Adoption of the Blended Talent Model on the Rise | Market Insights™
August 1, 2017
An increasingly holistic approach to talent management is leading to adoption of a blended (contingent + permanent) talent acquisition model
An increasingly holistic approach to talent management is leading to adoption of a blended (contingent + permanent) talent acquisition model
The growth of artificial intelligence is impacting talent acquisition and retention for both enterprises and service providers
Research from the Everest Group, a Dallas consulting firm, estimates that organizations can save as much as 12 percent in recruitment costs by adopting an integrated talent approach. The Randstad survey supports that finding: Nine in 10 respondents who’ve embraced an integrated talent model say they are very satisfied with the decision. Read more at SHRM.org.
In general, enterprises believe that mid-sized to small service providers are more nimble, flexible, and innovative than their larger counterparts
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Tips for aligning talent to take advantage of the surge of digital services development
There has been tremendous discussion around the “gig economy.” You need look no further than Uber or Airbnb to see the successful use of this labor model and understand why its popularity is growing among entrepreneurs, employees, and employers alike. Here’s the real news: major service providers are starting to experiment with the model. Here’s why.
The drivers
Two major factors are driving the gig economy. The first is the impact of millennials in the workforce.
There is a sea change in how millennials want to work. Ranking high in their demands is more flexibility. They want to be able to manage their lifestyle better – better, quite frankly, than I did at that age. They want more freedom, want to be able to work from home and potentially change the relationship between employees and employer.
Another driver is the recognition that the traditional employee model – whether it’s an in-house model in a US environment or an offshore support team – is inefficient and very inelastic. We employ a lot of people and incur significant cost in finding them, hiring them and training them. We put them at desks and provide them work. We often end up with a lot of the wrong people and never enough of the right people.
And since work is variable, the traditional employee model often results in unused capacity. This is not only a costly frustration but is counter to the more elastic, consumption-based models in today’s businesses and in clients’ demands from service providers. Traditional employee models are stuck in the 1950s and don’t allow moving to a consumption-based world.
The consequence
Consequently, clients are increasingly asking their third-party service providers to move to a more flexible construct. At Everest Group, we’re involved in numerous conversations where major service providers are experimenting and trying to understand how to navigate these twin secular forces—the desire of talent to be more flexible and the desire of clients to have more consumption-based services.
Providers are still in the early stages with these new talent vehicles and experimenting to incorporate them in their services. The work-at-home movement certainly is a part of this; it’s affecting the call center world and also the technology development and maintenance world, particularly for legacy applications.
We also see a lot of service providers relying more on contracting with SMEs rather than employing them. The contracting model allows providers to bring in subject matter expertise as required on a just-in-time basis.
We also see service providers experimenting with crowdsourcing within their own organizations. In large outsourcing organizations, we’re starting to see requirements go out for internal departmental and individual bids on work.
Considering all of the experiments together, we see a dawning recognition that providers know they need to adjust their talent models to incorporate the gig economy into their service delivery. Look for this blog to keep track of this movement and show use cases as they evolve.
The philosophy behind, and benefits of, alternate talent sourcing solutions, and traditional and alternate sourcing solution options
Much of the industrial arbitrage industry is based on developing tight and clear SOPs (standard operating procedure) for work, putting it into large factories in India where very bright people are asked to operate with tightly defined parameters and conform to them very rigorously and then go home. Unfortunately, in doing so, we inadvertently created human robots.
We put these people in air-conditioned environments, restrict their capability for independent thought and expect flawless execution from them. How is this different from a robot?
Why don’t we go the whole way and automate those functions now performed by human robots? We’ve done all the preparation. We have the procedures defined. We’ve eliminated the variability. Why don’t we just go to the next stage? In fact, I think that will happen.
Vishal Sikka, CEO at Infosys, is the person who first brought to my attention his observation that in many respects we treat our most precious resources like robots and operate them like machines. This speaks well for both his insight and also for Infosys in moving to address this issue.
Although the human robots model created real value for customers as well as service providers and also created employment for hundreds of thousands of people, it also had some negative effects. People don’t want to be treated this way.
We need to allow these people who have been conditioned into robotic types of behavior to think on the right side of their brains as well as the left side of their brains. We need to liberate this very talented workforce from their highly constrained environment and tap into their creativity, which separates humans from robots.
Another effect of the human robots model is that it opens the door to full automation and changing the method of service delivery. With automation, we no longer need human robots. But then what do we do with these people?
I think we need to create a fundamentally different people model. We need people with different skills that are not robotic in nature. It will change how we recruit, train, incent, measure, and manage people. And it will require change in the way we provide for context, connection, and communicating with customers and engaging in problem solving.
