Teams and Gig Economy

Preface

The digital revolution and rising gig economy are dramatically reshaping today’s and tomorrow’s workplace and the very future of work. These changes include a sharp reduction in the traditional employer-employee relationship and usher in innovative human resources behavior for many companies.

New human cloud platforms (also called open talent platforms and freelance marketplaces) allow economic activity to be organized in the ways that shift much of what was traditionally accomplished by full-time onsite workers within to an organized cloud of individual entrepreneurs and on-demand workers. As enterprises grow more comfortable with freelance marketplaces as an alternative to agencies or consultancies, they also increasingly oblige these platforms to provide teams of experts completing more complex and strategic projects.

Teams in human cloud platforms context

Proposal for research cooperation

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Background

In January 2020 the Moscow School of Management SKOLKOVO and Russia’s leading freelance marketplace for experts Professionals 4.0 (P4.0) launched a joint research project aimed at discovering the way alternative forms of employment involving freelance marketplaces as new intermediaries are adapted in the B2B setting.

Our goal was to advance understanding of the way teams develop and function at the intersection of the gig-economy and traditional organizations, and to examine new organizational forms restructuring teams, and vice versa.

Research Design

Qualitative study of 83 projects contracted on the Professionals 4.0 platform
Ten projects were selected for in-depth analysis
The research included 34 semi-structured interviews

Why Do Conventional Enterprises Decide to Adopt Human Cloud Platforms?

At the very beginning of this research we used our interview data to identify the most important benefits that companies cite as reasons for their decision to use human cloud platforms. After combining this data with our desk research results we identified eight key drivers for companies adopting “platform sourcing”, inspiring them to hire on-demand talent from such platforms.

Access to talent for hard-to-fill positions

Freelancers on open talent platforms offer skills that the company currently lacks; or they may engage with tasks that the company does not have the capacity to commit existing employees to perform.

Speed

Open talent platforms allow companies to find professionals to complete urgent tasks, which means that they can rapidly launch important projects and significantly save time to market.

Cost reduction

Platforms help to reduce expenses in several ways: the cost of hiring, the actual cost of labor, the cost of arranging and funding a workplace, etc.

Flexibility

Working via a platform contributes to a more flexible approach to workforce engagement distribution. Freelancers plan their own schedules, they are often more flexible in terms of timing and procedures, and, importantly, if there is no work available, the companies do not have to retain them on the payroll.

Hypotheses testing

Using platforms also makes it possible to quickly test hypotheses, find original solutions and abandon ineffective projects before major investments are made.

Bureaucracy reduction

Setting up a worker to function on a platform can be organized in a simpler and more convenient way than managing a new starter inside a company, especially in the cases of large industrial businesses or governmental structures. The platform often removes restrictions on the performance of a non-standard task (for example, an innovative solution) in the corporate culture of the company.

Transparency of freelancers’ skills level

Open talent platforms provide user feedback on the work of freelancers and access to their portfolios, including accumulated data on their skills, experience and track record of completed projects. Reputation control mechanisms on platforms are also applicable to the company's own employees and provide an opportunity to identify and develop talented individuals through their involvement with platform projects.

Instrument for Hiring

In the case of favorable market conditions the work carried out on the platform by the freelancer can be used as a preliminary stage for hiring professionals to work in-house.

Key drivers, inspiring enterprises to hire on-demand talent from human cloud platforms

Teamwork at Human Cloud Platforms

Business-Oriented Gig-Economy Landscape

In the freelance world where large enterprises post projects for freelancers to work on there are multiple human cloud platforms. According to recent studies, since 2009 the number of such platforms has grown from 80 to more than 330 globally. The landscape of the platforms compelled us to focus on their variations in two dimensions.
The first dimension has to do with the project complexity, or the complexity of tasks proposed for freelancers – from very simple standalone tasks (also called microtasks) to really complex projects with a diverse set of requirements and the call for high interdependencies among skills required to accomplish the work.
The other dimension involves different formats of freelance workforce: crowd, individual contractor or a team. We realized that platforms like Gigster, Business Talent Group or Professionals 4.0, that focus on complex projects and different team configurations to work on these projects, are studied far less. So we decided to focus on this particular platform type.
The main issue that we wanted to study was: how do teams actually form and function in the context of complex enterprise gig-economy projects? Therefore, we examined 83 different projects recently accomplished on the Professionals 4.0 platform, and narrowed their number to 10 projects that we believed fitting our requirements for in-depth research.

Working Groups and Teams in Human Cloud Context

The emergence of these new teams (often called "flash" or "liquid" teams), mixing regular organizational members with ad hoc experts recruited via independent human cloud platforms, is a fascinating organizational phenomenon that touches upon and transforms various elements of organizational life. Our research showed that such teams have numerous advantages making them a useful organizational tool.

