Tag: Gig Economy

Updated on March 20, 2024

Transforming Tomorrow: Harnessing the Future of Work

By Yolanda Lau

The future of work unfolds with boundless potential and transformative opportunities awaiting. As we stand on the cusp of exponential change, a new era emerges in which the skills imperative for success diverge from those of the 20th century. The rise of automation, artificial intelligence, and the gig economy is changing how we work. To thrive, companies and individuals must be proactive in preparing themselves for the future of work.

Embracing Automation

The rise of automation is one of the most significant changes in the future of work. Automation encompasses various technological advancements aimed at reducing or replacing human labor with machinery or software — and is expected to reshape almost every industry. Many low-skilled jobs, such as assembly line work or data entry, will likely be automated, leading to a transformation in job roles and skill requirements. Automation isn’t about replacing humans entirely — instead, it’s about augmenting human capabilities and efficiency. Companies must invest in training and development programs to ensure their employees have the skills required to adapt to this evolving landscape. While automation may displace some jobs, it will also create new opportunities for those who can design, build, and manage automated systems.

Integrating Artificial Intelligence

In tandem with automation, artificial intelligence (AI) is revolutionizing the future of work. AI technologies — including machine learning, natural language processing, computer vision, and robotics — are increasingly integrated into various aspects of business operations. While many fear that AI will lead to widespread job loss, the reality is more nuanced. AI has the potential to enhance productivity, streamline processes, and unlock new possibilities. However, individuals who resist or fail to adapt to AI may find themselves at a disadvantage in the job market. Companies must invest in AI education and training to empower their workforce to leverage AI technologies effectively. Every senior executive should be thinking, “How can my team use AI to augment themselves?” By embracing and integrating AI, companies can gain a competitive edge and drive innovation in the evolving landscape of work.

Navigating the Gig Economy

Simultaneously, the gig economy continues to grow, redefining traditional notions of employment. More people are taking side gigs, to hedge against potential layoffs and to sharpen and learn new skills. And more individuals are gravitating towards freelance or contract engagements, thanks to the rise of online platforms facilitating flexible work arrangements. To adapt, companies must embrace the liquid workforce — and learn to cultivate and work with a virtual talent bench engaged in project-based work.

Shifting towards Project-Based Work

The future of work will also see a shift towards project-based work. This trend is driven by the need for agility — and for organizations to constantly be responsive to changing market conditions. Project-based work allows companies to quickly assemble a team of experts with the necessary skills to complete a specific project, rather than maintaining a large permanent workforce. Companies must invest in project management and collaboration tools — and create a documentation-first culture — to ensure that their employees and contract workers can work effectively in project-based teams.

Cultivating Skills and Adaptability

To prepare for the future of work, companies must be proactive in developing their employees’ skills and abilities. This can be achieved through a variety of methods, such as on-the-job training, online courses, and formal education programs. Companies must also invest in leadership and management development programs to ensure their employees have the leadership skills required to succeed in a rapidly changing workplace.

Individual Agency in Career Development

Individuals must take ownership of their career development and professional growth — honing their skills through lifelong learning and side gigs. By actively cultivating adaptability and resilience, individuals can position themselves as indispensable assets in the dynamic landscape of the future workplace. Individuals must also be proactive in building their personal brand and cultivating professional networks. Today, everyone is a brand — and individuals must curate their online presence and narrative to authentically reflect their values, expertise, and aspirations. Doing this stratgeically can help find uncover new opportunities. When combined with a strong network of weak ties, individuals can leverage diverse connections to achieve their career goals.

The Imperative of Work-Life Fit

The future of work is also likely to see a greater emphasis on work-life balance, or as I prefer to call it, work-life fit. We’re already seeing this with some countries exploring a four-day work week and others have made it illegal for companies to contact employees outside of the workday. Executives, policymakers, and workers are realizing that work-life fit is essential for both individual well-being and organizational success. Companies must adopt flexible work arrangements, offering employees the ability to work from home or on flexible schedules. They must also invest in creating a workplace where mindfulness, compassion, and grace are commonplace.

Take Action to Transform Your Future

The future of work is here — and it’s teeming with promise and transformation. The time for action is now. Whether you’re a company leader or an individual contributor, the future of work awaits. Embrace change, augment yourself, invest in growth, and seize every opportunity that comes your way. Together, we can shape a future where innovation thrives, and success knows no bounds. The journey starts today — let’s make it count.

