Managers in global technology companies need to get beyond thinking about hardware and software and focus more on the people behind their products if they are to maintain a competitive edge, a new report has argued.
A study by consultancy PricewaterhouseCoopers has found that, while most technology executives understand that human capital management should be their top priority, most also accept that their organisation's capabilities in this area
are poor.
Graham Wyllie, director of PricewaterhouseCoopers LLP, said: "Competition for talent has never been fiercer and there is likely to be another industry talent war if demand increases.
"Technology executives must upgrade human capital management in their companies and create innovative programmes in order to attract and retain the best people," he added.
To gain access to larger pools of talent, technology companies were now being forced, more often than not, to look overseas.
In emerging markets, the situation is similar with 41 per cent of all technology companies indicating difficulty in finding technical talent and 48 per cent reporting difficulty retaining this talent.
Salaries in the technology sectors of emerging markets were also rising – a direct result of the intensifying need for talent.
In fact, compensation levels are increasing to a point where China and India will no longer be viewed as cost effective, the report found.
This meant, more than ever, retaining, developing and challenging existing talent needed to become more of a priority, stressed PwC.
Many global technology companies were weak in areas such as training for senior executives, recruiting capabilities and developing talented people.
"Technology companies have always had to compete for the best and the brightest, but with an industry boom they are faced with a talent shortage," said Wylie.
"It is no longer adequate for technology employees to have an advanced degree in mathematics and sciences. They need a strong drive to succeed, a willingness to learn, collaborate and innovate, and the capacity to manage change," he added.
Some companies were working with schools to boost aspects of curriculum and encourage students to study mathematics and sciences in order to combat the diminishing talent pool with these qualifications.
Others were looking in-house to better manage their best assets, it added, using tools such as talent maps, worker engagement surveys and human capital metrics.
Employees, it added, were no longer just attracted by the financial benefits of an organisation.
They were demanding innovative and interesting work and a clear view of how their careers would develop, with 90 per cent of respondents saying that developing and retaining existing high performers is very important.