First, a definition of terms. By “the cloud” I am referring to the large cloud-based platforms usually referred to as “the Gig Economy”. Companies like Uber and Lyft, Instacart, Grubhub, Fiver, and Upwork, HomeAdvisor, GreenPal, TaskRabbit, Handy, Field Agent, Gigster, and many others.
See a more complete list here
Increasingly the national staffing associations, Staffing Industry Analysts and American Staffing Association are including them under a common heading, i.e “staffing companies” or “staffing agencies”. In fact, this has been going on for a couple of years but recently it has become more formalized. The logic is simple enough in that they all do the same thing, i.e. hire “temps” with a variety of skills to perform short term gigs (jobs) for their clients.
In this definition, the traditional staffing company is now, and has been. the original “Gig Economy”. They may not be physically in the “cloud” “but their staffing software is, and it can perform almost every task that is needed to compete with these new staffing agencies.
As articulated in a recent article, good staffing software is also a great Content Management System (CMS), a Client Relationship Management (CRM) tool, an Applicant Tracking System (ATS) and an HR software.
Good staffing software also has a complete payroll and billing system, great communication software for keeping in constant contact with workers in the field, also, automated onboarding, medical benefits management, and more!
Staffing companies have the knowledge, experience, core staff, contract employees, client base, office facility, and knowledge of the local market to create a formidable competitive advantage.
So, what does Grubhub, Instacart, GoPuff, Rappi, and Roadie do that a traditional staffing company cannot do? Nothing! Those companies simply make deliveries. In fact, traditional staffing companies (lets call them Gig Economy companies) can perform those services, and many more difficult ones, much better. Why?
In large measure it is because they are not in the “cloud”. They are on the ground in every city and town in the country. They know all the restaurants, grocery stores, commercial and industrial sites that use these services every day.
They also know a lot of the principals and can network to others they do not know personally.
Staffing companies also have local political influence, a subtle but incredibly significant area of influence.
Compliance issues will be important as many of these “cloud” companies are using independent contractors rather than the regular salaried and hourly personnel. Often because of the nature of the work and the way in which some workers are being paid, the independent contractor status may hold, even in areas where it was not possible.
For example, if a gig worker uses his own vehicle and can accept or reject a given call, or is paid per delivery or by mileage, he or she may qualify for “independent contractor” status.
So, it may take some reorganization. Perhaps targeting a specific service and building a small team to staff and operate it might be a good starting point. Maybe forming some new relationships with colleagues in other local or regional staffing companies would be a helpful change specially to deliver an “on demand” service.
On the technology side, although your company has 95% of what you need, maybe you will need some new capabilities like Mobile Apps. Regarding mobile Apps or other technology, remember that your staffing software company is a great software developer so if an application, mobile or otherwise does not exist today, in the formatting desired, it can exist tomorrow!
Using API (Application Programming Interface) technologies, these new utilities can be incorporated seamlessly into your existing staffing software.
So, what about other temporary services provided by these new cloud-based platforms. Can traditional staffing companies compete with other Gig Economy platforms like Care.com, Heal.com, Pager.com, or Sittercity.com? These platforms hire, screen, and deliver caregivers to patients and then directly connect them to each other . . . and to the platform.
Isn’t this what staffing companies do every day in many other industries? Certainly! Can staffing companies deliver graphic artists, content writers, photographers, videographers, programmers? Or can they match expert freelance office workers with clients, like the platform Catalant does? Absolutely!
Some changes may need to be made but essentially this is what the Gig economy does and what traditional staffing companies have done for 50 years, i.e. providing gig workers (“temps”) for their clients by giving them and their workers increased flexibility in getting an important job completed.
Sometimes it is the way in which a service is delivered that makes the difference. It is always the same but always a different world out there. A successful business needs to meet them where they are now.
The American Staffing Association says there are 22,000 staffing agencies with 39,000 offices in the US. That is enough to cover every city and town in the country. We know the cloud-based platform companies are in every one of them.
We also know the business is there because we can see it being done daily in our own backyards. It is also business that staffing companies, with local offices, experienced staff and equipped with great staffing software, have, at least, 95% of the needed structure to accomplish nearly every temp job or “gig” you can think of.
Providing temp workers for temp jobs in a host of industries is what staffing companies have been doing for fifty years.
So, why not compete with “The Cloud”?