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Combatting economic uncertainty to stay competitive

A great deal of economic uncertainty has spread across the world this year already, worrying leaders, and we’re only halfway through March.
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This year started with Trump moving into the White House, Theresa May actioning on Brexit, and India struggling with a cash crisis. Despite what the markets hoped, 2017 is full of economic uncertainty and looks to be more tumultuous than 2016.

Companies are left facing economic uncertainty, not knowing what the right course for growth will be, given that they don’t know what regulations and trade deals will be in place a year from now.

Understandably, this makes companies nervous to invest in strategic projects. According to a survey by Business West, following the EU referendum in 2016 many British small and medium-sized companies reported lay-offs, price hikes for their customers, or scale-backs of their investment plans, to prepare themselves for the year to come amid economic uncertainty.

While it’s reasonable for companies to back off on major investment plans, there is significant risk of eroding market share and losing out to the competition if companies don’t continue to push forward, even in times of economic uncertainty.

Can you benefit from the gig economy if you want more than a burrito delivered?

Companies are starting to realise that the ability to flexibly bring in highly talented and skilled staff is a competitive advantage. When resources are scarce and the future is unclear, this new world work will help level the playing field between the big players and the challengers.

Uber brought the gig economy to the forefront of everyone’s mind. This idea that, at the touch of a button, you can have a personal chauffer to take you where you want to go, is incredible. Despite not having the resources for a personal driver all the time, Uber has made it accessible for everyone to have the advantages of a chauffeur, but only when they need it.

Imagine if this ability was transferred to consultants and highly skilled industry experts. Imagine if, rather than having to bring in an entire consulting firm or hire a permanent employee, you could bring in just the one person you need to solve your challenge, and only for the period that is required to solve it.

This is the new gig economy and it’s going make remaining competitive in times of economic uncertainty easier.

In for a penny, in for a pound

When companies don’t know what’s coming, they tend to hold back on any sort of new investment or innovation. As we’ve seen with the fall of BlackBerry (formerly RIM) from the smartphone race, innovation is key to maintaining a competitive advantage.

If companies are unwilling to invest, it’s only a matter of time before the competition catches up.

By leveraging the gig economy, companies can continue to innovate, to grow, and to drive efficiency in their organisations without huge investment.

When working through uncertain times, keeping costs low is a key strategy of CEOs. Companies tend to be hesitant to bring in independent consultants or contracts because of the assumed price tag they bring with them. It’s true that the daily rate of bringing in a consultant is usually a fairly large number (because of the wealth of experience that they are bringing with them), however this is not the full picture.

HR managers say that the overall cost of bringing in an independent consultant is significantly lower than bringing in a permanent employee. Without the added burden of weeks of time lost to the hiring process, existing employees can continue to add value to the company while the new consultant is coming in.

A wealth of knowledge at the touch of a button

The gig economy works because the suppliers of talent (in this case the consultants) are prepared to work on a project by project basis. This means that they come equipped not only with functional knowledge about the challenge they are solving, but also with skills of how to work on a project basis.

There is less time spent on getting the consultant up to speed and more time spent on providing value to the company. The consultant blows into the company, works on the required project, and then is gone when the project is complete.

Although appetite for investment is low now and companies aren’t sure about making big hiring decisions, economic uncertainty is no excuse to lose ground. The gig economy allows companies to harness the exact expertise that they need, for the exact time it is needed.

By working on a deliverables basis, companies can be sure that they are seeing value from their investment in consultant. With this wealth of possibility, can you risk being left behind?

Rebecca Porter is client success manager of SMB at Talmix

Image: Shutterstock

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