IT resourcing during the recession: call for tough choices

As part of the discussion on Cleaning out the IT-department and some additions, I got into an interesting discussion regarding HR-matters: fire for pure economic reasoning or stick to your scarce resources. Looking from the perspective of non-IT companies, these are some observations I made.

1. What can you afford
   It's easy to contemplate on resources but if your company can’t afford them you have to bite the bullet. You should make clear that IT activity levels will go down with the leaving of (experienced) personnel. If this means going into hibernation mode, it is worthwhile to think about alternatives. Instinctively one will try to keep the best people on board but the chance is that they will have trouble to turn into shopkeepers and one should look for those team members that are more equipped to a maintenance mode. Another obvious one is the “2 juniors for 1 senior” scenario. Can be ok but will require more management effort.
2. Look at your employee/contractor ratio
   Firing all your temp resources is the initial reaction of most IT managers and it sounds logical: direct cost cutting. But after that the air is out and if you have to cut deeper you lost valuable time and you might have lost that one very experienced external resource with specialized skills and an attitude that matches perfectly the winter you have to cope with.
3. Your IT-portfolios outlook for the next 2 years
   What activities does your business require from your team? Re-define and agree the project portfolio with your internal customers and craft a resource plan that matches these requirements as if it were a new business unit you have to set up. It will result in a fresh start and a more logical choice of resources.
4. What is the prediction for your local IT labor market
   In some countries it is known that there will be far too less IT-students graduating during the next few years to fill the expected vacancies. Even now we see that IT-expenditure is not declining as much as other business costs and not for long before the good resources available on the market are gone or getting too expensive again. Just compare the cost of getting a new resource on board (finding, hiring, introducing, training, handover, etc.) versus keeping a good one on board.
5. Ask your people what they want
   You will be surprised how problems can be resolved when the subject is involved pro-actively. All employees have their own life and dreams. Even in economic downfall on individual basis a person can be ready for the bold step of a much thought about but never executed sabbatical. Or interest for a complete different job that is open within the company. Ask openly for ideas, at least it will limit frustrations.
6. Outsourcing on project basis
   Depending on the exact situation you can outsource specific tasks like projects. If something new must be implemented or a major change in your systems, you can order another party to execute this, and control it yourself.
7. Can you make clean choices on whom to keep
   Often company policy, the trade unions or even the law limit as what you can do. Last in first out principles are often in place, or age category reflection options. Although far from easy it is worthwhile with the above mentioned in mind to think about additional reasoning for deviating from these set paths. Even if this means some more severance costs it might prove to result in a better balanced team.

Any additional observation that you want to add? Please let me know.

This blog is part of a series on IT in times of downturn:

1. IT resourcing during the recession: call for tough choices! (this blog)
2. Checklist to clean up your IT-department.
3. Checklist to clean up your IT-department: some additions
4. 8 (Eight!) Ways To Reduce Your ICT Management Costs, But Where Is the Low Hanging Fruit?
5. Recession impact on ICT: get the brooms out!

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This blog is written by Hans van Nes. Hans is a very experienced interim manager and (radical) change management consultant. You can contact Hans through his Results2Match email address.