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Taking the Long View on IT

October 1, 2004
Related Topics: Behavioral Training, Training Technology, Featured Article

Over the past few years, corporate IT departments have trimmed budgets, staffs and perks as steadily as the NASDAQ has lost points. In contrast, IT workers at Minnesota Life, the ninth largest group-life insurance company in the United States, are feeling pretty secure. The 124-year-old firm has never laid off an IT worker. Period. While other budget-crunched companies jettisoned their IT college internship programs in recent years, Minnesota Life CIO Jean Delaney Nelson, who started at the firm in such a program herself some two decades ago, declared the project sacrosanct. And new employees are given two to three months of paid training, and occasionally even more, before they start to work.

    That’s one reason Minnesota Life was recently named the eighth best workplace for IT workers, according to the annual survey by Computerworld magazine. The company has top-notch benefits, such as a 401(k) plan with an employer match, life insurance, health and dental insurance, adoption assistance and scholarships for family members. If Minnesota Life spends more on training--$2,166 a year per IT employee versus $1,825 for the 99 other best employers in the Computerworld survey--it also expects more. The IT department must meet the demands of the aggressively expanding company, and it has won a batch of awards for its efforts. Koreen Theisen, company project manager for IT training, says that the amount ploughed into training is more than recouped by the company’s high retention rate for skilled personnel. Turnover in the IT department averages 3 to 4 percent, about half the industry average.

    Meta Group analyst Maria Schafer says that companies like Minnesota Life realize "training is a strategic way of keeping a high-performance IT workforce," and the insurance company won’t suffer the costly and dramatic turnover that IT managers at other large companies are bracing for when the economy rebounds. The company maintains the equivalent of eight full-time trainers for the 397-person IT staff. Minnesota Life does not track the ROI of their new-hire training efforts, saying it would be difficult to judge the productivity of application developers. However, human resources representatives do estimate the cost at the start of each training project to ensure there is sufficient demand to justify the need for internal training support.

"Techie-Geeks" not wanted
    Rather than using Internet job boards to find a senior manager positions, Minnesota Life hires entry-level employees and promotes from within. "We continually grow associates into future managers and technical leaders," CIO Nelson says. Currently, 19 percent of its IT staff has been promoted at some point.

    In looking for prospective employees, Ann Wolbert, a human resources representative at Minnesota Life, says that a well-rounded background is as important to the company as technology aptitude. "We don’t want the techie-geek," she says. "We want someone who has balanced academics, worked, done an internship and held a leadership position in some club or organization." She says that well-rounded people are better able to progress through Minnesota Life’s IT dual managerial or technology tracts than those who have never taken their finger off a computer mouse. The company also focuses on recruiting job candidates from schools with strong liberal arts programs, which CIO Nelson believes produces students with superior communication and leadership skills.

    As a result, new IT workers are as likely to have majored in math or music as computer science. (The patterns and rhythms in music tend to cultivate the kind of logical-thinking and problem-solving abilities that IT workers need, Nelson notes.) "At college job fairs, most companies just give away mugs and tell students to go online to find out about the company," Wolbert says. "We spend a lot more time talking with them about our culture and environment."

    The company’s most successful recruitment tool is its summer internship program. Interns work on real-life projects rather than answering phones or filing papers, and become strong company ambassadors on their respective campuses. The internship projects vary greatly, depending on the needs of the teams to which the interns are assigned. In one case, an intern created an Access database that tracked projects being done by the Information Services department. In another instance, an intern constructed a Lotus Notes database that maintained information about job candidates during the interview process.

