The Tectonic Shift from In-House to On-Demand Talent is Transforming the Consulting World

Articles

HCLI Research

Published 9 October 2017

Technology and Digitisation. A highly wired, agile and mobile workforce. The emergence of the millennial generation. These three are all rapidly changing the rules of the employment game.

The traditional employment model focused on filling capability requirements by hiring people, full or part time, to work for the company as employees with the clear expectations of a livelihood and career is being disrupted and turned inside-out.

A recent study by Intuit predicted that by 2020, 40 percent of American workers would be independent contractors by 2020; one-third of the management consultants in the UK are working independently, and McKinsey has estimated that up to 25% of the workforce in developed markets is already engaged in independent work.

The term ‘gig economy’ is often used to describe this phenomenon. According to one definition in a BBC article, it is “a labour market characterised by the prevalence of short-term contracts or freelance work, as opposed to permanent jobs”. In the gig economy, instead of a regular wage, workers get paid for the “gigs” they do, such as a food delivery or a car journey. This is however not a new phenomenon and has existed since the early 1950s – Hollywood and Bollywood were pioneers in using this concept of on-demand specialist talent.

In the UK, it is estimated that five million people are employed in this type of capacity. Proponents of the gig economy claim that people can benefit from flexible hours, with control over how much time they can work as they juggle other priorities in their lives. However, it has its fair share of detractors (and there is a significant percentage in Britain) that claim it is a form of exploitation with very little workplace protection.

The gig economy is often referred to open talent economy, a term largely attributed to Deloitte Consulting. The open talent economy is a way to work or conduct business in a borderless and technology-enabled market. More precisely, it is a marketplace where businesses and professionals seek each other out to collaborate for a particular project or achieve specific, pre-defined business objectives.

Cost-cutting measures, retrenchments and a slowdown in both regional and global economies have contributed to the rise of professionals opting for flexible arrangements, sometimes by design and sometimes not through choice. Speed of change and innovation is also a key driver – it is almost impossible to predict all the skills an organisation will need in advance. Traditional hiring processes are too lengthy and cumbersome to meet dynamic needs. All this creates demand for on-demand talent.

Employers gain the depth of skill-sets on a flexible basis and it is a win-win for both the company as well as the independent consultant who maintains a balance of personal and professional aspirations.

In Asia, unlike the West, the concept of the open talent or the gig economy is in its infancy though it certainly is part of a shifting cultural and business environment. Some recent indicators are Singapore’s SkillsFuture programme, where government agencies offer training for citizens to learn new skills for short-term projects. Participating in the gig economy is gaining in popularity in Asia. According to a PwC report, the “desire for autonomy is strongest in China, especially among young people, indicating a generational shift towards greater freedom, entrepreneurship, and specialist skills in this rapidly evolving economy.”

So how does this work?

Embracing the open talent economy helps organisations blend fulltime employees with short-term consultants making them nimbler and efficient. These blended professionals– unlike traditional consultants– often get embedded into the organisation, assimilate into its ways of working and cost a third of what ‘traditional’ consultants do while bringing a wealth of experience and specialist skillset.

A win-win proposition for both parties it may be, but there are clearly some challenges on the ground. For starters how can companies and independent professionals be expected to find each other in an effective and efficient manner?

From the organisation’s perspective, the challenges are largely around the individual consultant’s credibility, assurance around quality, and a contingency plan when things go south.

From the consultant’s perspective – the ‘model’ it works on is the premise of networking, word of mouth references and 24/7 business development. Some of the finest consultants (akin to other creative and knowledge workers) do not always make the best business developers! Often senior professionals who decide to branch out of their own for lifestyle or downturn-related reasons find it tough to get business without the comfort of a strong brand, resources, and organisation behind them. Contracts are often skewed in favour of conglomerates with little room for negotiation.

Bridging the on-demand talent gap

This open talent economy or blended workforce is giving rise to an innovative form of talent consulting organisations that do not employ any consultants but seamlessly connect independent consultants to organisations seeking specialist skills and expertise.

