In-Depth

ESJ Salary Survey 2011 Part 1: Management Salaries

Most management salaries stagnated or dropped, though bonuses saw a bounce; business-to-business and ERP skills command highest premiums.

• 08/23/2011

Over the past year, the economy has been in slow growth mode, with an uneven recovery holding back IT department budgets, while creating pockets of opportunity in many areas of IT. The result has been a stagnation in IT management salaries over the past year, with companies holding the line on significant salary increases. Instead, IT managers have seen more compensation in one-time annual bonuses tied to the progress of their division or projects.

These are the findings of the latest Enterprise Systems survey of 1,467 IT professionals, conducted in May 2011. The survey covered nine key management positions, along with nine key IT staff positions (to be covered in the next installment of this report). Respondents were asked to fill in data on their own positions as well as other positions across their companies where they have salary knowledge.

ESJ 2011 Salary Survey PDF

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Management bonuses, in fact, were fairly robust over the past year, according to survey participants. Eight out of the nine positions covered received often-significant increases in their bonuses. Middle-tier departmental IT managers -- including application development and data center managers -- received substantial increases in their bonuses. Only help desk and support managers suffered a decline in average bonuses from last year's survey.

The survey also found that salaries were higher across the board for IT management professionals engaged in application areas such as business-to-business systems, supply chain management, and enterprise resource planning (ERP).

Although there has been a considerable amount of attention on cloud computing over the past year, this fascination is not translating into increased pay levels for IT managers. Ranking consistently low across all the management categories were IT shops reporting cloud and virtualization initiatives.

As in previous years, the survey found that IT managers and executives at mainframe and Unix sites tend to have the highest salary rates; those in more distributed environments (such as Windows or Linux servers with no mainframe) tend to see much lower rates.

This first of two reports to the Enterprise Systems salary report looks at the results for executive and management-level salaries in 2011. In the next installment, we will look at IT staff-level positions.

CIO AND VICE PRESIDENT OF IT

Salaries for the top executives in IT held steady over the last year with little change, at an average base rate of about $143,600. (Base salaries reported in this article do not include bonuses, which are addressed separately, or stock options or benefits.) However, top IT executive salaries are still down from their 2008-2009 peak, still reflecting the aftermath of the recent recession. CIO and IT vice president's bonuses have also remained constant over the past two years, currently averaging $18,300 among those companies awarding bonuses. However, this still lags the levels seen in the middle to latter part of the last decade, when CIOs and VPs received average annual average bonuses topping $34,000.

CIOs and VPs drew the highest base salaries and bonuses of the 18 positions covered in this year's survey. They are also the only management position to see an increase in average salary over the past year, though it is a modest one-percent jump. Notably, although bonus amounts for CIOs and VPs are the highest of any IT management category, these executives also saw the smallest hike in the size of their bonuses. (Excluding the category of help desk and support managers, who had a decline in their bonus levels.)

The typical CIO or top IT executive in our survey has 16 years of experience in the job. On average, CIOs with more experience -- at least a decade on the job -- earn about 42 percent more than their less-experienced counterparts.

CIOs overseeing business-to-business enterprise environments fare best this year, earning more than $163,000 in base salary on average. Those CIOs at sites with enterprise resource planning (ERP) implementations follow with $160,000. Supply-chain management operations ranked third, paying CIOs base salaries averaging $156,000.

By operating system environment, CIOs in Unix shops (including IBM AIX, Oracle Sun Solaris, and HP-UX servers) tend to pay best, at an average rate of $165,000. Mainframe shops follow closely behind, paying CIOs more than $163,000 in base salaries.

CIO/VP SALARIES

INFORMATION SYSTEMS DIRECTOR

The salaries of CIOs' direct reports -- IS or IT directors -- changed only a little since 2010, slipping only about two percent overall. Most important, their salaries are still well above what they were just two years ago, suggesting that these second-tier IT executives are seen as valuable to organizations as they concentrate on growth during the economic recovery. Overall, IS directors -- who plan, direct, and control all day-to-day IT functions and oversee entire departments -- made an average base salary of about $115,000 a year, compared to $117,000 in last year's survey.