Adam Smith, a Scottish philosopher about the market economy, warned that people who perform a few simple operations in which the effects are nearly always the same have no occasion to exert understanding in removing difficulties or applying inventions and consequently lose the habit of such exertion.
Besides heeding Smith’s warning, automation is here and forcing the services industry to change. It will be interesting to watch the development of a different people model that can deliver even more value than the human robots provided for many years.
Are you a brilliant Java coder? An expert in the R programming language? A phenomenal database administrator? A brilliant software seller? Sorry to say it, but you’re likely to soon be a member of the “extinct club.”
In corroboration of Scottish economist Adam Smith’s concept of the division of labor, organizations have historically preferred and hired specialists to develop their technologies, and other specialists to sell them. These masters of their craft had acclaimed expertise in their specific areas. And despite the evolution from mainframes to microcomputers to PCs to client server to ERP to the web, it was relatively easy for them to upskill or move to an adjacent skill, as the technologies adopted by companies rarely changed in their fundamental structure.
This gave rise to an “I am a developer, let me develop, I am in sales, let me sell” model within technology companies. It worked well, as enterprises persisted with outdated technologies they had intertwined their business models, and the cost of replacement was prohibitively high. This persistence created the specialists, who were assured of their place in the high echelons of technology as the landscape was not changing fast enough. This also gave rise to the outsourcing industry, which was leveraged to support these outdated systems and reduce the cost of management.
However, those times are gone. Due to digital transformation, organizations expect their professionals to understand not only the technology, but also business users’ perspectives, technology ease of use, consumption flexibility, and creation of top line impact. Development or sales specialists lacking a comprehensive business view are quickly losing their relevance and competitive edge.
Lack of relevance and competitive edge can, and will, also effect many technology providers. This is due, in large part, to the fact that as the cost of consumption of hardware and software decreases, organizations are increasingly willing to dismantle their existing systems and embrace newer models, e.g., migrating from one SaaS CRM to another. The idea of “fail fast, fail better” is gaining traction within enterprises, and technology companies need to align their business models accordingly to serve them.
The reality is that this sea change requires full-scale overhaul of technology providers’ entire business model – including their investment strategy, product roadmap, partnership ecosystem, and go-to-market approach. Yet executives in these businesses have made their careers and big money by developing and selling technology in a certain manner that promotes status quo. Think about a large software vendor and its partners who earn millions of dollars by just providing “certificate training” for their technologies. If the technologies become redundant, their bottom line will be severely impacted. Therefore, they will invest all their efforts in ensuring their clients stick to their technology platforms, irrespective of whether they are outdated and unable to cater to the business. Of course, there are buyers that do not want to rock the boat by changing something until it is really broken. This comfortable nexus has been going on for ages.
But the times are changing very fast. Technology providers that view their buyers as “cash cows,” rather than valuable partners to be helped to achieve business objectives, will fast lose relevance. The providers that succeed will: 1) embrace this new world of disruption, and create meaningful solutions that are more than beautified version of their outdated platforms wrapped in a pretense of user friendliness; and 2) make their prized specialists realize the new norm of the business wherein they need to at least understand, if not master, the art of viewing the world from a business and end-user perspective that incorporates a holistic paradigm beyond their usual tunnel vision.
If he were alive today, Adam Smith might well have changed his tune, instead suggesting malleable skills to enable technology companies’ success in these uncertain times of technology.
Photo credit: Flickr
Accenture’s set of service offerings is incredibly broad-based. They serve clients in an incredible number of business processes. They provide services in every geography. They deal with a huge variety of industries. How can a firm do so many things at the same time with such excellence?
Simply put, the answer is people. Using our framework assessing companies’ characteristics necessary for success, Accenture’s team of exceptional talent stands out. The provider is able to deal with a profusion of diversity in processes, industries and geographies because it aligns its brand, go-to-market approach, portfolio and business model with high-performance talent.
Accenture takes on clients’ big problems that require a transformational journey. Typically the challenge has a technology component or basis. And typically it requires the use of exceptionally deep talent.
Accenture’s relentless focus on high-end talent deployed against big business problems enables the provider to make decisions around what not to do. They are a talent engine, so they let others take on the roles of owning the technologies and servers. They play well in the ecosystem.
They also exit spaces that are highly commoditized where a provider can deploy less talented, cheaper resources. Accenture stays focused on big problems that require transformational journeys, which require high-end, exceptional talent. That’s why they’re extraordinarily successful in providing services in a bewildering variety of processes and industries.
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