We continue to write about the Future of Work and Pay through a series of articles.
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Many thanks from Arturo, Tony and Robby!
Stop Workism – build a portfolio workstyle instead
June 24, 2024
Workism is the false ideology that positions your job as the centerpiece of one’s identity and life’s purpose. It’s a term derived from “alcoholism” and “workaholic”, both not very positive. Companies that demand 24/7, 9-to-5 and 100% dedicated focus from employees will find it hard to engage talented people from younger generations.
“Flexibility at an individual level translates to agility at an organizational level”. This quote by Christina Wallace, lecturer at Harvard Business School, introduces a new method for companies to increase engagement and commitment of talented employees. Hybrid work models have ascended from necessity to a strategic choice for companies, offering a template that blends remote and in-office work with unprecedented flexibility. This new model avoids the rigidity of fixed office days for a fluid structure that accommodates meetings across diverse locations and fosters a work-when-and-where-you-are culture. This flexibility not only supports a broader spectrum of work-life balance but also broadens the talent pool from which companies can draw, unshackled by geographical constraints and local demographic developments.
Parallel to the evolution of how we organise work, the future of work will include the critical importance of appreciating unpaid activities and caregiving roles. Forward-looking companies are recognizing that supportive caregiving policies are not just ethical imperatives but strategic talent retention tools in a fiercely competitive labor market. Embracing such policies not only aids in retaining skilled workers but also aligns with a broader societal shift.
New leadership styles now that Gen X and Millennials are coming to the helm, advocating for empathy, inclusivity, sustainability and balance. Their approach, a departure from the hierarchical and profit-driven models of the past, emphasizes creating value for a broad spectrum of stakeholders. This leadership evolution aligns with the portfolio lifestyle’s ethos, advocating for a holistic view of success and fulfillment.
In recruitment, the transition to a skills-first approach over traditional degree prerequisites signals a move towards greater diversity, equity, and inclusion (DEI). This strategy not only seeks to dismantle barriers to employment but also mirrors a commitment to fostering community welfare and individual development. The recognition of DEI as crucial for organizational success has never been more pronounced, with strategic efforts to integrate these principles into corporate cultures becoming a priority for businesses worldwide.
Anne-Marie Slaughter and Autumn McDonald of the think tank New America observe a gradual shift towards a new work-life balance and note that the younger generations, shaped by decades of crises, are questioning the productivity-driven culture of their parents. Icons like Simone Biles and Naomi Osaka, who prioritize mental health over performance, exemplify this shift, challenging the capitalist framework that equates worth with productivity.
The call to action for companies and employees is to investigate the impact of increased individual flexibility (when, where and how to work) can be a tool to gain organizational agility and productivity. We assist companies in becoming more agile with improved levels of employee engagement and commitment, by adjusting the organisation of work and the corporate values that go with it.
As the lines between work and life blur more each day and the corporate careerpath is no longer a straight line up. The term ‘portfolio approach,’ first introduced in our book ‘Flex or Fail’ by Prof. A. Bris, Dr. Tony Felton, and R.P.M. Mol in 2019, has emerged as a theme for those seeking an answer to the question “Why do we work?”. This concept, challenging the traditional, mono-focused career path, invites professionals to diversify their life’s endeavors much like an investor diversifies a portfolio. It advocates for a life where work, personal interests, family, and (self-)care are equally valued components, each contributing to the individual’s overall fulfillment and wellbeing.
Please contact us at info@flexorfail.org if you wish to be amongst a core group of innovative companies that are pioneers in the future of work and pay. RTA Consulting would be happy to provide consultancy support for your organisation on these topics, speak at your events or engage with you to expand the conversation.
Business needs a social currency to deliver ‘good’
June 12, 2020
A social currency could express how business builds new connections with customers and society in the post Covid-19 era.
The pandemic forced us to focus on local and more basic activities. Working from home, making sure you and those around you stay healthy and accepting restrictions on mobility for the greater good, have become the ‘next normal’. Boot camps in parks became an alternative for the gym and a small trip to the countryside has replaced air travel. Access to nature, parks in cities and clean air became precious goods that many of us will want to keep. With these changes, new values are being assigned to things that matter most.
In our book “Flex or Fail – the future of work and pay”, we described how disruptions in technology and culture affect our expectations around work and pay, and what actions people and organisations need to take to stay afloat. Let’s take a look at where jobs have disappeared and what has replaced them.
How work has changed
Although the first round of lay-offs mostly touched people in the flexible layer, the coming tsunami of lay-offs will affect those working on fixed contracts. Most companies are now making long-term adjustments to their cost-structure. Business models and product/service designs are being evaluated with the aim to align them with new customer behaviours.
We estimate that one in five jobs could be lost in the aftermath of Covid-19, with wide variations between industry sectors. Once governmental subsidy programs wear off, we expect companies will adjust the size of their employee-base to the next normal. Demand for products and services will be different based on changed customer behaviour. New cultural values also means new monetary value is being assigned to existing products and services. Since flying and travel are severely restricted it is logical that airlines and aircraft builders are hit especially hard. You can witness the onslaught of job-loss in the table below.
Airlines / aircraft Sector
Jobs lost
Total # of Employees
% jobs lost
Boeing (aiming for 10% job reduction)
12,000
161,000
7%
Easyjet (aiming for 30% job reduction)
3,000
15,000
20%
SAS
5,000
14,000
36%
Latam (bankrupt)
43000
43000
100%
American Airlines (expected jobcuts)
35,000
129,000
27%
British Airways
12,000
42,000
29%
KLM / Air France (expected jobcuts)
4,000
35,000
11%
Lufthansa
26,000
138,000
19%
Average first round job-loss total
140,000
577,000
24%
All numbers in this article have been reported by companies to financial media such as Bloomberg, The Economist, Financiele Dagblad and The Guardian in 2020.
The baseline scenario for most businesses seems to be that revenue will be under pressure for a number of years and that profits will fall unless costs are brought under control. In order to stay competitive, automation will be brought forward. However, companies need to be aware that customers will look at brands through the lens of responsible behaviour. How you treat workers (on fixed or flex contracts), what your stance is on discrimination (#BLM), the dividend policy and how much your CEO is paid, add to this what CO2 emission levels your business has, all of which will influence the customers’ buying decision.
