9 min read.Updated: 13 Aug 2020, 08:15 AM ISTGoutam Das
In a pandemic-induced rush to cut costs, firms are hiring managers on short-term contracts. Is it here to stay?
Of course, all this does not mean that permanent hiring will shrink in a jiffy—80% of the new organized sector jobs could still be long-term in nature
Recently, Shiv Agrawal, managing director of talent recruitment company ABC Consultants, posted what appeared to be an employee-readiness survey on LinkedIn.
“Several of our clients are embracing the idea of hiring experienced professionals on a project, part-time or advisory basis," he wrote. “I am keen to understand if senior- and mid-management professionals are open to this model of employment vis-a-vis traditional, full time jobs in the long term. Your thoughts?"
“This kind of model works best for people like me who deal with designing turnaround strategies. In a turnaround and bankruptcy kind of assignment, we go in, help the company for 6-12 months and move out once the job is done," one of the respondents wrote. Yet another comment pointed to a CEO-sharing model in Europe where time is split between companies. “These CEOs work in more than one company. However, they ensure that the two different companies they work for are not competitors."
India probably hasn’t seen CEO sharing, yet. Nevertheless, in the rung below, C-suite sharing (CTO, CMO, or CFO) is increasingly on the cards.
The post covid-19 world has meant multiple things for the hiring world. The demand for niche skills hasn’t dipped much. Companies, more than ever, require talent in digital product development, in analytics, and in cyber security, for instance. At the top end of the organisational pyramid, companies require senior hires or those who can help tide over stormy weather.
In these cases, candidates set the terms because there is less supply and the roles are specialised. Having cut both employees and salaries as soon as the pandemic hit, companies are now worried about organisational parity in pay. Gig arrangements, where independent workers are hired on short-term contracts often through a digital platform, are a way out.
There is a clear shift towards lowering fixed costs. When gig workers are hired, companies often save on infrastructure and managerial expenses. That is why alternative models of employment are expected to be on steroids this year, further bolstering the overall addressable market in India’s gig economy, estimated at $3.4 billion by Invest India, the country’s investment promotion body.
K.R. Shyam Sundar, labour economist and professor of human resources management at XLRI, estimates that in the organised sector, for every 10 new jobs created, going ahead, two could be on short-term contracts.
And what started with delivery boys and Ola drivers—the blue-collar—has quietly spilled over to the white-collar. Flexing It, a company that connects organisations to white-collar professionals on an on-demand basis, said that the value of projects facilitated through the platform in 2019-20 grew four times with consulting and large corporates being the main drivers of demand. Covid-19, the company believes, will meaningfully accelerate growth.
“We are expecting that the pandemic will provide a strong tailwind to the gig economy. In the coming months and years, we are going to see rapid growth in both demand and supply," Chandrika Pasricha, founder and CEO at Flexing It, said.
C-suite sharing, as exciting as it sounds, is in its infancy. At the moment, models that connect the bottom and middle of the employee pyramid are widespread. A few digital platforms connect workers to projects directly. Then, there are companies who have positioned themselves as project management partners. They take up large projects from an enterprise and have a distributed network of gig workers execute them.
Of course, all this does not mean that permanent hiring will shrink in a jiffy—as Shyam Sundar indicated, 80% of the new organised sector jobs could still be long-term in nature. The future of work will probably be a fine blend of the permanent and the flexible, the generalist and the specialist.
“In a post covid world, new gig and on-demand staffing models will emerge to fill business needs. However, companies will move to a hybrid model of splitting their staff into core and non-core," Rishi Khiani, founder and CEO of KaamPe, a new job platform, said. “There are certain roles where you really need the corporate culture, need people wedded to the business, need the generalists. Then, there is going to be on-demand on the specialist-side," he added.
A shared future?
Back to Shiv Agrawal’s post on LinkedIn. After gauging the responses, he does believe that senior talent is ready to work like independent contractors. “Traditionally, people start thinking of doing consulting or gig roles once they hit the mid-50s because they may not get a full time job. They may have started doing this earlier," he told Mint. “I think career gig workers will emerge in India where you would see more people saying that they don’t want to be constrained by organisational politics."
One manifestation of C-suites looking for gig assignments could be a dual employment model where they work for two or even three companies—a micro and small enterprise, for instance, could find it tough to hire a top chief technology officer but it gets affordable if the CTO is a shared resource. This is similar to being a consultant, albeit an engaged one. Platforms facilitating this model are in business. Cohire, which started in 2020, is one company taking a shot.
“I could be a chief marketing officer with a company in the automobile sector and also one in the healthcare domain, which have no connection with each other. The cost gets divided," Vineet Arya, founder of Cohire, said. “It takes four to nine months to search, locate and hire a manager for any organisation. We have got a panel of people with C-suite level experience. We can make the match almost immediately," he added.
