The Gig Economy, India and SHRM Tech 17

The Gig Economy, India and SHRM Tech 17

By Jeremy Ames, with contributions from Leon Sariah

A couple of months ago, my friend and colleague at SHRM asked me for the most noteworthy topic to explore as she embarks on her first trip to India, her destination being the SHRM Tech Conference in Hyderabad. Having served as closing keynote speaker at the inaugural 2015 version of the event in Mumbai, I first offered some logistical advice. Then, after careful consideration, and hopefully in the nick of time, I’ve settled on a topic: the Gig Economy.

Background

Fueled by intense demand of organizations for contracted jobs or job functions as well as a burgeoning supply of independent workers available for short-term or long term engagements, the Gig Economy is taking the business world by storm. Here in the US, studies predict that by 2020 more than 40% of the workforce will be made up of independent contractors.  The rise of these job types is due in large part to the Digital Age and also to the fact that mobility has allowed people to work from basically anywhere. Other than the obvious, yet substantial, savings on employee benefits, there are also operational savings. No longer is there a need to bring someone into the office, supply them with a computer, desk and office supplies and pay for the utilities consumed by the employee.

As more and more of that money falls off of budgets, it’s becoming increasingly difficult to justify restoring it. Additionally, competitors of the early adopters have picked up on the effect on the bottom line and are following suit.

India – The Center of the Gig Economy

India was the original offshore resource pool for the United States and other countries. Many geographies have followed suit, but as we stand here in 2017, almost 20 years since offshoring really started to take off, India has been a clear leader and doesn’t show signs of slowing down.

My own work with India spans those same 20 years, framed at the start by undergraduate studies and at the midway point by an MBA, both of which entailed detailed analysis of the phenomenon. The overall recap is that there’s much more than meets the eye in the outsourcing of work to other companies, and particularly to talent halfway across the world.

For now we’ll just examine current state, starting with points made by some of my trusted Indian colleagues:

  • “Contract work is still increasing in India. More and more people are working independently.”
  • “The work you get is related to contacts and trust.”
  • “Things have shifted where small companies are seen as learning opportunities. That trend of working on multiple things at once is growing.”

So, what exactly does long term and sustained offshoring have to do with the Gig Economy? Well, it actually results in the Gig Economy itself. Workers gather specific skill sets on particular products, and particular verticals. That makes them more valuable in some companies over others, some projects over others. What else does it do?

It increases mobility. It emphasizes the value of skill set over tenure. It means that people are constantly moving around to acquire new skills, sometimes resulting in higher wages for specialized skills and other times less pay in exchange for a bullet point on their resume that will be valuable on the next gig.

Growing Possibility of Working from Home

At SHRM Tech 2015, a major concern expressed about the telecommunications infrastructure seemed to indicate that it couldn’t adequately support remote work. However, according to my sources, that situation is much improved in just this short span of time. “People are now able to work from their home towns, especially with 4G coming into the picture,” said a colleague, who had just wrapped up a call with a client in California from his home. This concept of “home towns” is especially relevant in India, where the large cities are becoming less-and-less affordable for the average worker, and not big enough to sustain the immense population.

The Middleperson

On most projects originating in India, it’s up to the project manager to hire contactors. The large companies don’t hire contractors directly, so they work through firms that have gathered the resources. Tata Consultancy Services is an example of a huge company providing these resources, but there are many more consortiums of contractors being represented by small companies.

HR Tech in India – The Disconnect

What’s amazing about the gigs that are specific to the HR Tech space, and likely the same in other industries, is that much of it doesn’t result in products that are actually being used in India itself.

Rather than buy the more expensive outputs of their labor, companies tend to use internally grown software or locally grown (and hence less expensive) software. Ramco and Empextract, which has grown in small to medium companies, are examples of commercial systems Indian companies might buy.

Long Hours?

When you work with India you begin to wonder when they sleep. It’s extremely common to be on a teleconference with them past midnight IST. The Gig Economy does seem to be having a profound impact on the amount of hours worked, whereby workers are taking on more concurrent jobs. The people who have skill sets in front end development (angular, css, etc) are most likely to take on part-time gigs.

However, on each individual job, it does seem that the work hours themselves are still managed. Big companies have shift systems, where second shift is typically 1PM-10PM.

The key to maintaining enough sleeping hours seems to be in the late starts, which are sometimes lined up with work being outsourced from North America or other world locations.  Of 7 people surveyed, the average length of sleep was 6 hours, which lasted from roughly 1-7AM. Start times tended to be in the 9-11AM range, which also accommodated long commute times when working from home wasn’t an option. What wasn’t really discussed was the effect on social, non-working time as a result of the side work being taken on in the Gig Economy.

Not All Roses

Despite the benefits, there are many downsides to the Gig Economy which could comprise an entire series of articles. Among them:

  • Being disconnected from a company’s vision
  • Lack of full attention to the contracting company
  • Lack of benefits being received by freelancers
  • Challenges in maintaining a consistent cash flow

What To Ask

Clearly the Gig Economy is thriving worldwide, and especially in India. It is meant to offer the freedom to work from anywhere, to acquire and practice new skills, and to select from a worldwide talent pool. It gives businesses the ability to hire experts at a cheaper cost than putting them on staff full time. Beyond India, it also offers opportunities for skilled work in areas of the world where it was previously scarce.

What I’d ask my SHRM colleague to investigate further while she’s there is:

  • How are these temporary workers being managed in HR systems? Are the home grown systems and commercially available systems like the ones I mentioned doing an adequate job of tracking them, or are certain functions like talent management being sacrificed due to the mobility factor?
  • Is sleep deprivation more prevalent than I uncovered in my interviews and what has the Gig Economy done to social lives?
  • Is there a trend towards using more of the software produced for international companies?
  • What other HR-related challenges and opportunities has the Gig Economy presented in India.

What I mostly hope is that she, and other attendees coming over from the US (like Josh Bersin and Stacey Harris), have as insightful and amazing time as I had while I was in India with some genuine, wonderful people.

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ABOUT JEREMY AND HIVE TECH HR

Jeremy enjoys exploring the HR Tech market, domestically and internationally. He is CEO of Hive Tech HR, which helps its clients find and implement HR technology. He was CFO and Board Member of IHRIM and sat on SHRM’s HR Management and Technology Expertise Panel.

Again, check out his 2015 experience here

Email him at jeremy.ames@hivetechhr.com

Follow Jeremy @jeremyallynames

Follow Hive Tech HR @hivetechhr

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