A large number of carbuilders have announced job cuts and some accepted governmental support in return for a strategic shift towards electric cars and lower emissions. The shock of the pandemic has made it clear that lower emissions and a positive contribution to climate change are high on the list.
Automobile Sector
Jobs lost
Total # of Employees
% jobs lost
Nissan
20,000
127,500
16%
Rolls Royce
9,000
52,000
17%
Maclaren
1,200
4,000
30%
Renault
15,000
180,000
8%
BMW
6,000
133,000
5%
Scania
5,000
50,000
10%
Average first round job-loss total
56,200
546,500
10%
The Oil & Gas sector was caught in a perfect storm whereby oversupply and a sudden drop in demand caused lower and in some cases even negative prices. Clear blue skies have delighted most people and the absence of jet-exhaust stripes in the air reminded most of us of a world we once had. The need to travel to work or holiday destinations disappeared for a large part. As a result, people may become more selective about mobility.
A greener, cleaner world where we only use carbon-based fuels when absolutely no other alternative is available might be conceivable. If this comes true, the Oil & Gas Sector needs to radically adjust. Zero-emission mission statements can be expected from more companies in this sector and investments in wind, solar and bio-fuels could be stepped up.
Oil & Gas Sector
Estimated Job disappearance
Total # of Employees
% jobs lost
Shell (voluntary redundancies)
8,200
82,000
10%
BP
10,000
73,000
14%
Chevron (voluntary redundancies)
5,200
52,000
10%
Halliburton (voluntary redundancies)
5,500
55,000
10%
Allseas
300
4000
8%
Average first round job-loss total
29,200
266,000
11%
How pay has changed
Lost jobs increase inequality. The knee-jerk reaction of most businesses when Covid-19 hit was to lay-off low-skilled flex workers. This explains the instant peak of unemployment that we have seen in March and April in the US. These people often only have a single source of income and are extremely vulnerable in terms of income and health.
Governments around the world have used financial support packages to save jobs. This has cost an unfathomable amount of money and current economic thinking is challenged to come up with new solutions for unseen levels of national debt, inflation and interest rates.
For governments, job-loss reduces the number of people which can be taxed based on their income. Most governments depend to a large degree on ‘tax on labor’ and are addicted to this source of funding. It is likely that governments will seek means to raise additional taxes on profit, wealth and dividends. You can expect measures that target companies and high net-worth individuals, and since the sympathy of the electorate is not with these groups, politicians might move fast to impose new ways to redistribute wealth as well as pay down debt levels.
How expectations of life and equality have changed
The call for a more just and equal economic system is growing louder by the day. The current growth- and market driven mechanics are thought to be responsible for the undesirable outcomes such as climate change, income inequality, risks to health and discrimination. Shareholder capitalism is built on consumption, growth, debt, globalisation and carbon-based energy. In this system, money or profits equal professional and personal success and these deliver status, influence and power to the winners. But what about the losers?
The past year already showed social unrest in places ranging from Quito (Ecuador) to Santiago (Chile) and Hong Kong (China). Institutionalised discrimination practices have been exposed by the murder of George Floyd in Minneapolis (USA), followed up by mass demonstrations in cities around the world. The Covid-19 pandemic is not reducing the income or health inequality between people, but is instead creating a bigger gap. There are groups within society that simply have had enough. At the same time, economic policies and political leadership are intertwined and have created a corrupt loop. One could argue that the world’s political systems need an update as well, since strong-man leadership has not delivered health-protection for the world’s population.
Covid-19 has shown that the globally connected economy is not able to protect itself well against a virus, and a second wave or a new future pandemic is thought to be likely by some. What new system will take the place of shareholder capitalism? It is likely that values such as equality, inclusion, the right-to-work, zero emissions, affordable education, access to healthcare and recognition of a positive contribution to society will become part of the blueprint. What should be the role of business to deliver ‘good’?
Is it time for a new Social Currency?
The importance to society of healthcare workers, doctors, teachers, garbagemen, delivery couriers and social workers (to name just a few of the essential jobs) became even more clear during the pandemic. People who look after grandparents or shop for neighbours have delivered value to our communities.
Traditionally, these activities are seen as volunteering work and are not rewarded. In a world where jobs are becoming scarce, it would be wise to deliver monetary recognition to these unpaid tasks. Although universal basic income experiments have shown there is little impact on new job creation, those who participated in these programs did report a higher level of wellbeing. Maybe the time has come to redefine work as we know it, and recognise new categories of activities such as taking care of each other.
Time to get out of your bubble
The world needs new and innovative products and services. The fact that most workers are spending more time at home means they experience everyday streetlife in their communities. That is a wonderful opportunity for your business, because through your employees you are present where your corporate reputation is being created. Visiting the supermarket at 11.00 in the morning will make it clear there are socially vulnerable people around us. We don’t get to meet these people in the office environment, but they count. So what could your business do for them? Which core competency of your company can be leveraged to make a positive change?
If companies want to re-imagine their future, society is an excellent ‘living-lab’ for testing out new ideas. Suppose you allow one day per week for your employees to set-up local teams with diverse residents from outside the company bubble to start experimenting with activities that contribute in a positive way to society as a whole.
There is the example of a garden maintenance company, which ‘blitzed’ together 20 people to clean up the neglected garden of a care-home for the elderly which was reopening for visitors. Experiments like this reduce the detachment of business from society. The phrase “the poor is another country” is a cynical expression of the stratification which is taking place – we could simply use the fact that working from our neighbourhoods is the next normal, and use this as a tool to break down the company walls.
We think those activities could be rewarded with a new kind of money – one we would coin as ”social currency” in this article. Look upon it as a social salary, expressed in a technologically enabled currency. Could this be a use case for blockchain and tokens? We will further explore this topic in our next article, which you can find on our blog at www.flexorfail.org and on our linkedin accounts.
Humanity excels at being able to adapt and one could say we are the best equipped species to adjust to the next normal. The world has changed around us and there is the need and opportunity to redefine your business. Now is the time to show that we can come up with a better version of ourselves and our organisations.
