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Communications Managers in Pivotal Role As Function Gains Increased Visibility.

Communications management is the field to be in, thanks to an exploding industry and the increasing awareness of its vital role by top management. "No single development is playing a more significant role in reshaping the way information is used in our society than the telecommunications revolution," observes John Sullivan, vice president and managing director of Korn/Ferry International's Los Angeles office. "The proliferation of computers in recent years, especially personal computers, has made the transition of data from one location to another virtually inseparable from its processing, and just as important."

Sullivan, whose firm is a large executive recruiting company, goes on to point out that "The supply of technically competent professionals in telecommunications is far below the demand for this expertise. Our salary records for executive searches performed in this functional area indicate no other segment matches this one in terms of salary appreciation over the past five years. Indeed, many institutions, particularly those that rely heavily on tlecommunications, have had to treat this particular functional area as an exception to their normal salary-administration policies."

In testimony during a recent public hearing on state telecommunications before the Commission on California State Government Organization and Economy, Sullivan explained: "This exceptions status usually develops slowly, beginning when management recruits several 'exceptions' into the organization at salary levels well above the range for comparable grade levels. As subsequent years' budgets are analyzed, it becomes apparent that salaries for this group are excessive when compared with those for equal management responsibility within other functional areas of the enterprise. This usually leads to serious disagreement between various operating groups with regard to the proper compensation level for telecommunications managers. A salary survey is often conducted that confirms the disparity for this specific management group. The next step is for new salary guidelines to be published with the telecommunications salary ranges broadened on the upside to reflect the realities of the marketplace or strong demand for telecommunications management skill.

"When one examines specific salaries within the telecommunications range levels, it is quite common for incumbents within each position to be paid considerably over the mid-point for that range and often at or near the maximum for the respective range. Therefore, it is normal for salary ranges, though higher than comparable responsibility levels, to nvertheless lag behind the market valuation for this group. We are aware of several current examples of this phenomenon."

So where do these telecommunications professionals come from? According to Sullivan, "in the business of executive search, one learns at an early stage to endeavor to 'fish where the fish are.' Superior telecommunications managers, though short in supply, are generally concentrated within a narrow set of specific industries. These particular industries were among the first to identify telecommunications as a useful tool for reduction of operating costs, or as a competitive weapon; that is, as a program for increasing market share by providing more users with more services. Therefore, when we are employed to search for a telecommunications executive, we normally target the following industries: airlines, major banks, brokerage firms, non-bank financial services institutions, on-line computer services companies, large hotel chains, nationwide car rental organizations, worldwide manufacturing organizations and, less frequently, common carriers."

On the last category, he explains that "Common carriers are usually excluded even though they employ large quantities of technically competent and knowledgeable telecommunications executives. Our clients often request that we avoid searching within the traditional monopoly due to their preference for a stronger profit motivation that is usually found in the smaller, unregulated business. Clients also believe the likelihood of finding a broad, general management perspective is greater in the user organization than in the large common carrier. Unquestionably, superb talent resides within the common carrier. however, it is foten too narrow in its focus and frequently lacks the broad perspective required, unless the individual is operating at a very high level within the common carrier. Then, compensation costs are usually too high." Voice and Data Together

Pointing to the increasingly complex industry, Sullivan says, "The environment affecting telecommunications management is ever more complicated by the growing number of alternative courses of action. Voice and data can no longer be planned and managed separately. They have converged into shared networks with a variety of terrestrial and satellite-based approaches. Many microcomputer alternatives are drastically changing the central data processing philosophies of most organizations. New vendor offerings and combinations are forcing reevaluations of what was considered optimal only a short time ago. Examples include IBM's purchase of Rolm, MCI's acquisition of Western Union International and GTE's purchase of Telenet."

Sullivan feels that a technician "simply cannot cope with such complex management problems. The technician's background is usually too narrow. It is unlikely that even minimal customer exposure and marketplace understanding have been obtained. The pure marketer should also be excluded from consideration due to a lack of technical understanding."

