In 2023 the projected gross volume of the US gig economy is expected to reach $455b. This will represent an increase of 53% compared to 2020, according to Statista Research Department’s report dated January 2021[1]. Why should we create a valuable experience for employees who are not permanently committed to a company? How can our efforts towards individuals with a shorter loyalty expiration date be justified? Today HR departments and independent headhunters have no doubt: freelancers and gig workers, who have an ability to spread their time over multiple employers, will strengthen their position on the labour market. When “productivity” being a word of the year is added to an equation, a very different map of HR needs and expectations can be drawn.

 

Workforce experience versus a loyalty anchor

Last years made us aware of the importance of workplace experience design. What’s new? Employees are being evaluated not only based on their 10+ years experience but also short term work history i.e. a temporary contract.  From an employee’s point of view a rapidly developing gig economy means flexibility and the possibility of project-based diversification. From the employer’s point of view it gives a chance to increase productivity and grant access to the perfectly qualified specialists without increasing the costs associated with recruiting and retaining them.

The gig economy is growing rapidly and a competitive advantage will be built by companies that optimize both tools and management tactics to utilize the potential of short-term employees. Onboarding, which was perceived as a time-consuming piece of unnecessary bureaucracy, has started to be seen as a key process to support project management. The “workforce experience” philosophy is also forcing a thinking shift. Organizations are beginning to anchor, even temporarily, people in terms of skills rather than positions. At the same time an access to most qualified professionals is needed, hence the emphasis on raising the quality of the experience in the organization. This is to motivate employees not permanently employed at the company to return regularly. Shortening project timelines does not carry over to compromises on organizational cultural issues – even in the age of process automation, nurturing relationships with short-term employees is becoming increasingly valuable. In the new work ecosystem, the qualitative differentiation of full-time staff and short-term hires ceases to exist; what matters is the overall of interactions and impressions.

 

Productivity versus maneuvering between ‘quiet quitters’ and AI

Productivity management, understood as a way companies transform resources into products or services, also needs to be redefined. In 2022 no one doubts anymore that human capital is becoming an increasing challenge. What should be done in case of a talent shortage? The culture of organizations that want to succeed beyond the near future will require a holistic view. This means much more than the need for digital transformation and process automation. We all know that behind every technology there is a human being, yet we are just learning that a human being exists in front of every technology, too. We are humans outside the company but if our corporate processes remain inhuman, we will unwittingly allow our competitors to overtake us. Experts agree that “productivity” will become the word of 2023. It is productivity that will help organizations to fill the talent gap. Productivity 3.0 goes hand in hand with business scalability, meaning it will boost a company’s revenue without increasing its operating costs, and will allow to expand the company’s structure by the right software choice instead of new team members recruitment.

 

HR 3.0

A traditional division between hard HR which carries out support processes – dealing with administrative, legal, payroll and HR issues, and soft HR, which takes care of the company’s culture, and raising the quality of work, is becoming obsolete. Today HR departments are expected not only to know HR, payroll and accounting regulations in order to prepare relevant documents, but also to know how to evaluate employees, recognize and develop their talents, motivate and mitigate conflicts. HR is becoming process-digital and requires new competencies, including understanding and using modern technologies. Companies are increasingly building internal resources in terms of their own specific requirements, e.g. combining positions from HR with IT, transformation or accounting – professions such as HR IT Manager, HR / Transformation Manager are emerging.

Decentralized HR supports individual functions in a far better way. It ceases to be responsible for operational and administrative matters, and brings additional value to the company, taking part in the creation and implementation of business strategy. The modern HR department is no longer a team of experienced and trained HR professionals, but a consulting staff perfectly navigating new technologies, taking care of the development of the employee’s natural predispositions and relying on business intelligence. It introduces innovative solutions, uses artificial intelligence, machine learning, modern predictive tools, agile project management methods, including Agile, and design thinking.

 

Flexibility and skills more important than competence

Modern HR managers not only define job roles and the competencies needed to fulfill them, but also make individuals aware of their strenghts and offer personalized tools and training plans. The bottom-up approach is definitely replacing top-down – in this approach employees self-identify their skills and set career goals. What is new is that employee development, which is the responsibility of HR departments, ceases to oscillate around competencies, i.e. a broad set of knowledge, skills and attitudes, and is increasingly based on the development of narrow qualifications (skills). The latter are increasingly acquired not during 5-year managerial programs, but during training courses of several dozen hours, which most quickly and effectively prepare an employee for a given task. Internal talent marketplace platforms enable not only the creation of new project teams based on competencies and qualifications, but also the efficient internal relocation of employees through upskilling and reskilling.

 

Anchoring an employee to a single project team within a single department is being displaced by encouraging them to go out into wide waters, i.e. assigning new roles in short projects. Internal job exchanges do a much better job of integrating work and life and minimize the risk of burnout. “Work-life integration” is a new approach, not just a new version of “work-life balance.” It is estimated that soon in the US as much as 62% of the population will have 2 jobs, which for companies and especially HR departments will mean redefining organizational culture, moving away from traditional divisions and rigid frameworks. As we project an uncertain future, we can be sure of one thing: it will undeniably include work flexibility.

[1] https://www.statista.com/statistics/1034564/gig-economy-projected-gross-volume/