Voices from top experts
Editor’s Words: What features will projects show in gig economy? What opportunities and challenges will project management face in gig economy? How to deal with those challenges? What will the life of project managers be like? What special skills will project managers need to survive or excel in gig economy? Here are voices from different experts.
Collection of viewpoints:
Oliver F. Lehmann:
What features will projects show in gig economy?
Gig economy promises speed in projects. It is also seen as a way to cut costs and make organizations more adaptive and agile. This gain in speed comes with risks. From a project perspective, gig economy is a form of project business management: Project management done in cross-corporate settings. It entails an approach to have a multitude of short-term assignments mostly to individuals or small companies, often referred to as “temps”. Temps can be “freelancers”, when they are highly qualified contractors. Others are people with rather low education, often called “day laborers”.
This short-term contracting contrasts with doing the project with company-internal employees acquired from across the functional organization. It is also different from more traditional project business, in which large chunks of the project work, sometimes even the entire project, are given to mostly larger vendors under contract for assignments that can take months or years.
Project business management means bringing strangers into the project as contractors. These strangers bring abilities and challenge the traditional working culture of a client company, helping it to respond swiftly to changing markets and regulatory requirements. They also bring many risks into the project, among them conflicting business interests, incompatible business cultures and egos of leaders. Despite these disadvantages, the percentage of project managers who work for contractor organizations is measurably increasing, as can be seen in Figure 1, which shows the results of two surveys on the topic.
Figure 1: Two surveys from 2015 (n = 245) and 2018 (n = 325) show a growing percentage of project managers working in customer projects for paying clients.
Gig economy increases the benefit of speed, as the phases of contract development are very short. The short-term assignments are built more on trust than on elaborated written contracts. This is the fastest approach when things go well, but it comes with great risk when they don’t. Contractors are rather freelancers, filling their calendars more or less tightly with short-term assignments for days or weeks. They build on their competency in their subject matter, but also in finding a great number of customers and winning them with little effort.
These temps may have only limited loyalty to the client and the project. They will also not consider mission success of the project a personal success. Mission failure will also not be perceived a personal letdown, as long as they have done their job correctly. This limits their use in projects to slices of work for which tight collaboration with other project staff members is necessary.
What challenges will project management face in gig economy? How to deal with those challenges? Are there any opportunities for project management?
Figure 2 shows what causes conflicts in projects under contract between the parties.
Figure 2: Causes of conflicts in projects under contract, according to a survey made in 2017
The short-term temporary nature of the assignments in gig economy contracts may in many cases reduce the relevance of these causes: Before the conflict can grow to a magnitude that can damage the project, the assignment may be over.
In other cases, the short time of cooperation may increase the relevance of these causes. The parties don’t have much time to go through a storming phase that helps sorting out the inter-organizational and inter-personal interfaces. They must instead function immediately, and to make things even more difficult, in a virtual space over a distance.
A challenge for project managers is the ability to develop rapid rapport. Building a relationship that is based on trust, but also on trustworthiness without the ability to refer to a long past and a solid background of common success stories.
Another challenge is to develop a set of simple rules for temps that can be comprehended quickly and applied easily. Too high is the risk that the strangers brought into the project may otherwise damage not only the project but the performing organization.
Will trans-organizational project management or interface project management be the key to project management in gig economy?
Gig economy requires from players the ability to lead in a connective fashion extending the reach of influence beyond the borders of the organization. This requires empathy, knowledge of human nature, and the ability to respond swiftly to interpersonal issues when they turn up.
Project managers should master a variety of different approaches and achieving styles to master the quick changes in people and their interactions. They must focus concurrently on both the cooperation of the client with contract partner and the interfaces between the two.
An additional level of difficulty can be added when the client and contractor are domiciled in different countries with different legal systems and cultures. This means that at least one of the two sides is expected to work under a foreign system of laws and business rules. In gig economy, it will mostly be the client, who will dictate the applicable law and the place of justice; however, it may be advisable to develop the ability to help the contractor act under the foreign rules.
