Two Ways in Which Work is Changing:

1
Two Ways in Which Work is Changing

• Virtual Work
• Defined as work performed outside of traditional
  centralized office locations
• Home-based telecommuting
• Telecenters
• Mobile work
• Facilitated by information technology
• Contingent, temporary, or explicitly part-time
  work
• Work for an outside contractor rather than being
  a direct employee of the organization (e.g.,
  Microsoft)
• Work as a self-employed individual on a project
  basis.

2
Virtual Work

• 19.6 million people (1 in 10 working US adults)
  work virtually at least part-time.
• 200 growth in 4 years
• In organizations such as Cisco systems, 50 of
  employees are virtual at least part-time

3
Why the trend towards virtual work?

• Organizational
• Increased employee productivity and commitment
• Real-estate cost savings
• Strategic benefits
• closer to customers and clients
• manage multinational businesses
• Individual
• Reduced commuting time
• Work/life balance
• Increased autonomy

4
Challenges of virtual work

• Supervisors are less able to support subordinates
• Team coordination is more difficult
• Virtual workers are more isolated
• Implicit and tacit newcomer socialization is less
  likely
• Mentoring and peer learning are diminished
• Diminished contact/peripheral status may reduce
  identification.

5
Contingent Work

• About 25-30 of the workforce is estimated to be
  engaged in contingent work arrangements (e.g.,
  part-time, temporary, or contractual work)
• 33 of the part-time workers and 66 of the
  temporary workers are holding such positions
  involuntarily because they cannot find better
  alternative employment opportunities (Pfeffer,
  1998, citing Feldman, 1996).

6
POTENTIAL BENEFITS AND COSTS TO CONTINGENT WORK

• Benefits
• Organizations gain flexibility in skills.
• Organizations accrue short-term cost savings due
  to lower salaries and benefits.
• Organizations are able to concentrate on their
  core competence.
• Workers have greater incentive to develop their
  skills.
• Workers potentially gain flexibility in their
  lives.

• Costs
• Managers have a decreased ability to monitor and
  motivate employees through workplace.
• The duality of core peripheral workers creates
  perceived inequities.
• There may be decreased employee attachment,
  loyalty trust.
• There may be increased variance in work quality.
• There may be increases in long-term labor costs.

7
The New Deal

• No guaranteed job security
• Employees viewed as expendable
• Employees viewed as free agents
• Employees are entitled to interesting work and
  employability but little else
• Jobs more project-based than positional
• Many jobs externalized (contract-based)
• Transactional rather than relational contract

8
Change from Old Deal To New Deal Violation
of the Psychological Contract

• Employees have beliefs about the terms and
  conditions of their employment relationship.
  This is known as a psychological contract.
• As organizations moved from the old model to the
  new, many employees felt that their psychological
  contract had been violated.
• This lead to anger, resentment and feelings of
  betrayal on the part of many old time employees.

9
The New Deal Over Time

• Over time, as new people have entered the
  workforce, the new deal has become more
  standard and expected.
• Many employees have not just accepted it, but
  embraced it, as a chance to change jobs and take
  advantage of new opportunities.
• Many organizations have found that the new deal
  is not all good. It has created a sometimes
  fierce war for talent as there is little glue
  holding employees to a particular organization.

10
Advantages of New Deal

• For Employees
• Encourages skill development and career
  self-mgmt.
• Greater flexibility in terms of work arrangements
• Continual new opportunities
• Many companies are offering great jobs with great
  amenities to attract and retain people
• For Organizations
• Greater flexibility
• A workforce that is better trained and
  cutting-edge
• Lower fixed labor rates
• Increased ability to concentrate on core
  competencies

11
Disadvantages of New Deal

• For Employees
• Job insecurity and uncertainty
• Fewer benefits
• Pressure to maintain skills and fear of
  obsolescence
• For Organizations
• Risk of losing most valuable employees
• Less loyal and committed workforce
• More self-interested workforce (agency costs)
• Higher turnover rate may affect customer service,
  organizational learning, long-term thinking

12
Questions Raised by the New Deal

• Do the benefits outweigh the costs?
• Have companies fully thought through the
  benefits and costs, or is there a bandwagon
  effect occurring?
• What management skills are required to supervise
  and motivate new deal employees?

13
IMPLICATIONS FOR MANAGING YOUR CAREER

• Better to be a generalist than a specialist with
  firm-specific skills.
• Understand that tenure and experience are no
  longer valued as much as they used to be.
• Need to be constantly learning, keeping up.
• Ask yourself would you still be able to get your
  job?
• What else will you need to know to do well in
  your job in the future?
• Plan for possible non-linearity in your career
  path.