First comes boot camp
    A key reason that Minnesota Mutual can be more flexible in looking for students with general knowledge and skills rather than experience with specific applications is because of its extensive training program. The trade publication Insurance & Technology says that the company’s rigorous two to three month training program "could be mistaken for a boot camp." The training begins with three weeks of classroom instruction. That allows the students to learn about the company and its technology environment in a group setting and to bond with others, an approach often not taken in the techie world. "A lot of companies throw new people into the business units," Wolbert says. "We believe in giving them the foundation first." The initial training is followed by self-paced learning with an advisor. During this time, a new hire learns about the company’s specific technology, software tools and project management protocols, such as the IMS and DB2 database management systems. These courses are bundled with Minnesota Life-specific information in the form of customized handouts, demos with an advisor, or classes. The new employees also receive education about the insurance industry in general and the specific lines of business they will support. The length of the training is individualized. Math majors, for example, might need more training than computer-science majors in basic computer skills. "There are never enough IT resources, so a lot of companies say, ‘We’ll train our people later,’ and later never comes," Nelson says. "That’s a real negative. Our greatest asset is our associates. If we don’t train them, we get higher turnover or they don’t retain their value."

Low training ratios
    One trainer for every 50 workers might seem extravagant, but training manager Theisen says the setup is cost-effective. "Replacing someone in IT is very expensive, because of the ramp-up time to understand our environment and the lost productivity when someone leaves," Theisen says. Throwing a new IT worker into the deep without enough training can slow their future progress, Minnesota Life contends. "The new employees might have the technical skills, but they need to learn things that they haven’t been taught in college," Theisen says. Students might know how to write Java code, but they don’t know how Java interacts with other technologies in Minnesota Life’s complex environment. Taking as much time as necessary to show them such things up front means greater productivity in the long run.

    The company’s training center, equipped with PCs with LAN connections, takes up a full floor in the St. Paul corporate headquarters. Other companies, Theisen notes, purchase external training materials and bring in outside trainers, which is expensive and might not relate to the company’s specific needs. In some cases, Minnesota Life will buy curriculum from vendors, and have its trainers deliver the material. Often, though, it’s more cost effective for the training department to develop its own courseware, such as how the corporate network is set up for Java. During slower business times, the company hires fewer new IT people. In those periods, the trainers are kept busy with other duties, such as producing news-letters and manuals and conducting research on business processes.

    The unorthodox approach seems to be working. Minnesota Life’s IT department has routinely won plaudits for being on the cutting edge of the industry. This year, Nelson was also named one of Computerworld’s list of Premier 100 IT Leaders, for effectively guiding IT in their organizations. The company’s group life insurance platform was a finalist for the prestigious A.M. Best E-Fusion award in 2002. Client companies that use the Web site have seen service calls drop by an average of 35 percent.

Strong female presence
    Unlike most tech staff departments that are predominantly male, Minnesota Life’s technology staff is about 50 percent female. Nelson attributes this partly to the lure of company’s emphasis on work-life balance, demonstrated by such benefits as onsite daycare centers and lactation rooms for new mothers. "Men become more interested in those things later in life, but it’s more appealing to women right out of college," Nelson says.

    Women also appreciate that a number of Minnesota Life’s female executives worked part-time at different stages of their career without being thrown off their career track. "You can work part-time for seven or eight years but still become a vice president," says company spokesman Margaret Jensen.

    The woman who runs the Minnesota Life’s research unit works 30 hours a week so she can have more time to spend with her two toddlers. A woman who is now a company director worked part-time in her earlier position as executive assistant to the CEO. He often traveled on business and agreed that when he was gone, she could stay home with her two young children. Early in her career, another woman, who is now a vice president, took every Friday off using her paid time off and the company’s leave-without-pay program, and she also came in very early so she could leave in the afternoon to be with her children when they came home from school.

    Also, the perks the company offers don’t rise and fall because of the latest quarterly profit earnings. "Prior to Sept-ember 11, companies tried to be more flexible with workers because the demand for IT workers was so competitive, so they offered perks like telecommuting," Nelson says. "When the economy turned around, a lot of companies take those opportunities away." Not so at Minnesota Life, where IT workers are given such options as flexible schedules and telecommuting. "For a lot of companies, implementing those policies was driven by competition and they never bought into the philosophy," Nelson says. "That creates a trust problem."

    "Minnesota Life believes in a conservative approach to personnel," she says. "During boom times, the company doesn’t aggressively hire with expectations of laying off employees at the first economic downturn. We wait for the right match and think in the long-term."

Workforce Management, October 2004, pp. 80-882 -- Subscribe Now!

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