What will the life of project managers be like? What special skills will project managers need to survive or excel in gig economy?
Gig economy project managers will meet many different people, freelancers and other temps and will need to develop a working relationship with them in very short time. There will be people they like more and others less. They will need to be able to cope with both groups.
The core intention when projects are outsourced or outtasked is to tap into the assets of contractors and turn them into project resources. These assets may be just free capacity of workers and equipment, but also special skills, know-how, licenses, and other soft assets. In gig economy, these assets are owned by individuals or small companies and therefore limited in size. The use of a greater number of contractors balances this limitation out.
Project managers will have to take more care of their contractors in gig economy. The much higher number of contractors and interfaces between them requires more attention to identify emerging issues early and address them swiftly. The greatest challenge will be to turn contract parties into project partners, promoting completing over competing, and implementing a “mission success first” culture that expands beyond the borders of the own organization and is robust enough to survive frequent change of people involved.
Internet and related ICT enable and generate opportunities for new business models and perspectives. Classical business and organization models are in the process of transformation and change. The “Gig Economy” is part of this change – which is already very present in our business environments, like in the US, where more than 35% of their workforce is identified as “gig workers” (Forbes, 8th Jan 2019). Independent contracts and part-time jobs are present in modern projects as well. We are having a lot of freelance experts and self-employed professionals (including project managers) who are selling their services on national and international markets. Most of them are having a project or program based contracts. I’m quite sure that this market will grow and prevail. The PM profession is becoming one of the critical integrative professions in this networked 21st-century business environment. The main problem lay in the fact that on the national and international level we are lagging with the adequate institutional, legal frameworks which should introduce new global and national business standards on this field. This is also challenging for PM global and national associations that should contribute and promote such new PM standards and culture.
I am a gig worker since 1988. It was good for me. My best engagements were long-term (3-5 years) and consecutive (up to 12 years) gigs and they were all built primarily on stakeholder engagement, understanding client needs (and then jointly developing requirements), aligning teams (up to 120 people) and building trust by being reliable. I saw many other gig workers during these 30+ years, and not many got up to the expectations. Nevertheless there is a growing usage of gig project managers, not always to the benefit of organizations nor the gig workers themselves.
Overall, gig economy may be even partly responsible for the lack in progress in project management success. Gig jobs will probably be the first to be replaced by AI, as they already are limited in scope, their interfaces are defined (by contracts) and stripped of the need for human influencing. Gig jobs are great as cream on the cappuccino for a project manager (40% of all gig jobs in western economy), but not all can provide the daily chicken soup (in fact only 30% are voluntary full-time). The remaining 30% are people forced into gig jobs. Gig economy is even detrimental for most freelancers (numbers out of a McKinsey report, 2016).
The main reasons why people choose freelancing are a perception of autonomy, task-based low -risk payment (in contrast to success-based), and short-term engagements. Many freelancers struggle to find consecutive engagements and compete with others. For some, freedom means also being free of commitment, loyalty and passion, which limits the trust in them to go for the extra-mile.
The reasons why companies chose freelancers are not to improve project management maturity though, but rather an indicator how companies still misunderstand the importance of project management. Project management is not considered a core competency but rather a skill gap like others. The leadership component of project management is not valued, rather a project manager who is also a subject matter expert is looked for – project management is seen as a skill, not a profession.
Gig economy is a term that became popular around 2008/9 when more and more people were engaged in executing specific tasks. The term “gig” comes from the music industry, when musicians perform a piece for an audience once, often unplanned and ad-hoc.
Gigs are per definition tasks, pieces of work, are mostly not value-driven and are performed outside the context of an organization. They are pretty much defined by time of the gig and its cost. But projects are becoming more value-oriented and context-driven. Strategic alignment, benefits integration and stakeholder engagement are best done while people are being part of the organization, having built relationships, understanding the overall picture (strategy) and the reasons why projects are done (portfolio). Gig workers mostly have no clue about this.