Evgeny Kaganer on teams and working groups in human cloud context

In our research sample there was a significant variation with respect to a number of different attributes of group work: attributes of goals, motivations, team roles and communication. We called these attributes “attributes of group dynamics”. After observing the totality of these attributes and analyzing team configurations we realized that ultimately we could distinguish two different types of team configurations. We called them “working groups” and “flash teams”. Working group members and flash team members interact differently, affecting the nature of group dynamics.

Working groups and flash teams: The attributes of group dynamics

In a working group, goals are clearly and entirely determined by the project originator. In the case of flash teams, even if there is an initial set of firm goals, these goals actually may evolve throughout the course of the project, and various team members could contribute to the very final definition of project goals.

Goals in Working Groups: Determined entirely by project originator.
Goals in Flash Teams: Set initially by project originator but may evolve through team member contributions

"My suggestion to the client was to test specific process optimization tools that I often use in my business though this wasn’t included in the initial project scope." - Denis, freelancer

Obvious and Complex Projects

Working groups and flash teams also suit different types of projects – we call them obvious projects and complex projects. In the case of “obvious projects,” goals or project results are clearly defined and can be delivered to the team, the methods and tools are well-established and known to the team. Typically project completion of an obvious project requires a single skill set, or if multiple skill sets are required, they aren’t really interdependent. Complex projects are the opposite: the results are ambiguous, the methods and tools are either new to the team, or even emerging, and then diverse skill sets are required to complete the project.

Obvious Projects

Project results are clearly defined and delivered to the team
Methods and tools are well established and known to the team
Project completion requires a single skill set or multiple skill sets with no interdependent tasks

Project Examples

Conducting market research of telecom operators that offer services to oil and gas companies
Extracting data from standardized corporate documents

Complex Projects

Project results are ambiguous and cannot be explicitly delivered to the team
Methods and tools are emergent or new to the team
Project completion requires diverse skill sets and involves interdependent tasks

Project Examples

Developing an online marketplace for road construction projects
Designing a big-data dashboard to control oil production process

Working Groups and Flash Teams Fit Projects of Different Types

We juxtapose the two team configurations – working group and flash team, and the two types of projects – obvious projects and complex projects. Our findings are captured in this matrix below. On the horizontal axis there is a share of attributes associated with flash teams, and on the vertical axis - a share of attributes associated with complex projects. In our sample team configurations that followed the flash team attributes were primarily deployed in complex projects, and they were more effective there. Whereas team configurations that we described as working groups were primarily deployed in obvious projects, and they also were more effective there.

Enabling Practices for Flash Teams

We identified four aspects of enabling efficient work in a flash team that must be taken into account by companies that have decided to adopt human cloud platforms:

1. Loosen existing policies and procedures

Organizational policies and procedures can act as barriers to implementing projects in flash teams. At the start of a flash team's work it is important to take into account the restrictions that external specialists may have in terms of accessing the necessary data and documents, or using common digital tools (for example, instant messaging) during their work on the project. This is where it makes sense for the company to be flexible in relation to existing rules and regulations.

2. Be prepared for discomfort

For enterprise employees accustomed to formal hierarchy working in a flash team can be somewhat uncomfortable. The project originators will need to be closely and thoroughly involved in the project and be prepared to change the settings of the final task; even adjusting their own role and functions in the project as it proceeds. During our research we found that employees who have experience in consultancy firms or who have already worked on internal cross-functional projects in the company found it most comfortable to work in flash teams.

3. Be flexible when controlling resources

For complex projects where a flash team has been assembled it is quite difficult to determine what resources will be required for its implementation (including the time needed to accomplish the goals). The project originator and the team need to be prepared for situations that require the reallocation of resources.

4. Be prepared for no “correct” answers

Complex projects do not offer only a “right” or “correct” final solution to a company's problem; the team seeks the best outcome through experimenting and testing hypotheses. For a flash team the optimal mode of operation is through so-called “sprints” – time intervals of a predetermined length, where intense communication takes place between members with different functions and skill sets. Methods and tools to work on the task are modified and adapted at the end of each sprint.

Research Team

Evegeny Kaganer (Research Leader) is the Dean for Academic Affairs at the Moscow School of Management SKOLKOVO
Mike Szymanski is Assistant Professor of Strategy at the Moscow School of Management SKOLKOVO
Ivan Smagin is Researcher at the Moscow School of Management SKOLKOVO

Thank you for your interest in our research

Please contact Research Project Coordinator Ivan Smagin ivan_smagin@skolkovo.ru to request permission to republish our materials, or if you have any questions about the research.

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