As a further testament to the value these executives have to organizations, their bonus levels rose considerably this year, the highest of any of the years since 2001, when this survey was first conducted. The typical average bonus reported among this survey group is about $14,600, up almost 23 percent from last year, and four times what was awarded 10 years ago.

IT directors’ salaries rank second among the nine management positions covered in our survey, and also second in terms of bonus amounts.

On average, the IS directors covered in our survey have about 16 years' experience. IS directors with 10 or more years experience make more than 25 percent more than those in the first 10 years of their jobs. An IS director with fwer than 10 years experience can expect to make about $94,000 a year, a figure that climbs to close to $120,000 for those with at least a decades' worth of experience.

The leading application categories for IS directors are in line with those of CIOs and vice presidents. IS directors in charge of sites supporting business-to-business transactions command the highest base salaries among their peers, averaging close to $130,000, or more than 12 percent above the average. Those overseeing supply chain operations follow with close to $126,000 a year in base pay. IS directors at ERP sites make an average of $124,000 a year.

By operating system environment, IS directors also parallel top IT executives, with those overseeing Unix sites seeing the highest levels of base compensation. IS directors at both Unix and mainframe sites earn an average of $127,000 a year. The base pay at more distributed environments, such as Linux or Windows, is more than 10 percent lower.

IS DIRECTOR SALARIES

INFORMATION SYSTEMS MANAGER

As is the case with their higher-ups in IT departments, the average base salaries of IS managers -- those who oversee the day-to-day operations of their enterprises -- is relatively unchanged from a year ago. The average an information systems manager -- who plans and approves equipment and software purchases, as well as oversees day-to-day activities -- now stands at just over $95,000. Althouh not quite as high as the peak year (2009), IS managers’ salaries are still above levels seen throughout the decade this survey has been conducted.

IS managers' pay levels may be flat, but their work is being compensated by a larger bonus this year. Overall, bonuses for IS managers have been gradually climbing over the past decade, from the $6,000 range in the early part of the 2000s to close to $9,000 in recent years.

IS managers' salaries rank third in salary levels among the nine management positions covered in our survey, as well, and third in terms of bonus amounts.

The average IS manager reported in this survey has about 13 years of on-the-job experience. Those in their first decade average about $79,000, a figure that jumps to more than $100,000 after about 10 years.

As with their higher-ups in the organization, IS managers involved in sites implementing and maintaining supply chain management systems, business-to-business sites, and ERP are the most highly compensated. In each of these top three categories, IS managers make more than $100,000 a year on average.

By operating system environment, IS managers in mainframe shops lead, earning a base of $100,000 a year, followed closely by those with Unix systems onsite.

IS MANAGER SALARIES

APPLICATION DEVELOPMENT MANAGERS

After their average base salaries almost peaked at the $100,000 mark in 2009, application development managers have seen a slow slide in compensation. Overall, base salaries on average declined by about three percent over the past year, to $93,000. The recession and its aftermath may be to blame for the decline in average salaries, which are now even with 2007-2008 levels. Also, more organizations may be relying on packaged and cloud offerings, with less activity on custom-designing their own software.

What AD managers did not see in their regular paycheck was made up by the bonuses they are receiving -- up by more than a third over the past year. This reversed a downward trend in AD managers' bonuses seen since 2006.

AD managers' salaries rank fifth among the nine management positions covered in our survey, and fourth in terms of bonuses. These managers also had the second-largest increase in bonus levels (up 36 percent).

The average AD manager has about 12 years of experience on the job. These managers can expect to see salary growth of up to 30 percent in the first decade of their careers, the survey finds. Currently, AD managers in the first decade of their careers make about $77,000, a level that rises to more than $100,000 for those with at least 10 years of experience.

