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Shortly after the start of the prior decade, there was a lot of concern that tech jobs would be outsourced, leading many to conclude that tech skills carried less value and that workers with tech backgrounds had little to offer. Turns out this thinking was stunningly wrong. Tech jobs boomed, and as technology pervades all other management disciplines, tech skills are becoming more important, not less. Today, tech knowledge can be a key differentiator for the job seeker. It’s the worker without tech skills that needs to be concerned.
As we’ll present in depth in a future chapter, there’s a principle called Moore’s Law that’s behind fast, cheap computing. And as computing gets both faster and cheaper, it gets “baked into” all sorts of products and shows up everywhere: in your pocket, in your vacuum, and on the radio frequency identification (RFID) tags that track your luggage at the airport.
Well, there’s also a sort of Moore’s Law corollary that’s taking place with people, too. As technology becomes faster and cheaper and developments like open source software, cloud computing, software as a service (SaaS), and outsourcing push technology costs even lower, tech skills are being embedded inside more and more job functions. What this means is that even if you’re not expecting to become the next Tech Titan, your career will doubtless be shaped by the forces of technology. Make no mistake about it—there isn’t a single modern managerial discipline that isn’t being deeply and profoundly impacted by tech.
Many business school students who study finance aspire to careers in investment banking. Many i-bankers will work on IPOs (initial public stock offerings), in effect helping value companies the first time these firms wish to sell their stock on the public markets. IPO markets need new firms, and the tech industry is a fertile ground that continually sprouts new businesses like no other. Other i-bankers will be involved in valuing merger and acquisition (M&A) deals, and tech firms are active in this space, too. Leading tech firms are flush with cash and constantly on the hunt for new firms to acquire. Cisco bought eighty-nine firms in the prior decade;M. Thompson, “Penetration Test: Cisco’s Driving New Markets and We All Go Along for the Ride,” Network World, March 16, 2010. Oracle and Facebook each bought nine firms in 2010, and Google bought a whopping twenty-seven firms!D. Hubler, “2010, the Year of the Big Comeback for IT M&As,” Washington Technology, March 28, 2011. And even in nontech industries, technology impacts nearly every endeavor as an opportunity catalyst or a disruptive wealth destroyer. The aspiring investment banker who doesn’t understand the role of technology in firms and industries can’t possibly provide an accurate guess at how much a company is worth.
Table 1.1 2010 Tech Deals by Sector
Source: T. Page, “2011 US Technology M&A Insights,” PwC, March 2011.
Those in other finance careers will be lending to tech firms and evaluating the role of technology in firms in an investment portfolio. Most of you will want to consider tech’s role as part of your personal investments. And modern finance simply wouldn’t exist without tech. When someone arranges for a bridge to be built in Shanghai, those funds aren’t carried over in a suitcase—they’re digitally transferred from bank to bank. And forces of technology blasted open the two-hundred-year-old floor trading mechanism of the New York Stock Exchange, in effect forcing the NYSE to sell shares in itself to finance the acquisition of technology-based trading platforms that were threatening to replace it. As another example of the importance of tech in finance, consider that Boston-based Fidelity Investments, one of the nation’s largest mutual fund firms, spends roughly $2.8 billion a year on technology. Tech isn’t a commodity for finance—it’s the discipline’s lifeblood.
If you’re an accountant, your career is built on a foundation of technology. The numbers used by accountants are all recorded, stored, and reported by information systems, and the reliability of any audit is inherently tied to the reliability of the underlying technology. Increased regulation, such as the heavy executive penalties tied to the Sarbanes-Oxley ActAlso known as Sarbox or SOX; U.S. legislation enacted in the wake of the accounting scandals of the early 2000s. The act raises executive and board responsibility and ties criminal penalties to certain accounting and financial violations. Although often criticized, SOX is also seen as raising stakes for mismanagement and misdeeds related to a firm’s accounting practices. in the United States, have ratcheted up the importance of making sure accountants (and executives) get their numbers right. Negligence could mean jail time. This means the link between accounting and tech have never been tighter, and the stakes for ensuring systems accuracy have never been higher.
Business students might also consider that while accounting firms regularly rank near the top of BusinessWeek’s “Best Places to Start Your Career” list, many of the careers at these firms are highly tech-centric. Every major accounting firm has spawned a tech-focused consulting practice, and in many cases, these firms have grown to be larger than the accounting services functions from which they sprang. Today, Deloitte’s tech-centric consulting division is larger than the firm’s audit, tax, and risk practices. At the time of its spin-off, Accenture was larger than the accounting practice at former parent Arthur Andersen (Accenture executives are also grateful they split before Andersen’s collapse in the wake of the prior decade’s accounting scandals). Now, many accounting firms that had previously spun off technology practices are once again building up these functions, finding strong similarities between the skills of an auditor and skills needed in emerging disciplines such as information security and privacy.
