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The digital revolution is forcing the rapid transformation of IT departments and compelling them to do more than take care of infrastructure and basic services. Today’s IT organizations must be strategic partners with business leaders to help them execute digital strategies and capitalize on emerging technologies in order to generate entrepreneurial opportunities and disruptive ideas.
Despite their pivotal importance to digital transformation, many IT departments are simply not prepared for these new demands. According to a recent World Economic Forum report, IT skill shortages and training requirements are the key factors slowing down digital transformation.1 The talent gap in the IT workforce is not about a lack of specific technology skills; rather, it’s about being able to solve business problems and create new opportunities for technology-enabled businesses.
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Many companies have failed at reskilling — the process of preparing people for new jobs and new roles — because they didn’t know the specific capabilities their employees needed to develop to fill the talent gap.2
We set out to understand what competencies are essential for IT professionals in the digital age, by interviewing senior technology leaders from a cross section of industries and studying a global telecommunications company based in Europe. (See “The Research.”) The research revealed that digital business demands four behavioral competencies — qualities that transcend technical proficiency to embrace interpersonal skills and a drive for continuous learning — that enable IT talent to meet current and future business needs.
1. Learn to manage role complexity. As IT departments are increasingly looked at as equal business partners and strategic enablers, the IT workforce also needs to be able to take on a more direct value-creation role, such as participating in decision-making that affects the customer experience. This means that a company’s ability to deliver digital products and services that are differentiated from those of competitors requires more in-house software development expertise than in the past. There is less demand for traditional capabilities, like the ability to coordinate outsourced work, and a greater need for creative engineers, software developers, and advanced data analysts.
IT roles are also becoming more complex because they now require individuals who can collaborate with colleagues who have different specializations than they do. Our research suggests that companies are increasingly deploying teams whose members have experience in a variety of functional areas. Companies also have team members with “T-shaped” skill profiles — that is, people who have expertise in one area as well as enough additional knowledge to collaborate with experts in other areas so they can perform complex and adaptive IT functions together.
For example, scrum, the popular methodology for Agile software development, requires the individual members of developer teams to be able to perform all of the tasks needed in the software development process: business analysis, architecture, design, development, testing, deployment, and operations. Previously, each task was assigned to a single person or group, often from different departments. Similarly, the increasing use of T-shaped skill profiles in software development teams means that both the depth and the breadth of individual skills are expanding: Each team member is expected to be an expert in one domain or task — such as coding or software development — but is also expected to develop complementary skills by working with experts in other domains or tasks, such as software operations and maintenance.
In the telecom company we studied, individuals working in teams with end-to-end responsibility for a product recognized that their roles were more complex, but they perceived that the benefits outweighed the costs. Receiving direct customer feedback on the products or services they developed not only improved IT workers’ understanding of customer demands but also helped them feel that their work was important for the company’s success and improved their confidence in decision-making.
Indeed, our employee survey found that, on average, IT workers feel more comfortable in managing increased role complexity when they can see how their responsibilities and actions directly impact business outcomes. The survey respondents who saw a clear link between business outcomes and their own responsibilities and actions perceived that they were better able to manage complex roles than their peers who did not see a clear link between business outcomes and their responsibilities and actions.
Leaders must make it clear that these changing roles and ways of working present opportunities for IT workers to create value for their companies, in addition to increasing the value of their skills and improving their own career paths.
2. Connect, collaborate, and integrate knowledge swiftly. As companies advance in their digital transformations, their IT infrastructures have to become more open and flexible so they can explore and exploit a wide range of emerging opportunities to create value and achieve faster time to market.
This requirement to take advantage of new tools, technologies, engineering approaches, and entrepreneurial insights places a premium on IT workers who can connect and cooperate with experts from a variety of disciplines and domains. In our research, technology leaders highlighted the need for employees to swiftly integrate new knowledge and problem-solving strategies into their current work.
These trends also influence the way companies set up their IT organizations. We found that the companies most affected by digital disruption are increasingly replacing the traditional model of hierarchical management with a more Agile collaboration model, with teams empowered to make and execute decisions.
Technology leaders in our study said that self-empowered teams usually develop, test, and launch solutions more quickly than teams in hierarchical organizations.
As a senior vice president of IT at the telecommunications company told us, “By reducing hierarchical layers of decision-making, we foster speed and directly integrate decisions into practice. These high-performance teams also benefit from the trust of their leaders in their competencies.”
Shifting decision-making to the “experts” — that is, the IT workers — is empowering on several levels, says Mattias Ulbrich, CIO at Porsche: “People who have the absolute responsibility for what they are developing tend to develop better products and come up with more creative solutions and concepts that are thought through more thoroughly. The manager-developer relationship changes from ‘Do this’ to ‘How can I help you?’ which creates more trust and quality work. In this way, trust becomes the biggest time and money savings factor and the most important requirement for good relations.”
In our survey, the findings suggest that IT employees feel able to work across organizational boundaries when their bosses delegate more strategic decisions to them and provide them with resources, such as budgets for client visits. They also find it helpful when the company assigns them a partner or mentor from other teams or divisions, such as through job shadowing, and when leaders from different functions and business lines in the enterprise act as role models for crossing organizational and team boundaries.
