I’m not normally one to jump on the acronym band-wagon, but ‘Work 3.0’ is definitely emerging as a real issue for many organisations ~ especially from an HR strategy and systems perspective. One of the messages from Work 3.0 is the notion that the workforce will be made up of lots of people providing specific skills to resolve specific outcomes, based on an on-demand working model.

The growth in crowd sourcing on-line businesses that essentially allow prospective employees to bid for a piece of work,  is a good indicator of this trend, although I would hasten to say that the growth of these businesses are not an indicator that organisations are shedding full time employees to be replaced by on-demand services. I think there will be a far more gradual shift to a on-demand workforce through natural attrition and opportunity. Practically the type of work suited to crowd sourcing is fairly limited and is currently best suited to outputs that are clear-cut and easily definable, and where the risk is low. As we see technology improving in terms of speed, collaboration capability and the ability to create a sense ‘closeness’ and ‘trust’, we will see the opportunity for jobs outside of the low risk category growing.

Let me cut to the main point of this blog – your HR system and its capability to manage an on-demand, and physically dislocated  workforce. There are a number of challenges that immediately spring to mind:

Hiring: Hiring someone to do a piece of on-demand work is simple – A line manager can go on-line, place a work requirement, wait for responses, select the resource you like and away you go. Of course this is reminiscent of ‘cowboy’ recruitment we have seen in the past and has a wide range of risks. So how will HR departments manage the hiring of these types of resources ?

If your organisation doesn’t have a sound practice to hire and manage contractors currently- this is a signal that you are going to have problems in Work 3.0 environments too. HR systems need to assist in managing the  process, provide tools to validate employee/organisation fit, manage post work assessment (performance management) to name a few. In my view I haven’t seen any HR or Talent tools stepping up into this space. We should also not assume that current system  functionality in Hiring, Assessment and Performance management can simply be extended to this new category of employee – it has very different requirements.

Classification of the employee: One of the basic HR functions is to know how many people work in your organisation – in many organisations this only means people paid through the payroll system. In my view this is a misrepresentation of the total workforce and its associated cost. The reason provided by HR is often indicated as a lack of system capability to track contractors who are paid through invoicing to finance. Work 3.0 will further exacerbation this issue, and HR organisations need to quickly get on top of this so that the workforce count if properly represented.

Data sharing: Crowd sourced employees will want to share information with organisations and want their employer to feed them information back – this data could be stored in commercial social networking tools such as Linked-in, Facebook, the crowd sourcing platform or their own personal database. The ability to share information between a corporate HR system and external and individual social / cloud tools is a new concept for HR vendors, but will become a prominent need in the next few years.

Payment: How you pay a crowd-sourced employee or on-demand employee can be challenging, particularly if they are in another country where you don’t have a physical presence. Its not so much the movement of money that’s the issue, but rather compliance to local tax regimes.The recording of time against a task will also be an important area for development and integration.

Hyper specialization: Crowd sourcing or on-demand working will give rise to the concept of hyper-specialization. Activities will be broken into a multitude of tasks in order to take advantage of an on-demand workforce. For a line manager, this brings in new dynamics to manage a team of people collaborating on a common output – Line managers will need new tools to help co-ordinate work across tasks and teams of physical and dislocated employees. Some HR systems do a decent job in supporting project environments, but its not the norm, and in future they need to provide better end-user management tools outside of the ‘Project Manager’ type tool mindset – tools that will facilitate teamwork, team management, performance management, completion tracking and communication.

Strategic Workforce planning and Talent Management: The on-demand workforce will provide new opportunities to manage the ‘supply’ side of long term talent management needs, which could ease the fears around the ‘war on Talent’ – however most workforce management tools are geared towards the traditional employment model. Workforce planning tools are emerging as an important components of an effective HR environment, particularly in the area of predictive modelling techniques. The crowd sourced employee adds an unknown layer into this equation that will need to be understood in order for WFM tools to be put to best use.

We are heading for an exciting time in execution of work in our workplaces, but we do need HR systems to start providing tools to better manage this future environment. What are your views.