Interested in the Future of Work? Join the Work of the Future #FutureOfWork Facebook Group.

Yolanda Lau is an experienced entrepreneurship consultant, advisor, and Forbes Contributor. She is also an educator, speaker, writer, and non-profit fundraiser.

Since 2010, she has been focused on preparing knowledge workers, educators, and students for the future of work.

Learn more about Yolanda here.

Updated on February 24, 2024

Time For HR To Manage The On-Demand Workforce

By Yolanda Lau

In many companies, freelancers are often the “hidden” workforce. The human resources (HR) team is not always involved in the hiring and management of freelancers. But as organizations shift to being project-based versus role-based, HR must take the lead in managing the on-demand workforce. We must rethink the role of HR in enabling the future of work.

I find there are five key areas that HR leaders should first focus on as they take the lead on managing the on-demand workforce.

Establish Hiring Practices

The HR team has the best expertise for hiring and engaging freelancers. Your recruiting resources are experts at sourcing and assessing talent — managers should be leveraging these recruiters to find the best freelance talent.

And just as your company has defined practices for hiring employees, hiring practices also must be defined for engaging freelancers and independent contractors. It’s just as critical when working with freelancers.

Set the minimum standards for what needs to be completed before a freelancer can be engaged for the first time. For example, specify that at least two interviewers should speak to the freelancer to assess qualifications and fit. Always require background and reference checks. Decide whether a non-disclosure agreement (NDA) is mandatory or define the conditions that trigger this requirement. Establish benchmarks for hourly rate ranges for the types of freelancers your company will most frequently engage.

Provide Internal Training

The HR department should also provide training for managers on best practices for working with freelancers and independent contractors. This training is important for boosting project success rates and ensuring that managers understand compliance requirements.

When working with freelancers and independent contractors, managers need to be aware of local, state, and federal regulations regarding engaging freelancers. For example, the IRS considers the behavioral control, financial control, and relationship of the parties when evaluating worker classification. Understanding the regulations is critical to ensure workers are not misclassified as freelancers instead of employees, which exposes your company to legal penalties and liabilities.

Standardize The Onboarding Process

It’s a best practice for companies to have standardized onboarding processes for their employees. The HR team should establish a standard onboarding process for freelancers and independent contractors. This process will be distinct from the employee onboarding process and reflect the different needs and requirements related to freelancers.

For example, rather than collecting a W-2 during onboarding, your company will need to collect a W-9 from U.S. freelancers or a W-8 from foreign freelancers. Your onboarding process should include all the essential documents for a freelance engagement, like an executed contract, NDA, etc. Onboarding should also include the critical “welcome” elements, such as information on any tools that the freelancer will need to access.

Standardizing the freelancer onboarding process ensures that all the essential documents are completed for every engagement and saves your company significant time.

Set Performance Evaluation Guidelines

Establishing performance evaluation processes and standards is a key element of any HR team’s responsibilities. Performance evaluations with on-demand workers are both similar and different from evaluating employees.

Performance assessments should be done on a project-by-project basis and should include a recommendation as to whether the worker should be considered for future projects. In addition to the project evaluations, the skill sets of each worker should also be tracked. Insights into skill sets help hiring managers source the best fit for upcoming projects from already vetted on-demand talent.

Determine Supporting Tools And Systems

Many companies manage their freelance engagements through a hodgepodge of tools. For example, some companies manage freelancers entirely manually, tracking information in various spreadsheets. Manual management of freelancers can become time-consuming and is prone to errors. And with an assortment of tools, it’s hard to have complete visibility of all freelancer and independent contractor activity and expenses.

The human resources team should take the lead on defining the central tool or system for the company, making it easy for finance, legal, HR, and line managers to collaborate and have complete visibility of on-demand workforce engagements. Freelance and vendor management systems, like the solutions my company offers, provide the integrated capabilities critical for on-demand workforce management.

With a central tool or system, you can more readily develop an external talent bench to support your company. An on-demand talent bench can help your company be much more agile as well as digitally ready.

Leading The Development Of The On-Demand Workforce

HR should be leading the sourcing and development of all talent, not just internal talent. HR leaders have the expertise and the right skills and resources on their teams to develop an on-demand workforce successfully. A blended talent strategy will supplement and complement internal teams. It’s time for HR to lead the transition to the future of work.