Dr Tony Felton, Robby Mol, Professor Arturo Bris
Please contact us at info@flexorfail.org if you wish to be amongst a core group of innovative companies that are pioneers in the future of work and pay.
How Covid-19 has transformed the world of work and pay in three months
May 25, 2020
Covid-19 is accelerating the disruption of jobs, work and pay that we described in our book ‘Flex or Fail’. The pandemic has already affected the world of work, with over 26 million Americans accessing unemployment benefits since March. However, we believe that the real impact on jobs will really be seen in the third and fourth quarters of 2020 when companies start to make longer-term adjustments to their cost structure in order to conserve cash and remain in business.
Massive government programmes have been implemented across developed world economies to support businesses and laid-off workers through a variety of loans and grant schemes. However, rising unemployment is a predictor for a dramatic increase in business failures in the latter half of 2020 and 2021, as the pandemic continues to impact economic activity.
What effect will this have on jobs and work? We can already see that lower wage and part time workers have borne the brunt of short term lay-offs, and this is likely to continue. Sectors such as retail, leisure and hospitality have been affected particularly badly in the short term, with doubts that all these businesses will return to their previous levels of capacity as customers switch permanently to new channels and consumer behaviours.
Business leaders will reflect on how their operations have performed during their exposure to ‘lock down’ and start to ask questions. Why have an office? Why do I need all these employees? Which employees are doing particularly well and which are non-performing? What decisions do I need to take to stay in business? The realisation that ‘only strong companies will succeed’ is forcing business leaders to think the unthinkable about every aspect of their business.
In our book ‘Flex of Fail’, we forecasted that automation and AI would be transformative in changing the nature of work. Not just by replacing ‘humans for machines’ but more so around changing the nature of how people work alongside new technologies and the changing nature of the tasks they perform.
Although this has up till now mainly been focussed around manufacturing or repetitive administrative tasks, emerging technologies (eg low code) will affect all areas of work including professional services.
The timeframe for businesses to invest and deploy automation has jumped from years to weeks since the pandemic started. Zoom meetings, online doctor consults and ‘click and collect’ have gone from fringe to mainstream. Businesses have done the unthinkable in terms of problem solving, agility, collaboration, embracing technology, focused goals, breaking rules and recognising what highly motivated people can achieve when put to the test.
For companies, re-imagining their future has become critical in order to build resilience. We see transformational leadership and vision being the difference between success and failure; these leaders are likely to excel in the following seven ways:
– Developing a deep understanding about their customers changing needs
– Mastery of being able to create and communicate a compelling vision
– Setting clear goals in both the short and medium-term
– Giving license to their teams ‘do things differently’
– Embracing technology and innovation, at speed
– Forging new collaborations to achieve objectives
– Using structured data as the ‘compass’ to evaluate progress
For all individuals this will be a time of risk and uncertainty. In our book we outlined three key steps for people who may have anxieties about their jobs, income and futures; we suggest that this is now an urgent task:
Planning for new ways of working
Managing risk for individuals starts with evaluating options for transition and planning. Diversification of income streams and work activities is an important component of planning in order to reduce risk. Relying on a salary from a single company is risky. Establishing a portfolio of income generating activities includes monetising assets, as well as work related activities, which would need to be included as part of a comprehensive approach.
Skills development
We outlined in our book the importance of adopting a ‘growth mindset’ and belief that abilities can be developed. Identifying what skills will be needed beyond the horizon will enable individuals to take a more entrepreneurial approach to achieving their personal objectives
Collaboration
Both virtual and physical communities are critical for social connections and as a means of both social support and networking. Identifying and planning how networks and communities can be utilised is key for individuals to develop their own ‘brand’ and stimulate a flow of potentially valuable ideas and opportunities
No one knows exactly when and how the Covid-19 pandemic will end. It is likely that a vaccine will be available in 2021 but uncertainty remains around timing and its effectiveness. The age of ‘hyper-uncertainty’ will be with us for some time yet.
Businesses and individuals need to adapt to this ‘new normal’. In spite of the tragedy and misery for many people that Covid-19 has brought, this event will open up new opportunities and it will have an end. For those leaders and individuals with a vision, who are both agile and fortunate, they may see this time as a pivot point in their lives.
Please contact us at info@flexorfail.org if you wish to be amongst a core group of innovative companies that are pioneers in the Flex Movement.
Dr Tony Felton, Robby Mol, Professor Arturo Bris – May 2020
RTA Consulting would be happy to provide consultancy support for your organisation on these topics, speak at your events or engage with you to expand the conversation.
How (not) to pay Independent Workers
November 25, 2019
At ING, the Amsterdam headquartered banking giant, hundreds of independent workers had not been paid since June 2019 due to cash flow problems at the intermediate payroll service provider, TCP. Initially ING refused to compensate and defended its position by stating the payroll service provider had already been paid.
The general public took a different view. A highly visible debate in the press made it clear that the sympathy was with the independent workers. The power imbalance between an independent worker and ING (with its middle man) was deemed so significant that people wanted ING to assume responsibility. A simple compensation issue became a corporate reputation risk. ING was quick to fix it and made a 180 degree PR turn in August by paying the independent workers directly.
Similar debates have been seen in California and Spain, with companies such as Uber and Deliveroo. The issue spans various industry sectors and continents and at the core of it lies the definition of ‘what makes someone an independent worker’ versus ‘what makes a person an employee’. Politicians responsible for labor market policies have are wrestling with this topic and are trying out various reforms. It’s proving to be a balancing act between the competitiveness of a nation’s economy, new technology, maintaining governmental income through tax on labor and keeping traditional voter groups (such as union members) on board.
Why do companies need these independent workers? Because these workers perform complex, often IT and compliance related, tasks and don’t necessarily want to work for any employer full-time. These people favor autonomy, job variety and freedom over a guaranteed monthly paycheck and have plenty of work to choose from. In other cases, companies opt for independent workers because they do not want to burden their P&L with more headcount. In both cases, companies do not want the administrative hassle to pay thousands of independent workers directly, which is why they use payroll service providers.
