How Commoditized White-Collar Work Will Change the Work Dynamic

May 20, 2009

My last post Is Commoditized White-Collar Work on the Horizon? reported on the concept of turning white-collar work into numbers by cataloging the skills of individuals and mathematically determining how to deploy workers to specific projects based on their skills. The goal being to optimize productivity of those commodity workers to achieve 100% productivity. In this post, I’ll share my immediate thoughts and reactions.

One argument from IBM -- in support of using their software tools – is that since these tools will make workers more productive, the market would reward the workers and enable them to negotiate better pay.

I don’t buy the argument for one minute! I can see how those elite workers at the top would be able to negotiate their pay, being perceived as talented stars, but would commodity workers have any negotiation leverage? My specific concern: When does something increase in price (implying greater perceived value) when it is commoditized?

If – and I think that this is a big if – white-collar work can be actually be broken down so discretely so that tasks can be divided into days, hours, or even minutes, the result will be the white-collar equivalent of piece work. Would you want to be a commodity worker?

This also doesn’t sound like the creation of an environment of informed, motivated employees who are also expected to help drive innovation that will spur continued growth of the company. In fact, it sounds like what Susan Lucia Annunzio was warning about in her book “Contagious Success – Spreading High Performance Throughout Your Organization.” And that is to avoid over-emphasizing productivity to the point that you drive out the ability for workers to contribute more through innovation and creativity.

You need to look no further than Google in support of allowing workers to contribute through innovation and creativity. Google’s software engineers spend 20% of their work time – one day per week – on projects that interest them. And it is paying off. According to Marissa Mayer, Google's Vice President of Search Products and User Experience, half of the new product launches originated from this 20% “innovation” time. (Source: Wikipedia)

Will commoditizing work actually optimize productivity? Not so, according to a recent BusinessWeek post, Surfing the web at work increases your productivity. According to this post, people who gave themselves quick rewards after completing mini-tasks were more productive, to the tune of being 9% more productive in a day. Will someone who thinks that you should be tracked down to the minute give you the space of surf the web at your own discretion? I can't picture that happening!

Let's continue on and assume that you are a commodity worker who is being pressed for 100% productivity all of the time. How will you stretch and grow into a star? Will management be responsible for even identifying potential? If so, how will this be accomplished?

I suspect that proving yourself will be done by doing things on your own time, on your own dime. And employees will want to generously donate their efforts towards a company’s success because…?

In the near term, companies will need to think long and hard before adopting this concept. If a company takes this too far, I believe that it will be difficult to succeed as there will be too few who are able, willing, and incented to contribute innovative thoughts and creative ideas on behalf of the company.

I’ll take the plunge and dive into greater speculation: The likely outcome will be the emergence of a true, virtual corporation. Why? I'll quote Newton’s Third Law of Motion:

For every action there is an equal and opposite reaction.

Newton was talking about the physical world and I'm talking about people, but as we all know, people react. The backlash of treating employees as commodities will likely encourage increasingly large numbers of people to become independent, where they have more control over their work hours and destiny. This of course will open up opportunities for web-based project solicitation and bidding. Hmmm…

At any rate, I’m predicting that these independent workers will choose work on a project-by-project basis, managing their own careers by selecting attractive projects and re-investing their own money and time into keeping their skills sharpened.

This will tighten and focus corporations significantly, as they will be unable to assign work for low-value activities. There won't be anyone within the corporation with any bandwidth to take on those tasks, and there won't be anyone willing to take them on as an independent contractor, either. Low-value tasks won't contribute anything towards improving skills and the value proposition of an independent worker.

Another opportunity in all of this will be an increase in telecommuting and greater need for network-based collaboration tools. Of course, there will be a reduced need for large, commercial office space, something to consider if you are in the commercial real estate market. (Again, I’m having a little fun predicting here, I’m interested in your take.)

Will corporations resist this? Interestingly enough, I doubt that they will. Corporations will find this work arrangement attractive because they will have far less people on their actual payroll, limited to those who will be responsible for defining and shaping the core business along with defining and farming out a majority of the work. Between this and other technological advances (cloud computing for one), corporations will have the easy, ready ability to flex their workforce up and down, based on immediate needs.

The real trick for corporations will be to identify and those who are willing and able to manage the business and set direction that will drive growth. One issue is that there will be less of an internal talent pool to draw from and develop.

I feel that there are challenges and opportunities for both the individual worker and corporations in the commoditization of work. The world certainly isn’t standing still, but I feel that technological advances will drive fundamental changes in how everyone approaches work in general.