Modern businesses, massively reliant on information technology, are faced with a fundamental question - should they organize “traditionally” via single locations where salaried “W-2” employees work, or should they exist primarily in “the cloud” - with far flung networks of “1099” contractors, vendors, affiliates and the like?
Let’s label the two approaches “old school” and “new school” and explore their pros and cons:
W-2 Old School Positives. You can spin virtuality anyway you like, but human beings are fundamentally designed to work together in 3 dimensions, in-person.
Among many other, an incredibly KEY benefit of the old school way - training and professional development.
While e-learning holds great promise, almost all of us have had the vast majority of our educational, development and collaboration experiences in the “real world.”
And unless and until there is some radical re-ordering of parenting and elementary school norms, this will always remain so.
As for reaching “hearts and minds,” working out of one’s spare bedroom, or from the kitchen table is convenient and all, there are few experiences of “true aliveness” like working in-person with colleagues you respect, toward accomplishing missions and objectives of value and high ideals.
Old School Negatives. It is 2012, folks, and markets and competitive conditions in our brave new world move far faster than the traditional, “one roof”, employer - employee organization dynamic.
Combine this with the fact that it is getting increasingly difficult to attract and retain the best and most creative self-starters to traditional corporate environments, and it is easy for organizations to devolve to both personnel mediocrity and a mismatch between what the market dictates and what the employee rolls reflect.
New School Positives. Sites like LinkedIn, Rent-a-Coder, Craigslist, and dozens of other have made it cheap and easy to find and transact with talent with the skill sets an organization needs as it needs it.
And while cynical, it is also true that it is easier to downsize a virtual workforce than one where folks are eating, laughing, and co-habiting together daily.
New School Negatives. This new school advantage is of course also its biggest weakness – the detachment of virtual workers makes it almost impossible to create that inspired workplace which visionary leaders like Tony Hsieh, Richard Branson and Sam Walton hold as the ONLY sustainable competitive advantage in modern business.
So what to do? There are of course no hard and fast rules, but a good shortcut is to deeply ask – “What is absolutely critical, absolutely core to my business and what is merely tactical?
That which is core, go old school.
Everything else, go new school and outsource it to that always-on, increasingly omniscient big data cloud of global talent and run your business to modern daylight!