In previous articles in this publication (see Specialization in the Modern Economy and Jack of No Trades, Master of One), I told a story about how the atomization of work has led to traditional, full-time jobs being broken down into discrete tasks that are increasingly outsourced to specialists. I talked about how online platforms have grown up to become the gatekeepers to that talent. And I described the realities of life on the frontlines of the specialized workforce – the best, and the worst parts. In this last article in the series, I’ll offer my thoughts on what specialization holds for our future.
Organizations will be changed by specialization, for sure. In the next twenty years, corporations as we have come to know them – small, medium and large – will undergo significant structural metamorphosis. Taking the outsourcing trend we’ve witnessed over the past 30 years to its logical end, certain firms may be whittled down to the point where regular, full-time roles are limited to just a handful of key operational and supervisorial roles. In turn, the number of freelance experts and remote specialists employed by these companies will grow and their power will increase as they are entrusted with more and more work that’s central to the operation of the firm. With this, we’ll see power shifting out from the center of organizations towards their periphery, and that will happen both in the physical sense (the identity of companies will be less tied to distinct geographic locations) and the hierarchical.
There’s plenty of evidence that companies are already moving in this direction. In its 2019 Global Human Capital Trends report, Deloitte cites the example of Bosch, which recently founded a whole new subdivision to regulate workflow for almost 2,000 former and retired Bosch employees worldwide. Employed in functions as varied as finance, purchasing, production, sales & marketing, and R&D, these experts are brought in on an as-needed basis to work on projects where the core team is in need of specialist input. Here in the US, Alphabet, Google’s parent company, had more contract employees than full time employees for the first time ever last year.
What will teamwork look like in this environment? For a start, the structure of teams will change, as the old, office-bound reporting structure gives way to agile, international teams spread out across borders and time zones. Managers will still be needed to coordinate the efforts of these teams, though I expect traditional managers to have less clear authority. The nature of management changes in a virtual environment, for the obvious reason that the team doesn’t share the same physical space. It’s harder to micromanage, for instance, and difficult to impose cultural norms like dress code. It is the remote worker who holds the cards in this situation, not the manager. Freelancers will just up sticks and go work for somebody else if things aren’t suiting them. As Miller and Miller put it in their 2012 HBR article on ‘supertemps’, “if the archetype of a great manager in the 20th century was GE’s Jack Welch, who grew talent internally, the great 21st-century manager will be someone who also understands how to tap the external talent pool.”
The physical fabric of working environments is going to change, too. For many remote workers, that environment now constitutes the four walls of their own home, as people take advantage of flexible employment and work-from-home policies. For others, an itinerant lifestyle is what suits, giving them the autonomy to work while travelling the world. Co-working spaces are also rising in popularity, catering as they do to people’s natural urge for social interaction, a desire for variety, and the need for access to professional amenities like printers and conference rooms. WeWork’s merging of office space with its WeLive brand is an interesting development and seems to foreshadow a world in which communal work and living spaces become intertwined. Whether or not WeWork will ever succeed in ‘elevating the consciousness’ of its tenants remains to be seen, but as a place where freelancers are able to meet, exchange ideas and socialize, I personally believe the brand has a bright future.
How will opportunity be apportioned in the age of specialization? Who will perform the work? Anyone who is qualified, as far as I am concerned. In my industry, developers are judged primarily by what the quality of their work – not by their résumé or where they went to school (although that stuff is still important). It is common for job applicants to be put through their paces with stringent coding tests. We do this at Adeva, for instance, to very high standards. There’s a refreshing meritocracy in this system which can reward people who might have struggled to fulfil their potential in traditional job markets. For the very talented, I expect to see employers competing hard to retain their services, for which the financial rewards will be not insignificant.
There will be losers in this game too, however, and unfortunately I think we are just at the start of the shake out. The power shift is especially pronounced in the movement of knowledge work, such as IT services, from the developed to the developing world. The economics of it are plain for all to see. Why would you hire an engineer in San Francisco when you can get someone with the same skillset for a third of the rate in Bangalore? Native speakers still dominate creative fields like journalism and marketing, although I can imagine a world in which advances in machine learning/AI dramatically change the way that work is performed, opening it up to other participants. Only time will tell what the future holds in store for these professions.
Viewed through the lens of the last 500 years of Western history, the specialization trend is more a return to the way things used to be that anything profoundly new. In pre-industrial Europe, for example, most people were self-employed in specialized trades and entrepreneurial endeavor was just a necessary part of making your way in the world. Perhaps the megalithic corporation and the luxury of a job for life really were just a brief phenomenon of the 20th century. So why are we all so confounded? What is new is the global dimension. Today, thanks to technological innovation, people must compete for jobs not just with workers in their neighborhood, township, or city, but with a global workforce. There is something both terrifying and thrilling about this. Maybe it is good that the institutions and hierarchies of the old order are being broken up. But the fear of what exactly will be lost and gained in that process is what looms large.
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