3. Embrace and manage contradictory demands. The digital age requires IT organizations to manage conflicting demands. First, they have to excel in their traditional role of providing infrastructure, high-quality service, and security, all with rising performance and at a lower cost. At the same time, they have to be business enablers and help their companies sense and seize opportunities made possible by emerging technologies. This requires a shift from being an organization that reacts to demands to one that is proactive.
Achieving this shift requires that IT organizations deliver an ambidextrous response: one that can exploit existing IT capabilities for operational efficiency and excellence while simultaneously identifying new IT capabilities to help innovate and create differentiated customer value.
According to our study, some companies enable ambidexterity at the individual level. Employees working in the two modes described above set goals together, planning and prioritizing features at the beginning of a product release cycle or sprint. They analyze and identify the potential conflicts between the old and new IT structures in terms of budgets, priorities, and responsibilities. To succeed, IT workers must be proficient in both modes of working.
Ambidextrous employees are those able to embrace the tension between IT’s traditional capabilities and the new ones required by the digital age. Those who maintain traditional operations learn to understand innovation and serve as enablers for new solutions from those who are working in innovation or exploration mode. Instead of seeing inconsistencies as a threat, they view them as a source of creative conflict that can be built upon to create value. This requires those employees to learn to live with dual agendas and conflicting time horizons.
Our survey findings suggest that IT workers can cultivate their own ambidextrous experiences when their leaders demonstrate an appreciation for behaviors such as exploring new approaches, taking risks, and dealing well with failure. We found that IT employees working with leaders who encourage risk-taking without instilling the fear of failure reported, on average, a 30% greater score for novel and innovative activities and approaches compared with peers working with leaders who leave little room for experimentation and exploration. Several senior technology leaders reported that it’s also helpful when leaders cultivate a culture of experimentation in which they share their own failure stories.
Companies can also foster an innovative mindset by providing development platforms for testing and trying out new ideas and solutions. The telecom company we studied is using a development sandbox isolated from the company’s production chain, where employees can explore new product and service ideas and solutions.
The company also organizes events such as hackathons — days where IT employees assemble to develop a prescribed business or design idea within a given time frame — and innovation sprints, in which IT employees create something novel outside of their normal work routines. These company-sponsored exercises foster both creativity and collaboration.
4. Master continuous learning and adaptation. The digital age has increased the pace of change in both business and technology. At the same time, it has become more difficult to predict what specific skills will be needed, even in the very near future. This makes ongoing education, both on the job and outside of it, critical for IT workers and their companies.
Our research findings indicate that both IT employees and their employers understand that workers need to be able to learn from their own experiences — and those of others — on a continual basis to become better at their current jobs and better prepared for future roles. Employers need to provide learning opportunities, and IT workers must have the drive to absorb lessons, acquire new skills, and gain insights from feedback.
Some companies facilitate this continuous personal growth by embedding learning opportunities in the design of regular work processes. For example, some teams working in scrum are employing the framework’s “inspect and adapt” principle and can learn from their experiences and mistakes in targeted feedback loops. This is not limited to task feedback but also includes feedback about the skills, behavior, and performance of the individual team members. At every step of the way, through the changes and improvements to products and processes, teams must focus on the overarching business goal and the activities that best solve a given business problem.
Our research found that learning opportunities are more effective when the IT workforce has some leeway in managing individual learning and progress. Our survey findings suggest that employees feel more motivated and empowered when leaders facilitate development by providing proactive coaching and feedback, support on functional and methodological issues, and communications platforms (virtual or otherwise) for the purposes of open debate and discussion.
Employees perceive it as a major demotivator, however, when leaders unilaterally define and prioritize learning targets without involving them in the goal-setting process. Those who have a stronger influence on their learning targets tend to exhibit greater motivation for exploratory activities. Furthermore, most respondents did not perceive financial prizes such as extra pay as effective motivators for achieving developmental goals.
The findings make sense to IT executives like Porsche’s Ulbrich. “The core value of letting people pursue their very personal learning experiences is intrinsically motivating. Especially young talents, who bring in new perspectives and creativity, are not motivated by rigid cultures, which they perceive as very limiting. Leaders who lead through enabling instead of dictating can be role models who support a positive culture of learning and competency development,” he says.
A Career That Transcends Technical Skills
The four behavioral competencies described here are capabilities that IT employees can and must learn in order to perform well in their new and redefined roles for their companies as they adapt to the requirements of digital business. They provide the chance for IT professionals to continuously update their technical skills for specific tasks while building interpersonal skills and developing a habit of lifelong learning that will help them build lasting careers in a dynamic field.
For corporate leaders, ensuring that your IT workforce is future-proofed for the digital age makes it imperative that new talent strategies prioritize these four behavioral competencies in hiring, training and development, and promotion — because in the digital age, technical skills alone are not enough.
1. For information on the role of IT in digital transformation, see G.C. Kane, D. Palmer, A.N. Phillips, et al., “Aligning the Organization for Its Digital Future,” MIT Sloan Management Review and Deliotte University Press, July 2016, https://sloanreview.mit.edu; and “Towards a Reskilling Revolution: Industry-Led Action for the Future of Work,” white paper, World Economic Forum, Geneva, January 2019, www.weforum.org.
2. Our study is related to the reskilling process, since we focused on IT jobs that redefine skills/competencies for existing IT jobs/roles and develop/build new skills/competencies for transitioning to completely new jobs/roles; see also L. Weber, “Why Companies Are Failing at Reskilling,” The Wall Street Journal, April 19, 2019, www.wsj.com.