Computer Weekly reporters
Continued economic growth is finally beginning to show through in IT spending and recruitment plans. Both this week's Computer Weekly/Kew Associates Quarterly Survey of IT Expenditure Trends and last week's SSL/Computer Weekly Quarterly Survey of Appointments Data and Trends, show signs of an upturn. Computer Weekly asked a range of IT directors from across the UK about their recruitment and project plans for the year ahead.
The replacement of old systems and a return to expenditure on large IT projects is driving demand for IT staff in the financial services industry. Advertised jobs were up 10.9% on the third quarter of 2003.
The sector, traditionally one of the biggest spenders on IT, has been hit particularly hard by the economic downturn. This year, however, spending will focus on more than just cost-cutting exercises, fuelled by a raft of industry regulations with implications for IT.
Alex Robinson, IT director of general insurance at Norwich Union, said he was looking for IT staff with experience in systems architecture and project management and business.
"Systems architecture is a key area for recruitment and it is a skill area where we think a lot of companies are looking to recruit," he said. "It is about planning what the eventual system will be like and making the necessary technology choices, such as whether to go for .net or J2EE. But these sorts of people are in relatively short supply as few have the technology understanding and the depth of business knowledge required."
IT projects in the general insurance business of Norwich Union will be split almost evenly between maintaining existing IT systems and new projects.
The insurer will this year begin to replace its ageing back-office systems, some of which are up to 30 years old. This will involve replacing 750 mainframe systems. "It is simply uneconomical to try to connect new systems to a range of old systems," said Robinson.
New IT projects include using software to automate some of the claims processing procedures in parts of the general insurance business, a move that Robinson believes could save the company tens of millions of pounds.
Mark Hemsley, chief information officer and managing director of market solutions at exchange Euronext Liffe, said he was looking to recruit about 50 IT staff over the next year. Skills in demand include programming languages C++ and Java, and staff with experience in software testing, project management and systems development.
New projects will be based around developing Euronext Liffe's trading platform, Connect, which it has sold to other exchanges, including the Chicago Board of Trade and the Tokyo International Futures Exchange.
"We have been extremely busy," said Hemsley. "We are launching a euro dollar contract on Liffe by the end of March and we have to make sure that there is straight through processing all the way from the traders to the clearing house."
UK manufacturers could well be holding back on IT recruitment plans in 2004, with many firms focused on improving their skills base rather than adding numbers. Advertised jobs were down 18% on the third quarter.
Brian Jones, global chief information officer at drinks giant Allied Domecq, welcomed the increased demand for IT staff but said his priority was getting the right balance of skills rather than increasing the number of staff.
"We are focusing on strengthening our gene pool rather than adding heads - in some cases we are collapsing roles together and getting a better result, providing we have the right person doing the new, expanded job," he said.
"It also enforces more ruthless prioritisation since work is less likely to be invented unnecessarily. Ultimately, things happen if you have the right people doing the right things, not just a bigger resource pool."
Another priority for Allied Domecq is to reduce dependence on IT contractors by improving the skills of internal IT staff, Jones said.
"When we need external resources we tend to contract for them from a major provider on a risk/reward or deliverables basis so that our service providers focus on getting us to where we want to be rather than filling their order book," he said.
Tony Whitby, group data manager at manufacturing firm Johnson Matthey, said although the IT department is not growing, the turnover of IT staff has increased. "We are not recruiting more staff but people are leaving more regularly because there are more jobs out there and more companies are willing to recruit," he said.
There has also been a change in the IT skills required at the company. "We require fewer people with AS/400-type skills and more with web-based and Java skills," said Whitby.
Andy Billington, IT director at clothing retailer Burberry, said his department was probably untypical in its IT recruitment plans. "Our focus is to ensure all systems are delivering a solid, reliable service - maybe not the best functionality, but consistent," he said. "To this end we are not starting new developments and will be scaling back staff."
The increasing interest in RFID and other supply chain technologies across the retail and manufacturing sectors is also likely to drive demand for IT recruitment during 2004, according to industry experts.
"There is certainly going to be increased demand for people with RFID skills and there will also be integration requirements, which will drive demand," said David Weatherby, senior executive at UK supply chain standards body e.centre. "There will also be a requirement to network all the RFID readers, which will require certain skills."
Councils are recruiting IT staff to help meet the 2005 deadline for getting public services online.
Kate Mountain, chief executive of the Society of IT Management, said local government IT managers were looking to boost their skills in non-technical areas.
"Key skills in demand at the moment are to do with influencing and understanding the business - these include the likes of change management and project management," she said.
The 2005 deadline will also place a premium on IT staff with general business skills in addition to technical knowledge, added Mountain.
"IT managers in local government now need a range of skills, including managing risk, negotiations and influencing a range of stakeholders, such as elected members," she said.
But Roy Cosway, corporate IT services manager at Cornwall County Council, has noticed rising demand for web-based skills, partly due to the 2005 target. He said, "We are seeing significant demand for development skills, particularly web-based software development.
"All forward-thinking local authorities will be making sure that their developments are web-based." This could be in any number of areas, such as redeveloping existing systems or handling new legislation, such as the Freedom of Information Act, he added.