Challenges of a modern CTO and how IT outsourcing can solve them

Challenges of a modern CTO and how IT outsourcing can solve them
N-iX
1970-01-01T05:09:32+00:00

Every day, Chief Technology Officers face a number of technological, management, and strategic challenges. Every day, these challenges evolve, bringing new opportunities and risks as well. Engineering managers today have to build robust and resilient strategies in the face of disru...

Challenges of a modern CTO and how IT outsourcing can solve them
By Marta Hlova, Maksym Palamarenko July 11, 2019

Every day, Chief Technology Officers face a number of technological, management, and strategic challenges. Every day, these challenges evolve, bringing new opportunities and risks as well.

Engineering managers today have to build robust and resilient strategies in the face of disruptive trends and talent scarcity. But no one says they have to do it on their own. A reliable IT outsourcing partner can share a lot of their risks, grow their engineering capabilities, provide the necessary tech expertise, and relieve their management headaches.

IT outsourcing vendors who constantly work with CTOs of large enterprises, well-established ISVs, and growing startups understand the pains modern CTOs are going through and often know how to ease them. IT outsourcing as a new type of partner relationships can help engineering managers adapt to the changing industry trends and attract the best talent. Below, we list the most common pitfalls today’s CTOs tend to encounter and ways how IT outsourcing can help tackle them.

4 challenges modern CTOs are facing today

#1 Recruiting and growing IT specialists

According to a survey by the LA CTO Forum, the largest network of CTOs in the USA, recruiting tops the list of CTO challenges for 2019. No wonder, the talent shortage is today a global concern threatening tech companies in many countries. 

In the UK, the IT sector is expected to see 800,000 unfilled jobs by 2020, according to the latest study by Computer Weekly. In the USA, the U.S. Bureau of Labor Statistics predicts that this figure will reach 1,4 million. 

Engineering managers are struggling to hire the right talent when they need to launch a new software development project or quickly ramp up a team with the necessary skill sets. Hiring, onboarding, and training take too much effort, time and resources. 

Moreover, CTOs find it challenging to provide employees with professional development tools so that they can advance either vertically or horizontally. To keep software developers engaged and motivated at work, a company should offer diverse learning opportunities and career prospects. Otherwise, they risk suffering high turnover rates as employees are likely to look for more fulfilling job opportunities elsewhere if their job expectations are not met.

Delegate recruitment and HR activities to an IT outsourcing vendor

When a CTO needs to gather a software development team or quickly extend a team with the necessary skills, IT outsourcing to booming tech markets turns out to be the best option. IT outsourcing opens up the opportunity to attract the best talent. Indeed, it is easier to hire skilled software engineers in Eastern European countries like Ukraine and Poland than in the USA or the UK. The IT markets in this region thrive and the supply of IT specialists is higher than the demand.

For example, when analyzing the number of Java job postings in Ukraine on Indeed.com, it turns out that the supply of Java developers (29,9766) is almost 55 times bigger than the demand (551). The same is true of other technologies, including Python, .Net, and Javascript. 

Many companies have already experienced the benefits of hiring IT specialists in Ukraine. For instance, Orbus, a sole developer and a distributor of iServer Product suite worldwide, was struggling to find skilled QA specialists in London. So the company decided to tap into the Ukranian tech talent pool. They started with a small team of about 5 QA’s and within several years their team in Ukraine has grown to almost 40 specialists.

On the other hand, the majority of custom software development companies dedicate much time and effort to the professional development of employees. Mature IT outsourcing companies have a number of well-established best practices to retain and grow employees, such as Individual Development Plans (IDP), Performance Appraisals (PA), career planning, regular salary reviews, and others. 

For instance, at N-iX, HR Business Partners provide employees with a set of development tools that supplement the IDPs: 

  • GAP analysis (a technical interview to identify knowledge gaps);
  • mentorship program; 
  • internal technical training; 
  • professional certifications (Microsoft, ISTQB, Linux, Oracle, Scrum Alliance, and more), etc. 

In fact, IT outsourcing allows CTOs to transfer many risks associated with recruiting and retaining employees to the vendor. Therefore, they can focus on their core business tasks, the product, and technology.

#2 Security issues

The issue of security is among the top concerns of modern CTOs. As the industry security requirements are constantly changing, reevaluating security measures is a day-to-day task of every CTO. They need to make sure that their products are operating smoothly, meeting compliance with the security controls and policies. 

When it comes to data security, engineering managers have to ensure confidentiality and integrity of information assets while maintaining agility, transparency, and easy data access. They need to learn how to balance security with accessibility. 

The problem, however, only escalates due to the fact that there is a growing cyber skills gap in the tech world. Today, many organizations are suffering advanced security skills shortage in areas such as cloud security, threat intelligence, network security, application security, etc.

