The ‘Great Resignation’ and its fallout for CTOs in 2022
The Bureau of Labor Statistics in its latest report, says, 4.5 million US workers voluntarily left their jobs in the month of November 2021. In the US, the pandemic-era labor market has seen employers locked in tight competition to fill roles with the demand for talent far exceeding supply.
2021 was indeed the year of “The Great Resignation’ as the attrition rate hit record levels especially in the IT sector and IT departments as the pandemic caused a huge demand for software services. Product engineering CTOs, more than ever, need to focus on their core activities in 2022 to build a great product and drive profit by delivering a superior customer experience.
2022 will see the permanence of remote and hybrid working models. As the world switches over to remote or hybrid working models, this in turn has had and will continue to have a disruption on the development momentum of software product engineering companies who are working with and managing teams across geographies. Even if COVID were to end in the next quarter, we are not likely to see the end of the hybrid or remote working models. And it’s not just in the western world and developed economies but globally a remote working culture that is inclusive will prevail.
2022 is also likely to see the official death of shadow IT organizations. Shadow IT organizations are created when business goes to software vendors to manage their modernization challenges and when they find it difficult to manage these vendors, they come back to internal IT to help them manage these vendors. Organizations will have common funding processes by IT, business and other departments to partner with the right vendors. This will happen from large enterprises to medium-size businesses. Shadow IT organizations will evolve into ecosystems that CTOs need to manage.
2022 will see the emergence of distributed teams. For software product engineering CTOs who need to ramp up their modernization focus, hiring dedicated distributed teams will help them leverage the advantage of having the best talent across the globe working together will not only help boost productivity but also drive ROI.
The pandemic era has forced modernization as a priority for all organizations. It has especially shown up organizations which have not prioritized modernization and invested in rationalizing their IT. The changing market dynamics and tight supply of skills has now made it difficult for them to build new capabilities.
In 2022 and the future, CTOs of software product engineering companies need to look at integration and talent challenges for their modernization objectives as they look to contain the fallout from the “Great Resignation”.
The Integration Challenge
The last 600 days of the pandemic has shown medium to large size enterprises that they cannot own the complete product development any longer. That is not normal any longer. They need to maintain digital bridges. The way to do that is through APIs.
The global API Management market is expected to triple and reach USD 6.2 billion USD in 2028 from 2.4 billion USD in 2020. For software product engineering CTOs, APIs hold out many benefits. Smaller, functional components are not just easier to build and maintain but they also provide increased agili in terms of upgrading and scaling while also more importantly leveraging domain-specific expertise.
In the context of modernization, APIs are powering the shift from monolithic on-premise software to the cloud and microservices-based applications. They are bringing in new efficiencies and increasing profitability through optimization of resources and access to new revenue opportunities. CTOs can use APIs to supercharge business growth.
The Talent Challenge
Across the globe and not just limited to technology, the pandemic-era and the Great Resignation has placed a huge demand for quality talent. Across the North American, UK and Western Europe talent development and retention is a challenge for organizations. There is a huge shortage of talent. The high rate of employee turnover has impacted continuity and consistency in development and delivery of products and services. The high turnover has resulted in a lag in process, testing, quality standards, and employee training. The lack of knowledge transfer perhaps is the biggest challenge that organizations and CTOs are facing. Documentation and institutionalized knowledge as a response to this knowledge transfer challenge are bigger priorities for CTOs in 2022.
The Society for Human Resource Management in a study identified that nearly 70% of employees who were effectively onboarded stayed for at least three years with their new company research. The study also revealed that effective new employee onboarding led to higher job satisfaction, organizational commitment, lower employee turnover and higher performance levels.
To counter the challenge of knowledge gaps due to high employee turnover, CTOs need to automate knowledge transfer, and store team knowledge on the cloud. Mistakes due to knowledge gaps can be eliminated using a centralized knowledge database and a knowledge map.
In 2022 and onwards, CTOs will need to be more invested in onboarding, skilling and making their teams more versatile while also ensuring knowledge management to ensure their documentation is up to date and knowledge is institutionalized.
2021 was the year of Great Resignation. 2023 can be the year of big opportunities for software product engineering companies to accelerate their modernization agenda while containing the fallout from 2021 by focusing on APIs and talent development.
What Relevantz Can Do for You
We have been helping software product engineering companies with our extended product engineering teams. Product engineering has been part of our DNA. You can count on us to accelerate your product development agenda and modernization program.