As we described in our book ‘Flex or Fail’, over 23% of the global workforce in developed countries is working independently and their number is likely to double in the next 10 years. A variety of industries, such as transportation, logistics, building and day care are using contractors or independent workers to get the work done. Even governments have embraced the use of independent workers. These large employers are served by a variety of payroll service companies, promising easy payment handling at very low costs. This has quickly become a crowded marketplace leaving the payroll service providers with thin margins and increased financial vulnerability. The risk of having to pay twice, which happened to ING, can happen to many other companies.
Policy makers at governmental level have not been able to come up with a clear definition of what ’employed’ versus ‘independent work’ means. In the absence of clarity, the risk of not getting paid (for an independent worker) or the risk of getting fined, or facing a PR crisis (for companies) is increasing.
Our analysis of this problem leads to some key recommendations that include:
Companies conduct regular and systematic audits of their payroll service providers;
Governments improve clarity and rights around the status of ’employed’ versus ‘independent’ workers;
Independent workers evaluate the risk of working with weak payroll service providers and, if need be, seek payment guarantees upfront from the end-client.
Our work with organization leaders has demonstrated that the rapid expansion of an independent workforce is generating both risks and opportunities for companies. Third-party payment providers are just one area that many companies have underestimated as a source of risk that goes way beyond simple HR and payroll processes. For ING, this rapidly became a strategic and reputational risk to the business and its brand.
In our book ‘Flex or Fail’, we describe the future of work and pay in an era of automation and outline a set of steps organisations will need to take to retain competitive advantage. We are working with organisational leaders to support deployment of these approaches to help develop solutions to complex problems that their industry and organisation may be facing in the future.
Please contact us at info@flexorfail.org if you wish to be amongst a core group of innovative companies that are pioneers in using the Flex IndexⓇ. RTA Consulting would be happy to provide consultancy support for your organisation on these topics, speak at your events or engage with you to expand the conversation.
Field-experiments with Flex Work
October 31, 2019
The 2019 Nobel prize for Economics was won by Abhijit Banerjee, Esther Duflo and Michael Kremer from MIT and Harvard University. The award this year has received even more publicity than usual, not because Duflo is only the second woman in history to have won this prize, but also because of the nature of their research on alleviating global poverty. A worthy cause no doubt, but it was their approach and methodology to this problem that was cited by the Nobel committee. Their mantra ‘what works, matters’ was demonstrated throughout their approach in designing multiple experiments at a small level and testing them in real world settings.
Not daunted by trying to tackle such an enormously complex subject as global poverty, they tested various small initiatives, tracked outcomes and demonstrated the power and feasibility of focussed field experiments that were ‘low cost, well designed and simple’.
Businesses are also facing an increasingly complex set of emerging conditions. In our book ‘Flex or Fail’, we explore a key aspect of this as to how AI and automation will drive transformational change and its potential implications on competitiveness, productivity and jobs. Businesses are of course facing many other factors such as the threat of an economic recession, changing demographics and global warming, to mention but a few.
What should business leaders do to evaluate this level of complexity and make rational decisions for the future of jobs and the longevity of their enterprises? In spite of policy advisors and consultants who are setting out various future scenarios, there is no ‘playbook’ out there that organisational leaders can truly rely on. Winning organisations will need to ‘design their own futures’, but how?
‘Framing the problem’ is the first and crucial step. This usually begins by formulating a hypothesis, a proposed explanation made on the basis of limited evidence, as a starting point for further investigation. Those with a scientific background will be familiar with this approach, often followed by observation, measurement, experimentation and analysis of results that may modify the starting hypothesis.
This may sound a bit ‘heavy duty’ for busy senior executives to follow, but back to our Nobel Laureates. They faced similar complex issues, but were able to address these by deconstructing them into a set of multiple small, well defined, simple and precise questions. These could be answered by crafting well designed experiments that were used to test solutions and discover outcomes that had real impact, and could be scaled up.
Their preferred methodology of randomised controlled trials (RCT) is familiar to physicians as the ‘gold standard’ for defining efficacy and risk for testing new drugs and medical interventions. It is now becoming standard practice in development economics.
In a randomised controlled trial, subjects are randomly assigned to one of two groups: the ‘experimental group’ receiving the intervention that is being tested, and the ‘comparison group’ or control who follow the conventional approach. The two groups are then followed up to see if there are any differences between them in outcome. This approach seeks to achieve statistically validated results and avoidance of bias, which is a common problem in testing new solutions in business settings.
Like the Nobel Laureates, creating a ‘living laboratory’ within your organisation is both feasible and can drive competitive advantage. It can be achieved at a small scale within a controlled setting, and can be used by senior executives to answer the question “what works, and what doesn’t work” in a fast and iterative way. Results of the outcome of such experiments can be scaled up to drive organisational benefits. RCTs are of course not the only approach business can take, as other methodologies are available that may be simpler and quicker to deploy depending on the situation.
Our experience of working with clients and analysis in the field can be distilled down to three ‘key success factors’ for business leaders to consider when establishing a ‘living laboratory’ within their organisations:
Undertaking this kind of research within the business needs ‘top-level’ leadership. This is a new and innovative approach that needs to be championed and communicated from the C-suite
Applying ‘intelligence-based’ crafting of the problem and selection of methodologies used to test solutions that mitigate for bias. This requires a small, but diverse high-performing team in terms of skills, knowledge and thinking.
Bold decision-making at the ‘top-level’ to utilise findings that can drive positive change in order to realise competitive advantage
In our book ‘Flex or Fail’, we describe the future of work and pay in an era of automation and outline a set of steps organisations will need to take to retain competitive advantage. We are working with organisational leaders to support deployment of these approaches to help develop solutions to complex problems that their industry and organisation may be facing in the future.
We cannot guarantee that you will win a Nobel Prize, but be assured that you will deepen your organisations insight, innovation and confidence when planning for the future. It’s time to write your own playbook…
Please contact us at info@flexorfail.org if you wish to be amongst a core group of innovative companies that are pioneers in the Flex Movement. RTA Consulting would be happy to provide consultancy support for your organisation on these topics, speak at your events or engage with you to expand the conversation.
