in News by Vanessa Zainzinger. Permalink.
Technology is breaking down geographical boundaries, boosting the economy, creating jobs and making the mid-market more competitive - because we can now work together online.
Hiring is painful. It takes time, money, resources, working your way through a frustrating skills-gap, and once you have found a talented someone, it turns into a battle to keep them from being poached by another company.
But this is the digital age and new technologies are working on making it all a bit easier, and a lot different. Talent as a Service is the SaaS of HR; a market that will only be worth $1bn this year, but by 2020 will, most likely, affect one out of three professionals worldwide, with vast economic and social consequences.
Talent as a Service (TaaS) is a term behind the way technology enables businesses to work with the talent they need, regardless of geographical boundaries. It means bringing work to the worker, rather than vice versa.
A growing SEO agency in London, for example, discovered the greatness of TaaS on the search for talented software developers to take their business further. Their budget was limited; too limited for the wages good technical talent is expecting in the Capital, amounts driven through the roof by an increase in demand from the talent-hungry companies in East London. Neither did they have the office space for new employees.
The business came across oDesk, an online workplace that connects businesses with workers all over the world. The SEO agency chose two very talented software developers, who were offering to work for half the price of the typical London-based professional. The only difference? They're based in Poland.
oDesk has 32,000 more clients in London alone who have posted more than 50,000 jobs on their platform this year. The Silicon Valley-based mid-market innovators have 250 international, online-only employees themselves, on top of 100 “offline” ones. They're leading a market that is growing fast.
“We asked our clients what they would have done if oDesk wasn't available, and only 15 per cent of them would have hired locally,” oDesk founder Gary Swart told Real Business. “They would have cancelled the job, delayed the job, worked longer hours themselves. We view this opportunity as a lift, not a shift in the economy – these are new jobs created!”
While the skills-gap is widening - and the talent war in the UK is increasing - great talent in countries outside of the big tech hubs is waiting for the opportunity to show what they can do; to the advantage of the economy.
Take Bangladesh, said Swart. “They just passed a law that makes dollars earned over the internet tax-free. The reason is that this money is helping their GDP. Instead of their workers going to the UK or the US to find work, they're staying in Bangladesh and spending their money there. It's a way of creating jobs in the country, without having to relocate anybody.”
Bangladesh now comes in third on oDesk's list of hours of work done in any country through the platform.
The same as businesses are being empowered to find the talent they need to grow, workers in – often developing – countries are being enabled to build themselves an international profile that makes them worth more in the global economy. The average worker on oDesk increases their rate by 190 per cent within three years.
As is the case with most major transformations triggered through technology, the laws for Talent as a Service are only being written. As soon as international boundaries are crossed, labour and money compliance becomes complicated and platforms such as oDesk need to be careful to protect their clients, the workers, and themselves in a challenging new landscape. Just like ecommerce was driven forward by Amazon, oDesk is leading the disruption in this new, fast-changing space.
But governments are investing in pushing it forward too. The reach and speed of broadband in Bangladesh, Singapore, and many other areas is advancing rapidly, enabling new tools for collaboration online. The infrastructure is improving, new tools are being developed: the two parts of the game are driving each other forward. The speed of development is increasing.
The on-demand nature of online work is making mid-sized companies in particular more competitive. The mid-market can't compete with the talent war in Silicon Valley or Tech City, so while SME business leaders are watching talented employees leaving Google for Facebook, Facebook for Square, and Square for Quora, the same kind of talent has suddenly become available to them – it just happens to be a few miles away.
"Most of the work done [on oDesk] is web development, mobile, technology, anything that has to be done in front of the computer. But by now, even accounting software is done as a service,” said Swart. “Most of the work is done in devleoping world countries.”
The market is on its way to grow and grow as much as ecommerce and SAS did before it. The rules are only being written – but Swart's enthusiasm shows that they are being written fast.
“It takes time for the market to adapt these technologies, and Talent as a Service is early in the market. But we envision that in 2020, one in three workers will be working online as opposed to on-site; for all the same reasons that companies adopted SAS. One they start to work this way, they continue to work this way.”