In his upcoming book Rethinking Work, Rishad Tobaccowala, former Chief Growth Officer at Publicis, lists five trends that business leaders need to be aware of. First is the demographic shift, second is technology like Generative AI, third is freelance work, fourth is marketplaces, and fifth is individuals questioning why they work.
Of those five, three are directly similar to the shift from full-time employment by default to self-employment by default, an artistic style that many call independent economics. Today, some 435 million freelancers from 63 countries offer their services to companies in 186 countries. According to the World Bank, this represents 12. 5% of the available global workforce just a click away. Meanwhile, 70% of Gen Z are lately self-employed or have plans to do so in the future.
More than individuals, the way corporations access and manage their workforce is shifting from an analog to a virtual world, driven by the rise of skills platforms. I call this the shift to the Human Cloud, because just as the shift to cloud computing required intermediaries and programs like Salesforce, AWS, and Azure, workforce change is being driven through more than 800 skills platforms, each specializing in skills, industry, and regional expertise.
Companies and Americans recognize the importance of skills platforms. 40% of freelancers have worked on skill platforms in the last 12 months and 47% plan to work on skill platforms in the next 12 months. Meanwhile, Harvard Business Review’s Building The On Demand Workforce report states that “nearly 90% of business leaders’ skills platforms would be somewhat or very important to their organization’s long-term competitive advantage,” and a study MIT Sloan Management Review and Deloitte’s 2022 joint report reported that 86% of global business leaders say effective monitoring of external participants is critical to their organization’s overall performance.
However, the adoption of independent skills platforms has been as widespread as cloud computing or as attractive as recent advances in AI. Human Cloud Trend Tracker data (Q3 2024) shows that only 39% of skills platforms cite positive business performance, while only 39% of skills platforms cite positive business performance. 5% of skills platform leaders say they have “succeeded” in attracting consumers (a decrease from 26%). It’s just about the independent economy. Technology has had a difficult year, with the New York Times reporting that the United States has created 818,000 fewer jobs than previously announced in the past 12 months.
So where does freelance, specifically the self-employed workforce and talent platforms that source, manage, and scale self-employed workforces stand? Will talent platforms realize their 16.5% CAGR from 2023 to 2030 estimated by Grand View Research?
The generational adoption lifecycle is a maturity curve for promising industries.
Technology Adoption Lifecycle
It describes the relationship between what types of leaders and organizations, and at what stage, adopt a technology. Early adopters are generally smaller, more risk-tolerant, comfortable with uncertainty and lack of standardization, and make an investment in foresight than in a product or service shown. While most require standards, more productive practices, and a physically very powerful ecosystem.
In the case of skilling, independent skilling platforms are a generation that creates a paradigm shift in the relationship between the employer, the worker and the existing external skilling ecosystem. This is a significant change, and reaching adulthood requires overcoming the narrative that “no one gets fired for hiring Accenture. ” But this is unprecedented.
Olivier Nguyen Van Tan, Chief Marketing Officer at Malt and former Vice President at Salesforce, says the maturity of the human cloud is “no different than the early stages of shift to cloud computing. At first, it’s startups and small teams within large enterprises adopting. Then it becomes the standard and companies that don’t embrace it get left behind.”
A common example is Netflix disrupting Blockbuster by embracing the cloud before Blockbuster and building a transparent moat that Blockbuster may not overcome. In the case of skill, the accusation of not adopting independent work is futile because the skill is limited. There is not an infinite amount of capacity, because there is an infinite amount of cloud storage. Therefore, for leaders, failing to build their freelance skills pipeline can be devastating in the coming years.
So what do small businesses and startups say about freelancing? I spoke to more than 30 business leaders last month: from Omaha Steaks to Microsoft, Airbus, and fast-growing startups. This article is the start of a series showing how environment leaders see the future of freelancing within companies.
Kartik Ahuja, Founder, CEO & CFO, GrowthScribe (US)
Freelancers play a vital role in our skills management strategy. In the past, we have continually encountered obstacles when we could not locate an express skill set locally. By hiring freelancers, we can leverage global capacity, thereby accelerating task timelines and improving the quality of our services. From experience, this provides us with exclusive perspectives and experiences, making our paintings enriching and more innovative. Additionally, freelancers come from other countries, adding a wide diversity of cultural perspectives to our assignments. This promotes creativity by allowing us to approach disorders from multiple angles. By incorporating diverse cultural nuances, our campaigns are more effective in reaching a global audience. On the other hand, it promotes inclusivity, contributing to an adaptable, varied and open-minded pictorial culture found in today’s global pictorial environment.
Chris Yang, co-founder of Coins Value (United States)
Freelancers turned out to be a turning point for Coins Value. Partnering with a network of independent professionals has allowed us to temporarily boost our content creation, online page progression, and knowledge research capabilities. This helped us launch new features successfully while keeping overhead low and the team agile. Furthermore, freelancing platforms and remote execution provide an excellent opportunity for companies to connect with the most sensible skills around the world. By embracing this trend, organizations will open themselves up to a more varied skill set, encouraging innovation and artistic challenge-solving within their teams.
