Businesses are turning the traditional employment model inside out – if not dismantling it. Hiring full-time, long-term employees who work 40-hour weeks in a 9 to 5 environment seems a thing of the past. At least, for some organisations. A new model has entered the workplace: the open talent economy. It’s a blend of full-time employees and short-term, project-based freelancers that helps companies become more efficient and agile.
To be fair, this blended approach is not entirely new. Hollywood adopted this system back to the 50s. But, all the conditions are now in place to make it a global phenomenon. A growing number of people now seek greater work-life flexibility. Autonomy is as sought after as purpose. In this new century, there’s the technology to enable new ways of working.
Considering these factors, companies should reassess their employee engagement approaches, especially with regards to talented individuals. The way organisations recruit, communicate, engage, and manage the workforce – internally and externally – needs a serious rethink. This is what Nele Klepper (pictured right), Client Service Partner & Global Marketing Lead at a-connect, advocates.
Founded in 2002, a-connect has built an international network of 2,000 independent professionals with consulting and deep industry expertise across sectors such as life sciences, agribusiness, food and chemicals, financial services, and private equity. These highly skilled freelancers are certified and vetted by the a-connect team. By tapping into this network, a-connect provides employers with flexible and on-demand talent, based on the immediate needs of the project.
I spoke with Klepper to explore the state of the current open talent economy. She describes not only the drivers, benefits, and challenges of tapping into the growing freelancing market, but also provides MARGINALIA readers with advice on how companies can engage with talent on an on-demand basis. “Yes, it will reshape the entire business and the way in which it works, but if implemented with an open mind and a solid strategy, it will also save time, money, and resources.”
Gloria Lombardi: What constitutes the open talent economy?
Nele Klepper: The open talent economy provides access to talent but not necessarily ‘ownership’ of the talent. The way we looked at work 50 years ago has shifted. In the last century, there was a social contract in place where employees would spend their entire career with one employer in return for job security and a predictable future. Now we have a more open, flexible, and modern way of looking at work. In addition, the type of work is changing; It’s often project based, which is done to improve the speed of the innovation cycle inside a company. Thus, the guarantee of lifelong employment on the part of the employer, and lifelong loyalty on the part of the employee, is a construct of the past.
GL: How do companies use the open talent economy?
NK: Some organisations may have a pool of preferred freelancers who they work with at the same time every year. For example, the director of a quarterly magazine might bring in a freelance designer every three months to design the publication.
Some might simply access the open talent economy whenever an issue crops up within the company that requires fast, expert attention. Thanks to the rise of smart technology, the hiring process is quicker and more efficient than ever.
Other companies, including Uber and Airbnb, rely solely on on-demand workforces. The open talent economy is popular among many start-ups.
However, big corporations are starting to understand and embrace this opportunity too, bringing in experts and professionals for strategic transformations or large implementation projects – which they had previously hired traditional consulting firms for.
GL: Beside the social contract, what other mega-trends are driving growth of the open talent economy?
NK: Technology is the foundation of the open talent economy. Workers can now provide their services without physically being in an office. With all the digital tools available, they can work remotely and still collaborate with others in real-time, in almost any discipline. When people can learn, share, and work anywhere in the world, the traditional talent approaches are no longer worthwhile.
Market places. There are now platforms that allow faster matching, on-boarding, and knowledge transfer when engaging freelance agents, which also lowers the overall transaction costs.
Another force is social business. The open talent economy is considered to be a social environment where people connect, share information, and spread communities; shifting from traditional organisational structures to dynamic networks.
The speed of change is a driver too. New business models are emerging. The need for faster innovation cycles creates a widening demand for skills. However, it is hard to predict all the required skills in advance. In addition, it’s almost impossible to build up an internal team with all the necessary competencies, who are available exactly when they are most needed – and the traditional recruiting system is too lengthy to cope with such dynamic needs. All this directly creates the need for on-demand talent. One of the biggest advantages of the open talent economy is that it allows employers to fill skill gaps immediately, from a global pool of skilled freelancers.
There is a generational debate associated with the open talent economy. The latest working generation have been exposed to different conditions while growing up and developing their skills and outlooks. People nowadays have more options. Thanks to connectivity and mobility, choices are unlimited. People can choose an employer that is not necessarily located around the corner.