How a flexible workforce drives competitive advantage
September 1, 2019
Freedom and autonomy rank above job security for independent workers
A recent US Bureau of Labour Statistics report showed that 79% of independent contractors prefer their autonomy over a traditional employment contract where someone else tells them what to work on. In the US, around 35% of the working population are independent workers [also called flexible or non-standard workers], a figure that is forecast to grow to over 50% within the next 10 years in developed economies.
Why are people preferring to work independently rather than through a traditional employed model? Independents value in particular the high level of autonomy and control they have over their time, flexibility in their work and choice over type of work they undertake. Some independent workers may prefer the predictability of being employed, but this is less than 30% of the group as a whole
For many younger workers and parents with childcare, elder-care and other external demands to their lives, flexible working is particularly attractive. The rise in the number of workers aged 55-64 in transition from full time work to retirement, is likely to further fuel this trend.
How independent workers access work opportunities is also changing fast. The traditional role of agencies and intermediaries who broker the demand for labour with supply of independents is being disintermediated by freelance platforms which streamline the process. Independents can access these online platforms directly, log their details and select the type of work they want.
For companies facing fast strategic change and accelerating product life cycles, the need for rapid access to specific skills becomes critical. Agility and ‘just is time’ need for specific skills is becoming a competitive advantage in terms of lower costs and improved productivity, with some multinationals now having up to 40% of their workforce as independents. Multiple layers of management are giving way to agile, self-managing teams. Increasingly, the traditional employment model is being seen as a slow system with high fixed cost that may not be delivering the best value and skills to the company.
How can organisations become smarter in utilising independent workers to create value? We see three areas where leading companies are focussed on:
Workforce is no longer just about Human Resources
The HR function is changing fast. Traditional administrative tasks around recruitment, and benefits management are either being automated or outsourced. Workforce planning and management is increasingly a strategic responsibility, driven by data and analytics needed to respond to demands for ‘real-time’ information and decision making. Development of an independent workforce strategy is becoming more central to this role.
HR functions are adapting to this transformation, sometimes through the emergence of an ‘internal marketing’ capability that is focused increasingly on addressing the needs of a flexible workforce.
A deeper understanding of what independent workers value is emerging and becoming part of the attraction that winning organisations offer. This may include skills development and training, working in high performing multifunctional teams or being provided with a credential on completion of a task that adds value to the individual’s skill portfolio.
Engage with new platforms and processes
It’s clear what independent workers want but what don’t they want? They don’t want laborious recruitment administration, impersonal procurement processes and late payment. Smart organisations are transforming these traditional ‘pinch points’ and reaching out to independent workers in ways that lower cost and drive efficiency.
Many organisations are setting up their own databases of independent talent that has been home grown or comes through other platforms. Selection, credentialing and onboarding is increasingly automated and driven by key performance indicators that can be monitored in real time. Invoicing and payment is automated and verified.
Happy independent workers become ‘brand ambassadors’ of the organisation that they have worked for if they have had a positive experience. Platforms also offer services whereby independents can provide feedback on their work experience and rank the organisation which, like ‘trip advisor’, may provide positive or negative signals to stakeholders.
Competitive organisations are cognisant to these developments and are moving swiftly to attract high quality independent talent that is often required at short notice and can quickly be integrated into teams to undertake the task in hand. Focus, agility and delivery are becoming the drivers of value.
Where you are now?
Senior management and Board’s need to evaluate how workforce change in a fast moving environment will impact their business. To remain competitive, they will rapidly need to understand where they currently are and where they need to be in terms of ‘readiness for change’.
In our book ‘Flex or Fail’, we describe the future of work and pay in an era of automation and outline a set of steps organisations will need to take to retain competitive advantage. Subsequent to this, a number of organisations have approached us to work with them in order to provide a more detailed road-map as to what steps they need to take. From this, we have developed the ‘Flex Index’™, a tool that enables organisations to benchmark where they currently are in terms of ‘Flex readiness for change’. This takes a 360 degree view of where organisations are within their sector, including in areas around future-proofing workforce.
How to migrate from an employee centred to a more flexible workforce model, was low down the scale of understanding in many, but not all the companies we surveyed. Those who were engaging with new technology, taking a data driven approach and engaging with independent workers in an innovative way correlated with being performance leaders in their sector. Now may be good time to test where you are?
RTA Consulting would be happy to provide consultancy support for your organisation on these topics, speak at your events or engage with you to expand the conversation. Please contact us at info@flexorfail.org if you wish to be amongst a core group of innovative companies who work with this method first.
by Dr Tony Felton, Robby Mol, Professor Arturo Bris
September 1, 2019
Why your future classmate should be an artist or engineer
July 2, 2019
By 2030, new technology and automation will replace some 20% of existing jobs and impact work activities of another 60%. Many new types of jobs and job contracts will be created as a consequence of automation and changing societal values, such as an increased desire for autonomy and improved work-life balance.
The challenge facing society will not necessarily be unemployment, but availability of workers with the necessary skills needed for a new economy that will be shaped by these technologies. We forecast a slimmer employed workforce, but a rising demand for independent workers with new and relevant skills.
As we have written in our book ‘Flex or Fail’, some 23% of workers in developed economies are ‘independent’ rather than working through an employment contract, but by 2030 this will have risen to more than 50%. How will these new independent workers survive and thrive in an emerging and uncertain future work environment?
Let’s go back to the mid 20th century when the school curriculum started to become more specialised around a handful of specific subjects which, by the time young people went to university, were honed down to a three year study of a single subject. Further education and academia since then has been an increasing story of specialism and sub specialism.
How well does this play out in the future of work and pay? Sure, technical specialism is in demand, tax specialists, neurosurgeons, mining engineers and maths teachers will all still be required, but the emergence of the ‘specialist-generalist’ is on the rise. These are the people with a core skill [or skills] who can diversify and readily embrace change. In a world of rapid tech advance, there is increasing demand for workers with creative and process skills who work together with ‘silo specialists’. But where do ‘specialist-generalists’ come from?
