Editor’s Note: The key to business success is gaining access to the right talent. But the world of work has profoundly changed, and most hiring managers can’t fill higher-level, strategic, management and technology positions. The fastest-growing trends in the labor market today are the flexible workforce and the employer-independent worker dynamic. The companies that adapt to these new realities will be in a stronger position to succeed.
I spoke with John Kunzweiler, CEO, M Squared Consulting, Inc., which provides senior-level professionals, project leaders and subject matter experts for managing and implementing business-critical initiatives. He shared insights on the flexible workforce, how to leverage today’s quickly expanding market of independent workers and how this strategy differs from the historical practice of using temporary workers. He says it starts with recognizing that the way employers and employees look at work has changed radically.
SandHill.com: How has the world of work changed and what caused it?
John Kunzweiler: It changed dramatically in the post-2008 crash. In the massive layoffs, middle management was eviscerated. More importantly, the layoffs felt horrible to the senior management as well as the employees. Both came to believe there has to be a better way. That led us away from transactional thinking about jobs – do your work and wait for another task and keep that job for years – to today’s environment of viewing work as modules.
SandHill.com: Please describe an example of modular work.
John Kunzweiler: It’s basically the “by the drink” model to fill the positions needed. Companies don’t need those people full time, but they need the very best talent they can get on a contract basis with a defined scope of work. But it’s more than that. For example, a company may need to contract with a marketing expert and will expect him to manage multiple third parties – multiple modules of work – to make sure they get done on time, on budget and meet the company’s expectations.
SandHill.com: How are the professionals in the workforce you’re describing different from temporary workers with domain expertise?
John Kunzweiler: Domain expertise is only about one-third of the experience that companies require in senior-level positions today. They must possess expertise in how to get work done in a complicated, fluid, challenging environment. They need classic consultant expertise where they know how to define work, communicate with stakeholders, develop a work plan, do the time line, identify the issues, resolve the issues, etc. A domain expert is not sufficient to do mission-critical or mission-important modules of work on a contract basis.
SandHill.com: How does that differ from contracting with a consultant?
John Kunzweiler: Some companies like consultant skills and training but hate the traditional, large firm approach. They don’t necessarily want somebody to show up at hundreds of dollars an hour to tell them what to do; often they already know what they want to do. They just need the smart, talented horsepower to get them there.
SandHill.com: What is the top driver for why companies are willing to use this flexible workforce now?
John Kunzweiler: It’s a combination of financial caution and the difficulty in finding people with the right talent. Full-time employees cost a lot to get and keep. And if things change, it also costs a whole lot financially and emotionally to let them go. Also, it’s difficult to find people under the traditional terms.
Professionals with the in-demand skills for a modular work environment are very independent and can easily walk away. Their minds have changed over the past few years and they don’t want a full-time job. They don’t want to stay somewhere for 25 years and retire.
I’m not talking about the younger generation; it’s the mid-career professionals who are making this move to independence. They look around and realize the employer’s commitment to them is only as good as the results of the next quarter, and they better figure out a way to have a set of sustainable, solid, professional skills so they can take care of themselves without depending on the employer.
SandHill.com: The skills you’re referring to are industry or domain expertise and management skills, right?
John Kunzweiler: Industry expertise is the minimum requirement. An example of a required skill set might be “a marketing person; needs 15 years of consumer package goods marketing experience; has an MBA; needs to be right-brained.” The flexible worker needs those kinds of expertise and requirements to get in the door. But they also must know how to manage a modularized work environment, managing mission-critical work in a fluid, dynamic organization with constant change – and doing it as an outsider. If they can’t do that, they won’t be successful and the company will waste a lot of money.
SandHill.com: What is the biggest challenge in undertaking a flexible workforce strategy?
John Kunzweiler: The primary challenge of utilizing a flexible workforce is making sure the internal managers have the right skills to manage this talent.
SandHill.com: Are there other pitfalls?
John Kunzweiler: A lot of projects fail before they start. A major driver of failure is when HR or whoever does the contracting with the flexible worker plays purely a price game. Large companies have many independent contractors working for them. In their effort to get that spend under control, they often impose rate cards on third parties. Too often, if the tenor of the discussion is all about price, they miss the other half of the value equation. Companies providing the flexible workers must be price competitive, but the customer utilizing this strategy makes a mistake if they don’t focus on the deliverables and the business outcomes. In this new world of work, it’s not about price or bodies. It’s about value.
The second challenge is organizational maturity or readiness. In the old days, you could work a temporary employee however you wanted to. Often they were desperate and needed the job, so they put up with that not-so-healthy dynamic. Today, thinking of contractors as being more expendable than full-time workers is no longer valid. The high-end flexible workforce is comprised of top-notch, high-quality, talented individuals with a lot of options.
The third cause of failure in utilizing a high-quality professional flexible workforce is waiting too long. Because we live in a world where the headlines say unemployment is unacceptably high, companies often think that is the case across the board. Not so. There is a percentage of jobs that we cannot fill because we cannot find the skills in the marketplace – anywhere. There are a number of areas that are just flat out impossible to staff. For the high-demand business professional technical arenas, companies are being very naïve if they think there is a gaggle of those people available in the marketplace on demand.
SandHill.com: You’ve emphasized the need for these flexible workers to be able to work in a fluid environment of change. How do they ramp up with the necessary knowledge about the company they work with?
John Kunzweiler: At M Squared, part of our value-added services ensures that when our contractors start with a company, they can be up and productive in their first 15 minutes. Otherwise, time is wasted, and we don’t look good. There are a lot of on-boarding steps that need to be done. We have engagement managers whose job is to make sure that our contractors get on board quickly, understand the project and know who the players are.
SandHill.com: From your description, it seems that the world of work and hiring is quickly undergoing a complete and radical change that may soon catch some companies unaware and not able to compete well.
John Kunzweiler: That’s true. Over the past 18 months, I’ve observed that this new world of work has really become a very interesting power shift – a confluence of what employers want and what highly talented workers want to do. It’s no longer a one-sided transaction. The new world of work is a very interesting balancing act in a world that is becoming increasingly skills constrained.
John Kunzweiler joined M Squared Consulting as the chief executive officer in May, 2010. Based in the Bay Area, M Squared provides project leaders and subject matter experts for managing and implementing business-critical initiatives. A pioneer in the growing flexible workforce industry, M Squared is recognized for delivering quality and value by providing unparalleled, targeted consulting expertise. Prior to M Squared, John was a senior partner at Accenture, where for 26 years he helped grow the firm from fewer than 2,000 employees to more than 150,000 worldwide. He held several leadership positions including Global Managing Partner of Alliances, Joint Ventures and Venture Capital.
Kathleen Goolsby is managing editor at SandHill.com.