For the small company, there is no liability on the balance sheets—if it’s not working, the exit is as easy as the entry. Arya said that there are about 15 companies Cohire has worked with on an Uber-sort of a model. It keeps about 20% of the pay.
The direct way
We have a moral duty to create an immigration system that protects the lives and jobs of our citizens," President Donald Trump said on June 22, as he extended the pause on new immigrant visas, H-1B included, up to December 2020.
Nonetheless, work visas used by Indians were getting constrained even in 2018, when Snehil Mathur graduated from Northwestern University in Chicago. She didn’t find an employer willing to sponsor a visa and moved back to India. “That’s when I came across Kaam.work. They got me access to Advance Auto Parts (an automotive aftermarket parts provider in the US). I analyse marketing data," Mathur said.
Kaam.work is a job portal that facilitates hiring from anywhere in the world. Mathur is not a gig worker—she works full time as a senior data analyst from a co-working centre in Bengaluru. There is a breed of mid-sized business in the US that finds it expensive to outsource work to Indian IT exporters. Nevertheless, firms can still hire Indian talent independently. In the post-pandemic world, where free movement of people is under strain, platforms that allow access to talent regardless of the country could receive far higher traction.
“Historically, companies in the US went to an outsourcing company or operated out of a build-operate-transfer (BOT) model. You always needed a bridge to access talent in India. The large companies set up their own campuses," Nilesh Parwani, founder at kaam.work, said.
“We are removing that middle layer and making it an open platform. Candidates apply to the company directly. Second, we are creating a universal language for hiring. The applications are standardised in one format which becomes very easy for a company to compare when hiring cross borders," he added.
Many companies do prefer to hire talent directly. Consulting firm EY, for instance, launched a platform called GigNow two years ago to access talent for short-term projects.
Ramandeep Kaur Chug currently lives in Bhopal. She moved four towns ever since she got married in 2004—her husband has a transferable job. “I lived in Indore for a while where I worked as a technical trainer for Teleperformance, a business process outsourcing (BPO) firm. However, many of the smaller towns didn’t even have a BPO for me to work," she said. Remote gigs suited her.
Sheroes, a women-only social network and a platform for remote work, deployed her in projects with Zomato, where she verified delivery boys. Next, she was signed up for a project with student accommodation company Oxfordcaps where she responded to queries and concerns from students looking for accommodation. She made about ₹22,000 a month.
Sheroes functions like a project management company. It aggregates demand from customers such as Zomato on one side and supply of women gig workers at the other end. The gig workers do their bit but, eventually, Sheroes is responsible for overall delivery of a project.
The skills are standardised. Anyone with a phone, a computer, and basic operational skills can potentially pull off the work that Ramandeep did.
Sairee Chahal, CEO of the company said that a corporate can save up to 40% in capex and managerial costs a year using her gig model. “To manage a 500-people workforce, a company may need a team of 10. However, in our case, we can do it with one manager. That’s because we take away the layers of inefficiency. There is increased ownership from the gig worker doing the work and we take a lot of time bringing the person on board," she said.
Yet another company that functions like a project management firm is Awign. The company’s co-founder Annanya Sarthak prefers to describe his company as an “execution partner" because the nature of his projects are recurring and not one-off. He works with companies like Oyo Rooms and complex tasks are broken down into simpler micro-jobs to be picked up by gig workers.
The focus, unlike in Sheroes, is on physical work such as audits, demand aggregation, and supply aggregation such as on-boarding merchants for e-commerce companies. Customers are usually billed based on measurable outcomes.
For Oyo, Awign manages a revenue leakage audit where gig workers physically visit hotels to investigate if bookings are accurately disclosed. “Oyo extrapolates the data and bills a penalty to the hotels at the end of the month if there is a slip. We bill Oyo whenever we complete an audit," Sarthak said. Awign, the co-founder added, has worked with over 150,000 gigs thus far and completed more than five million tasks.
In the post-pandemic world, the emerging hiring platforms will serve an important purpose. Not only will they connect talent to work, they would also handle prickly issues such as payments. Freelancers have for ever complained of delayed payment cycles and it gets worse during an economic crisis. And yet, there are risks.
Anubhav Raina worked with McKinsey before turning into a gig worker in 2019. He takes up freelancing projects around strategy consulting. For those pinning their hopes solely on the platforms, he has advice. “The entire client outreach is reliant on another human being or another platform. Like in any business, you want to control access to the customer as much as you can. From a long-term perspective, the goal should be to have a healthy pipeline of your own customers," he said.
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