns were outlined in this post, the opportunities with each approach (and potential pitfalls) will be addressed in my next article.