Technology has thrown a grenade onto the marketing landscape, and as a result, the skill set needed by today’s marketers is radically different from what was leveraged by the prior generation. Online channels have provided a way to track and monitor consumer activities, and firms are leveraging this insight to understand how to get the right product to the right customer, through the right channel, with the right message, at the right price, at the right time. The success or failure of a campaign can often be immediately assessed based on online activity such as Web site visit patterns and whether a campaign results in an online purchase.
The ability to track customers, analyze campaign results, and modify tactics has amped up the return on investment of marketing dollars, with firms increasingly shifting spending from tough-to-track media such as print, radio, and television to the Web.J. Pontin, “But Who’s Counting?” Technology Review, March/April 2009. And new channels continue to emerge. Firms as diverse as Southwest Airlines, Starbucks, UPS, and Zara have introduced apps for the iPhone, iPad, and iPod touch. In roughly four years, iOS devices are now in the hands, backpacks, purses, and pockets of over 200 million people worldwide, delivering location-based messages and services and even allowing for cashless payment.D. Coldewey, “iOS Passes 200 Million Devices, 25 Million of Which Are iPads,” TechCrunch, June 6, 2011.
The rise of social media is also part of this blown-apart marketing landscape. Now all customers can leverage an enduring and permanent voice, capable of broadcasting word-of-mouth influence in ways that can benefit and harm a firm. Savvy firms are using social media to generate sales, improve their reputations, better serve customers, and innovate. Those who don’t understand this landscape risk being embarrassed, blindsided, and out of touch with their customers.
Search engine marketing (SEM), search engine optimization (SEO), customer relationship management (CRM), personalization systems, and a sensitivity to managing the delicate balance between gathering and leveraging data and respecting consumer privacy are all central components of the new marketing toolkit. And there’s no looking back—tech’s role in marketing will only grow in prominence.
A firm’s operations management function is focused on producing goods and services, and operations students usually get the point that tech is the key to their future. Quality programs, process redesign, supply chain management, factory automation, and service operations are all tech-centric. These points are underscored in this book as we introduce several examples of how firms have designed fundamentally different ways of conducting business (and even entirely different industries), where value and competitive advantage are created through technology-enabled operations.
Technology helps firms harness the untapped power of employees. Knowledge management systems are morphing into social media technologies—social networks, wikis, and Twitter-style messaging systems that can accelerate the ability of a firm to quickly organize and leverage teams of experts. And crowdsourcing tools and question-and-answer sites like Quora allow firms to reach out for expertise beyond their organizations. Human resources (HR) directors are using technology for employee training, screening, and evaluation. The accessibility of end-user technology means that every employee can reach the public, creating an imperative for firms to set policy on issues such as firm representation and disclosure and to continually monitor and enforce policies as well as capture and push out best practices. The successful HR manager recognizes that technology continually changes an organization’s required skill sets as well as employee expectations.
The hiring and retention practices of the prior generation are also in flux. Recruiting hasn’t just moved online; it’s now grounded in information systems that scour databases for specific skill sets, allowing recruiters to cast a wider talent net than ever before. Job seekers are writing résumés with keywords in mind, aware that the first cut is likely made by a database search program, not a human being. The rise of professional social networks also puts added pressure on employee satisfaction and retention. Prior HR managers fiercely guarded employee directories for fear that a headhunter or competitive firm might raid top talent. Now the equivalent of a corporate directory can be easily pulled up via LinkedIn, a service complete with discrete messaging capabilities that can allow competitors to rifle-scope target your firm’s best and brightest. Thanks to technology, the firm that can’t keep employees happy, engaged, and feeling valued has never been more vulnerable.
And for those looking for careers in corporate law, many of the hottest areas involve technology. Intellectual property, patents, piracy, and privacy are all areas where activity has escalated dramatically in recent years. The number of U.S. patent applications waiting approval has tripled in the past decade, while China saw a threefold increase in patent applications in just five years.J. Schmid and B. Poston, “Patent Backlog Clogs Recovery,” Milwaukee Journal Sentinel, August 15, 2009. Firms planning to leverage new inventions and business methods need legal teams with the skills to sleuth out whether a firm can legally do what it plans to. Others will need legal expertise to help them protect proprietary methods and content, as well as to help enforce claims in the home country and abroad.
While the job market goes through ebbs and flows, recent surveys have shown there to be more IT openings than in any field except health care.2009 figures are from http://www.indeed.com. Money magazine ranked tech jobs as two of the top five “Best Jobs in America.”“Best Jobs in America,” CNNMoney, 2009, http://money.cnn.com/magazines/moneymag/bestjobs/2009/snapshots/1.html. BusinessWeek ranks consulting (which heavily hires tech grads) and technology as the second and third highest paying industries for recent college graduates.L. Gerdes, “The Best Places to Launch a Career,” BusinessWeek, September 15, 2008. Technology careers have actually ranked among the safest careers to have during the most recent downturn.T. Kaneshige, “Surprise! Tech Is a Safe Career Choice Today,” InfoWorld, February 4, 2009. And Fortune’s ranks of the “Best Companies to Work For” is full of technology firms and has been topped by a tech business for five years straight.See “Best Companies to Work For,” Fortune, 2007—2010. For 2010 list, see http://money.cnn.com/magazines/fortune/bestcompanies/2010/full_list/index.html.
