“The right talent, in the right place, at the right time, is the equation for success in today’s world.” – Building the On-Demand Workforce, Harvard Business School & BCG.
Researchers from Harvard Business School and Boston Consulting Group conducted interviews and surveys with over 700 business leaders on how they viewed on-demand talent platforms in relation to building flexible workforce and teams. The results from those interviews surveys were published in Harvard’s Report titled Building the On-Demand Workforce.
“As early-adopter companies have become more comfortable with shopping for talent in these digital marketplaces, they have begun moving toward new, more flexible, agile organisations—ones that are built not on fixed costs and head counts but on a blended mix of full-time and part-time workers: the ‘on-demand workforce,’” according to the report.
The benefits of the on-demand workforce, the authors write, include increased labor flexibility, accelerated speed to market, and innovation through new business models. At Talanta.co, we’ve seen the market for on-demand talent booming as organisations — under pressure from competitors, new technologies, and a global pandemic — rethink their strategic workforce planning priorities. The study confirms what we have always believed and seen first-hand.
Not only that, but half of all business leaders expect to work more with on-demand talent platforms in the future, and 60% said they would prefer to rent, borrow, or share talent with other companies.
That means most business leaders are looking to move quickly into new markets and products, and anticipate adopting an on-demand talent sourcing approach to workforce planning. Their reasons go well beyond cost-cutting and improving efficiency, according to the study.
“The survey showed that, increasingly, companies expect to use new talent models not just to improve performance within the confines of their current business models but also to experiment with new business models built around using an on-demand workforce. Certainly, a majority of C-suite leaders shared that vision for a future that relies on new talent models,” the study reveals.
Increased utilisation of talent platforms to access high-skills talent. Nearly 60% of business leaders reported significantly increasing the use of crowdsourcing innovation platforms. Source: "The On-Demand Workforce Survey," Harvard Business School's Project on Managing the Future of Work,
While overall enthusiasm for on-demand talent platforms is notable, researchers found a mismatch between C-level executives and frontline managers, many of whom are less optimistic about moving toward a flexible workforce. In fact, CEOs were twice as likely as frontline managers (VP and Directors) to predict their usage of on-demand talent platforms would grow in the near future. The researchers point primarily to a split between business leaders and the human resources functions at their organisations.
“The survey showed clearly that human resources departments were only doing what they were tasked to do: hire, evaluate, and compensate employees within the jobs, laws, and company systems as they are currently defined. In conversations with companies where on-demand workforces were being blended in more successfully, we sometimes heard that it was despite HR, rather than because of traditional HR,” according to the report.
Perhaps HR isn’t to blame. Giving up decades of tradition and culture is difficult, and many frontline leaders are wrestling with the challenge of implementing a new talent model that fundamentally alters the reality of how work gets done and by whom.
That’s where on-demand talent platforms need to step up. Large-scale talent transformation requires more than just a directory of available experts and firms. 25% of business leaders report complexity in identifying, evaluating, and selecting the right talent sourcing model.
Organisations also need to build the capability to work with on-demand talent platforms in accordance with their own legal and compliance requirements. For most, that will mean partnering closely with a platform partner that offers enterprise support via master service level agreements, job classification services, demand planning, and more.
Finally, the researchers say, the adoption of the flexible workforce should be driven by a C-level leader within the organisation. While they remain agnostic about the functional area responsible for leading, the important part is to lead from ahead.
“To be successful, the change requires a leader who models the new capabilities required of all employees—a leader with the ability to recognise and shed the constraining dogmas of the past and the eagerness and creativity to embrace the possibilities of the future,” according to the report.
The world is moving to new talent models, driven by technological advancements, cultural changes, and the profound impact of the COVID-19 pandemic. Smart organisations are already working with trusted on-demand talent platforms to build their internal capabilities and manage a blended workforce of in-house and on-demand talent.
While the changes necessary to build these capabilities may seem daunting, the research is clear that the value far outweighs the cost. Or, as the study from Harvard Business School puts it:
“Companies will find those costs worth bearing when they realise how on-demand freelance talent can be essential to their continued viability. To harness the full potential of an on-demand workforce, companies will need to embrace the disruption of digital talent platforms, just as they would reorganise while adopting any important new technology.”
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