In terms of what the pandemic hath wrought for IT teams, the rapid uptake of remote work lands near the top of the list of positive impacts. For some IT leaders, the increased comfort managing a digital tech workforce has opened the door to hiring professionals in far-flung locations.
“There is no question that the pandemic has revolutionized the process of recruiting top-tier IT talent,” says Aysha Khan, CISO and CIO at customer data platform vendor Treasure Data. “With budgets being slashed for many, we’ve had to get more creative while doing more with less, and as a result, I have had the opportunity to connect with some amazing professionals from regions and countries we wouldn’t have considered in the past.”
Pre-pandemic Khan often lost out on premium candidates seeking salaries beyond what the company was able to pay. Since, remote work has broadened the talent pool and enabled Khan to find quality candidates in other locations within her budget. “Now, it’s really about finding the best talent for the cost, which streamlines the process and allows us to focus more on whether they’re the best fit based on their talents and experience versus having to factor in location,” Khan says.
Last year, Gartner began exploring a growing phenomenon it calls the borderless workforce: talent working remotely from different countries based on an employment contract made across national borders. Nearly six in ten organizations (58%) report having at least some IT talent working in a fully remote borderless arrangement, according to Gartner — a number the firm says has doubled over the past three years. For companies engaging in this type of hiring, 19% of their IT workforce is borderless on average. Its survey of 288 C-level executives and their direct reports found another 27% of leaders exploring the model.
“Today in the professional world, location is fluid, the market is global, and the talent competition is agnostic as we are all competing under the same flag: technology,” said Gartner analyst Gabriela Vogel presenting the survey results at the Gartner IT Symposium in Barcelona. “There are no more competition boundaries, and business and IT leaders hire borderless staff where they have the biggest competitive advantage.”
The realization that IT services can be delivered seamlessly from nearly anywhere has opened opportunities for IT leaders to look beyond domestic talent pools particularly for high-demand skills such as AI, data, cybersecurity, and DevOps, says Amit Anand, senior analyst at Everest Group.
“The emergence of job boards and tech stacks to facilitate remote hiring has made direct sourcing a viable and preferable option for IT leaders, as it can offer greater flexibility, cost savings, and quality control in managing their IT talent, leading to better alignment with organizational goals,” Anand says. “However, there are challenges to evaluate, such as time zone differences, communication barriers, and cultural differences when working with remote IT professionals.”
The global IT talent market evolves
Tapping the global talent pool is hardly new for IT. But looking back a decade or two, this worldwide market of IT professionals was largely dominated by outsourced and captive (company owned and operated) models. Location wise, India and the Philippines provided most of the talent supply. The US and the UK led on the demand side.
“Initially, much of this was in outsourced operations. However, over time companies decided that in some cases it was more cost effective to set up their own captive operations,” says John Hill, senior vice president and chief digital information officer for MSC Industrial Supply, who in previous roles set up captive IT operations in Eastern Europe and Latin America for cost and quality reasons. “So the trend is not new.”
But when COVID-19 hit and nearly everyone worked from home, the hiring market grew less location-specific, more fluid, and hiring someone in another state or another country began to gain traction — not just for developer or infrastructure support roles.
“What the pandemic has demonstrated is that jobs that were traditionally thought to be important to be in-person — business analysts and project managers, for instance — suddenly became viable in a near or offshore manner,” Hill says.
Marc Tanowitz, managing partner in the advisory and transformation practice at digital services firm West Monroe, finds clients far more open to acquiring talent in geographies they would not have before. “Companies are looking beyond their four walls and beyond existing geographies,” Tanowitz says. “Those who aren’t opening the aperture of talent, struggle to fill open roles and that longer lead time has an impact on speed to market.”
The top two areas of expertise that CIOs are seeking for “borderless” direct hiring, per Gartner’s survey, are software engineering/application development (62%) and application support (55%). Other skills in high demand include infrastructure and operations support, analytics and data science, cybersecurity, customer experience, digital product management, and architecture.
“In some cases, it is easier to locate more technical roles in areas such as programming or data engineering in alternative countries. The US is not graduating the number of STEM candidates needed by the industry,” says MSC’s Hill. “By adopting a larger geographic window of consideration, companies gain access to a much larger pool of candidates.”
India is the most commonly tapped source of borderless tech hires for both European companies (34%) and North American firms (59%), according to Gartner. European firms also hire heavily within Europe due to favorable labor laws, with talent pools in the UK, Germany, France, Spain, Italy, Poland, Portugal, Ireland, the Netherlands, and Lithuania leading the way. Meanwhile, Canada and the UK are popular locations for US IT leaders to find talent, accounting for 33% and 26% of their borderless hiring activity, according to Gartner.
