BT turns to global online freelance IT talent to solve digital skills crisis
BT explains its February £30m contract and investment in an on-demand software engineering platform will help attract talent it has previously struggled to reach
BT Group - which faces a number of challenges this week, including mixed financial results and a worker walkout - may have a mid-term solution to at least some of its problems: improving access to IT talent via a global community of freelance software developers and workers to make up for a skills shortfall.
The idea is to use collaboration technology to access so-called ‘Elastic Teams’ - private talent clouds that can give it access to high-quality tech talent in composable, quickly deployed teams.
Use of Elastic Teams began in earnest at BT in April, with 78 colleagues from the platform working across both the BT enterprise Digital Team, its consumer CIO and global CIO function, as well as its incubation team, which is a where the firm is looking to develop future revenue lines in healthcare, drones and the FinTech and payment service space.
A key project also underway at the brand using this form of outside technical help, including its proposed 888 service to protect women walking home at night.
Elastic Team IT capability is being delivered by a new UK London-based partner called Distributed.
Distributed has also been offering on-demand talent support for organizations including the BBC, Capita, and the UK Government’s Ministry of Justice.
We spotted a need
BT has actually switched from being a customer of the platform, to an investor. It announced in February that it was so impressed with the concept that it has signed a £30m contract with the company, which delivers the AI-powered workforce platform.
That investment - which the company claims is a first in its history - also gives it a board seat and an equity stake in the business. The BT executive taking that seat - and who also is leading the use of the approach at the telco giant - is Director of HR, Technology Units at the firm, Mark Murphy. He said:
We were initially in discussions with this company last December about how we could work with them and add them to our third party support base. But rather quickly, those conversations became exploring options about how we could invest in them, as they were about to do their next funding round.
So, the story here is that we spotted a need, but then went with an interesting digital HR way of doing it via partnership with a very promising British tech company.
The context here, for not just BT but many firms, is The Great Resignation and the war for talent.
In IT, that currently means that demand for highly desirable competencies in areas such as frontend, backend, database, API, and DevOps is fierce, says the vendor.
And given that the US and UK tech sectors between them currently suffer from nearly two million software development vacancies - a number that could grow by over 20% per year for the next five years, while the Higher Education sector of both economies can only offer a maximum of 65,000 relevant graduates per year - a more flexible approach to resourcing needs to be found.
Accelerating digital capability across the business
Murphy agrees. He says that there are already plenty of freelance contractors in the employment market; 3,500 people that work within the new BT Digital Team today and 12,000 third party individuals and organizations across its IT estate, in the fields of software engineers, designers, UX testers, and so on.
So, what’s different with an Elastic Team? He said:
We do use a lot of subcontractors to supplement what we've got in-house, but our strategy is to bring more of that digital capability into BT and grow our directly employed Digital Team quite significantly over the next 18 months or so.
Doing that means we will shrink our dependency on not all, but some, of our global freelance base. But we are really focused on how we build digital capability and accelerate the building of it across the business.
This will include more investment in in-house training and L&D, he says, including a new BT Digital University for all of its existing and future technologists to continue to develop vital digital skills.
But, Murphy added, BT’s move to boost its internal IT capacity is happening when the market couldn't be hotter for technology skills, forcing he and his team to get more creative about how they get access to talent pools. He explained:
We know we're never going to solve these skills requirements on our own, and it must be done through smart partnerships like this.
After all, we're going up against some big names in this space. And although BT is a strong brand, when you think about BT you don't always think about some of the leading-edge technology and digital transformation products or services that we're working on.
You think about payphones, landlines, BT Sport, maybe. If we approached them about a permanent job at BT, a lot of these freelancers wouldn't be interested, which would deny me the opportunity of bringing their skills in.
Hence why the Distributed freelance platform, which Murphy says was developed by software engineers for software engineers, is such an important first step. He added:
Elastic Teams gives us access to freelance software engineers, data and AI specialists and others which means we can be really flexible about standing up a whole squad to solve a particular customer problem using these resources, as they can mobilize so quickly.
Or we can cherry pick and create squads made up of BT people and Elastic Team experts, which give us more reach.
It's a win for both sides, BT thinks, as it de-risks the uncertainty of the Digital Team not being able to find skills, but ensures that freelancers using the platform can still work when and where they wish.
Next steps, concluded Murphy, includes the release of new BT products and services created with the help of freelancers, increasing overall BT IT creativity and a better experience for customers.