This article was originally published in Forbes.

Interested in the Future of Work? Join the Work of the Future #FutureOfWork Facebook Group.

Yolanda Lau is an experienced entrepreneurship consultant, advisor, and Forbes Contributor. She is also an educator, speaker, writer, and non-profit fundraiser.

Since 2010, she has been focused on preparing knowledge workers, educators, and students for the future of work.

Learn more about Yolanda here.

FlexTeam  is  a mission-based micro-consulting firm, co-founded by Yolanda Lau in 2015, that matches talented mid-career women with meaningful, challenging, temporally flexible, remote project-based work opportunities. FlexTeam’s clients are businesses of all sizes across all industries and sectors. FlexTeam’s most requested projects are competitor / market research, financial models, and investor decks. FlexTeam is also the team behind Liquid.

Updated on February 24, 2024

Six Tips to Build and Integrate Your Flexible, On-Demand Workforce

By Yolanda Lau

How we work has changed. The pandemic has accelerated trends already in progress, and it’s become imperative for organizations to develop a flexible, on-demand liquid workforce.

1. Develop a flexible, on-demand workforce as a competitive advantage.

A November 2020 HBS and BCG study of leaders and executives reveals insight into how companies are changing how they think about their workforce. A growing number of organizations are shifting their talent model to a blend of full-time employees and freelance workers as a future competitive advantage. Nearly 90% of respondents expected working with on-demand platforms for premium talent to be critical to the success of their strategic initiatives in the future.

More than half of leaders responding to the same study said they expect their full-time workforce in the future to be much smaller than their current one, and the same number said they would increasingly prefer to rent, borrow or share talent with other companies.

Executives and leaders agree that the future of work requires embracing a modern business strategy that includes working with on-demand consultants and advisors.

2. Change work definitions to be project-based.

A flexible, on-demand workforce cannot function if leaders don’t get better at planning and defining the work itself. The risk of redundancies, missed handoffs and other unforced errors only grows when some or most of the team responsible for delivering work includes freelancers, consultants, and contractors.

This starts by training employees to ask the right questions to get to the right level of clarity and detail about what needs to be done. Use this input to clearly define the scope into discrete pieces of work with finite milestones for external talent. Ambiguity and shifting goals can quickly escalate costs and reduce effectiveness when working with the on-demand workforce.

3. Create an integrated approach for the liquid workforce.

At most companies, consultants and vendors are kept isolated from the inner workings of the company as much as possible. Executing work across cross-functional teams has always been challenging. These issues can be magnified when working with external talent without an integrated mindset and approach. All workers — employees as well as freelancers, consultants, contractors, and vendors — need to understand the overall goals of work. They must also have visibility into pre-existing and ongoing work that informs the work at hand. Keeping the liquid workforce siloed can duplicate work and increase the time and cost for completing work.

Truly confidential and sensitive information should be protected with many internal safeguards. And it’s essential to have every external worker and employee sign a non-disclosure agreement (NDA) or, as we use in our company, a confidential information and invention assignment agreement (CIIA) before work begins. But while it is necessary to keep strictly confidential information safe, it’s paramount to also provide access to the data, information, and people needed to get projects done quickly and efficiently.

4. Define new processes and guidelines.

At some companies, consultants, freelancers, and vendors are subject to rigorous scrutiny, including background checks. Some may have master services agreements (MSAs) or independent contractor agreements (ICAs) or similar contracts in place. But in all too many companies, external workers are governed on a case-by-case basis at best — or with verbal agreements at worst. This puts undue stress on hiring managers and workers, as well as the legal, finance, procurement and HR teams who share the burden of compliance.

Make sure to get fully signed and executed MSAs/ICAs along with NDAs/CIIAs and clearly defined work orders before work begins. This helps to mitigate compliance risk and ensures that work gets done smoothly.

5. Change the culture.

A flexible, on-demand workforce is disruptive. It’s the future of work. Workers and managers will have to rethink their roles, and some will question — or even resist — change. Great shifts require cultural adaptation.