As with their IT executive and management counterparts, those application development managers engaged in operations involving business-to-business, supply chain management, and ERP systems draw the highest average base salaries, close to $99,000 a year.

Mainframe application developers are faring best in terms of salaries when breaking down the results by operating system environment, our survey finds. Those AD managers involved with mainframe shops top the list, drawing at least $99,000 annually, followed by those at Unix sites with $95,000.

APPLICATION DEVELOPMENT MANAGER SALARIES

DATA CENTER/OPERATIONS MANAGER

As with their application development counterparts, data center managers have been seeing a downturn trend in their overall average salaries over the past couple of years. Data center and operations managers -- who oversee day-to-day operations of data center environments -- saw a four-percent decline in average base salaries since last year, our survey finds. Data center managers now make about $88,000, not counting bonuses and benefits -- compared to last year’s average of about $92,000. Salaries for this position peaked in 2009 at $97,000, just as the full brunt of the recession was being felt.

Making up for the flat-lining of their salaries, data center managers are receiving very hefty bonuses -- up by almost 50 percent of what they received in 2010. Annual average bonuses for data center managers now average more than $7,100 for the year -- a level not seen since 2006.

DC managers' salaries rank sixth among the nine management positions covered in our survey, and also sixth in terms of bonus amounts. Notably, however, these managers had the largest overall increase in bonus amounts -- up 48 percent over last year.

Data center managers in our survey have about 12 years of experience. The more experienced managers (with more than a decade on the job) are drawing salaries of at least $97,000, a 40 percent rise from their entry-level counterparts.

For data center managers, business-to-business systems are the most likely to offer high-paying environments, averaging close to $95,000. Those DC managers overseeing supply chain management and ERP systems follow closely at $93,000 in base pay.

Those DC managers overseeing mainframe sites also commanded higher average salaries, bringing in more than $91,000 over the past year. Those at Unix sites follow closely at more than $89,000.

DATA CENTER/OPERATIONS MANAGER SALARIES

NETWORKING MANAGER

Although down from 12 months ago, the average salaries of networking managers have remained in a consistent range since 2007, our survey finds. Currently, network managers -- who oversee the operation and planning of computer networks -- was just above $84,000, down from close to $89,000 a year ago.

Networking managers base salaries may be stuck on neutral, but their bonuses have been on the increase. This year, the average annual bonuses reported by this group of survey respondents was about $5,200 -- a hefty jump over the $4,2000 they received a year ago, and $2,600 the year before that. As with many of the management positions covered our the survey this year, bonuses appear to be back within “normal” or above-normal ranges.

Networking managers' salaries rank seventh among the nine management positions covered in our survey, and also seventh in terms of bonus amounts.

Networking managers who average about 10 years’ experience on the job, can expect to see salary growth of more than 25 percent throughout their careers, the survey finds. Currently, networking managers in their first decade on the job (with less than 10 years' experience) make about $72,000, a level that rises to more than $91,000 with experience.

As with most other IT management positions this year, business-to-business-centric operations are top employers for networking managers, paying more than $94,000 in base pay. Those networking managers involved in supply chain and ERP systems also saw better compensation as well.

Networking managers in mainframe environments also were paid better than those with other platforms, averaging $94,000 a year.

NETWORKING MANAGER SALARIES

HELP DESK/SUPPORT MANAGER

The past year has not been kind to help desk and support managers, our survey finds. These managers saw their salaries whither when the economic downturn first hit in the 2008-2009 time frame. Things bounced back, but base salaries have again begun to droop. Help desk and support managers -- responsible for diagnosing, troubleshooting, and correcting end-user access problems -- now make just over $71,000, a decline of eight percent since last year's peak. Salaries are still higher, however, than the pre-recession period up to 2007.

Help desk and support managers are receiving bonuses comparable to the previous year. This year, help desk managers’ bonuses are averaging about $4,150 in bonuses, slightly below last year's level, but still higher than in most previous years.

