gig economy impact on talent management - …€¦ · what is gig economy? “a labor market...
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GIG ECONOMY IMPACT ON TALENT MANAGEMENT
IMRAN KUNALAN – PRINCIPAL CONSULTANT
DIGITAL TALENT & PEOPLE ANALYTICS
q Future of Work
q Gig economy defined
q Impact on Talent Management
CONTENT
q Future of Work
q Gig economy defined
q Impact on Talent Management
CONTENT
FUTURE OF WORK (FOW)
DRIVERS OF CHANGE FOR THE FOW
SKILLS FOR THE FOW
q Future of Work
q Gig economy defined
q Impact on Talent Management
CONTENT
WHAT IS GIG ECONOMY?
“A labor market characterized by the prevalence of short-
term contracts or freelance work as
opposed to permanent jobs ”
“Work or task transacted through
digital platform”
………….proficians are experts in a field and includeskilled technicians and professionals. They may be lawyers,sports stars, architects or IT specialists. Their key quality isthat they are project-oriented freelance workers
§ Gig workers can be in contingent or alternative employment arrangements, or both.
§ Contingent workers are those who don’t have an implicit or explicit contract for long-term employment
§ Alternative employment arrangements include independent contractors (also called “freelancers” or “independent consultants”), on-call workers, and workers provided by temporary help agencies or contract firms.
GIG ECONOMY IS ALSO KNOWN AS….
Online Platform
• That connects the worker/service provider and the prospective employer/client
Flexible Time
• Worker or service provider has the flexibility of delivery
Task Based Compensation
• Worker/service provider paid on specific task or project deliverables
Platform Mediated Payment
• Payment is directly paid to the service provider mediated through the platform
CHARACTERISTICS OF GIG ECONOMY
GIG ECONOMY VS SHARING ECONOMY
Source: MGI 2016
GIG ECONOMY TREND
The Malaysian Landscape
GIG ECONOMY – MALAYSIAN SCENARIO
GLOBAL FREELANCERS TREND
§ Employers/Client/Buyer/Consumer § Democratisation of access to a variety of services,
talent (global), offering competitive price and higher efficiency and productivity gain
§ Workers/Talent§ Alternative job seeking means, global roles/tasks,
flexibility of work location, generate income at their convenience and promises a dynamic work environment
§ Entrepreneurs§ Offers flexibility for entrepreneurs not to be bound
by permanent and high cost team/staff
WHO ARE THE BENEFICIARIES OF THE GIG ECONOMY?
Source: MGI 2016
FEATURES OF THE GIG ECONOMY WORKERS (…PROFICIANS)
PRIMARY INCOME
SUPPLEMENTAL INCOME
FINANCIALLY STRAPPED:
Do independent work to supplement their income but would prefer not to have to do side jobs to make ends meet
RELUCTANTS:
Derive their primary income from independent works but would prefer traditional jobs
FREE AGENTS:
Derive their primary income from independent work and actively choose the working style
CASUAL EARNERS:
Use independent work to supplement their income and to do so by choice. Some have traditional primary jobs, while others are students, retirees or caregivers
PREFERRED CHOICE
NECESSARRY CHOICE
GIG ECONOMY WORKERS SEGMENTATON
q Future of Work
q Gig economy defined
q Impact on Talent Management
CONTENT
IMPLICATION OF GIG ECONOMY ON TALENT MANAGEMENT
Impact
Flexibility (for both workers and
firms),
market “thickness,”
efficient use of time.
GE BENEFITS ON TALENT MANAGEMENT FOR EMPLOYERS
Quick Hiring
Fulfill Short-term Business needs
More Cost Efficient
Opportunity to try out a range of candidates
Ease of use and access to greater talent pool
Risk mitigation of bad permanent hiresLow
reliance on FT Innovative
q source talent from the global marketplace q source talent more quickly than via traditional
recruitment channels q source talent at an affordable rateq bring in talent on a project-by-project or non-
committal basis q avoid the cost of unnecessary long-term or permanent
hires q reduce the risk of unsuitable long-term or permanent
hires q experiment with a wide range of different service
providers.
GE BENEFITS ON TALENT MANAGEMENT FOR EMPLOYERS
Losing workers’ loyalty to the employer brand
EMPLOYER BRANDING
Perceived as an employer whois cost conscious and gainingpoor reputation
CHEAP EMPLOYER
The legal and regulatoryrequirements in this arearemai hazy
POTENTIAL DISPUTES
Inconsistent informationshared in profile and reality
UNQUALIFIED CANDIDATES
CHALLENGES/RISK OF GIG ECONOMY TO EMPLOYERS
Online Rating & ReviewSystemAn online ratings and reviewsystems are made available to enhance trust and transparency.
Comprehensive vettingand communication
Facilitating comprehensiceassessments, vetting and in-depth communication
Creative Hiring ApproachesOffering different type of hiringexperinces including competitions and contests which allow employers to ”try out”or see candidate’s portfolio or work first.
Payment GuaranteeOffer
Offering payment guarantees, either by holding the payment until the work is complete or releasing it in agreed instalments for larger projects
MITIGATION EFFORTS IN PLACE
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BENEFIT FOR GIG WORKERS
Global Talent
Interactive CV
Career variations
Flexibility of time
and location
Self Managed Compensation
BENEFIT FOR GIG WORKERS
q market themselves globally and work for different clients around the world
q develop an interactive CV, with reviews, ratings and even examples of previous work
q experiment with different careers, both alongside or instead of traditional employment
q work flexibly at a time or in a place that suits them q set their own price and terms depending on availability
or demand.
AVERAGE INCOME BY GIG WORKERS
CHALLENGES/RISKS FOR GIG WORKERS
Being excluded from having the same protections and entitlements as those in traditional employment, including pensions, statutory sick pay and holiday entitlement
Not being assured continuity of work (a particular concern for workers using the gig economy as their primary source of income)
Being forced to lower their rates due to increased global competition
Losing control over their digital résumés, as online ratings systems give prominence to clients’ reviews
Not getting the type of ‘fixed flexibility’ that part-time contracts offer.
ARE OUR EMPLOYMENT REGULATORY COMPONENT READY?
q UPDATED LABOR LAWSThey have to be revised in order to better fit this new world of contingent workers, guaranteeing fair practices for all parties.
q REGULATION OF THE SERVICES
In most of the industries, the services have to be regulated in order to guarantee a fair level of competitiveness. Governments have the challenge to do that without discouraging innovation.
q BETTER TRANSPARENCY RULES
Companies have to be more transparent and ethical with consumers and workers.
THE GIG ECONOMY IS PART OF HOW THE WORLD OF WORK IS SHIFTING.
IT’S ECONOMICALLY INEVITABLE THAT IT WILL BE PART AND PARCEL OF HOW THE
FUTURE ECONOMY FUNCTIONS.
Thank You and Get in Touch !+(6018) 688 4096 [email protected]