Losing Tech Talent? Shift It From a Bug to a Feature

As the tech industry confronts an increasingly urgent talent shortage, a growing number of employers have taken to poaching talented workers from their competitors. It’s not unlike continuing to fish in a small pond: there simply aren't enough fish, so for hundreds of hard-to-find skill and experience sets, stealing has become a primary strategy.

For many hiring managers, this has led to a new whatever-it-takes, no-holds-barred ethos when it comes to finding the tech talent they need. Some companies are paying candidates just to show up to interviews. And, with the new normal of work-from-home, the largest companies can compete with small, local businesses to employ tech workers in the most enviable and lowest-cost markets. Many tech employees now benefit from national competition -- or even an international market -- for their services, which makes the competition even fiercer.

Few employers feel this more acutely than technology service providers. Tens of thousands of companies offer services across every major tech stack and in every industry. And dozens of giant system integrators like Infosys, Accenture, Wipro, PwC, and Deloitte offer every technology solution for every conceivable business product, process, and problem. These companies employ millions of trained tech workers and put them to work on behalf of clients.

Increasingly nowadays, their talent-starved clients seek to poach that talent themselves. Unfortunately, the largest, most established service providers make it crystal clear to clients that poaching is verboten, which means that those smaller companies often find themselves at the mercy of bigger fish in desperate need of their talent, regardless of what their contracts might say.

For tech service providers, poaching is a bug in their model, something they'd love to squash if they could. But sometimes when there are bugs everywhere, the right answer isn't constant squashing, but rather to open a bug museum, charge admission, and make a lot of money.

This is the road a few service providers have taken. Optimum Healthcare IT, a healthcare consulting and staffing firm (and Achieve portfolio company), works with hospitals and healthcare systems on electronic health record systems like Epic, and across other tech stacks like ERP and ServiceNow. Their work addresses a particularly acute talent shortage, as there are few training programs or pathways specific to healthcare IT platforms. Optimum itself saw a number of high performing consultants leave the firm to work for clients. But last year, Optimum decided enough was enough and launched a new hire-train-deploy pathway to see if it was possible to solve both their own talent shortage and that of their clients at the same time.

Here’s how the program, known as Optimum CareerPath, works: Optimum hires new and recent graduates from college partners like the University of North Florida and University of Colorado Denver with an aptitude for healthcare IT, but who don’t yet have relevant tech stack skills or experience. Optimum then runs them through an immersive apprenticeship training program. Following successful completion of the training program, apprentices are staffed on client projects. After a year or two, clients are not only permitted to hire the new talent, they are expected to.

In CareerPath’s first year, 100 apprentices completed the program and were staffed to hospital, healthcare system, and provider clients. That’s 100 new, trained, and certified tech workers in a talent-starved ecosystem. Two-thirds of them are from communities historically underrepresented in the tech industry. Optimum plans to scale CareerPath to thousands of new consultants every year.

By building a healthcare IT talent engine, Optimum can flip the script on the talent poaching bug. Encouraging its clients to hire CareerPath talent is now a feature of Optimum’s model, and a significant point of differentiation when competing for contracts against other service providers. According to Optimum CEO Jason Jarrett, “leading with CareerPath has opened the door to dozens of potential new clients who are seeking a pipeline for new healthcare IT talent.” A bonus, he added, “is not having to have conversations with clients around contracts that prohibit them from taking our talent. Because that’s the whole point of the CareerPath model.”

Optimum isn’t the only organization that’s trying out this model. FDM Group and Revature, software developer staffing companies, have scaled to thousands of placements per year with a hire-train-deploy approach. In April, a similar IT staffing company, SkillStorm, acquired a smaller hire-train-deploy business called Talent Path. With a growing tech talent gap, business is booming.

In a labor market that shows no sign of loosening anytime soon, tech service providers may want to rethink their approach. Instead of zealously trying to protect the talent they have and continuing to fish in the same small pond, a better strategy may be investing in and building a new talent engine and turning the bug of losing tech talent into a feature.