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CX and the Gig Economy - Part 1: The Challenges

The Gig Economy
Image by Pixabay

The advent of the Internet and the widespread availability of consumption infrastructure have made it possible to create a variety of jobs that would've been unthinkable just a decade ago. Although it was not unheard of to be freelancer even in the 90s, the availability of services marketplaces (such as Upwork, Uber, Deliveroo, Angie's List) have spawned a new type of economic segment amongst the working class: The Gig Economy. The Gig Economy has enabled people to find "gigs" to supplement their regular work or lifestyle. Students can now find uncomplicated jobs to which they can commit a specific duration of time everyday. Employed professionals can find a "side thing" to supplement their income (to spend on a hobby or save for a rainy day). New parents on a sabbatical can also find something to keep themselves challenged before they're able to return to regular work. The Gig Economy has taken a few hours here and there from hundreds of thousands of people and rolled that up into tens of millions of human-hours of productivity that helps move society forward. In all of those ways, to say it has benefited society would be an understatement.

However, the Gig Economy comes with a set of challenges, not the least of which is CX. Here's a look at how the Gig Economy makes it more challenging to deliver great CX. High workforce turnover

A common thread that runs across most companies in the "gig" model is that there's high workforce attrition, for necessarily no fault of the company. Students who work part-time graduate and find full-time jobs. Employed professionals get promoted and don't have as much time as they did before for a side gig. New people join the workforce everyday, as older ones leave. In a sense, there's always a transitional feeling around the whole thing. Companies can invest in training the new "hires" but this often turns out to be just more cost, since the companies rarely get to reap the long-term benefits of said training. The cost (time, effort, attention, money) of maintaining good CX starts to shoot up as workforce turnover increases.

The "gig" mentality

This isn't a career. Nobody comes in with that illusion. Nobody is successfully sold that dream either. It's a "thing" that people do, in addition to whatever else they _do_. As a result, there's only a limited buy-in even from the workforce. If the company increases paperwork or compliance, or adds more mandatory training, or enforces strict standards of CX, there's always another "ecosystem" in which to work. There's a wide array of opportunities to take advantage of, so the workforce is also not incentivized to "commit". When the workforce does not think long-term, that's already a major roadblock for CX strategy to pan out well.

The threat of substitution Even for the "employer", the Gig Economy is tricky. It's a tight-rope walk between growth and decay, between survival and success, between quality and quantity. They may have set up the platform and own the overall CX, but they're largely dependent on their "partners" to execute the service and manage the associated CX. If the employer introduces more rigorous training, the partners leave for the competition. If the employer puts in place an incentive structure that doesn't excite the partners, they leave for the competition. If they penalize a partner for bad CX or a track record of below average CX, they leave for the competition. This abundance of opportunity creates an atmosphere where the employers are never really as much in control of the CX they'd like to be.

The layer of governance

Governments have been trying to "regulate" the Gig Economy for a while across the world, but have only had very limited success so far. For example, in a number of countries, people employed by the Gig Economy are considered unemployed, since they're not employees of the brands they work for. This means they find it hard to retain their lease if they miss a payment, or get a credit card if they don't have one. Another example is when a bad dispute occurs between a customer and a gig partner (like an Uber driver). To the customer, it is all Uber. For Uber, there is a clear line of separation between themselves and their partners, although they do take accountability for the actions of their partners in many cases. For the Government, this is all a complicated spaghetti mess of legality.

On the one hand, the Gig Economy has enriched some segments of society while providing a vital layer of convenience for more affluent segments. But on the other hand, it has also made things difficult for brands to maintain a high bar in terms of CX. I'd like to talk about how brands are managing this situation and are trying to maintain consistently good CX, but that's worth its own post (coming soon!).

For now, if you think there's any other dimension to CX in the Gig Economy, let me know in the comments section or on Twitter (@ThatCXGuyTweets).


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