Executives and employees will need to trust outsiders with information and think about freelancers, consultants, and contractors as more than just people who execute non-strategic work. Leaders will need to be more transparent and better at communicating specific, discrete objectives for the work they need to accomplish. Teams must become adept at working with a revolving set of colleagues, both full-time employees, and on-demand workers. This begins by building the habit of explicitly verbalizing formerly implicit team norms and making progress more transparent for others to track.

6. Build in software that integrates your flexible, on-demand workforce.

Moving to a flexible workforce requires leaders to think very differently about how they integrate outsiders with their most important work. A successful organization must build the capacity and capability to manage the complexity of compliance, payments, and legal agreements across multiple cross-functional teams. Key to building this capability is partnering with a vendor management system (VMS) or freelancer management system (FMS) like Liquid (our offering), WorkMarket, or Coupa with the tools and processes to help.

Using a VMS can help organizations scale and optimize project-based work at a lower cost, with lower risk and greater transparency and visibility. The same HBS and BCG study mentioned above also found that difficulty in onboarding external talent quickly and efficiently is a barrier for companies engaging flexible talent. Automated onboarding is just one of many key benefits of using a VMS or FMS.

Building Your Flexible, On-Demand Workforce

Building and integrating a flexible, on-demand workforce requires rethinking work definitions, integrating external talent, adapting company culture, and enabling via processes and software like a VMS. While these requirements can initially seem daunting, each is critical for companies to engage their on-demand workforce successfully. And flexible, on-demand workforces are increasingly becoming an essential strategic lever for companies. It’s time to embrace the future of work.

This article was originally published in Forbes.

Interested in the Future of Work? Join the Work of the Future #FutureOfWork Facebook Group.

Yolanda Lau is an experienced entrepreneurship consultant, advisor, and Forbes Contributor. She is also an educator, speaker, writer, and non-profit fundraiser.

Since 2010, she has been focused on preparing knowledge workers, educators, and students for the future of work.

Learn more about Yolanda here.

Updated on February 24, 2024

The Future Of Work Is The Liquid Workforce

By Yolanda Lau

The future of work — or, as some call it, work of the future — has been a hot topic for many years. Most people think of the future of work as it relates to a specific technology or social issue. For example, the wide range of ideas I’ve heard discussed around the future of work include:

  • Jobs at risk of being automated due to advancements in artificial intelligence (AI) and machine learning (ML).
  • The end of physical office space as companies transition to fully remote operations.
  • A digital workplace that includes virtual reality (VR) or augmented reality (AR).
  • Diversity and inclusion.
  • Attracting and retaining top employees in an increasingly competitive talent market.
  • Soft skills and emotional intelligence.
  • Retraining and reskilling workers for the future.
  • Finding work-life balance or work-life fit.
  • The rise of multivendor software as a service (SaaS) for personal and team productivity applications.
  • Good jobs that pay a living wage, regardless of education or sector.
  • The gig economy.
  • Government-enacted policies and regulations, like California AB5, designed to protect and effectively tax freelance workers.

So which of these many options is truly the future of work?

I believe it’s a combination of all of the above, and it can be summarized by saying that the future of work is the liquid workforce.

Working For Yourself: The American Dream

Working for yourself used to be the American Dream. We were a nation of farmers, creators, builders and individuals with a shared identity as aspiring achievers taking charge of our futures (and destinies). According to historian Steve Gillon, before 1860, most Americans lived in rural areas, and upward of 80% of the workforce was self-employed. By the late 1970s, the self-employment rate dropped to an estimated 7%. Today, that percentage has risen and continues to rise faster than the overall labor growth rate — 10% of workers are classified as self-employed, and 20% to 30% of people are engaged in some kind of independent work.

Corporations And The 9-to-5 During The Industrial Era

As America transformed from a nation of rural farmers to one of industry, so did the way we work. America became a nation of large hierarchical corporations, and our industrial economy required reliable, cookie-cutter workers. The 9-to-5 traditional workforce is a relic of this era: Early 20th century factories introduced the five-day workweek (down from six days to improve productivity).

Future Of Work In The Digital Age

In today’s digital age as AI and machine learning begin to automate jobs and as VR and AR change our workplace and training abilities, the structure of work and the skills needed to succeed have changed. Soft skills like emotional intelligence are now paramount to success, requiring changes to our education system. People are increasingly looking for work-life fit and choosing to leave traditional jobs and instead engage in independent, and often remote, work.

