The ‘Virtual’ Talent Pool: The Next Level Of Competition
August 7, 2008 at 11:08 am | In Career Development, Personal Branding, guest post | 7 CommentsGuest post by Todd Rhoad
Background
According to Charles Grantham and James Ware, executive producers of Work Design Collaborative LLC, an estimate of 12% of the working population serves their organization as part of a distributed workforce. This estimate is expected to grow to 40% by 2012. This trend ushers in the changing face of corporate America. Companies no longer need to have a facility that workers shuffle in and out of everyday to accomplish their work. We are a knowledge-based service industry now. With the advancements in information and communication technology, organizations are reducing the cost of building and maintaining workspace by creating a ‘flexible’ work environment for employees. This includes flex time, telecommuting, and several others. This new face of business is known as the Virtual Organization (VO).
No cubicle required
Example
DELL computer company in Austin, Texas, has taken this a step further and outsourced much of their work overseas to countries like China, Malaysia and Ireland. DELL also taps into local companies and satellites offices to aid in the production of its computers. Either way, they are able to tap into talent that isn’t in Austin, TX. This distributed group of talent ensures they can make the best product and deliver it at the best price while reducing the cost of operations. Other companies, such as Cisco, are following suit. The huge savings in operations is driving the trend to go VO.
So what does this mean for the rest of us?
It means the competition pool has just exponentially grown in size.
Are you ready to face the competition?
Employees from around the world will be competing with us for that next job and they won’t even have to leave the house to get it. As current VOs achieve and share their success, more organizations will follow. In traditional organizations, potential new hires don’t have the issue of competing head to head with those outside the US. This is because the company doesn’t usually move its operations around. In the VO, this isn’t the case. VOs move operations to other regions to reduce cost (e.g. reduce taxes, lower labor rates).
There is no job security
As the VOs follow the savings by “picking up and moving,” employees will turnover at much faster rates. Companies will see an increase in new hires and employees will see an increase in the jobs held in their career. New hires will also have to seek jobs they are clearly qualified for; that is to say, they’ve worked in that position or industry before. VOs won’t invest in training new employees and will seek the best skills for the job. The task of finding the right people will be left to companies local to the new location of the company facility. This will render the job unreachable by many US applicants as the local firms will favor local people.
VOs usher in new challenges to new hires. Employees face the ever-mobile company that will hire the best talent wherever it may be. When its local talent they need, outsourced firms will hire their own. Shorter jobs, more competition and local favor are becoming the flavor of the day.
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Todd Rhoad is an author and speaker specializing in Career Development Strategies. He is the author of
“Blitz the Ladder” and another soon to be released book “Virtual Organizations: 75 Things Your Career Should Know” and speaks frequently at colleges, businesses, conferences, and organizational associations. Todd is the managing director of BT Consulting and holds both a MSEE and MBA.
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great post dan. right now we are studying this in our organization as we see a lot of our clients moving in this direction. cost reductions and new abilities. many pros, but there are cons too, which is what we are trying to work with right now. it’s hard to build an internal culture/employer brand when you dont have an office to work at or people to see in person everyday, but all it will take is new solutions. excellent stuff.
Comment by Brandon — August 7, 2008 #
Although I also can see from customers and partners that employees turnover faster I cannot see the real benefit for the companies here.
As long as a company offers only jobs that can also be done by a trained ape working for a banana – no problem. But when there is more intensive thinking, creativity, specific know how and teamwork etc need to be done I can hardly believe that such strategies bring any benefit.
As far as I can see: Changes in staff usually produces a lot of unproductive “shutdown” and “startup” work and difficulties.
Regarding the training: If this strategy is practiced by every company then there would be no training and employees in general have to do and pay for their training in private. This results IMHO in the fact that well trained people will be available only for a higher amount of money. So well trained employees will cost more money but probably will not have exactly the combination of skills you (as a company) want. So you (as a company) could either invest in training cheaper employees or do not invest in training and hire workers who cost more. Both can be a possible better strategy depending on the area the company has it’s focus on. So I think both scenarios will be seen in the future.
Comment by Martin Wildam — August 8, 2008 #
Working for a major aerospace company for many years, I’ve seen the industry begin to transform itself into something similar to the VO. The global market has managed to pry working knowledge from companies in order to meet the demands of the customer at the local level. Such pressures do seem to force the industry to strive to hire the best; that is, those they don’t have to train and become productive very quickly.
Comment by Al — August 8, 2008 #
I agree that the new trend is taking us away from training people. Companies now expect the incoming employee to be totally functional and able to immediately contribute. There is no learning curve anymore. Gaining a competitve edge on others is really difficult now.
Comment by Dusty — August 11, 2008 #
As one who has continued to go back to college to keep my skills current, I can say that the demand on employees just keeps on growing more and more difficult. These VOs require employees to be almost completely self-sufficient for the organization to operate efficiently and effectively. I’m not sure most employees will rise to challenge so I can see where organizations will start to have difficulties. Unfortunately, it appears that money is driving us in this direction so it’s unlikely that such issues get addressed until they are out of control. Then, we go into fire fight mode, as always.
Comment by Rudy — August 18, 2008 #
I see this happening a lot. Organizations need to understand the impact to its operations and ensure its employees understand the direction they are heading. Goal alignment is critical in VOs since there are fewer people around to help. VOs are a great way to save money and respond quickly to customer needs but it’s really hard to manage.
Comment by DBaker — August 19, 2008 #
I think we are all feeling the global pressure. I’ve never had to compete so hard for the same job I’ve always done. Great article!
Comment by Chad — August 20, 2008 #