The Gig Economy Is Reinventing the Enterprise -- Don't Get Left Behind
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The enterprise as we know it is reinventing itself, all thanks to the phenomenon known as the gig economy.
As automation forces workers to find new occupations, consulting firm McKinsey & Company believes as many as 800 million adults worldwide will need to find new ways to earn a living by 2030. Although some will simply change careers and land in new full-time roles, others will decide to explore the growing freelance marketplace. This shift is already underway in many sectors, with 72 percent of millennials telling the Intelligence Group that they prefer to be their own bosses.
While this evolution of workplace dynamics might seem to diminish the traditional notion of the enterprise, it’s a positive change. Instead of fearing this shift, companies at the leading edge are embracing this transition to freelance labor. They appreciate the opportunity to engage with professionals who have specialized skill sets on specific projects, enabling them to use matchmaking algorithms to connect with the labor supply du jour.
Looking forward to a fluid corporate team
From internet startups to global conglomerates, freelancers provide an incredible opportunity to outdo the competition. Foremost is the ability to cherry-pick the right people for the right job at the right time. Why pay someone to sit at a desk waiting for a chance to shine when you can instead divert that money toward people with relevant experiences and credentials?
Contractors can come and go as needed, allowing organizations to staff up or down depending on their needs. The biotech space is rapidly shifting from full-timers to freelancers. For instance, Nimbus Therapeutics reports that only 25 of the more than 150 people it pays would identify as traditional employees -- the vast majority of Nimbus team members are freelance consultants. Other industries are sure to follow suit.
Want more reasons to embrace the idea of farming out tasks to freelancers? Try increased cost-effectiveness and productivity. Because businesses only pay for hours worked and have complete control over hiring and firing, they’re able to quickly pivot if an approach proves ineffective. Plus, freelance workers usually have the experience necessary to hit the ground running on day one.
While traditional enterprises won’t cease to exist in 20 years, they’re going to look radically different from today’s incarnations. Large corporations such as Procter & Gamble, FedEx and Verizon are climbing aboard the contractor bandwagon, with the Wall Street Journal reporting that 20 to 50 percent of the workforce in these companies is outsourced. As matchmaking algorithms evolve and workers realize they can make more money freelancing than they might in full-time roles, the traditional walls of the enterprise are certain to crumble.
This might sound like a perilous situation for established enterprises, but businesses should treat this growing contingency of freelance workers as an opportunity to improve rather than an existential threat.
Setting the groundwork to welcome freelancers
Even if you’ve already flirted with the idea of freelance hires, it’s time to commit to the trend. The best way to make any change is by following a well-conceived plan. Here’s yours:
1. Break projects down into digestible pieces.
Instead of looking at the big picture, find ways to break tasks down into smaller chunks. You can then work to find the right skill set for the task at hand -- even if that means dividing and conquering. Considering that a PricewaterhouseCoopers study found that 72 percent of CEOs are concerned about the availability of key skills in workers, it’s sometimes easier to farm out elements of a larger project than it is to find one person who can handle everything.
Let’s say your health sciences firm wants to farm out a blog post about a fairly technical concept in your industry. While a writer who has a background in health sciences would be ideal, you might struggle to find that combination of talents in a timely manner. Instead of waiting for one person with the perfect blend of skills, you could enlist a health sciences expert to provide the material and hire a skilled writer to translate that content into a compelling blog post.
It all boils down to understanding your needs. By plotting out exactly what has to happen and being flexible as to who will handle various tasks, you’ll be able to find the right combination of workers for any project.
2. Set up a virtual workflow that uses modern tools.
Communication must always play a guiding role when working with freelancers. Without clear, consistent communication, projects can go askew. Avoid setbacks by establishing explicit expectations and using technology to create open lines of communication with freelance team members. This could include messaging platforms and videoconferences, which you can record and retain in your system for future reference.
A study by TECHnalysis Research suggests that 75 percent of workplace communication takes place via email and phone. These tried-and-true channels are by no means obsolete, but you could lose essential information to push projects forward if you don't house it all in one centralized system. Make it easy to have an audit trail and document storage clearinghouse by using platforms such as Slack or Trello.
3. Leverage freelancers' expertise to boost your business.
Mental Health America reports that disengaged employees cost corporations at least $450 billion annually. To make matters worse, a study by EmployeeChannel claims a mere 16 percent of workers feel engaged. These are serious problems, but they represent a tremendous opportunity for your business to find ways to truly engage full-timers and freelancers alike.
Integrate freelancers into your team, and encourage them to share their outside perspectives. They have likely learned valuable lessons in roles with other organizations, so find ways to capitalize on that wealth of knowledge. More importantly, give them credit when you put their ideas into action.
4. Find freelance marketplaces that best serve your needs.
Freelance marketplaces can connect you with gig workers within hours. According to an article in Time, a sizable number of freelancers who use the internet to drum up work are able to find suitable projects in as little as 24 hours.
The caveat for your organization is that you must find a marketplace you fully trust. Many sites do not vet their freelancers, which means you’re stuck combing through ratings and endorsements from clients whose needs might not match your own. Try a few different marketplaces, as one single platform isn't likely to solve all your hiring needs. To make things easier, identify marketplaces that specialize in the roles you need: For instance, you might consider Gigster for app development, 99designs for graphic design work or Paro for help with finances.
The American enterprise is living on borrowed time, but there's no reason to panic. The Industrial Revolution completely changed the way people work and companies operate, but that dramatic shift was a net gain for everyone involved. The ongoing freelance revolution is likely to have a similar effect on the business world. Instead of fearing the structural changes on the horizon thanks to this shift in how we work, business leaders should seize the opportunity to get ahead of the curve by embracing freelance workers.