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Why recruitment alone is a weak talent strategy

Richard Florida authored a piece entitled “America’s Looming Creativity Crisis” in the Harvard Business Review (https://miscsf.typepad.com/miscblog/files/CreativityCrisis.pdf) published In October 2004.  He presciently identified a challenge that was facing and continues to face the United States – the inability to find the “creative class”.

In the article, Florida writes, “Today, virtually the entire public dialogue about jobs in the Untied States revolves around outsourcing and unemployment.  But these are short-term issues. The real long-term predicament facing the United States and the world is the looming shortage of creative talent.”

In recent months, the colleagues in my firm and I have spoken throughout the Midwest with numerous city leaders in Omaha, Milwaukee, Peoria, Oklahoma City, and St. Louis.  The conversations invariably included a conversation about talent. Whether the person on the other side of the table is an executive, an ecosystem builder, or an economic developer, everyone is worried about where to find talent, and particularly technology talent.

This is not a company problem. This is not a local problem.  This is not even a national problem. This is a global problem.  Many perceive that the way to “solve” this problem is to recruit better people.  This may place a band-aid on a single job or group of jobs. However, the reality is that Florida saw this problem coming in 2004.  We, as ecosystem builders in a global economy need to treat the cause, not the symptom.

I believe the cause is three-fold:

  1. Our organizations (startups, universities, large companies, and even entire communities) are STILL treating the problem as one of commodity.  The sentiment has been “We just need to find more oil and then we can make more gasoline,” rather than a human problem that involves super complex motivations, incentives, trust, and humility.
  2. We have not trained the right types of people for the right types of jobs.  We have basically assumed that the way to hire is through universities or traditional training grounds – rather than recognizing that artists need to do their art.  We need experience and experiential learning through apprenticeships.
  3. We have not spent the money on building a new ecosystem that involves all of the pieces necessary for local creative environments to evolve naturally.  Instead, we have tried to recruit one-offs that are band-aids.

Thus, we find ourselves in the Midwest with thousands of potential workers too few.  In our conversations, our subjective estimate of the shortfall is about 40%. This means that if we, collectively, need 100 workers, we have approximately only 60 in the region.

The authors of an April 2017 USA Today article (https://www.usatoday.com/story/tech/talkingtech/2017/03/22/tech-where-jobs/99496462/) identified three important statistics.  One is that the Bureau of Labor statistics predicts that in 2020 there will be 1.4 million more software development jobs than applicants who can fill them.

Here’s the rub – the May 2017 Occupational Employment Survey for the software developer category (15-1130) identified only 1.6 million current jobs in the entire US.  This means that we need to build 46% of the workforce in the next 18 months or so.

All of our communities are sticking their heads into the sand by implying there is a solution other than training more software developers.  None of us can recruit our way out of this problem. Certain communities already grow more than they need – at universities – but these same people are not necessarily prepared for the workforce out of school.

The belief among cities seems to be that there are technology workers out there who would want to move to MY city if they only knew the benefits.  This is shockingly wrong-headed. Every city is woefully under-prepared from a talent perspective. We cannot recruit our way out of this problem.

The secondary belief is that there is a human reserve just beyond the horizon that if we but tapped, we would have unlimited talent that would fuel the company’s vision.  Talent is not a commodity. It does not wait underground, like oil. It will move selfishly to the organizations and places that make the people happy and fulfilled.

However, that group does exist in many communities.  This group is the urban core, often poor, and often under represented groups.  In 2004, when Florida wrote his article, if communities had been serious about solving this gap, those communities would be leaders today.  But, as a region, we relied on tradition – universities, our well educated, and our large company leadership – to drive towards the talent that we would need.  Those groups overwhelmingly failed. We are now facing the glaring talent gap that Florida warned against.

When I worked more directly in software-related companies, we often discussed the time between graduation with a college degree in computer science, and the time that the new graduate would be a profitable employee.  We typically penciled this into about eighteen months. Our premise was that we would hire a bunch of young, smart new graduates, train them, and they would be valuable. For the most part, this was a winning strategy.