Who, then, does make a good communications manager. "The ideal, sneior telecommunications executive should possess a general management background and perspective, wary of technical excess and mindful of market need," says Sullivan. "To find such talent within variou organizations will inevitably involve tradeoffs between the available technical depth required and scarce management skills, but it is most important to insist upon a well-rounded and respected manager and organizer as the lead figure. This person must have a reporting level allowing direct access to the highest policy-setting executives within the (organization). This individual should have substantial experience in both data processing and telecommunications in order to appreciate that the integration of voice, data, video and text resources is less challenging in a technological sense than it is from an organizational standpoint."

"The essential requirement," he adds, "is a determination to get conrol of the data processing/telecommunications organization."

Another major factor, says Sullivan, is that the telecommunications executive must "demonstrate the ability to communicate effectively with top executives and key user groups throughout (the organization). Such communication skills are not typical of telecommunications managers."

He acknowledges that "outstanding technicians rather than managers have often been appointed telecommunications heads. Their careers have continued to advance through enhancement of their technical rather than their managerial skills, and their responsibilities have increased through improvement of their technicla skills as well. The result has been that the business side of telecommunications managers has often been poorly developed. It is imperative that telecommunications managers have the capability to talk the language of business as well as the language of telecommunications." The Compensation Factor

Covering salary levels in his remarks to the California commission, Sullivan said, "Compensation for a senior telecommunications executive within theprivate sector is in the $90,000 to $100,000 range for California companies with less volume and diversity than the State of California. This individual would normally report to a senior executive responsible for all company-wide information systems who would make in the area of $125,000 to $175,000. In turn, this latter individual usually would report to the chief executive officer or to the chief operating officer and would sit on policy-setting and strategy-forming committees of the firm."

Continuing, he said, "Below the level of the director of telecopmmunications services, organization structures vary widely. Most of our client organizations separate operational functions from planning and development activities. As one descends through the management levels, technical expertise becomes increasingly more important and conceptual skills and management experience becomes less so. However, at all levels our clients prefer candidates with a blend of voice and data experience, an ability to make rational 'make or buy' decisions, and interpersonal skills sufficient to promote meaningful alliances with other users and vendors."

Looking at educational background, Sullivan explains, "With regard to formal education, we have found that though most of our clients prefer a bachelor's degree, much greater emphsis is placed upon a successful track record as a business manager within a telecommunications environment than is placed upon the attainment of advanced degrees. However, we must admit that 'all things being equal,' we would be more proud to present a candidate with the successful track record who also happens to have a bachelor's degree in computer sciences followed by an MBA. The client tends to view such academic achievements as 'nice but not necessary' for this particular function. It probably is due to a conviction that telecommunications is truly learned in its practical application on the job. Another possible reason is that so much has happened in the development of the technology in the past few years that few formal education institutions have kept pace."

In a further look at organizational levels and salary ranges, Sullivan pointed out that "In larger telecommunication services organizations, two management levels normally exist below the head of telecommunications services. These levels are normally compensated at approximately $70,000 and $50,000, respectively. At the first level below the head of telecommunications services, appropriate titles would be manager of planning, manager of operations, manager of develoment or manager of support services. At the next level down (the $50,000 salary range), an example of a title might be communications software development manager. This individual probably would report to the development manager, who in turn would report to the director of telecommunications services. The communications software development manager would in effect be equivalent to a program manager, who would manage seven or eight projects, each with its own project manager. An example of a project might be electronic mail. The project manager would have responsibility for planning, designing, development and creation of necessary support services for successfully turning over that project to the operations group. Program managers normally are compensated between $45,000 and $49,000 per annum."

So, the bottom line, as indicated by John Sullivan and a growing band of industry observers in recent years, is for communications managers to develop more business-oriented expertise and possess the fine blend of both telecommunications and data processing experience necessary to manage the increasing integration of voice, data, video and text disciplines.
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Author:Sullivan, J.
Publication:Communications News
Date:Feb 1, 1985
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