When I interviewed The Hackett Group's Michel Janssen and Erik Dorr last month, they made a point that often gets forgotten when folks discuss whether offshoring results in a loss of U.S. jobs. For general and administrative functions (the subject of our interview), the biggest competitor to offshoring is automation. With G&A functions, as with manufacturing, companies looking to cut costs face a choice of migrating work to lower-cost locations or investing in automated systems that enable work to be done with far fewer people.
There appears to be a similar trend coming in IT, with some folks predicting that companies will likely be able to get by with less staff as they migrate more functions to the cloud. Companies will need far fewer people minding servers. That's not necessarily a bad thing, writes Derrick Harris on GigaOm. In theory, it'll free employees to pursue more strategic functions. That's what both they and their employers want, right?
Maybe not, opines Harris. He writes:
"Today's laid-off systems administrators, however, are not likely landing these newly formed IT 2.0 jobs. They have been too busy applying duct tape and Band-Aids to existing infrastructures to stay on top of the cutting edge. Nearly a year and a half ago, already, I heard a FedEx Corporate Services IT executive bemoan how ill-equipped his team was to deal with the division's increasingly fabric-like infrastructure. He was neither the first nor the last to express that sentiment."
What can be done to address this dearth of qualified staff? Companies with a stake in the success of the cloud, including Google and IBM, are trying to get cloud computing included in the curricula of computer science programs. In late 2007, those companies announced they would invest $20 million to $25 million each to provide hardware, software and services to universities so students wouldn't just be schooled in programming applications on a single server. Yahoo and Amazon are involved in similar efforts, notes Harris.
As I wrote back in June, the trend will likely create a greater need for systems integration skills as many companies will opt for a blend of on-premise and hosted applications. Some other interesting speculation from that post: Many new IT graduates may work for managed services providers, before some of them migrate to jobs in corporate IT. The most technically oriented CIOs may seek jobs with managed services providers, while their more business-oriented peers remain in corporate IT.
If you think this trend sounds as if it'll drive demand for more IT pros with strong business skills, you're right. Many of the jobs that'll stay in house, including business intelligence, data management, project portfolio management and vendor management, will require folks to connect the business and technology dots.