The reality is that in many instances, these newly trained, super smart now three-or-four-years-of-experience software experts left.  They left because they would get higher wages and more responsibility at a larger company. Or they left to start their own company as the new Chief Technology Officer.  Or they left because their new spouse found a great job in Colorado. Or they left because they did not like me or someone else on the team.

Because our premise was that we would hire great smart young people and some would stay (but not all) and we would unleash them on hard problems, we knew that we could guide but not control.  If we tried to squeeze too tightly, we would lose people. And because it was a long-term strategy built on growing the person – not filling a job – we continued to find new kids, backfill new expertise, and unlock great, smart people and their talent.  And we ended up building an incredible network of our people in other organizations AND OUR OWN.

As a region, we are squeezing too tightly.  Every market is talking about retaining “kids” so that they don’t take their skills to another market.  EVERY MARKET. And most markets are unwilling to make the changes necessary for the kids to actually run their software development shops.  If you want to retain them, put them in charge of solving hard challenges and guide them. If you want to attract them, put them in charge of solving hard challenges and guide them.  The time for transition passed ten years ago.

Most communities in the Midwest are no longer playing catch up – they are in a delaying movement until their demise.  This is not inevitable…but it requires a wholesale change – a complete overhaul of expectations, people, and talent.

The point is that many Midwestern companies want to find employees that do not really exist.  They want someone who is prepared to take below-market wages indefinitely while they train under inferior (often untrained in software development) management.  They want someone who will step in and solve the problems of bad internal structure, poor development practice, and bad management. And they want to do this while also retaining power in the hands of a few people who do not really understand the problems and are unwilling to admit their ownership in creating the problems.

Instead, we need to accept that we are trying to build an ecosystem; one that is premised on creating a new way of building our products and services – even in 1000 person companies.  But, instead we continue to talk about recruiting people like commodities.

And thus, most of our cities lose talent because those who are talented are under-appreciated and hired to be cogs rather than problem-solvers.  This results in the loss of plenty of “code monkeys” rather than the training and retention of innovation leaders. Real talent does not want to be seen as a code monkey in a large organization that NEEDS them but does not value them.

This is a bigger problem than just paying more or having snacks available.  This is beyond a “culture” problem at an individual company. This is a substantive problem that our communities face.  For decades we have failed to build AND PAY FOR apprenticeships. We have failed to put strong leaders in charge of our software workforces.  We have failed to identify the long-term nature of these problems.

Instead, we have always treated training and talent as micro-level problems at an individual company, not ecosystem problems.  Virtually every individual technology ecosystem in the Midwest suffers from these types of cancerous challenges. Reinvestment should be planned against ten or twenty-year horizons – not one-year “recruitment” budgets hidden inside of the HR line item.

Reinvigorating our communities includes entrepreneurs and entrepreneurship not just as training grounds for line workers but the people and places that model agile development, agile leadership, and agile thinking about how to organize around the best talent (even when the people are in their twenties or thirties).

There are not long-term employees available on the coasts either.  The coasts are simply comfortable with innovators who are young, untested, and untried working on problems that are new and thus need different types of solutions.  These innovators are the creatives that are the backbone of Florida’s paper and research.

Over the coming generation of software employees, it will be necessary to move 100% of all systems to the cloud.  Most companies in the Midwest are still debating this problem. It is not a debate. This is happening. You can either adjust your plan or not find talent.  This type of problem illustrates the fundamental challenge our communities face – we are simply trying to hold onto what we understand – rather than embracing the reality that is the Creative Economy.

Our systems will turn over completely.  Start now knowing that as a leader, you will not see the end.  There is liberation in understanding that you are not in control of the future.  The kids of today are writing the code for tomorrow – and even they don’t know what it will look like in ten years.  Guide them. Unleash them. Don’t try to recruit them.

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