Latin America also offers a solid supply of IT workers and low-to-moderate pay levels, with Mexico City; Guadalajara, Mexico; Buenos Aires; Rio de Janeiro; and Campinas, Brazil drawing the most hires. In Central and Northern Europe, Budapest, Warsaw, and Helsinki likewise offer plentiful talent at reasonable costs. In Asia, Manila, Shenzhen, and New Taipei City, Taiwan, offer large supplies of talent at lower salaries.
Treasure Data’s Khan is impressed by the candidates she has found abroad. “We are in Silicon Valley, and the perception for years has been that this is where all the top tech talent is,” Khan says. “That is no longer the case. I’m seeing exceptional IT talent in Canada, Japan, the UK, the Philippines, Vietnam. It’s incredible.”
That’s made it easier to source historically hard-to-fill positions such as IT operations analysts while still managing costs. It also offers the bonus of coverage across time zones for responding to emergencies.
“This approach has truly been a game-changer,” says Khan. “If you want to find the people you need to fill your open IT roles, you’d better be willing to look abroad.”
Making global hiring work
Recruiting and managing employees in other countries won’t work for everyone. There are significant issues to consider, including labor laws, tax and compliance issues, administrative overhead, cybersecurity considerations, and cultural challenges. Seven in ten organizations that perform borderless hiring say it’s critical to factor in the specific needs of borderless tech workers into their workplace strategy, according to Gartner.
Often consolidating these efforts can make more sense than one-off hiring. “Whether global or domestic, establishing centers of excellence focused on ubiquitous IT areas like CRM and cybersecurity is another good idea,” says Scott duFour, global CIO of business payments company Fleetcor, which has a Prague center for IT infrastructure and cloud (serving Western and Central Europe, Australia, and New Zealand) and another in Atlanta (serving North America). The company also operates a virtual Salesforce center of excellence for North America, Western and Central Europe, and India.
“[Centers of excellence] provide the flexibility of on-site and remote working for staff managing teams serving lines of business while also acting as a satellite location for engineers, coders, and others who can work independently from anywhere,” duFour says.
MSC’s Hill, who’s done this in the past, emphasizes the ability to develop the employees for the company’s future benefit. “These employees will build a deeper understanding of the business model and operations,” Hill says. “This, in turn, will reduce cycle time and improve quality for both projects and operations.”
Other IT leaders see benefits in working with IT professionals abroad in a more targeted fashion. “Borderless workers, such as freelancers and remote workers, can offer organizations access to specialized skills and provide greater flexibility and scalability,” says Gartner vice president and analyst Monika Sinha. “These individuals can work on a project-by-project basis, allowing organizations to tap into specific expertise as needed.”
Best practices for hiring abroad
For CIOs considering hiring IT professionals in other countries for the first time, the following emerging best practices are worth keeping in mind:
Determine which skills are the best targets. “Borderless hiring does not mean hiring anyone from everywhere,” Gartner reports. Where your organization has a medium to low supply of skills with medium to high business importance is the best opportunity for going global.
Identify regions or cities with a potential supply of talent. CIOs can review some established and emerging hubs of IT talent, but with an eye toward those with the skills identified above.
Consider and calculate the costs and challenges of global hiring. Many CIOs meet significant resistance from HR and legal when pursuing a borderless workforce strategy, according to Gartner, so it’s important to understand the challenges, discuss them with the appropriate stakeholders, and factor them into the business case for hiring abroad.
Look out for language, cultural, and distance barriers. “With global organizations, a language barrier is definitely a big challenge, as it’s important to be able to communicate quickly with your team in real-time. And while we get more 24/7 coverage by hiring globally, managing people in different time zones poses its own challenges,” says Treasure Data’s Khan, adding that language and cultural issues can also make performance management of global teams more challenging and complex.
Invest in onboarding and retention targeted to global hires. The expanded global talent base gives IT leaders access to many more hiring options, but it doesn’t solve attrition problems. Employees in another country are just as — or even more — likely to walk out the door if they’re not happy. That means making sure faraway hires feel welcome and engaged, and ensuring that they have a career path in the organization.
“If the structure of hiring in another country focuses on the bottom rungs of the career ladder, there will be higher attrition as those associates see lack of career progression as an issue,” says MSC’s Hill. “The other challenge is that companies need to understand the infrastructure around these remote employees. Hiring remote employees without a sense of belonging to an organization will also likely lead to higher attrition rates.”
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