GL: What challenges is the open talent economy facing?
NK: One challenge is the outdated mindset of some employers. Many companies are still bound by ‘unwritten rules’ from years of doing business in a certain way. For example, there is still the expectation that workers should start at the bottom and work their way up. But with the open talent economy, independent professionals enter the workplace based on their skills and expertise, and they can craft new opportunities for themselves along the way. This enables employers to tap into the talent available at that moment, but it challenges the traditional hierarchy.
Learning how to manage this complex network of workers effectively is challenging too. The organisational structure of some businesses often does not foster a holistic approach to talent management. Therefore, the full potential of engaging a talent pool of diverse professionals is still hard to achieve. For example, a company’s Human Resources department might be responsible for the full-time employee budget – they look after talent from an internal, payroll point of view. Then, Procurement, which is responsible for consulting services, is in charge of the contractor budget. Unfortunately, it is not rare for HR and Procurement to be out of sync in these matters.
Another challenge is regulatory. Labour laws protect workers from exploitation, but they also put constraints on how to work with and engage with the open talent economy. It’s vital for employers and contractors to understand the regulations, but I also feel that regulations will need to be flexible to enable brand new ways of working in the future.
GL: What can organisations do to maximise the potential of the open talent economy?
NK: The root of success for the open talent economy is undoubtedly technology. Without internet-enabled devices, companies wouldn’t be able to connect with on-demand talent instantly, personally, and accurately. But before investing in digital tools, organisations need to work on their company’s collective mindset. The open talent economy changes the way they do business: the workforce becomes more collaborative, and hierarchies are destabilised. Organisations might encounter a different team every month, depending on how they work. Companies need to get past this mental hurdle, and think about integrating independent professionals into their teams.
Tapping into the open talent economy also requires companies to reshape their traditional ways of managing staff. To start, the HR and procurement departments will need to communicate, if not integrate, over matters involving the workforce. It is about looking at talent management in a holistic way, and addressing practical questions such as, what talent management must mean, where employee and contractor responsibilities lie, and how the HR and Procurement departments discuss and authorise getting external support.
GL: When it comes to engaging the open talent economy, what would you recommend?
NK: At a-connect we always say that is about Choice, Communication, Collaboration, and Culture. The four Cs.
Choice: businesses often have an idea about their talent needs, but they don’t take enough time to define what they are really looking for. Yet, with the open talent economy, organisations must have a clear understanding of the skills they require, at what time, and so on. Therefore, the scoping exercise is crucial.
Communication is about setting expectations in advance. Independent workers don’t have a 3 month on-boarding period to learn how the whole system works. Once the professional has been introduced to the team, it’s vital that everyone comes to an understanding of what it will take to successfully implement the project. The contractor’s perspective must be taken into account. Set aligned timelines and goals. Communicate feedback frequently, which helps to build rapport, and course-correct where necessary.
Collaboration requires investing in personal relationships. The new hire is not just a bundle of skills or another pair of hands – they are an actual person, here to help the company solve problems.
Culture: although the external talent will not stay with the organisation for years, companies should integrate them in the corporate culture as they would do with their employees to ensure that everyone speaks the same language. The supposed divide between ‘us and them’ is detrimental to the new blended teams approach.
GL: As with any development in the business world, there are pros and cons to the open talent economy. How can a company know if the open talent economy is right for them?
NK: Whether a company views these developments as positives or negatives is largely down to their needs and capabilities as an organisation. For those who are open to change and innovation, there are many opportunities to embrace. But, if they stay tied to the old ways of doing things, they might feel out of their comfort zone.
The open talent economy, together with the notion of flexible working, will only continue to grow, providing new ways to meet the needs of employers and workers. Yes, it will reshape the entire business and the way in which it works, but if implemented with an open mind and a solid strategy, it will also save time, money, and resources.
To know if the open talent economy is right for your company, don’t just dive in: get your teams, departments, and directors together, and start talking about what an on-demand workforce could mean for your company, and how mindsets will need to change to accommodate it. Just remember, you need to have everyone on board if it’s going to work.
Contact a-connect to find out more about harnessing the power of the open talent economy.
photo credit: business team, pttgogofish 97199917 via photopin (license)