I went out on a recent Friday night. I met a couple of friends at a bar and had some drinks. Some of us (not me) had a few too many drinks, and since some of us (again, not me) drove, we had to take a car service home. My friend kept saying “we’ll Uber home, Uber is great!”. Irony of Ironies, she was actually using Lyft, not UBER. In that same vein, my son continually asks to use my iPad (it’s an Android tablet), and he’s not the only one technology confused. Even after spending $400,000 for placement microsoft found out that their Windows based surface tablet is talked about as just a ‘knockoff ipad’. There was a period in my life when every craptactular cable company was a TiVo. Although the idea of DVR’s as a thing has now been replaced wholly by Netflix. The point of this post isn’t really to discuss the generification of brands , it’s to comment on Uber, Lyft, et al. as it relates to the regular full time employees, and what it means for the professional individual contributor class.
Back in the earlier part of the industrial age the majority of jobs were based in traditional manufacturing. You were a full time employe or a part time employee. You could be a temp worker known as a contractor. Over the decades rules were designed around these classes and safeguards were put in place for the employee. An organization that treated a contractor like an employee was – in theory – forced to offer the benefits of being an employe to the worker. If a company wanted their cake (on demand workforce) and eat it too (meet legislated workforce regulations) they just paid a premium and used a staffing agency. Clearly the demand was there for this sort of arrangement as there are staffing agencies that cover every spectrum of the workforce including professionals. Now Uber and it’s ilk have created a new class.. The ‘gig economy’.
There are two big points to the fast company article. The first point is how Uber (and its contemporaries) are moving faster than the world’s governmental agencies to create this new on demand workforce. The employers of the giggers are learning how to manage them, and how to get all the benefits of direct control over employees without all high cost requirements for keeping the employees on the payroll. This first point is researched and explained far better by the author of the fast company article than I could do in the limited amount of time I have here. In effect it is the old channel partner of risk shift taken to the extreme.
I think the next point, the point I can make here that wasn’t really driven home (heh) in the Fast Company article was the idea that the software is managing everything. The software is doing the logistics, it’s creating the scheduling, it’s applying the incentive to the individual drivers. Heck the software is even doing the training and oversight. In effect the software has become the middle management layer. The formal term used by the researchers at Carnegie Mellon University is algorhythmic management. The key word there is management. This then becomes another great story about how what professionals used to do, provide the management layer to the work force, is being subsumed by data. If your a good fast driver, your safe if underpaid. If your a logistics expert, not so safe. If your a software programmer, then your safe… maybe.
This article was very interesting to me because it speaks to several of my expertise areas. I’m a data guy, I have a masters in information technology. I love technology and I am always on the cutting edge with my personal tech, or at least on as much of the cutting edge as my budget will allow. Interestingly enough, I’m also a workforce guy. I’m the guy who is part of the team that has to pick up the pieces when a large group of people are laid off. Finally I’m a business guy, I understand the needs and demands of the business world. I get all the complicated elements that go into the trends of the modern business climate, not the least of which is the influence of wall street in a marketplace that includes world wide competition.
There is a very real business case and a technically seductive nature to the data driven and automated business models managing
employees, contractors, partners, giggers. There is also a real social benefit case to be made for a distributed risk health care system (currently employer provided health care) and a solid retirement system that came with traditional employment. If you really want to get into the nuances of it, there is a huge business benefit as well.
The one thing the gig economy isn’t bringing is more middle management or even professional individual contributor jobs. In short, if you read through the lines, this is another story reinforcing the trend of the PIC not having anywhere to go from a career perspective, and it’s complicated by a shrinking base of options in their current job categories. It doesn’t look like it’s going to get better anytime soon.
I guess if there is a workforce reduction in the professional layer, then at the very least PIC’s can make lessen the impact between jobs by being an
Uber Lyft driver.