The Workforce is Reinventing Itself. Are You Ready?

Contributor: Jon Hanley
Posted: 11/04/2015
Jon Hanley
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I was chatting with the owner of a staffing agency, recently, about the challenges of finding good talent. He shared a story of a skilled Java programmer who turned down a role with a 30% salary increase. Why? He was concerned the new role would not fit his lifestyle. You see, the programmer moves from city to city for several weeks, writes code during the day, and then spends evenings out with friends. A veritable programmer-adventurer traveling across Europe, Latin America, and the United States.

To those of us who have spent careers in a traditional work environment this might sound like an anomaly. It's not. Flexible freelance work is becoming the new normal, especially in the technology sector, where specific skill sets are becoming scarce. Enablers include ubiquitous Internet access, modular or project-based work, and remote workplace arrangements that only require access to a phone and a computer. Possibly with the exception of factory or customer service-facing roles, the idea of punching the clock and sitting at a desk from 9-5 is fast becoming a distant memory.

The phenomenon isn't being solely driven by employees. Flex work arrangements can reduce corporate real estate and associated support costs. And managing temporary staff reduces carrying costs and potentially some of the legal risks associated with full time employees.

Looking at the situation more broadly, longer lifespans and the threat of reduced government retirement benefits are causing older members in the workforce to seek part-time work to make ends meet. Even if it’s not financial need, part-time work is an appealing alternative to retirement for people who simply want to stay active and make a contribution.

On the other side of the spectrum, following decades of outsourcing and downsizing, younger workers have given up on the notion of corporate loyalty. Without the perceived security of a corporate benefactor, newer workers are forced to embrace a greater sense of independence and self-reliance.

All this translates into a new kind of workforce – one that is being forged from the crucible of global competition, evolving technology, shifting demographics, and changes to cultural norms. Workers are becoming more independent and "networked", unconstrained by the limits of their geography.

The Data Supports It

This situation is especially true for technology work. According to a September 2015 Bureau of Labor Statistics report, unemployment in the US professional, management, and computing industries is in the 2-3 % range. This means employees have more leverage than ever before.

An independent study, commissioned by Upwork and the Freelancer's Union, suggests that there are approximately 54 million freelancers working in the US (note: Freelancer's are defined as independent contractors, temporary employees, a moonlighter doing part-time work on the side, workers who hold several part-time jobs, or freelance business owners who freelance themselves and hire people to assist them from time to time), and a 2014 study of over 1000 business executives, sponsored by the Chartered Institute of Management Accountants (CIMA) and the American Institute of CPAs (AICPA), found that more than 25% of organizations confirmed that external talent comprises over 50% of their workforce.

How Can Companies Adapt?

In light of these shifts, the question for business leaders is still the same: "How do you get the best talent working on the most important work – while managing cost constraints?"

This challenge can no longer be fully addressed with traditional internal talent management. Too often, the biggest barriers come from old habits, ossified cultural norms and processes, and leadership teams that remain internally focused.

Here's the good news. There are more options for gaining access to quality talent than ever before. Taking insights from a variety of different sources – here are some practical things that organizations can do in order to transform challenge into opportunity:

  • Offer people meaningful experiences. Remember, it's not always about the money. Not all work is glamorous, however, it's important to keep in mind that people like to do work that is meaningful, offers new experiences, and can help with their professional development. If you're concepting a role description or a new project, be sure to take additional time to highlight why it's a great opportunity for a potential candidate.
  • Cultivate a talent network.Don't view your "organization" as primarily the people who report to you. Invest time to develop relationships with freelancers, contract agencies, other departments and leaders, prior employees, professional trade organizations, or others who may be a source of possible talent for your organization. These are resources that can be mobilized and motivated to assist when needs arise.
  • Run some experiments.You don't have to jump in feet first. Consider trying different experiments on specific projects or within a small team. This could include different work arrangements, exploring new sources for talent, or testing alternative team operating structures. Explore how you might eliminate constraints of geography, 40+ hour workweeks, or physical presence.
  • Retain "assemblers". Although it's a rare skill, keep an eye out for leaders who've demonstrated the ability to successfully assemble, manage, and disassemble teams. This skill will become even more valuable as the pace and variability of business challenges accelerates. As an analogy, think of these as project managers who orchestrate "flash mobs".
  • Align the functions. As talent becomes more and more external, extra effort is required to align HR, Purchasing, IT, and other hiring organizations around a deliberate talent strategy. Companies will require more robust on-boarding, off-boarding, and compliance functions. Shared services teams will also need to become more focused on supporting the needs of extended members of the organization versus full time employees.
  • Secure the perimeter. As movement of people in and out of the enterprise becomes more porous, physical and information security takes on an even higher level of importance. Every CSO or Head of Security should have robust procedures and monitoring in place to ensure critical information and assets are secured. This is especially true since most serious threats operate internally within the organization.

Moving Forward

In the ongoing battle to attract the best talent, companies can’t afford to sit on the sidelines and manage business as usual. It's important that leaders acknowledge what's happening in the marketplace and develop an approach that's relevant for their business.

At minimum, this can begin with cross-functional conversations between IT, HR, Procurement, and other key business leaders. Even a few experiments to explore new approaches to talent can yield meaningful insights on how to make your organization more nimble, cost efficient, and competitive.

Interested in learning more about this topic?
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For additional insights related to this topic you may also consider reading, "Is thinstaffing the future of shared services" and "the sharing economy and lessons for shared services". These articles highlight complimentary trends that demonstrate how individuals are becoming more empowered to run their own businesses and how the sharing economy is creating new ways for people to exchange goods and services.

Please join in the discussion. We would love to hear about your experiences, insights, and suggestions about the future workforce. Comment below.

Thank you, for your interest in The Workforce is Reinventing Itself. Are You Ready?.
Jon Hanley
Contributor: Jon Hanley