Students studying technology can leverage skills in ways that range from the highly technical to those that emphasize a tech-centric use of other skills. Opportunities for programmers abound, particularly for those versed in new technologies, but there are also roles for experts in areas such as user-interface design (who work to make sure systems are easy to use), process design (who leverage technology to make firms more efficient), and strategy (who specialize in technology for competitive advantage). Nearly every large organization has its own information systems department. That group not only ensures that systems get built and keep running but also increasingly takes on strategic roles targeted at proposing solutions for how technology can give the firm a competitive edge. Career paths allow for developing expertise in a particular technology (e.g., business intelligence analyst, database administrator, social media manager), while project management careers leverage skills in taking projects from idea through deployment.
Even in consulting firms, careers range from hard-core programmers who “build stuff” to analysts who do no programming but might work identifying problems and developing a solutions blueprint that is then turned over to another team to code. Careers at tech giants like Apple, Google, and Microsoft don’t all involve coding end-user programs either. Each of these firms has their own client-facing staff that works with customers and partners to implement solutions. Field engineers at these firms may work as part of a sales team to show how a given company’s software and services can be used. These engineers often put together prototypes that are then turned over to a client’s in-house staff for further development. An Apple field engineer might show how a firm can leverage podcasting in its organization, while a Google field engineer can help a firm incorporate search, banner, and video ads into its online efforts. Careers that involve consulting and field engineering are often particularly attractive for those who enjoy working with an ever-changing list of clients and problems across various industries and in many different geographies.
Upper-level career opportunities are also increasingly diverse. Consultants can become partners who work with the most senior executives of client firms, helping identify opportunities for those organizations to become more effective. Within a firm, technology specialists can rise to be chief information officer or chief technology officer—positions focused on overseeing a firm’s information systems development and deployment. And many firms are developing so-called C-level specialties in emerging areas with a technology focus, such as chief information security officer (CISO), and chief privacy officer (CPO). Senior technology positions may also be a ticket to the chief executive’s suite. A recent Fortune article pointed out how the prominence of technology provides a training ground for executives to learn the breadth and depth of a firm’s operations and an understanding of the ways in which firms are vulnerable to attack and where it can leverage opportunities for growth.J. Fortt, “Tech Execs Get Sexy,” Fortune, February 12, 2009.
With tech at the center of so much change, realize that you may very well be preparing for careers that don’t yet exist. But by studying the intersection of business and technology today, you develop a base to build upon and critical thinking skills that will help you evaluate new, emerging technologies. Think you can afford to wait on tech study then quickly get up to speed? Whom do you expect to have an easier time adapting and leveraging a technology like social media—today’s college students who are immersed in technology or their parents who are embarrassingly dipping their toes into the waters of Facebook? Those who put off an understanding of technology risk being left in the dust.
Consider the nontechnologists who have tried to enter the technology space these past few years. News Corp. head Rupert Murdoch piloted his firm to the purchase of MySpace only to see this one-time leader lose share to rivals.O. Malik, “MySpace, R.I.P.,” GigaOM, February 10, 2010. Former Warner executive Terry Semel presided over Yahoo!’sJ. Thaw, “Yahoo’s Semel Resigns as Chief amid Google’s Gains,” Bloomberg, June 18, 2007. malaise as Google blasted past it. Barry Diller, the man widely credited with creating the Fox Network, led InterActive Corp. (IAC) in the acquisition of a slew of tech firms ranging from Expedia to Ask.com, only to break the empire up as it foundered.G. Fabrikant and M. Helft, “Barry Diller Conquered. Now He Tries to Divide,” New York Times, March 16, 2008. And Time Warner head Jerry Levin presided over the acquisition of AOL, executing what many consider to be one of the most disastrous mergers in U.S. business history.J. Quinn, “Final Farewell to Worst Deal in History—AOL-Time Warner,” Telegraph (UK), November 21, 2009. Contrast these guys against the technology-centric successes of Mark Zuckerberg (Facebook), Steve Jobs (Apple), and Sergey Brin and Larry Page (Google).
While we’ll make it abundantly clear that a focus solely on technology is a recipe for disaster, a business perspective that lacks an appreciation for tech’s role is also likely to be doomed. At this point in history, technology and business are inexorably linked, and those not trained to evaluate and make decisions in this ever-shifting space risk irrelevance, marginalization, and failure.