Talent Wars: How Boston-Area IT Companies Are Dealing With A Severe Staffing Crunch

12/5/07Follow @wroush

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scouring both job sites like Monster and business-networking sites like LinkedIn and ZoomInfo. “If you can get all those pieces going…then you have a chance of competing in a hot market,” Minichiello says.

Don’t look for people to fill specific positions—hire on a rolling basis.

Vinter says Google hires qualified people as they find them, then gives them time to figure out on their own where they fit into the company best. Melissa Lawrence does something similar at ITA Software, a fast-growing Cambridge company that builds comparison shopping, reservation, and ticketing systems for airlines and other travel companies. “We interview our engineers not with a specific job in mind, but asking ‘Are they going to raise the corporate average?’” says Lawrence, who is the company’s director of human resources. “Then we figure out which team needs them.”

Minichiello thinks of it as a numbers game. “I don’t always know which group [the new hires] will be in, but I do know I’ll need to hire x number of recruiters and that I’ll need to spend y dollars to get the word out. I look at it from the standpoint of how many candidates we need to be speaking with to keep [the growth] moving.”

Aggressively exploit employee referrals.

At ITA, 35 percent of all new hires started off with a referral from a current employee, according to Lawrence. “It’s really important to us to hire people that we know are good and talented, and referrals are our secret weapon,” says Lawrence.

Bill Andrews is CEO of ExaGrid Systems, a disk-based backup systems company in Westborough, MA, that recently raised $20 million in Series B funding in order to expand its sales, marketing, and technical hiring. “I’ve talked with dozens of CEOs, and what we are all finding is that it’s a very risk-averse workforce out there,” says Andrews. “People have been burned—they’ve all made the mistake sometime in the last five or 10 years of going to a company without really knowing how healthy it was. So they are tending to move to where they know people. So the thing that’s working better than anything else [when it comes to hiring] is networking.”

Referrals are so important to ExaGrid that the company pays employees a $3,000 bonus when a tip leads to a position being filled—and up to $9,000 for hard-to-find specialists. That’s still a bargain, Andrews points out, considering that using a headhunter will usually cost a company 20 percent of a new hire’s first-year salary. “We’ve gone from 30 employees to 85 in the last three months, and 75 percent of those hires came through referrals,” says Andrews.

Hire from within.

Vinter says that as he looks for the best people for Google’s Cambridge office, he considers employees currently based at the search giant’s Mountain View headquarters to be fair game. Indeed, employees who already work for a company, or who have recently left, have the advantage of being known quantities, and are often easier to woo.

Sturtevant says he’s collected quite a few references for former Microsoft people who had to move east to follow a spouse to another job or get closer to an aging family. “The ones that I kind of latch onto” are people who have already had a high career trajectory in Microsoft, Sturtevant told Bob last week. “They’re absolutely looking to stay with the company and the more we have going on in Boston the better it is for these kinds of folks.”

These kinds of people are great, Sturtevant says, because they already know Microsoft and have networks and an appetite for work. “That’s the best situation for me,” he says. (While Sturtevant hasn’t actually hired anyone yet, he says he has a number of good prospects and expects to have a core team in place this year.)

Poach unabashedly from other companies.

ITA’s Lawrence says one of her company’s strategies is to target riders of Boston’s Red Line, many of whom have high-tech jobs and have plenty of time to ponder their dissatisfaction with their current positions as they ride the subway to work. “We’re frankly trying to attract people who have other jobs,” Lawrence says.

Other companies are more active about their poaching. Andrews, at ExaGrid, says it’s important to be on the lookout for local tech companies where employees are starting to eye the lifeboats. “There are two ways that a lot of employees get freed up,” Andrews says. “One is when companies are starting to struggle. You can tell, because the sales and marketing people are always the first to jump ship—the engineers down in the engine room tend to go down with the ship. The other way is … Next Page »

Wade Roush is Xconomy's chief correspondent and editor of Xconomy San Francisco. You can subscribe to his Google Group or e-mail him at wroush@xconomy.com. Follow @wroush

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