Help desk managers' salaries rank last among the nine management positions covered in our survey, and also the lowest in terms of bonus amounts. These managers also saw the greatest decline in average salary, sliding more than eight percent.

The typical help desk manager in our survey has at least 10 years of industry experience. He or she will earn about $62,000 in the first decade on the job, and then rise above $80,000 as experience grows.

Help desk and support managers are most highly valued when they are helping to engage and assist outside customers, and those managers helping to oversee business-to-business operations tend to have the greatest premiums, followed closely by those helping to oversee supply-chain management and ERP operations.

Help desk and support managers in mainframe environments also tend to earn more than those in distributed computing environments, our survey finds -- with base salaries averaging close to $78,000.

HELP DESK/SUPPORT SALARIES

ENTERPRISE ARCHITECT

Enterprise architects -- who bridge the gap between IT and business processes and help plan long-term technology road maps -- saw declines in base salaries over the past year. Part of this may be attributable to the fact that companies are focusing less on long-term issues and are committing resources to address short-term issues. Enterprise architects saw average annual base salaries of about $94,000, down by about six percent from last year. However, the slide was not as steep as the previous year, when average EA salaries slid by 16 percent.

While not quite making up for the reduction in average salary, enterprise architects’ bonuses were up since last year, by 18 percent. This is in line with a general shift across most management categories toward increasing bonuses in lieu of salary hikes.

Enterprise architects' salaries rank fourth among the nine management positions covered in our survey, and fifth in terms of bonus amounts.

On average, enterprise architects have been on the job about 12 years, and those that stick around see significant salary bumps -- rising close to 40 percent after a decade. Entry-level or junior-level enterprise architects (those with less than 10 years' experience) report average base salaries of about $74,000 a year.

For purposes of this survey, EAs are categorized as management because their responsibilities include supporting business process enablement, preparing for the architectural implications of outsourcing, adopting a system for measuring and managing performance, and measuring the business impact of the architecture. The position may also be known by titles such as senior architect; chief architect; and director, enterprise architecture and/or enterprise strategies and/or enterprise solutions.

In line with most of the other management positions in this survey, EAs engaged with supply chain management operations top the list in terms of salary premiums, followed closely by those managing supply-chain systems.

EAs at mainframe sites earn the most, averaging close to $103,000 a year in base salary. Professionals working within Unix-oriented sites follow at $98,000.

ENTERPRISE ARCHITECT

INTERNET MANAGER

Internet managers -- who oversee their companies' Web presence and e-business channels -- saw average salaries drop over the past year, to close to $82,000 a year. However, since 2005, salaries have remained in a general range between $80,000 and $87,000. The volatility of salary data for this position points to the fuzziness of the duties of this job and the shifting tides around e-business and Web development.

As has been the case across the board for IT managers, Internet managers have gained ground in bonuses in lieu of base salary increases. This year, average bonuses awarded to Internet managers totaled close to $5,000 -- a 31 percent increase over last year's results. This also reverses a long-term decline seen in bonus levels for this position.

Internet managers’ salaries now rank eighth among the nine management positions covered in our survey, and also eighth in terms of bonus amounts. However, these managers saw the third-largest increase in bonuses, right behind data center and application development managers,

Internet managers in the survey have, on average, 11 years of industry experience. Those with greater than 10 years of experience tend to see a fairly significant salary bump, topping out at more than $92,000 for more experienced managers.

The survey also finds that Internet managers working within companies with supply chain management installations have base salaries averaging more than $91,000, followed closely by both business-to-business and business-to-consumer operations.

By platform, Internet managers in Unix computing environments had the highest ranges, averaging above $88,000, followed by those in midrange settings with close to $87,000 in base salaries.

INTERNET MANAGER SALARIES

SALARIES OF PROFESSIONAL STAFF

In our next report we'll examine salaries of IT professional staff -- from application programmers to storage administrators.