The Way Business Is Moving published by
Issue Date: May 2008

Skills shortage looms

May 2008
Andrew Seldon

The eternal question of skills has reared its head again. Network Times asked a few pundits for their take on the local situation.

A recent Computergram report noted a serious shortfall in IT and telecoms talent in the UK. The article states that the numbers of graduates with IT-related degrees is dropping 'dramatically' and 'employment in the IT and telecoms industry is predicted to grow up to five times the national average'.
What is the situation locally? South Africa does not need as many professionals as the UK does, but we certainly need more than we have available.
We posed a few skills-related questions to the market.
Network Times: What are the skills most lacking in the South African market? Or, if you could advise the next generation of school leavers on what skills they need to get into and thrive in the ICT market, what would you say?
Martin Rennhackkamp, COO, PBT: In-depth technical skills, from application developers (using C++, Java, and other Web-database application development technologies), through to application architects and system analysts as well as technology specialists for example ETL developers and report/dashboard developers in the BI space.
Martin Rennhackkamp, COO of PBT
Martin Rennhackkamp, COO of PBT
With regards to skills, I would recommend the following:
* A very strong technical foundation: programming language(s), programming technique and skills, Web and user interface design, database design, SQL, systems analysis, systems architecture, object orientation; and an exposure to open source technologies.
* Good business background: commerce, retail, insurance, banking, mining, government - some background in business economics.
* Strong theoretical foundation: mathematics, accounting and/or statistics.
Inez Van Aswegen, general manager, Network IT Recruitment: From talking to clients in general, I believe that the skills most lacking, apart from specific new technology skills, is that of business sense and the ability to understand business processes and link it with the IT environment. This also includes project management skills. I would advise the next generation to choose a degree/course where they get exposure to the full IT life cycle and learn the basic principles of business in conjunction with for example programming skills.
Inez Van Aswegen, general manager, Network IT Recruitment
Inez Van Aswegen, general manager, Network IT Recruitment
Grant Hodgkinson, MD, Mint: The biggest challenge in the IT market is a lack of experienced resources. As a result, people who are junior resources feel that they are more senior than what they are, and this places more strain on projects and the success of IT initiatives. Junior resources do not understand that experience counts for something and believe that if you have the right flavour development-type qualification that you are worth your weight in gold. Sadly, the most IP in a project comes into the planning and the architecture of a solution or platform. These are the skills that are critical to any project, and are the most lacking in the industry right now. Understandably, companies have to make use of these resources in the pre and post sales cycle which places additional strain on the senior resources of the organisation.
Grant Hodgkinson, MD, Mint
Grant Hodgkinson, MD, Mint
Julian Field, director, KID: Business intelligence (BI) is booming, resulting in a demand for skills that exceeds supply by some distance. Junior employees are taking home exceptional salaries, and for customers that is having a negative impact on the cost of consulting.
Another factor is poaching. Because BI skills are in such great demand, there is a lot of poaching between government departments and businesses. The problem is exacerbated by the fact that the BI skills shortage is not a local phenomenon, as organisations abroad can offer highly competitive salaries. People will go where the best earnings are to be had.
Julian Field, director, KID
Julian Field, director, KID
A junior BI professional, with one year's experience, recently accepted a competitor's offer to boost his salary by 60%. His new employer then put him on a customer site and had to charge a fee commensurate with his salary. The customer ended up paying senior consultant fees but receiving junior-grade work.
Malcolm Rabson, MD of Dariel Solutions: Hard core technologists that have technology degrees from universities and a matrix of technology competencies that include design, coding, networking, security and database theory are the skills set most lacking in the South African market currently.
Malcolm Rabson, MD of Dariel Solutions
Malcolm Rabson, MD of Dariel Solutions
Network Times: How can companies address this lack?
Grant Hodgkinson: The lack can be addressed through experience and through successful engagements. Companies need to realise that an investment is required to build these critical skills, and a substantial investment at that. Creating a culture of excellence and a sound approach to quality is also important. IT companies need to realise - and embrace - that people are their only asset.
Inez Van Aswegen: Companies should invest in mentorship and training programmes. If employees feel that they are learning and becoming a valuable asset to an organisation from an early stage, they will be more likely to stay and grow within the organisation. Also adopt a learning culture whereby employees take initiative in learning more about the company's business, and the business of its clients.
Julian Field: Companies must provide their skilled employees with further training to enhance their performance and to develop them as a motivation to remain with their employers. Training can attract new talent and stem the skills loss, and take graduates with relevant degrees and provide them with further education and necessary practical experience to more rapidly prepare them for the industry.
Network Times: What role can government play?
Malcolm Rabson: I think the most important role government can play is to create a software institute of professionals, facilitating standards and skills and provide larger budgets for graduate software training.
Grant Hodgkinson: It is important to remember that not long ago, a government that had been in power for longer than one generation was removed and replaced by another that had no experience in running a country. We all expected the worst, and the miracle of South Africa was the result. However, we could not have expected it to be a walk in the park, and we are now starting to see the cracks appearing. The question is whether the government is up to task of addressing this. I believe that they are - there is too much at stake. Having said that, the role that the government needs to play in the fostering of a job-friendly culture is an acute requirement currently.
The culture of personal enrichment that has stemmed from government officials downwards is showing itself in the junior resources that are coming into the job market. Government needs to start educating these younger resources that a career is something that is built over a period of time, and does not happen with the snap of fingers, and they need to start demonstrating that in their own officials too. Furthermore, government needs to create an overall feeling of wanting to stay in South Africa.
The fact is that most government departments have no financial accountability - as shown by qualified audit opinions. The infrastructure on which businesses can be built (roads, power, water, telecommunications) has been abused into ruin, and is under-maintained. These elements combined do not create an environment that is 100% job friendly. Sadly, the brain drain is only accelerating - fast - and this is going to have dire consequences to the industry as a whole, where the global demand for these folk is substantial. I remain positive that the very expensive lessons recently learned through the likes of Eskom is likely to be the wake-up call that the government has needed for a long time now.
Martin Rennhackkamp: Government needs to look at providing facilities like training centres and bursary schemes to assist young professionals to get better skilled before and when entering the job market. Additional initiatives should also include:
* Assist companies in training and up-skilling young employees (eg, through tax breaks or similar re-compensation mechanisms).

