The Gig Economy is eating your talent

IBM recently recalled its remote workforce, citing the need for more creativity and collaboration as the reasons. This seems quite a remarkable handbrake turn for a company that pioneered the practice over decades.

The significant, but undisclosed, number of employees who were working from home were given just 30 days to join an IBM office or 90 days to apply for another IBM job opening. Many have chosen not to come back into the fold but to start their own freelancing and consulting businesses; further bolstering the ranks of ‘giggers’ in the gig economy.

The lure of the gig economy is compelling. Social Media feeds are full of start-ups and stories of people winning. Elon Musk and Mark Zuckerberg have become cult figures for everything right about ‘having a crack’ when you are young. In a recent Xero survey, it found Aussie entrepreneurs are driven by wanting to be their own boss (55%) and increase their income (42%).

Flexibility, variety, autonomy and riches – what’s not to like?

At the same time, EY’s June 2016 Contingent Workforce Study in the US shows that one in four organisations believe they will have 30% or more contingent workers in the next 5 years. Two of the main reasons for this are to gain access to specific expertise and to overcome resistance to change from the existing workforce.

Similarly, PWC’s 20th Annual CEO survey shows that 77% of Australian CEOs are concerned about skills shortages in their workforces. In particular, they cite a lack of creative, innovative leaders with emotional intelligence.

It seems both employer and employee are seeking flexibility and variety. With no-one too sure who is the chicken and who is the egg, both sides of the equation are embracing the gig economy.
But is this the best decision for the majority of businesses and individuals alike?

With the failure rate of small business in Australia historically running at 50% in 5 years, it seems that many entrepreneurs are in for a tough time of it. Almost half those in the Xero survey said they worked much harder running their own businesses and would go back to being an employee.

In a survey of more than 1,000 giggers in the US, EY found that 58% felt that permanent workers were treated better than they were and almost half feared job uncertainty and security. Added to that were significant concerns over personal leave, holiday and retirement entitlements.

Companies too must beware of exactly what gets outsourced to giggers. Presumably strategic leadership, innovation and drive for change are better as internal capabilities?

Intrapreneurship, fostering the more entrepreneurially inclined talent within organisations, is an attractive upgrade to the either/or mentality of the gig economy; it blends some of the pay offs each party receives and ameliorates some of the risks.

It’s a healthy hybrid that has a growing place in your business ‘portfolio’. Employees want more autonomy and flexibility and employers would love them to be more innovative and creative. Intrapreneurship delivers from both perspectives.

Employers who embrace Intrapreneurship get:

• More innovation from employees who know the company and customers best
• A larger cadre of innovative, creative leaders with the ability to influence
• The opportunity to create new, more entrepreneurial, reward structures that address retention and motivation of your Intrapreneurs.
• Better engagement, collaboration and retention

Employees – the Intrapreneurs get:

• More autonomy and flexibility
• Less risk than starting their own business
• A greater ability to drive the changes they seek
• To still feel part of something bigger (belonging is a core human need) and avoid the isolation of working alone or in a small team

Intrapreneurship is growing rapidly in Australia, often by other names; corporate innovation, corporate venturing, corporate entrepreneurship and business transformation. But most organisations are falling short of the tenacity required to pull it off.

In research studies by Kuratko et al over the past twenty years, there are 5 dimensions required to build an intrapreneurial culture, one that can deliver large, creative innovation projects to launch and revenue.

5 dimensions required to build an intrapreneurial culture:

1. Management support
2. Rewards and reinforcement
3. Time availability
4. Work discretion / autonomy
5. Flexible organisational boundaries

It is only with a stronger and more balanced effort on these that you will sway more of your best and brightest to resist the lure of entrepreneurship in the gig marketplace, in favour of becoming an Intrapreneur. If you can, its likely both parties will benefit.