Michael Olsen, co-founder and CEO of Mailbird (Denmark)
When we founded Mailbird twelve years ago, as a US-based company, we couldn’t hire actual employees from abroad. So we built a team of independent contractors – all working remotely from around the world. Relying on a team of 30 independent contractors, we have never had the need to have an employee. Among the many advantages of this approach, the one thing that’s hard to beat is the access we have to tremendous talent around the world that has helped us grow through the years. Also, people have flexibility in how they handle their taxes and can decide whether they want to start their own company or not. Not to mention the lower overhead and the fact that we can quickly hire a freelancer to tackle an urgent project, or scale down in an area when we need to focus on another.
Becky Read, VP People, Focal Point Positioning (United Kingdom)
At FocalPoint, freelancers offer much more than just technical skills: they bring new perspectives, creativity and innovation. As a specialist GPS-based technical company, leveraging freelancers and contractors is critical to our success. This technique allows us to remain agile while accessing the specialized global expertise we need, whether for short or long-term projects. By expanding our network to include independent professionals around the world, we have leveraged the agile and specialized wisdom that is essential. to our growth. We also benefit from freelance experience in public relations, marketing, internet design and content creation. This allows us to stay focused on our key strategic priorities, while trusting our contractors to deliver exceptional results.
Valerie Khayutin, North America CEO of BADESOFA (Germany)
For the past two+ years, my team has been operating fully remote and globally, and the majority of our skill set are freelancers and independent contractors. This technique gives us the flexibility to try other strategies, adjust resource allocation in reaction to seasonal demand, and have the kind of localized insights essential for marketing strategies. The freelancer’s ability works with other corporations in the same industry, bringing valuable knowledge and connections that a classic in-house team might not have. In my experience, the most productive team effects are achieved when a combination of internal staff and contractors is treated as a unified team, with normal meetings and shared communication channels.
Debora Lima, Managing Director at Sensei Advisory (United States)
Adopting a style that combines a small core team of full-time workers with a roster of global freelancers, hired out as needed based on new clients or the desires of new clients, has been instrumental in the evolution of our company. When Sensei launched in 2020, our team consisted of approximately 10 full-time workers. We went through a restructuring phase and once I moved into a strategic management role about a year ago, I chose to adapt an ad hoc freelance hiring style to cover our entire small team. you can just handle it. As a strategic consulting and communications company with offices in the US and Europe, the next step is to tap into the developing pool of world-class independent talent. Today, Sensei has 3 full-time workers besides me; For everything else we rent freelancers.
The shift towards a global freelance workforce marks a transformative moment in staffing and business operations all around the world. Like how AWS enabled thousands of startups to outcompete, scale, and eventually replace or merge with incumbents, the Human Cloud enables all businesses access to the most important asset: top talent.
Based on our interviews with startups and small businesses, some similar themes continue to emerge to the strength of indie platforms and more sensible talent.
The first theme is access to the most sensible skills from around the world, allowing companies to have a diverse skills pool that unlocks expertise and new sources of profit through the policy potential of the local market. In the words of Kartik Ahuja of GrowthScribe: “With freelancers on board, we have served clients in regions we never imagined. People in certain regions understand the local market, language and cultural preferences, improving our ability to serve consumers in those regions. This localized experience is gold, no matter what industry you represent. This occurs in today’s global economy, as AirBnB recently stated in its second quarter earnings report that “Latin America and Asia Pacific remain our fastest growing regions. Instead of opening an office in LATAM, companies can access Torc for the smartest software developers in LATAM, Ollo for the smartest creatives in LATAM and myBasePay to compliantly scale a freelance LATAM workforce in Asia, businesses can access. to Ravenry for market research, to Talmix for business consultants and to Superson for creative, or Expert Powerhouse for subject matter expertise. Even for a sector as specialized as oil and gas, Trees Engineering can hire independent engineers in the field. Southeast Asia.
The current topic is scalability while maintaining agility, flexibility and load capacity. Instead of long, monthly, risky full-time hires, freelancing is a fast, low-risk, and elastic way to scale based on market demands and productivity requirements. Chris Yang of Coins Value said: “A network of freelancers has allowed us to temporarily boost our content creation, online page progression, and knowledge research capabilities. This helped us launch new features and facilities successfully, while keeping overhead low and the team agile. For this reason, independent monitoring is a rapidly growing solution for companies of all sizes and regions. As a Forbes reader, you’ve probably heard of remote payroll and compliance responses like Deel, Remote, and Rippling. But Mellow is an independent compliance, payroll and control formula that specializes in hard-to-reach locations and uses a transparent payment of 2% for every independent dollar spent, allowing the security of compliant escalation and exact control of your charges. . .
The third theme is the high-quality experience. This is arguably the biggest impact on the freelancer economy, as freelancers now have the precise credentials, portfolio, and experience that allow startups to avoid the usual onboarding time and costs. Even if freelancer networks have impressive technology, the surprising attitude of a company usually emerges in the first 2 to 5 days, when skills platforms offer the first circular of available freelancers. The typical reaction is something like, “We can actually access this point of experience at a fraction of the cost,” only to feel more inspired when the task is done in a fraction of the time.
So what do you think? Whether you’re a startup, small business, or enterprise, does your organization have the strength of independent networks?
In the next article in this series, I’ll go over the large enterprise executives’ view of the freelance economy.
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