From the corporation side, the talent market is becoming increasingly competitive, requiring companies to engage the liquid workforce as part of their talent strategy. Remote work is becoming commonplace for both liquid workers and traditional workers. Governments are looking to regulate and capture taxes as the workforce evolves. And as the business case for diversity and inclusion has been made clear — that diversity in thought correlates directly to increased economic output — corporations need to add more diversity to their workforce. Corporations are increasingly turning to on-demand workers, consultants and advisors as part of their diversity and inclusion strategy.

The Liquid Workforce

What brings this all together is the idea that the future of work is the liquid workforce — a diverse, robust economy where more and more workers go back to being self-employed, where we go back to our roots as an entrepreneurial nation.

Where the corporation was once the structure driving our economy, the future is an agile, technology-enabled, human-optimized and inclusive system. The individuals who comprise the liquid workforce will work anywhere, anytime on projects with varying durations. This idea encompasses the changing policies, mindsets and strategies of the future of work, and more importantly, the opportunities that follow.

Opportunities Ahead In The Future of Work

Integrating the liquid workforce will bring fresh and diverse perspectives to companies and add new energy and ideas. Businesses will be nimbler and able to quickly respond to changing customer expectations or shifting markets. Developing an adaptive workplace and systems will enable companies to support their flexible blended workforce in terms of both productivity and experience.

The future of work is the liquid workforce, and it is already here. Companies that expect to compete in today’s fast-paced digital landscape must activate the liquid workforce, often by engaging on-demand advisors and consultants along with other freelance workers. Are you ready to take advantage of the opportunities that lie ahead in the future of work?

This article was originally published in Forbes.

Interested in the Future of Work? Join the Work of the Future #FutureOfWork Facebook Group.

Yolanda Lau is an experienced entrepreneurship consultant, advisor, and Forbes Contributor. She is also an educator, speaker, writer, and non-profit fundraiser.

Since 2010, she has been focused on preparing knowledge workers, educators, and students for the future of work.

Learn more about Yolanda here.

FlexTeam  is  a mission-based micro-consulting firm, co-founded by Yolanda Lau in 2015, that matches talented mid-career women with meaningful, challenging, temporally flexible, remote project-based work opportunities. FlexTeam’s clients are businesses of all sizes across all industries and sectors. FlexTeam’s most requested projects are competitor / market research, financial models, and investor decks. FlexTeam is also the team behind Liquid.

Updated on February 24, 2024

Hiring On-Demand Consultants And Advisors As The Gig Economy Matures

By Yolanda Lau

When you think of the gig economy, you most likely think of people shuttling around passengers or delivering food and of companies like Uber, Lyft and Taskrabbit — companies whose workers are, generally, not thought of as highly skilled. You may also think of companies like Upwork, whose success is proof the business model for freelancer workers is here to stay. McKinsey reports that up to 162 million people in Europe and the United States are engaged in some form of independent work. That’s 20% to 30% of the working-age population!

From Low-Skill Freelancers To Specialized Knowledge Workers

But the gig economy is more than low-skill freelancers and side hustlers, more than drivers shuttling passengers, people hosting overnight guests and workers delivering meals and groceries. Today, highly experienced — and highly educated — knowledge workers and creative professionals are the fastest-growing segments of the gig economy.

Companies are realizing that the quickest and most efficient way to get specialized talent is to hire them as project-based gig workers. Corporate boards and executive teams are hiring experts who can provide high-level advice on how to take advantage of business and technology trends while also delivering tactical insights on implementation. These knowledge workers are changing the face of the gig economy.

The Role Of On-Demand Consultants And Advisors In Changing Times

With the rapid rate of change in today’s world, it can be difficult, time-intensive and expensive to assess and react to each new technology trend and challenge on your own. How should your company incorporate artificial intelligence and machine learning into its strategic plan? What are the latest cybersecurity threats, and is your company prepared for them? What is the internet of things, and how does it affect your market? Why should your company care about blockchain or 5G? How can your data be analyzed to provide deep insights into new product and market opportunities?

These kinds of questions and problems are perfect for executive-level consultants who have deep industry experience and can be contracted at an hourly or project rate.

How can on-demand consultants and advisors help?

On-demand advisors can help with a variety of needs — whether it’s providing an in-depth report on competitors, spending an hour giving advice on a potential new product, writing a memo on entering a potential new market, creating financial models and investment memos, or providing expertise on switching software systems. Executives can use on-demand knowledge advisors as sounding boards, to brainstorm ideas, get vital introductions, and ask for advice and insight at critical times.

