COVID Rise of Gig Economy

Before Internet era, companies used to recruit people so that they knew the performance of people and could give key projects to key people. Telephone and physical papers were used for communication purposes. With the advent of Internet, communication became effective and outsourcing took off. Companies started to find vendors online and depend on the reputation, processes, trained people, culture of the outsourced company to deliver efficient services. And the companies were paying a “margin” to outsourced companies for ensuring quality services. However, they had no control of the actual people who were working on the project. Each project had a mix of very good, good and average quality of resources. Some projects also failed due to various reasons

Due to covid effect, few software companies have decided to shift the majority of resources to “work from home”. They will depend upon the coordination and communication tools instead of co-location to ensure that work still gets delivered effectively.

However, the prevalence of global coordination and communication tools presents a unique opportunity to companies: creating an effective temporary team for the required services themselves, Once the tools which enable this mature, the overhead of creating temporary team will reduce drastically thus resulting in saving of “margin – overhead costs”. Also by leveraging global resources, cost and time to market will be reduced substantially and flexibility to scale up/ down as required will be enhanced. This will lead to jump in Gig economy.

What are the functions of the “tools” I am referring to above? These are abilities to:

  1. Access updated list of skilled global resources (like LinkedIn)
  2. Validate skills/ effectiveness through an effective rating system of past projects, training, etc. (e.g. MOOC, rating of LinkedIn profiles)
  3. Help companies to list their requirements of services with defined outcomes
  4. Match potential people to the requirements. AI/ML tools are already being used by companies for recruitment
  5. Help to select team and assign deadlines
  6. Coordinate and communicate effectively. Tools like Microsoft teams, Google drive, meet and spreadsheets, etc. are examples of this.
  7. Manage projects effectively i.e. track plans, procure further resources, manage risks, manage invoices, communicate to stakeholders. PM tools like Jira, Trello, etc. are used currently
  8. Deploy, test remotely. Dockers, Kubernetes, etc. are examples
  9. Accept/ reject delivered services
  10. Rate all stakeholders involved in key aspects
  11. Incorporate lessons learned for future improvements
  12. Manage payments

AI will automate lots of these tasks above. Hence, technology will do what it best at: eliminate “middlemen companies” and reduce inefficiencies. This will empower people to manage life the way they want and give boost to the gig economy.

However, this transition will not be smooth and will give rise to winners/ losers. So the world will have to shift to universal basic income asap.