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Sudozi 2022 Predictions: Increasing demand for technical talent has companies turning to vendors and vendor management solutions

vmblog predictions 2022 

Industry executives and experts share their predictions for 2022.  Read them in this 14th annual VMblog.com series exclusive.

Increasing demand for technical talent has companies turning to vendors and vendor management solutions

By Rose Punkunus, Founder & CEO, Sudozi

My prediction for 2022 doesn't touch on a single area of technology, but rather the entire labor ecosystem of technical talent, and how that has ripple effects on other parts of the organization. Primarily, the impact of a technical labor shortage translates to companies needing more vendors to fill the gaps in work previously done by full time employees.  Sudozi, a cloud based tool that manages vendor information, procurement, and budgeting helps companies manage the complexity with vendors, especially in a remote environment.

Technical talent shortage increases the need for vendors

When the pandemic started in 2020, there was already a shortage of technical talent.  With private and public markets being at their all time highs, companies had lots of resources (read: cash and equity) to attract technical talent.  The competition for top talent may have dipped slightly during March and April of 2020, but since then it has grown exponentially.  The difficulty in hiring technical talent and even recruiters of technical talent has a number of implications for the organization.

Who is doing the work?  Just because it's hard to recruit technical talent, doesn't mean the work no longer needs to be done.  Many companies are onboarding more contractors and vendors to fill gaps in IT, security, development, and technical recruiting.  From fractional IT managers to full time equivalent mobile developers, the average company may have dozens of technology vendors to manage.

Vendors are complicated to manage without dedicated tools

Each vendor has a unique set of legal contracts and payment methods.  One contractor may charge by the hour while another may require an upfront payment for a block of time, and then a variable rate after that.  Yet another may charge a flat fee for a fixed project deliverable.  Not only is there payment complexity in how the work gets done, but what if the vendor needs to buy something, like more servers, to get the job done.  Does the company pay for that directly or does the vendor pay for it and charge back to the company?  These are all questions that need to be answered and details that need to be tracked for each vendor.  The complexity is quite high and a mistake may be very costly.

Oftentimes, pre-public companies will track vendor details on an Excel sheet shared between finance, accounting, legal, and IT.  Sometimes the key point of contact for the vendor doesn't even have access to the vendor information or payment history because there isn't a tool to help share this information.  Needless to say, Excel and email are no longer sufficient to manage the increased volume and complexity of these vendors.  Finance teams and technology business partners are turning to cloud based digital tools to keep track of vendor information, payments, and budgeting.  Sudozi has a lightweight vendor management feature that does all of this for the company without needing to spin up another Excel spreadsheet.

Increasingly distributed workforces will require vendor management tools to prevent gaps and errors

In addition to having more vendors at the company, the semi-permanent remote nature of employees managing those vendors makes it more challenging for finance and accounting teams to know which vendors are being used and how to classify them on the financials.  Even if many teams at the company are not remote, you will see more and more companies allowing technical team members to be remote to attract talent in any geography.  This will further reinforce the need to have a tool like Sudozi to help digitally manage purchase requisition and budgets between remote employees.

The trend of increasing vendors is here to stay

In closing, 2022 is going to be a fantastic year for technical talent.  These individuals are going to have a lot of companies to choose from and high negotiating power when it comes to salaries, benefits, and overall compensation.  Because of the competitive nature of technical talent, companies will increase their reliance on contractors and vendors to get the job done.  The increased number of vendors has finance teams turning to systems like Sudozi to keep up with vendor tracking and management.

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ABOUT THE AUTHOR

Rose Punkunus 

Rose Punkunus is the Founder and CEO of Sudozi, a software platform to help finance teams collaborate with business partners on procurement and budgets. Previously Rose was CFO at ScaleFactor, VP Finance at Fundbox, and Regional CFO for the US & Canada business at Uber. Rose has an undergraduate degree in Economics from MIT and MBA from UCLA Anderson.

Published Thursday, October 14, 2021 7:34 AM by David Marshall
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