The Rise of Gig Work Demands Managerial Reinvention

Standard top-down management techniques won’t work for a fluid and piecemeal workforce.

In 1944, the Office of Strategic Services (which later became the CIA) released a secret pamphlet designed to teach partisans living in Nazi-occupied Europe the best ways to resist, by showing how everyday people could help undermine the German war effort.

The “Simple Sabotage Field Manual,” declassified in 2008, says rebellious office and factory workers should “talk as frequently as possible and at great length,” “hold conferences when there is more critical work to be done,” and “bring up irrelevant issues.” Other tips include “When training new workers, give incomplete or misleading instructions,” “Tell important callers the boss is busy or talking on another telephone” and, finally, “Try to commit acts for which large numbers of people could be responsible.”

OSS document or corporate management playbook?

The document, designed to help cripple the Nazi war machine, also reads like the management guide for many companies you’ve probably worked for.

While that top-down and inefficient strategy was standard management operating procedure for decades, it simply won’t suffice anymore. One thing pulling it apart is the rapidly growing part-time and piecemeal gig economy.

A report by Freshbooks, a cloud-based accounting company, says the number of self-employed workers could triple, reaching 42 million by 2020, with millennials leading the pack. Freshbooks reports that 97 percent of self-employed workers don’t want a traditional 9-to-5 job, which could indicate a dramatically shifting view on work, particularly among the young. “Americans are increasingly disillusioned with the notion that a successful career means climbing the corporate ladder,” FreshBooks CEO Mike McDerment told Quartz. “The real significance is the mindset shift of the American workforce.”

For employers, the proposition of on-demand employees is tempting: a flexible workforce that expands and contracts as your work needs do, without the longer-term commitments that come with permanent staffers. Contingent workers, meanwhile, have the freedom of setting their own schedule and avoid getting stuck with an organization they don’t like.

This changing nature of the workforce will have a huge impact on both business and management strategies. Firms like TaskRabbit, Uber, Postmates, and dozens of others like them are not workplaces so much as free-wheeling labor marketplaces, with a highly distributed and malleable workforce. “The most valuable assets of a 20th-century company were its production equipment,” said management guru Peter Drucker in 1999. “The most valuable asset of a 21st-century institution, whether business or non-business, will be its knowledge workers and their productivity.”

If Drucker was right (as he so often was) what happens when that “most valuable asset” is no longer tied to your company, but shared?

Challenges, changes, but a reliance on fundamentals

The result is a relationship challenge for both sides, one that requires continual readjusting and retraining. “All companies are going to have to think about investing more in training,” said Susan Lund, a partner at the McKinsey Global Institute, in an interview with Reinvent. “All companies are going to have to think much harder about building and creating the talent pools they need as opposed to expecting to be able to hire people with exactly the set of skills and experiences they need.”

Lund: management and worker retraining is needed.

Despite these foundational changes, certain bedrocks of business should remain for employers. Job candidates for a temporary role, for instance, should interview with both management and potential colleagues to see how they’ll fit in with the team. The expectations and metrics for success for a contingent role should be clear, to manage expectations on both ends and avoid risk of legal troubles later on. Have a contract in place, not a handshake.

To foster a sense of community, companies need to ensure that gig workers feel like part of the full-time crew. Temporary workers are often not included in planning session or even social events. It’s a shabby attitude, implying that they are just hired guns. When you’re done with them, they’re gone. No one will do their best work under such conditions.

Employers could provide online zones where their freelance contributors can meet, swap stories as well as exchange ideas and best practices. A virtual water cooler, if you will. There are a lot of ways to do this: online boards like Slack, group emails, weekly group phone conversations with your gig workers.

Employers could provide online zones where their freelance contributors can meet, swap stories, as well as exchange ideas and best practices. A virtual water cooler, if you will.

Contingent workers must also feel like their contributions matter. The need for recognition and feedback is a fundamental human desire. Freelance workers, particularly those in demand, want to do assignment that both pay the bills and give them joy. These workers have the confidence to turn down jobs that suck their energy. A report from the Harvard Business School sums it up nicely: “Unshackled from managers and corporate norms, people can choose assignments that make the most of their talents and reflect their true interests. They feel ownership over what they produce and over their entire professional lives.”

Above all, treat gig workers fairly. Gig workers are looking to do a good job and get paid for that work. Companies that simply treat them as vendors or hired hands may lose a valuable future contributor. Top talent needs to be retained, then added to more challenging assignments, not let go at the end of the gig. The longer you can retain good workers, whether full-time or freelance, the better off you’ll be. Remember that gig work is here to stay. The future you save may be your own.

For more, watch the full interview with Susan Lund.