Avoid security issues with an experienced IT outsourcing vendor

Software development vendors can help CTOs build reliable software products that conform to industry compliance regulations. Established IT companies apply robust strategies to developing secure applications including a concept of security by design, testing for security and on-time incident management. Established IT outsourcing companies follow the best security practices in software development such as Microsoft SDL, OWASP Top 10, Microsoft STRIDE, etc. that help ensure the security and reliability of software. 

It’s worth mentioning that Ukrainian programmers are ranked first in the world in terms of security, according to the 2018 Developer Skills Report by HackerRank. Information security teams at tech companies constantly revise their security policies at planned intervals to guarantee they are suitable, adequate, and effective. They educate employees on cybersecurity and train them before an accident occurs.

When it comes to data protection, IT outsourcing companies have effective information security measures in place which comply with international standards, laws, and regulations. They undertake recurrent internal audits and develop thorough information security policies that ensure secure log-on procedures, password management, cryptographic keys management, network security, and information asset management.

#3 Enabling consistent innovation

The main job of a CTO is to drive consistent innovation. The problem is to keep up with tech development trends without going blindly after every next hype. Emerging technologies are disrupting every industry quicker than ever before. But when something new appears, a CTO should consider whether they need to adopt it or not. Or when the existing system becomes hard to maintain and scale, the CTO should decide whether to keep it or replace. Sometimes the race for popular technology can play a bad joke on the CTO and turn out to be a nightmare. But the problem is twofold. Firstly, if engineering managers decide to adopt new tech, they will need people who know it. Usually, these people are rare and expensive. As a result, lack of expertise in emerging technologies adds complexity, extends time to market, and drives costs.

On the other hand, if they don't modernize their tech stack, their systems will become inefficient and they won't be able to find the software developers who'd be ready to work with outdated technologies. 

Leverage IT outsourcing relationships to force innovation smartly

Reliable custom software development companies have experience working with disruptive technologies across a variety of industries. They have a wider talent pool with more diverse expertise. So an experienced IT outsourcing vendor can advise a CTO on a technology stack that would help them drive innovation without harming their business and technical metrics.

Before adopting cutting-edge technology, a software development company will work with you on the feasibility study and a proof of concept. They will help you make a decision not based on “what sounds fancier”, but rather what will bring value to your customers and your organization. They will help you avoid additional costs, long delivery time, technical debt, talent shortage and a high defect density, which are always associated with switching to new unknown technologies. 

#4 Establishing the best engineering practices

One of the most acute pains of a CTO is to set up work processes in such a way that everyone can do their job more efficiently without wasting time on tasks that could be simplified or automated.

This starts with choosing a strategy for software architecture design and ends with testing, refactoring, conducting code reviews, and setting up continuous integration. Of course, engineering managers don’t need to perform each of these tasks personally, but they should make wise decisions related to these issues.

Tap into industry best practices with an IT outsourcing partner

IT outsourcing vendors are delivering a number of products year by year. They understand all the pains of CTOs and know how hard it is for them to take decisions on their own. It's great to have an experienced partner with a pool of experts in a wide array of fields and technologies that a CTO can rely on. So they can take some weight off their shoulders and let the IT vendor help them with setting up effective software development processes. 

When it comes to software architecture design, a custom software development vendor can offer a full architecture decision-making cycle, including analysis of business needs and requirements, conducting discovery phase, and building prototypes ensuring the most suitable architecture for the client.

An IT outsourcing vendor can also consult a CTO on the best practices on how to improve software testing and increase the quality of software products. Moreover, they can help them determine the needs for automation and provide the best implementation of automation testing.

IT outsourcing companies help CTO introduce continuous integration and make refactoring and peer code reviews integral parts of the software development lifecycle.

Wrap-up

IT outsourcing is a solution to the most acute problems CTOs are facing now. A mature software development vendor can share a number of risks associated with security, innovation, gathering a dedicated team for your project, and setting up efficient software development processes. 

Do you face any of these challenges? Contact our experts and see how we can help you.

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By Marta Hlova, Maksym Palamarenko July 11, 2019

About N-iX

N-iX is an Eastern European provider of software development services with 900+ expert software engineers onboard that power innovative technology businesses. Since 2002 we have formed strategic partnerships with a variety of global industry leaders including OpenText, Novell, Lebara, Currencycloud and over 50 other medium and large-scale businesses. With delivery centers in Ukraine, Poland, Bulgaria, and Belarus, we deliver excellence in software engineering and deep expertise in a range of verticals including finance, healthcare, hospitality, telecom, energy and enterprise content management helping our clients to innovate and implement technology transformations.

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