How are corporate boards engaging on-demand advisors and consultants?

Corporate boards are also relying on independent subject-matter experts to help with high-level, long-term planning and strategy that management teams may not be focused on. Moreover, on-demand consultants can bring unique outside perspectives, which are particularly helpful at companies that lack diversity. I’ve seen it firsthand: Our consultants have helped corporate boards assess expansion plans, acquisition plans, capital raises and exit strategies. These kinds of projects are critical to strategic planning and management in today’s fast-paced economy.

So, how do you find these advisors and consultants?

Start by asking your network for referrals; someone you trust is likely to be able to make an introduction. And, after all, you’re most likely to have a successful engagement with someone who has a track record of delivering strategic insights. If your network fails to uncover the right professionals, there are marketplaces and providers of on-demand executive-level advisors like Business Talent Group, Catalant, and our firm, FlexTeam. Some outsourcing options provide rigorously vetted executive-level consultants; through others, you vet the workers yourself.

Not sure how to vet your on-demand advisors and consultants?

When vetting your on-demand advisors, start by asking whether they have an incorporated entity and an EIN (IRS-issued employer identification number), as those are indicators of commitment to their consulting business. Review their LinkedIn profile and website for red flags. Then, if all seems well, ask for references, and request case studies that illustrate their value proposition. An experienced and reputable advisor may not be able to share work samples due to nondisclosure agreements but should be able to speak confidently about the kinds of work they have done and the outcomes they have achieved.

With more and more companies using on-demand knowledge workers, it will soon become commonplace to hire on-demand advisors. Companies that don’t will risk falling behind their competitors.

The future of work is here, and the decision to adapt and change for the better is yours.

This article was originally published in Forbes.

Interested in the Future of Work? Join the Work of the Future #FutureOfWork Facebook Group.

Yolanda Lau is an experienced entrepreneurship consultant, advisor, and Forbes Contributor. She is also an educator, speaker, writer, and non-profit fundraiser.

Since 2010, she has been focused on preparing knowledge workers, educators, and students for the future of work.

Learn more about Yolanda here.

FlexTeam  is  a mission-based micro-consulting firm, co-founded by Yolanda Lau in 2015, that matches talented mid-career women with meaningful, challenging, temporally flexible, remote project-based work opportunities. FlexTeam’s clients are businesses of all sizes across all industries and sectors. FlexTeam’s most requested projects are competitor / market research, financial models, and investor decks. FlexTeam is also the team behind Liquid.

Updated on February 24, 2024

Six Liquid Workforce Trends Employers Will See In 2020

By Yolanda Lau

The impact of the freelance economy is already significant, contributing nearly 5% of U.S. GDP. But beyond dollars, the liquid workforce is reshaping the future of work. As a chief talent officer working with freelancers every day, I am continually looking at the changes in how we work and what we work on. These are my predictions of the key trends for the liquid workforce in the year ahead.

1. The professional workforce will continue to shift more from full-time employees toward the liquid workforce.

Skilled services represent the largest freelancing category, according to a joint study by Upwork and Freelancers Union, “Freelancing in America.” The same research found that 35% of U.S. workers freelance already, with over 60% starting in the last five years. Millennials and Gen Z are more likely to freelance as well as to hire freelancers.

This shift will require companies to approach and manage their liquid workforce strategically, rather than transactionally. HR leaders must develop new policies and processes to manage a blended workforce.

2. A global talent shortage will increase the pace at which companies engage the liquid workforce.

Deloitte reports that 45% of employers are having trouble filling open positions, a challenge that becomes even greater the larger the company. Tapping into the liquid workforce will help companies close their talent gaps and rapidly respond to business needs.

However, the war for talent will extend to the liquid workforce. Business leaders need to invest in processes, policies and systems that will help them source, attract and retain the best liquid talent. Your onboarding process is just as crucial for building a relationship with a freelancer as with a new employee.

3. The expansion of the liquid workforce will create a workforce that is increasingly geographically distributed.

Over the next decade, an overwhelming number of companies will engage with remote workers — both in terms of traditional employees and freelancers. The growth in communication, project management and collaboration technology options is accelerating the growth of virtual teams and the ease of integrating freelance workers.