One route is from ‘multi-disciplinary learning’ which can be described as: ‘where two or more specialist disciplines collaborate for a specific purpose’. It is a radical approach that challenges not ‘what to think’ but ‘how to think’. Of course, multi-disciplinary teams have existed for a long time in areas such as large, complex engineering projects and in healthcare where multidisciplinary teams review and plan treatments for patients with cancer. But in technology development and wider business settings, convergence of skills such as developers and creatives is catching fire and traditional barriers are falling fast.
Multidisciplinary learning is emerging across a range of settings, from schools and universities to business training and project management programmes. For example, the Open University [an online educational platform in the UK] provides an online curriculum around Multidisciplinary learning. All of these sources have common themes including:
Asking questions through which answers are developed through a multidisciplinary process
Learning and developing links between different subjects and disciplines
Including individuals from diverse backgrounds such as arts, creatives, quants, tech and science
Out of this process comes a broader and deeper level of critical thinking, self-management and adaptability. This in turn provides teams and organisations with the ability to synthesise a wide variety of ideas to drive creativity, innovative thinking and problem solving. This is particularly relevant to new applications for information technology and artificial intelligence.
What’s in it for workers and organisations to invest their time and resources in promoting multidisciplinary learning? In our book, we focus on the term ‘Flex’ which we describe as ‘how organisations and individuals can better understand, plan and execute actions that will enable them to transform and thrive in the emerging world of technology change and automation’.
We believe multidisciplinary learning is a key success factor to achieve ‘Flex’ and one in which forward looking organisations will adopt and refine the approach in order to achieve competitive advantage. The driver for this will be the ability to remain agile and enhance the ability to switch rapidly to different contexts and environments as evolving technologies challenge the status quo.
Governments and policymakers have a critical role in this to stimulate lifelong learning as part of their obligation to maintain economic growth and competitiveness. Workers will need access to financial resources to enable them to benefit from different forms of education and development that will be relevant to their job roles.
Schemes such as education vouchers and ring-fenced educational grants that people can draw down on, will stimulate the supply of high-quality educational resources. These will be delivered through an increasing variety of sources and formats. Multidisciplinary learning will become part of this mix, allowing people to select and add value to their learning portfolio credentials.
For workers, and especially the emerging independent workforce, multidisciplinary learning will allow them to differentiate from competitors, broaden their knowledge base, enhance creative thinking and make new connections. In an uncertain world, that is an insurance policy likely to be worth the cost.
Based on the key themes described in the book, we have developed the ‘Flex Index’™. This tool enables organisations to benchmark where they currently are across seven ‘key domains’ that include strategy, technology readiness, organisational culture and communication. Backed up by some fifty measurable factors, this measurement will allow business leaders to evaluate their organisations in terms of readiness for change, and make informed decisions for key areas of development. The outcome will provide important insights for strategic planning around the concept of ‘responsible change’. The conclusions and can form a basis for organisational leaders to form a narrative and communications strategy that supports engagement with both internal and external stakeholders.
RTA Consulting would be happy to provide consultancy support for your organisation on these topics, speak at your events or engage with you to expand the conversation. Please contact us at info@flexorfail.org if you wish to be amongst a core group of innovative companies who work with this method first.
by Dr Tony Felton, Robby Mol, Professor Arturo Bris
July 2, 2019
Will independent working drive you mad?
June 6, 2019
Are independent workers more or less prone to mental illness?
Have you ever felt depressed or anxious? Symptoms of depression may include low mood, poor energy levels, feelings of guilt and poor ‘self-worth’. Anxiety symptoms may be a result of prolonged stress and include feelings of worry, fear, agitation, panic attacks, inability to concentrate and disturbed sleep patterns.
Most people experience some period of anxiety or depression in their lives, but when these symptoms become more persistent and severe they may have debilitating or even catastrophic effects. In the UK between 15-20% of the adult population [depending on the region] will have these illnesses at any one time.
Are independent workers, as opposed to those who work through an employment contract, more prone to stress, anxiety and depression? Research presents us with a mixed picture. Those independent workers who experience higher levels of income volatility and a limited scope of available job roles appear to have a higher association of a range of mental health problems, including anxiety and depression. This group of independent workers are often low paid ‘gig workers’ who have become independent workers ‘reluctantly’ rather than by choice.
At the other end of the scale are independent workers who are ‘free agents’ who have mainly sought independent working by choice and enjoy a high level of decision authority and control over their work. This group reports of higher level of job satisfaction and well-being, using subjective assessment of their lives, compared to people working through an employment contact.
Control over ‘work-life’ balance clearly has an influence on independent workers well-being and mental health, however most independent workers are exposed to some degree of income volatility, isolation and absence of a ‘safety net’ of benefits that employed workers enjoy. These factors may impact people’s mood and state of well being irrespective of their background.
How to reduce mental health risk for independent workers
In our book ‘Flex or Fail’ we outlined a ‘five point tool-kit’ for people thinking about transitioning from employed to independent working. Part of this tool-kit contained strategies for reducing risk to wellbeing and mental health that included:
Reducing income volatility by developing a diversified portfolio of income streams that mitigates the risk of unexpected loss of a client or workstream;
Combating the risk of isolated working that may precipitate loneliness and depression, through building online and offline networks, especially with individuals who live close to you and are following similar paths;
Ring-fencing ‘protective time’ and space on a daily basis to manage your individual wellbeing including: physical exercise, mental reflection such as meditation or other therapeutic recreational activities such as music.
Underpinning these strategies is mindfulness of your own mental state. We all have an awareness of ‘how we are feeling today’ both physically and psychologically. If there is a decline over a period of time, this should be a trigger for a ‘mindful person’ to reflect on and take action, which may include a consultation with a medical professional.
Policy makers are also crucial in addressing risks that independent workers are exposed to. Examples of policy innovation from leading countries such as the Netherlands include:
Improving access to training. As off Jan. 1 2020, each Dutch citizen will have access to a personal training budget which can be used for skills development and lifelong learning. This enables independent workers to gain access to a wider range of job roles and higher pay rates.
Expanding access to benefits such as pensions and sick pay for independent workers that will provide a level of protection and security.
