Chicago StockyardsNote from Art: this topic has me deep in thought.  While the issue is generally a negative one, I do wonder whether it contains the seeds of significant management and leadership revolution.  I would love your thoughts here.

In case you missed it, the article, “The Disposable Worker” in the January 7, 2010 issue of BusinessWeek  offers a sobering look at the increasing trend for employers “to create just-in-time labor forces that can be turned on and off like a spigot.” And guess what folks, this trend is not just for those near the bottom rungs of the ladder, this current fashion extends all the way up into the CEO Suite.

While one might get the impression that this is a fairly modern “management innovation,” enabled by advances in technology and easy access to low cost labor around the globe, I’m reminded of the scenes in Upton Sinclair’s gruesome and powerful book, The Jungle, chronicling the early days of the meat-processing industry in Chicago.

I last read the book in high school, but the images of men (in this case, they were men) lining upside the gates of the stockyards and processers, and the foreman stepping out and indicating how many that he needed for the day, jumps to mind.  If you were lucky enough to be picked on a given day, you were invited in to literally put life and limb on the line for a few cents.  On other days, your family went hungry.  If there was no work or you became injured, often, you died.

I’ll stop short of comparing the modern organization to those firms described in Sinclair’s pro-union classic, however, the picture painted in this article has that haunting specter of The Jungle hiding in the shadows.

My perspective here is not pro or con and don’t take my use of The Jungle or the  union reference to mean anything other than highlighting a point in history and the message contained in this book.  Organizations are striving and struggling to cut costs, compete and in some cases survive and desperate times call for desperate measures. The use of on-demand talent is well established in consulting and technology and in some cases it works well.  However, I do think that the tasks of managing and leading and competing in an era of “workforce on demand” are about to change in ways that we might not yet fully understand.

Thoughts and Issues on Managing and Leading In the Era of the Disposable Workforce:

-The challenge to choose the right tasks for “just in time” resources.  While it might be tempting to broadly apply the “on/off” approach to the workforce, managers should carefully evaluate the impact on business execution, customer satisfaction and innovation of replacing formal employees in core areas with contract workers.  The short-term cost savings might just cost the firm its future.

-The difficulty of acclimating the remaining workers to this new reality.  One of the more laughable parts of this not so funny article was the example of a firm adopting this model and then bringing in a resource to train the remaining employees on positive thinking.  I suspect that more than a few workers were pretty positive what they wanted the firm to do with this speaker!  While those that remain will likely be happier with a job than without, there’s little chance they will be happy.  And while work doesn’t have to be an endless group hug, there’s something to say for the ability of an engaged, motivated workforce to satisfy customers and fuel innovation.

-The pain of living through the destruction of a firm’s culture. Whatever the firm was before, it no longer is the same after retooling with temporary workers.  Instead of something that had a history and stories and artifacts and all those tangible and intangible components of a culture, the organization’s new environment might best be characterized as one that lacks a culture.  Thoughts of Dystopian environments and various science fiction novels are beginning to jump to mind here.

-The challenges of measuring and maintaining quality and identifying and implementing critical improvements will be more difficult in the on-demand environment.  The dearth of individuals that understand how to get work done via the informal organization will challenge firms to create new systems for these issues.

-The role of the Project Manager and the field of project management take on a very, very high importance in this new style organization.

-The impact when the worm turns! If and when recovery occurs, watch out!  Somewhere, some wise firm will catch on to the novel idea that they can compete more effectively with an engaged workforce and the “jumping ship” will happen so fast that the firm’s leadership will be checking the news for information on the tsunami that cleared out the buildings.

-The role of the leader will change significantly. Many of the core focal points that are written about daily in the leadership blogosphere and in shelves filled with books from name-brand authors will no longer be relevant.  The leader as a transaction manager with accountability for output with no concern for development, coaching and well-being may disappear.

The Bottom Line for Now:

I recognize that I’ve taken a mostly dark look at this issue in this post.  The beauty of writing these things is that they force the author as well as the readers to think through the issues at a deep level.  Intellectually, I do wonder whether the current economic situation contains the seeds of a new approach to management…an evolution or as Gary Hamel describes it, management innovation, and that the real challenge and issue here is truly how to rethink management and leadership.

Hmmm.  Back soon with some more thoughts.  Meanwhile, I would love to hear yours.