Businesses need to take a strategic approach to build out and grow a virtual workforce. A study published by Harvard Business Review found that companies that prioritized working slowly and strategically averaged 40% higher sales and 52% higher operating profits over three years. Invest in training your managers to develop the skills required to manage a virtual and blended workforce successfully.

4. The liquid workforce is fueling a new skills-based economy.

The World Economic Forum’s “Future of Jobs” report notes that “by 2022, no less than 54% of all employees will require significant re and upskilling.” Freelancers recognize the importance of continually updating and expanding their skills. “Freelancing in America” found that over 60% of skilled freelancers have done skill training in the last six months, 1.6 times the rate of nonfreelancers. Freelancers are investing time in developing both soft and hard skills.

Course offerings with marketplaces like Udemy, university courses through edX, vendor certifications, professional association classes and more make it easy for freelancers to keep upskilling. Automation technology and AI may be disruptive, but for skilled freelance workers, these technologies offer the opportunity to be more effective and efficient, while honing their skill-based services.

5. Growth in the liquid workforce will reshape employee retention strategies.

For highly skilled workers, freelancing offers the opportunity to make as much or more than they do in full-time jobs while enjoying more flexibility, greater control and better work-life balance. The risk of losing top talent is even greater with millennials and Gen Z-ers.

Business leaders need to evolve their current policies, practices and programs to retain employees. Consider incorporating elements based on the benefits of freelancing. For example, foster alternative work arrangements. Increase support for self-development, and structure more project-based work.

6. Focus on the rights of freelance workers will continue.

With California’s AB5 law now in effect, other state legislatures are also considering new rules and regulations related to freelancers. However, any other legislation passed is not expected to be as extensive as AB5.

The continued focus on regulations related to freelance workers underlines the importance of ensuring your company has an onboarding process for freelancers, including all the necessary documentation to avoid any potential misclassification issues, and a detailed contract.

The liquid workforce is reshaping the future of work. Managers will need new skills to lead a blended workforce of employees and liquid workers successfully. Companies must adapt their cultures, processes and systems to capitalize on the potential of the liquid workforce. Is your company ready for the liquid workforce?

This article was originally published in Forbes.

Interested in the Future of Work? Join the Work of the Future #FutureOfWork Facebook Group.

Yolanda Lau is an experienced entrepreneurship consultant, advisor, and Forbes Contributor. She is also an educator, speaker, writer, and non-profit fundraiser.

Since 2010, she has been focused on preparing knowledge workers, educators, and students for the future of work.

Learn more about Yolanda here.

FlexTeam  is  a mission-based micro-consulting firm, co-founded by Yolanda Lau in 2015, that matches talented mid-career women with meaningful, challenging, temporally flexible, remote project-based work opportunities. FlexTeam’s clients are businesses of all sizes across all industries and sectors. FlexTeam’s most requested projects are competitor / market research, financial models, and investor decks. FlexTeam is also the team behind Liquid.

Updated on February 24, 2024

How (And Why) Companies Should Engage The Liquid Workforce

By Yolanda Lau

The rise of the liquid workforce is transforming how companies and people work together. Companies are learning that temporary, specialized workers — or what is increasingly known as “the liquid workforce” — can help them stay relevant in the rapidly evolving, project-based, digital landscape.

The Growing Liquid Workforce

You may have learned the term “liquid workforce” from Accenture in a 2016 report describing the growing trend of freelance workers in the marketplace. Since that report was published, the number of freelancers has continued to grow. A report from Upwork and Freelancers Union estimates that 57 million people worked freelance this year (an increase of 4 million since 2014) and contributed $1 trillion to America’s gross domestic product.

This increase has made it easier for companies to engage the liquid workforce and recognize their numerous benefits — including more flexibility, instant support for specific projects, on-demand access to expertise and reduced overhead and lower costs. Tapping into the liquid workforce allows businesses to be nimble by fluidly shifting their business as new challenges arise.

Who Makes Up The Liquid Workforce?

Freelance work is not a new concept. The vast majority of people in creative fields, such as entertainment and fine arts, have long operated as freelancers. For educated professional workers in fields such as IT, marketing and consulting, however, the normalization of working remotely has allowed more people to unchain themselves from traditional W-2 employment in favor of a more autonomous work life. Moreover, the current availability of online trainings and certifications allow freelancers to learn skills independently — making them appealing to traditional businesses that may only require that specific skill sets for a short period.