Supporting the development of co-working spaces that independent workers can gain easy access to in order to develop networks and engage with others, thus alleviating isolation.
How will technology and automation impact wellbeing?
In our book we describe how advances in technology and automation are impacting jobs and pay. Currently in the US, around 35% of workers are ‘independent’ rather than working through an employment contract, but by 2030 this will have risen to at least 50%. Independent working may thus become the ‘norm’ in developed economies making wellbeing of the workforce a key priority for organisations and individuals to address.
Technologies such as AI will displace around 15-20% of the existing workforce, affecting those most whose jobs involve repetitive manual and administrative tasks in the short term. By 2030 technology will impact work activities of around 60% of the workforce, but not necessarily displace their jobs. New jobs will also be created as a consequence of automation. The result of this transformation will be a slimmer employed workforce, but a rising demand for independent workers with relevant skills.
Those independent skilled and professional workers will enjoy greater certainty of income, but only while their skills are up to date and remain insulated from the threat of automation. These factors will have a direct effect on the wellbeing and mental health of the independent workforce.
New online tools and technologies are emerging that can support effective mental health interventions such as online cognitive behavioural therapies. Online networks also increasingly offer support, engagement and information for independent workers. Diagnostic tools too are being made available directly to individuals who can track their mental health and wellbeing state over time.
Automation may however have a more sinister impact at the lower paid end of the independent worker market who lack control over their work and the skills to demand higher pay. Automated systems will increasingly select, direct and control workers activities through platforms. Imagine being invited to bid for a paid task by an anonymous robot dialler, having to compete to get the work through a reverse auction selected by lowest price, monitored remotely through CCTV and your smartphone app as you undertake the task which may seem incomprehensible to you [such as going to a certain address and taking a photograph at a particular time].
Your work will be verified remotely and once approved, payment made through cryptocurrency to your online account. You will have no contact with humans during this process, which will happen on a daily basis. Welcome to the world of the ‘day worker’! If you live alone or are socially isolated, such circumstances may well lead to depression and mental illness over time.
We cannot hold back the march of progress, and innovation will provide very many benefits for individuals and societies. The impact of this on the mental health of individual workers is only just being understood. We don’t believe that independent working will drive you mad, and indeed for many it will improve wellbeing, but for individuals and organisations, making wise decisions early on may prevent the incidence of mental health problems from rising even further.
Please contact us at info@flexorfail.org if you wish to be amongst a core group of innovative companies that are pioneers in the Flex Movement.
RTA Consulting would be happy to provide consultancy support for your organisation on these topics, speak at your events or engage with you to expand the conversation.
by Dr Tony Felton, Robby Mol, Professor Arturo Bris
Platform businesses and the ‘Art of Flex’
May 24, 2019
Have you heard of Deutsche Bank, an international bank that employs 91,000 employees worldwide and has a market cap of around $16bn, first established in 1870? Of course you have, but have you heard of Adyen, a Dutch based global payments company started in 2006 with 900 employees that currently has a market cap of $21bn? Probably not, but how has a recent start-up achieved such a valuation compared to such an established global brand, and with just 1% of the workforce? You would probably respond by saying, “ah, but that’s the power of platform businesses”, and you would be right.
Adyen processes payments through its platform for large companies like Amazon and Facebook and has cost and scale advantages over traditional incumbents. Driving down costs, especially through the utilisation of new technologies, and needing only a small number of employees, is a key driver for competitive advantage and valuation.
The platform revolution is disrupting whole industry sectors and disintermediating incumbents. Their rise however has not been without controversy. The ability of platform businesses to monitor and manage their independent workforce has created an ‘information asymmetry’, with an increasing power transferring from ‘labour to capital’.
Uber’s eagerly awaited IPO has coincided with driver ‘strikes’ in the US and internationally. Ubers 3 million drivers, who are independent workers, timed their action to highlight the lack of transparency as well as levels of pay and working conditions. As independents they do not have employee benefits such as paid time off and health insurance.
But workers are also utilising new technologies to fight their cause. Take Organise (www.organise.org.uk) that started in the UK in 2017. This is an online platform that allows workers to raise concerns about work issues and start a national campaign for change. Organise believes that workers within organisations are unable to communicate together effectively in order to share issues and created a platform to enable them to collectively take action. A current campaign to challenge low pay at a major book retailer has backing from some 10,000 staff and customers that was started by a post from an individual worker.
Organisations who engage independent workers are of course in a difficult position in their ability to offer benefits, without running the risk of them being categorised as ‘employees’ and thus have to tread a narrow path. Platform players are increasingly aware of their need to respond to the evolving requirements of their workforce, both employed and independent, in order to protect their brand, maintain investor confidence and create a stable workforce.
Board discussions around strategy increasingly focus on the existential threat of agile competitors who will disrupt suddenly from ‘left field’. As consultants and academics, we are often asked by senior executives: “But how can we beat them at their game? How can we to become a platform business before it is too late?”
In our book we write extensively about this subject. We have used the term ‘Flex’ to describe how organisations and individuals can better understand, plan and execute actions that will enable them to transform and thrive in the emerging world of mass automation.
Data from a recent study of senior executives using our ‘Flex Index’™, a tool that enables organisations to benchmark where they currently are in terms of ‘Flex readiness for change’, shows some interesting results. Most organisations felt positive about their technology and platform strategies, but were far less confident around its implication for workforce, national policy, and ‘responsible change’, as their strategies were rolled-out at scale and across geographies.
How organisations engaged with key stakeholders and migrate from employee to independent workforce models, were low down the scale of understanding. These are crucial factors that are likely to wrong-foot organisations as they implement their strategies.
Successful platform businesses will not only be winners in tech prowess or customer acquisition alone, but also will be super-savvy in balancing future workforce costs, needs and efficiency. This is the ‘Art of Flex’ and understanding your position in this triangle is a first step to ‘platform bliss’.