* Assisting universities, technikons and especially accredited job-based trainers to improve their programs.
Andrew Cardoza, CTO, Mobilitrix: An incentive scheme where companies are rewarded and encourage to employ young starters fresh from college, technikon or universities. A government scheme to pay a share of the young individuals salary for a specified period of time ensures that companies can afford (and are rewarded) to take on lesser experienced individuals. The specified period may then be seen as learnership - where the company contributes and the government contributes a share to their salary.
Andrew Cardoza, CTO, Mobilitrix
Andrew Cardoza, CTO, Mobilitrix
This will result in a better salary for our young, inexperienced developers, will encourage them to stay - instead of going and look for jobs in other countries - and will give them the much needed experience. This all goes a long way to filling up the gaps - where skills are needed most. Tertiary institutions are rewarded for the number of students studying science and technology - this can surely be extended to qualifying companies? Germany assist their students with learnerships (and pay and reward their students) to continue with their studies.
Network Times: Is offshoring or 'northshoring' to places like Nigeria where good skills are being brewed a realistic option for local companies?
Malcolm Rabson: No, it is not a great option because of the low standards of software engineering in SA - managing a team abroad can become expensive in terms of re-doing work all the time.
Andrew Cardoza: For smaller companies like Mobilitrix it is quite difficult to manage. To use foreign expertise on a day-to-day basis for an extended period of time requires that the software development processes are quite mature and well managed. Most smaller companies are still battling to get to a well managed and mature software processes. Working with foreign cultures and languages introduce another set of challenges - with local talent we do not have to deal with these challenges.
Grant Hodgkinson: Given the current situation, we have no option but to seek skills elsewhere. Establishing meaningful relationships in geographies that are skills friendly is important. Other powerful economies are coming to the fore on the continent and it is important to consider these. Places such as Nigeria and Ghana come to mind, although these economies are plagued with issues of their own, having only recently emerging from downward spirals themselves. Venturing out there for resources can present other unique challenges that we have not yet faced in South Africa.
Inez Van Aswegen: If we look at the business skills and project management skills needed today, in my opinion, offshoring is not a viable option because the environment in SA is completely different to our African counterparts. I also believe that we have enough potential people in SA to train and mentor into the skill sets we need. We just need to become cleverer in utilising our education system, and educating scholars and school leavers about the market and the skills needed in South Africa.
Martin Rennhackkamp: In the present day, this does not seem to be a viable option because of the following reasons:
* The skills that can be obtained in this manner are not of a high enough quality.

* Communication and remote development are extremely difficult, and become very costly if things go wrong.

* Most importantly, we need to build our own skills bases, and uplift our own South Africans - it does not help if we support other countries with upliftment when we neglect our own people.
While offshoring or 'northshoring' may seem like a quick win, it is in fact, a long-term loss.

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