Freelancers today view their work as a long-term, intentional option, not simply a way to supplement income or recover after a job loss.

Why Use A Liquid Workforce?

Businesses are evolving faster than their full-time employees can keep up. By utilizing the on-demand liquid workforce, a business can assess a need and onboard a freelancer to address it more quickly than they could train up their own employee.

1. Specialized Skills

With the rise in talent-matching platforms, it’s become simpler to find the right on-demand workers. There are now platforms to hire software developers, business consultants, content writers, marketers, designers, accountants, lawyers and even salespeople. Once you’ve found the right worker and sign a contract agreeing to terms, they can start working ASAP. Moreover, with low unemployment rates, it’s often easier to find a freelancer for a short-term project than it is to fill a full-time role.

To find the right freelancers with the specialized skills you require, you must clearly define the project — including detailed proposed deliverables, qualifications and work experience required and payment. Highly experienced freelancers are busy and in demand, so make sure your project is compelling.

2. Reduced Cost

With companies increasingly shifting to project-based workflow, once a project is complete, the freelancer is released without any burdens on the corporation — no health benefits to pay, no pensions to guarantee. Without benefits or office space, companies can expect to save 30%–40% annually when working with freelancers versus employees. It’s easier to ramp up or pull back on spending on freelancers than it is with salaried employees.

To make it easy to activate your liquid workforce whenever your company needs project-based support, set up a standardized onboarding process for your freelancers. Automating onboarding will save you time and money, plus help avoid compliance risks.

3. Quality

Freelancers thrive on repeat work and repeat customers to stay in business. They aim to deliver top-notch work, every time, in order to maintain relationships. While employees know that a bad week likely won’t affect their pay, freelancers know that client contracts are always subject to renewal.

Every time you are considering hiring a new freelancer, make sure to review the freelancer’s past work and client ratings/testimonials. A quick interview helps you not only verify a match for the project but also align expectations. Consider engaging the freelancer for a smaller test project to thoroughly vet skill set and fit before commencing a critical project.

4. Agility

Freelancers see innovation as a part of their working method rather than just a buzzword. Generally, they’ve developed flexibility, the ability to make sense of uncertainty and complex ideas and an understanding of how to communicate new ideas and roll them out quickly.

To hire freelancers adept in agile methods and thinking, talk to them about their project management style. How do they communicate and collaborate with their clients? How do they self-assess their work?

5. Globalization

Working with the liquid workforce allows companies to find talent outside their geographical limits. Sometimes this means reduced costs. But it can also deliver insights into new markets. Using freelancers may open the door to growth while minimizing risk in case things don’t pan out.

When hiring freelancers internationally, make sure to assess mutual communication fit. This fit is more than language — you and your freelancer must be able to understand each other fully or this will become a hurdle that may cause project delays and rework, and potentially incur an additional cost. Communicate availability windows upfront to avoid causing project interruptions while the freelancer waits to hear back from you.

The Liquid Workforce

Contingent workers have become a critical resource for companies needing deep expertise or additional on-demand brainpower. The liquid workforce is becoming an increasingly valuable component to a talent acquisition strategy. As companies hope to compete in today’s global marketplace, they must learn to engage the liquid workforce or risk getting left behind. And it becomes increasingly important for organizations to use software like Liquid to manage contracts and payments for the liquid workforce. Companies that tap into resources for freelancer acquisition and freelancer management will decrease their costs and increase their revenue — helping companies stay ahead of their competitors.

This article was originally published in Forbes.

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Yolanda Lau is an experienced entrepreneurship consultant, advisor, and Forbes Contributor. She is also an educator, speaker, writer, and non-profit fundraiser.

Since 2010, she has been focused on preparing knowledge workers, educators, and students for the future of work.

Learn more about Yolanda here.

FlexTeam  is  a mission-based micro-consulting firm, co-founded by Yolanda Lau in 2015, that matches talented mid-career women with meaningful, challenging, temporally flexible, remote project-based work opportunities. FlexTeam’s clients are businesses of all sizes across all industries and sectors. FlexTeam’s most requested projects are competitor / market research, financial models, and investor decks. FlexTeam is also the team behind Liquid.