Please contact us at info@flexorfail.org if you wish to be amongst a core group of innovative companies that are pioneers in the Flex Movement.
by Tony Felton, Robby Mol, Arturo Bris
Urban Tech and Flex Work
April 25, 2019
Today’s cities are as inefficient as farming was in 1950…
In our book ‘Flex or Fail’, we described how technology transformed agriculture in the last century. Fifty percent of the people working in the US were active on the land in 1900. Today, less than 1 percent of the workforce does the same work and delivers higher output. Farming has become a high tech business with drones, sensors, apps, direct trading platforms on smartphones and self-driving tractors abound.
The same thing is happening with manufacturing. In the middle of the last century, half of the workforce of the US were employed in factories. This is now down to 5 or 6 percent. Factories have become lean, robotised environments that run day and night managed by ‘machine supervisors’ and utilise innovative technologies that have reduced waste and emissions.
Cities as we know them are still as inefficient as the farming of the 1950’s. Offices sit empty half of the time, cars and bicycles idle on the streets until rush hour. Many homes are often empty or rooms unoccupied. Most young people can not afford to enter the property market for apartments, which are expensive and hard to finance. Elderly people see their children move to the cities; often they cannot follow as they live remotely and could not afford high city real estate prices.
The rise of the independent worker and the creation of smart cities goes hand in hand. Much of what people need in order to handle their additional responsibility for income and personal development (which we described earlier in the book) is present in the cities. By that we mean: paying customers, supportive communities for single-person households, connectivity, mobility, opportunities to learn, inspiration from culture and arts to recharge people’s energy, housing and (inter)national transportation connections.
Part of the reason why cities are not yet as efficient and attractive as they could be is fragmented ownership. Shopping centers, offices, houses, sport facilities and public transportation infrastructure are the property of different owners, which makes coordinated upgrading difficult. Investors pour money into the cities but do so in a mono-disciplinary manner, in other words: they give money to specialists who handle just one type of assets, e.g. offices or houses.
However, when citizens describe their ideal neighbourhoods they often do so in holistic terms: ‘easy to get to’, ‘lots of green spaces’, ‘safe and well lit’, ‘close to school’, ‘there are shops nearby’, ‘space to park’, ‘close to work and the city center’. To effectively manage the upgrading or development of neighbourhoods, a more multi-disciplinary approach to ownership and investing is needed.
Some companies, like CBRE Global Investors, are starting to formulate ‘urban strategies’ which have multifunctionality at the core. Compare it to ‘assorted liquorice’, whereby the layers and shapes represent different functions of building within an area, with the aim to provide an answer to the new needs of citizens. A second element within this strategy is sustainability. Leading companies in this field build towards BREEAM Excellent standards, which has become the standard of the industry to make buildings green.
Technology will play an important role in the further development of cities. A new field, called Urban Tech, encompasses the following fields:
co-living and co-working
mobility
delivery
smart cities
construction tech
real estate tech
We’d like to offer a 7th, namely travel, where technology should support the solution to ‘tourism overload’ as witnessed in Venice or Barcelona.
The new round of urban economic growth has to handle three challenges at the same time:
Build and develop in a sustainable manner so that cities become evermore pleasant places to live;
Make the city a green, with clean air and visually pleasing green environments, open to new workers and visitors;
Enable a fair distribution of work and pay to all stakeholders.
Research by Richard Florida’s team at CityLab reveals that investment in Urban Tech totaled more than $75 billion during 2016-2018, representing roughly 17 percent of all global venture-capital investment. Between 2016 and 2017, urban-tech investment more than doubled. Urban tech may well be the largest sector for venture capital investment, attracting more funding than pharma and biotech ($16 billion in 2017) or artificial intelligence ($12 billion in 2017).
Venture capital and start-ups in the urban tech field start to appear in a small number of global cities. The San Francisco Bay takes roughly 30 percent of all global venture-capital investment in urban tech. Beijing follows second with 26 percent of funding. New York City is third, with 10 percent, followed by Shanghai, with nearly 7 percent. The US cities produce many more urban-tech startups than Shanghai and Beijing.
Singapore accounts 6 percent of all investment, trailed by Bangalore, Los Angeles, Berlin, and London, the only other global cities to attract more than 2 percent of global urban-tech investment. Other cities that are generating reasonable numbers of urban-tech startups include Seoul, Chicago, Dubai, Amsterdam, Madrid, Paris, Boston, and Toronto, although none of them accounts for more than 1 percent of total investment. This global group of cities that are key players in urban tech suggests that the “rise of the rest” is not occurring inside the United States but outside it, especially in China’s two largest cities.
Cities have become the new platform for innovation and economic growth. The investment made in campuses and offices by Google and Amazon recently are further evidence that talent and work are increasingly found in cities. As such, they have become more important than countries or for that matter, companies. Some cities go the great length to create space for new urban developments. Copenhagen has announced plans to start building 7 new islands starting 2022, aimed at attracting new tech start-ups and green energy initiatives. The islands, called ‘holmene’, will require and investment of Euro 425 million and will host waste-recycling facilities from which 25% of the cities energy consumption can be generated. The next couple of decades we will hear people talk about the ‘success of Shanghai’ versus the ‘competitive position of Berlin’.
If we were to make a prediction about the faith of companies in urban areas, we would say that, for example, ‘Google in Paris’ needs to be a really good neighbour to the people in Paris in order to maintain its license to operate. If not, companies risk expulsion from these economically important zones.
On the one hand, Microsoft seems the be aware of this risk and has invested $500 million in building affordable housing for medium- and low income families in its home city Seattle. The program includes $25 million for homeless people in the region. On the other hand, the number of homeless people in street in the vicinity of Facebook’s HeadQuarters is unpalatable and will backfire on the companies in the area if they do not become a part of the solution. In this context the comments made by high ranking government officials at the 2019 WEF in Davos are worth noting: ‘business can expect a lot more demands from civil society. It’s no longer good enough to conduct passive corporate social responsibility, because the values in society have shifted and a more active and inclusive approach from business is called for’.
Multi-stakeholder approaches and new forms of collaboration are called for from both owners & investors (the private sector), politicians, city councils and education officials (the public sector) and workers (be it independent or dependent). Companies will need to reach out beyond their own staff in providing active support, investment and benefits to local communities if they wish to be treated as a ‘good neighbor’.
by Tony Felton, Robby Mol, Arturo Bris who welcome your comments!