Andrew Karpie's Blog

Kelly, oDesk and the “Hybridization” of Staffing in 2013

The recently announced partnership between Kelly and oDesk is not just an isolated landmark event in the staffing industry, it is a part of a whole process of evolution and transformation — one that may alter the face and landscape of the staffing industry over the next 10 years (strengthening and bringing new growth to the industry as a whole).

While the general, incremental adoption of information technology applications into staffing firms has been a major driver of improved staffing performance and efficiency, another set of developments has been emerging: that is what I call the “hybridization” of traditional staffing agency and online staffing platform models. This hybridization entails a variety of potential combinations of these two models.

For some time, many thought that the two models were quite different and performed in different business segments. But we are now starting to see very different kinds of “mash-ups” of these models resulting in ways of intermediating work arrangements, and even new forms of work arrangements (such as on-demand, global freelancer-based Talent-as-a-Service or TaaS). [i]

In fact, “mash-ups” related to technology, platforms, and hybrid models are now causing us to have to think and speak differently about new and evolving “work-arrangements.”  See:  “Online Work” vs. “Online-Intermediated Work Arrangements” – That is the Question

As I see it, 2013 will be the year that we look back on and say: “Yes, that was when signs of hybridization in the staffing industry started to appear.”

So what are some examples of hybrid models we have begun to see in 2013?

Let’s start first with the Kelly/oDesk partnership. This is the first instance of a traditional staffing business partnering with a large (actually the world’s largest) prototypical online freelance marketplace platform— that is, one of those platforms that mainly enables specific “online project work-arrangements” between hirers and freelance knowledge workers almost anywhere in the world. In this partner model, Kelly MSP clients will have access to a new service offering (online projects performed by any of oDesk’s millions of online freelancers across the world) to ease their talent-gap woes. In this model, the oDesk marketplace platform becomes a supplier/sourcing pool of online-talent which can be consumed by enterprises as “managed” Kelly workforce service.

Another partnership, between MBO Partners and Work Market, was announced in the second half of 2013. MBO Partners is the largest ICEC (Independent Contractor Evaluation and Compliance) and “high level professional” IC servicing firm in the US; Work Market is the leading online marketplace platform for on-site, contract workers. These two businesses have partnered to provide a service they call “Managed Contractor Cloud,” which is targeted to enterprises that want to or need to hire high-skilled, independent professionals who do not want to be employees or temps. The “Managed Contractor Cloud” allows those enterprise to develop, engage and deploy a fully-compliant, curated contract talent population, leveraging the combined services and platforms of MBO and Work Market (businesses, which are each in their own ways, hybrids of sorts).

Hybrids need not involve partnerships as such for cross-pollination. One example of this is NextCrew, which is a white-label online platform that a staffing firm can license and deploy, much like it would a SaaS ATS or CRM solution. But the NextCrew platform enables the staffing firm to begin to provide its clients with new advanced online staffing services for onsite/local workers under its own staffing firm brand. NextCrew, in effect, enables traditional staffing firms to become online platform hybrids.

Another kind of hybrid, I believe we will see more of, is that of staffing firm that is designed and built--from the ground up — as an online staffing platform. An example of this type of firm would be PRSONA, which bills itself as a “Cloud Staffing” firm (a business that functions just like a staffing firm, but on more of a self-service basis and without the cost structure of branches, sales people, and recruiters).

In effect, hybrid models arise not just through partnership combinations or vendor-client combinations (and other potential forms of cross-pollination), they also arise when new firms are designed to be hybrids. Different firms (like Work Market, PRSONA, OnForce, FieldNation, TaskRabbit, GigWalk, ElevateDirect (UK), etc.) are all slightly different models that are hybrids because they were not designed (like an oDesk or Elance) to provide a “global online-freelancer marketplace platform,” but rather to provide platforms that mainly address enterprise needs for on-site/local contractors. To some extent, these platform businesses are designed and built to use platform models to fulfill traditional staffing requirements.

Besides online staffing businesses that exist today, there are also entrepreneurs in various parts of the world with business plans (some funded and advancing, some more seminal) for start-up that will introduce new, innovative hybrid models.

Moreover, I am clearly seeing increasing cross-pollination between traditional and online staffing in the form of staffing firms of all sizes (and other staffing supply chain players) all over the world, seeking partnership and investment opportunities among online work arrangement platform businesses (and vice-versa).

From my observation point, I can see there is so much going on in terms of hybridization that will be much more prevalent and visible in 2014. But I am certain we will look back on 2013 as the year when the first signs of this extremely significant, transformative industry trend of hybridization became apparent.

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[i] In fact, “mash-ups” related to technology, platforms, and hybrid models are now causing us to have to think and speak differently about new and evolving “work-arrangements.”  See:  “Online Work” vs. “Online-Intermediated Work Arrangements” – That is the Question

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