IT workers get raw deal

In a world in which every new technology company that goes public makes the people who own shares in that company overnight millionaires, you can't help but wonder if certain other segments of the technology food chain are now undervalued.

In a world in which every new technology company that goes public makes the people who own shares in that company overnight millionaires, you can’t help but wonder if certain other segments of the technology food chain are now undervalued.

Specifically, if the people who make the technology are now valued at a certain level, then the people who toil to implement that technology should be worth a percentage of the value of the people who make the technology. In plain speak, that means most of the folks in IT are probably getting a raw deal.

This is especially true when you consider the shape that most hot new technology comes in when it’s first adopted. The truth is that most IT departments actually serve as the final beta testers and bug fixers for just about every major piece of technology that comes down the pike. And, once more, most of the new features that get added to the next release of that technology actually emanate from the people who first implement the technology.

This is nothing new. After all, most of the IT people that still struggle to make ERP (enterprise resource planning) implementations a success never receive more than their weekly salary and a rare bonus, even though the company they work for is realising significant savings from the work they do. Of course, most of the folks who hold shares in the company they work for hope their work is somehow reflected in the stock price of their companies.

But even if they hold stock in their companies, the value of their efforts is still not fairly represented in their salaries. Take, for example, all the work that is now being put into building digital exchanges. By even the most conservative estimates, these exchanges are saving the companies that implement them anywhere from 10% to 20% of their purchasing costs. In terms of real currency, that adds up to millions of dollars.

But many of the people working on these projects might be making $90,000 a year before taxes. So it’s little wonder that anybody who has an opportunity to gain any experience in this sector is probably going to defect to a start-up company building this type of software, where they can double and triple their net worth in two or three years.

The end result of this economic inequity is that there is a steady brain drain of people moving away from working inside the IT departments of major companies.

And what’s an even bigger shame is that this brain drain is occurring at the exact time that these companies need this talent most. This is because the role of IT within these companies has changed substantially. Rather than viewing IT as another cost centre that needs to be contained, savvy companies now see IT as a tool to drive revenue and cut costs.

But the biggest issue they now face is retaining the people who know their business well enough to make sure they gain a competitive edge.

After all, even the most unique competitive edge on the planet has only an 18-month window before the competition figures out how to trump it. So the only way to stay out in front is to hold on to the IT people who know your business.

Of course, lots of business-people frequently lament that the IT folks don’t understand the business well enough. But IT people are becoming increasingly well-versed in business skills because they are able to see how large parts of the company truly operate.

In fact, many of them are a lot more familiar with the peculiarities of the business they work for than the senior-level managers who nominally run those companies.

Michael Vizard is editor-in-chief at InfoWorld US.

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