People performing gigs are seen as task performers, bringing with them skills, experience and knowledge. They are not seen as full human beings who have drives like passion, holistic views or synergizing.
If a project decides to use gig resources, there has to be an efficient procurement process. Work packages have to be defined clearly (Statement of Work) and gig jobs have to be advertised, often using agencies and platforms, offers have to be screened and selected down, interviews and negotiations have to take place and when started and on-boarded, the performance of the freelancers has to be monitored and adjusted.
For project management as a profession, improvements in maturity will be observed in long-term, sustained environments. Organizations will continue to entrust their own loyal staff with mission-critical or strategic projects and programs. PMOs are best led by employees, being part of the organization’s society and culture, though freelancers can provide help in setting them up and coaching PMO leaders.
As companies struggle to develop own capabilities in project management, they will have no choice but to look for gig workers. They will select the ones in whom they can see the most security and put their trust. As a gig worker, being able to influence them, build trust and ask the right questions is important. For contractors, it is also important to understand the procurement and contract delivery specifics.
The first 20 years of the 21st century has seen increased interest in gig economy, which has been estimated to be in full force by 2020 or 2025. Because we are now less than a year away from the first of those targets, let’s imagine we have perfected all the actions needed to make PPM successful in gig economy, and explore what it is like! (PPM = Program/Project Manager).
Status Check: We are in gig economy when…
A. The most successful enterprises accomplish much of their project and program work through contracts.
B. A high percentage of the best gig PPMs successfully bid on well-planned contracts.
C. Project teams are staffed in the same way; they bid on projects or programs as team members.
D. Most meetings are virtual, using three-dimensional augmented reality immersion.
E. Of course, all communication is supported by 5G (Fifth Generation) wireless systems.
What are the advantages of this brave new world?
A. Enterprises that engage proven ‘gig PPMs’ consistently get superior results, faster, and at lower cost.
B. Those project and program professionals who have mastered all needed competences thrive.
C. Executives who contract with them trust them more than their internal staff, an unfortunate situation.
D. Gig Agents, operating like movie star agents, match professionals with open gigs—for a fee.
E. Enterprises can access ‘gig Reviews,’ much like on Amazon, to see performance reviews of candidates.
F. The best contract PPMs earn GIGantic fees, based in part on project/program performance rewards.
What are the risks/threats in this Gig Economy?
A. If your PPM candidate has merely passed a knowledge-based exam, and has little relevant experience, he or she will consistently fail. Demonstrated competence and performance, against advanced and complete baselines, are required to manage both contractor and enterprise risks.
B. If your leadership & interpersonal skills, and strategic thinking & business savvy are not exceptionally high, you will consistently fail in gig economy.
C. If relevant application area experience and experience with the initiative’s national languages and cultures are low, you are a risk! Savvy executives will avoid you as a PPM candidate.
D. If gig PPMs succeed by burning out their teams, then they will have difficulty collecting an effective team in future projects or programs.
E. If a PPM spends all their time in gigs, then she/he will fail to do the marketing and bidding needed to get more gigs. And the converse: marketing and bidding brings in no direct revenue. Reputation or an alliance with a Gig Agent, are smart risk mitigations.
F. If your PPM candidates are not engaged in continuous learning, then their job will be lost to Artificial Intelligence—or to candidates who demonstrate their continuous learning, by sharing their freshest insights with others.
Gig Economy can be risky, or it can be a market differentiator for the smartest enterprises. And it can be especially useful for project and program managers, and the organizations that employ them. This is because our practitioners are the smart secret to well-managed organizational change, and to high business benefits. Gig economy will, as it matures (and as decision-makers mature in its use), highlight the talents of the smartest Executives and Managers, and the best project and program managers.