A-Connect is one such leading human resourcefulness enterprise – founded in 2002 in Europe by two ex-McKinsey consultants, Hanne de Mora and Nils Hagnader. A-Connect today boasts a network of over 2,000 consultants with deep industry knowledge across sectors such as life sciences, agribusiness, food and chemicals, financial services, and private equity. These skilled freelancers are certified by A-Connect via a rigorous vetting process. By tapping into this network, A-Connect provides employers with a flexible and on-demand talent to suit their immediate project or transformation needs.

According to Vincent Casanova, A-Connect’s Client Partner for Asia, who is based in Singapore: “We have a unique approach that balances an independent professional’s (IP) interests while ensuring client organisations get the best in class talent when they need it. We operate a lean office in Asia with a few full-time resources – there is a dedicated talent partner that is constantly meeting with our IPs, sourcing new talent–especially in specialist sectors, ensuring we have an updated and robust pipeline of the finest talent. Our dedicated client partner on the other hand works with companies to help them articulate their talent needs,” explains Casanova.

This unique high touch and personal model helps A-Connect with a deep understanding of a client’s business challenge. They select the best talent from their global network of independent professionals with the perfect combination of skills, experiences and culture fit. This increased project pace, ensures impact and helps clients more effectively confront the future. A-Connect also monitors the projects closely ensuring a certain standard of project delivery at all times.

ICG is another such consulting organisation that describes itself as the world’s fastest growing consulting firm that has no employees. After only four years in operation ICG has over 2,500 consultants and nine offices across Australasia, Asia, Europe, and North America. They work for some of the biggest banks and government instrumentalities, manufacturers and fast-moving consumer goods companies (FMCGs).

ICG’s unique selling proposition (USP) is a digital platform driven by their patented ‘Industrialised Adhocracy’ intellectual property that puts clients in control of the process, value extraction, and outcomes. A completely transparent medium that allows independent consultants already in the ICG network to choose the projects, rates and locations that satisfy their lifestyle needs, rather than be shackled to the directives of traditional top tier firms. All project postings are visible to all consultants regardless of location.

Organisations benefit by the opportunity to handpick high-quality specialist consultants who fit perfectly within their own teams to work together to create lasting change and shareholder value. Clients can choose a single specialist to fill a project role or complete teams to deliver strategic solutions.

Wade Azmy, ICG’s Singapore Managing Director, says the ICG model is very refreshing compared to the traditional ‘pyramid’ team that is generally imposed by top tier firms on clients, who often resent the arrogance of the top tier consulting firms and the wastefulness of large teams bulked up by juniors.

“We do not believe in a headquarter model – we in fact operate on a hub-based approach where each geography has a lead that is responsible for sourcing key talent, developing business and ensuring client satisfaction through via a hands on approach”, adds Azmy.

ICG is able to offer a team of senior experts by ‘unbundling’ solutions, which means clients pay for what they need as opposed to buying the entire suite of consulting services. This provides comparable quality solutions at lower fees to the client. Their extensive suite of offerings includes research and publications that are available to everyone in the network, products, tools, templates, and importantly ICG constantly provides their independent professionals with frequent training to hone their skills and keep them relevant.

Both Casanova and Azmy admit that the way organisations in Asia attract, motivate, and retain key talent is also steadily evolving; however, there is still a long way to go before the region embraces this new blended workforce reality.

In a recent article in Marginalia, Nele Klepper, the Client Services Partner for A-Connect Europe, discusses how hiring full-time employees who work forty hours a week will soon be a thing of the past. As these trends take shape, hiring independent consultants and external talent will become a crucial part of the talent acquisition strategy of any company.

So why is this not taking off as fast as Airbnb or Uber?

Detractors of this model are quick to point out that this on-demand model is not without its share of issues. Organisational memory, long-term focus and continuity, loyalty and IP to name a few.

That said, an organisation’s ability to engage with talent on an on-demand basis could truly reshape the way businesses work. However, this needs to be implemented with an open mindset and well-articulated expectations. This model of on-demand talent creates an ecosystem that promotes super specialists who need clear direction and assimilation in the traditional organisational hierarchy.

On the other hand, consultants and specialists need to develop what Casanova describes as the independent consultant mindset: be comfortable with ambiguity, uncertainty and an uneven pay curve that often fluctuates.

References:

https://www.cipd.asia/news/hr-news/asia-gig-economy-challenge-hr
http://www.marginalia.online/harnessing-the-power-of-the-open-talent-economy