The new game in town
Outsourcing is becoming a game that more than the big guys can play, writes Sue White.
When a US worker made international headlines earlier this year for outsourcing his job at telco Verizon to a worker in China, it seemed "Bob" had simply figured out what large companies have spent the past couple of decades doing. Sometimes there are cheaper, more efficient ways of getting a task done than sitting there and doing it yourself.
But while Bob, somewhat unsurprisingly, was fired (to the disappointment of many following his story), the fact he could even achieve the task shows just how much our ability to outsource work has changed.
"The first wave of outsourcing was all about voice - for example, call centres. We saw that work going overseas," says outsourcing specialist and former president of the Australian Business Process Outsourcing Organisation, Martin Conboy.
It's known in the industry as lift and shift. "We lift it from here and shift it to there. It's more commonly known as labour arbitrage," he says.
But outsourcing has moved way beyond the lift and shift. Customers now demand 24/7 service, and both technology and outsourcing make it possible. For those companies not willing to engage with the world of 24-hour business, social media does the convincing. spreading the word about problems faster than you can say "global economy".
"Expectations are rising," Conboy says.
According to the University of NSW's Professor Michael Quinlan, the trend to an increasingly outsourced workplace is concerning.
"You could never run an argument that nothing should be outsourced . . . But what usually drives most outsourcing experiences is cost- cutting . . . You have to ask how that price reduction is achieved; it's usually by a cut in quality or a cut in the labour standards for the work," he says. Quinlan says the "chains of subcontractors" seen in some industries often result in exploitative conditions, or at a minimum, difficulty in enforcing conditions such as occupational health and safety requirements.
"The more contracts you involve, the harder it is to regulate," he says.
Of course as the way we work is changing some people are more than happy to be "outsourced".
Contrary to popular opinion, our employers are not only outsourcing overseas. In Australia, an online platform connecting local "on demand" workers with businesses has tapped into a niche that appears to be keeping both sides happy. Now running in Melbourne, Sydney and Brisbane, Sidekicker began when a time-poor Melburnian, Tom Amos, was studying for his chartered accountant certificate and dreamt of outsourcing his chores. His future business partner, Jacqui Bull, could see the potential.
"I would have loved a way to make work fit in around my studies and sporting commitments," Bull says.
The pair soon realised the real opportunity lay not in dropping off dry-cleaning for busy professionals (although there is some of that), but helping small to medium businesses deal with a temporary spike in workload.
"People need short-term help with data entry, accounts or manning a registration desk at an event," Bull says.
More than 5500 hours of work has been assigned to the pre-screened "Sidekicks" since the business launched in September 2012. An employer posts a job, and pre-screened candidates apply. By balancing the number of available Sidekicks with the rough amount of work out there, employers don't get overloaded with applicants for a short-term gig, and Sidekicks aren't competing with hundreds of others or "bidding" for jobs, like say, Elance. Jobs start at $29 an hour (the company takes about $9 of that) and employers are free to offer more.
While Bull says Sidekicker takes its role in screening candidates seriously, once a Sidekick is approved, it's hands-off in terms of the actual workplace relationship.
"We're not a recruitment agency . . . we have no control over what jobs they do, it's just an initial measure . . . [But] we want quality people. People have to apply with a resume and cover letter, and we interview them," she says.
Bull says Sidekicker is not about driving prices down.
"We don't want the race to the bottom. It's about providing access to a pool of great people," she says.
The company tries to keeps the deal sweet for Sidekicks through a mix of community building, private rating systems and practical sweeteners. The technology allows workers to communicate with each other and the ratings system, although not public, means if either side acts up they can be removed from the site.
Sidekicker can also handle all the payments and invoices are generated automatically after job is completed.
Bull says outsourcing in this way will never replace full-time employees. But she believes it may change the game.
"Many people don't want to be stuck in the 9 to 5. They want to work for a period, then do something else with the rest of their time," she says.