The digital world is changing how we conduct business and interact with our colleagues and friends; and has removed barriers such as time and location, allowing us to “meet” and collaborate with partners from all over the world. One of the newest advantages to these technological advancements is the “sharing economy.” Sharing itself, is not a new concept; it’s one of the first things we learned as children. But mobile devices and applications have offered us a new way of sharing, connecting disparate individuals from all over the world in mutually profitable operations.
Also known as “collaborative consumption,” the movement towards a sharing economy has proven to offer lucrative opportunities for entrepreneurs and freelancers alike. While most participants are currently turning to these options as a way to supplement their incomes, many are so attracted to the flexibility these opportunities have to offer, that they are seeking out additional ways to diversify their professional portfolios. With our economy in the midst of record unemployment numbers, wage stagnation, and income inequality, a diverse portfolio offers an added layer of protection, insulating workers from the uncertainty that comes with our current economy. And as more profit potential is realized, more entrepreneurs are turning to this business structure as a viable way to make a living.
Mutually Beneficial for the Enterprise, Worker, and Consumer
Etsy, Uber, Airbnb, and TaskRabbit. These are just a few of the profitable businesses that have emerged from this collaborative business structure. Founded in 2005, Etsy is perhaps one of the most well-known and mutually profitable shared economy enterprises. The site offers one place for sellers to create, share, and sell their own specialty products, building a brand and name for themselves. The website boasts approximately 1.5 million active sellers and 21.7 million active buyers. A reported 3/10 of Etsy entrepreneurs sell their creative products full time, supplementing their income doing what they love best. Everyone wins: Etsy shop owners enjoy the creative freedom that comes with selling their products online, with a reduced financial burden that comes with running their own business. Consumers who are socially conscious, looking to support the “small business” can find unique, handmade items. And with a 3.5% cut of all merchandise sold on its site, plus 20 cents for each product listed, as well as money made via advertising, executives are realizing the multi-faceted, lucrative nature of sharing, as well.
The Enterprise Wins With Options
As with anything new, change is difficult and, when considering the width and depth of traditional business models across the spectrum of modern business, change becomes more of a detraction and disruptor, which is usually seen as a negative. Collaborative Consumption is literally spearheading fundamental changes to modern business, which will be vast and longstanding for many decades to come. Much of the resistance to the openness of ideals stems from an old guard who are steeped in the traditional constructs of business. It is difficult to see the merits in a system which smacks against everything that has been taught, learned and practiced for so many years. This is exactly why, though, this change is so important at this moment in time. The exponential changes, which have occurred in the last 20 years, thanks in large part to technological advancements, have set so many other traditions on their ear that the business community was only a matter of time.
But, it isn’t a bad thing. In actuality, the freedom and options afforded by increased worker choice help to build a more complete and comprehensive business. There will always be traditional business roles and ideals, but these new flexibilities allow for areas of lesser concern to be serviced and given support, therefore increasing the overall abilities of the organizations who enact and embrace the changes. The scope of services being offered becomes complete to match the scope of customer requests, without diverting existing efforts from your core teams. Instead of reducing service options to stay streamlined and profitable, the new model allows freelance workers to step in and fill a void, without having to invest in additional hiring processes, benefit packages and salaried staff.
The Workers Crave Freedom
As far as the modern worker is concerned, the desire to cut one’s own path is as strong as ever. The fierce independence yet loyalty to honest employment is a rallying cry for numerous Millennial workers. They strive to be skilled in their fields but do not want to be pigeon-holed into a singular position. And Millennials don’t need to be tied to a company to feel loyalty. Their overriding concern is often the character of the company they work for as a guiding force for their continued support. These workers of the sharing economy are socially conscious and feel the company or companies they work for should mirror their own sentiments. Greed is good is out. The money grab mentality of the 80s has become passé. Today’s worker class is looking to make a solid living, but doesn’t mind investing back into their own community or of those they feel are less fortunate and in greater need than themselves. This translates into a worker who will work where needed for the betterment of the overall company.
Additionally, networking is pan ultimate. Almost as it has been cultured in social media, business connections are of critical importance to the sharing economy participants and can be seen as an extension of workers’ personal personas. The networking, in turn, facilitates the ability to find the business niches, the ares that need someone, but don’t require full-time employment. Couple this with flexible scheduling, which the individual has a large part in creating, and the workers begin to collaborate as a community to make everything work. It is truly a team effort to “complete the mission.”
There are, of course, critics and nay-sayers for this bold new model, and some concerns are valid and deserve to be discussed, as no plan is ever perfect. One of the primary concerns revolves around the support a company may or may not provide for these freelance operators. It is a calculated risk, which some critics feel haven’t been actualized in the minds of these workers who are so taken with the freedoms and individuality these jobs provide. And, will this kind of shift cause an entire generation of workers to be left without retirement, health care or options for aging workers? And what will that do to an economy based on the strengths associated with traditional business pillars? Some critics have even gone as far as to suggest that the overall quality of output will suffer, without having dedicated workers in place.
Look to New York, for example, where Mayor DeBlasio took on pseudo-taxi service Uber and their licensing to work in the state. He has argued that regulation has to exist, especially with the high numbers of potential new workers and vehicles on the roads. Safety and continued support through state revenue become strong talking points, when there is a problem with worn infrastructure or dangerous or criminal interactions between drivers and their fares. Still, in the long run, the public has spoken and Uber and their ilk don’t seem to be going anywhere.
In the midst of technological advancements, social and economic consciousness, and the drive to build a life on our own terms, the shared economy is a refreshing concept, designed to benefit the consumer, the worker, and the enterprise. Organizations now have the ability to offer unique services that cannot be met by traditional means. And as we watch the demand for these services grow, it has become clear that businesses who wish to stay on the cutting edge need to take note, proposing innovative ways to integrate this concept into their daily operations.