A Complete Rethinking of How Work Should Work

Stephen DeWitt has had the kind of career that used to end with a gold watch, a comfortable retirement, and a slow decline into old age. He’s held senior positions at HP, Cisco, and Symantec, and took Cobalt Networks through one of the highest flying IPOs of the late 1990s. But instead of retiring, in early 2015 he took the position of CEO at Work Market, a fast-growing platform that is reimagining the relationship between labor and business.

Backed by legendary investor Fred Wilson, New York-based Work Market helps large enterprises create “labor clouds” that connect skilled workers with tasks companies need to complete. The platform integrates all types of workers?—?contractors, full-time employees, and vendors?—?and parameterizes tasks and workflows against any number of data points and business rules. In short, Work Market hopes to instrument a wholesale rethinking of how work gets done in our society?—?from a world of traditional corporate employment to a world where every skilled worker can act as an enterprise of one.

Of course, we’ve already seen this concept break out in the “on demand economy” of Uber, Postmates, and TaskRabbit, but DeWitt is convinced the “gig economy” will spread to all kinds of work, well beyond service industries like transportation or delivery. Our economy has trapped millions of people in jobs that are unnecessary and inefficient, he argues, and the world just needs a platform to root that inefficiency out. As he points out, by 2030, there will be 3.2 billion skilled workers on earth, all of whom are connected to the internet. In that environment, is the best approach to getting work done a traditional corporation brimming with full time workers? Or might it instead be a smaller, more nimble core of managers who apportion work to a tightly integrated network of staffers, contractors, and vendors, all of whom compete for projects based on their skills, their reputations, and their ability to generate good outcomes?

Here at NewCo, we’re using Work Market to create a “labor cloud” of writers and editors who are building a new kind of publication that covers the new “platform workforce.” Work Market is a sponsor of that publication, but we sat down to talk because I find DeWitt’s enthusiasm for the shift occurring in our economy to be both infectious and fascinating. Below is the transcript of our conversation, edited for length and clarity.

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You’ve been an executive at some of the most important legacy tech companies in the Valley. But I get the sense that Work Market is different for you?

When you think about the impact of the software that we’re building, the experiences that we’re rendering right now…I never built a server that did this stuff. I never built a storage array or a piece of infrastructure that fundamentally changed the human experience, but this stuff does that.

The implications of the software we are building are enormous. We’re building technology that will fundamentally change the world of work and impact millions of Americans across the country. We just witnessed one of the most stunning and unprecedented elections in modern political history. It was an unequivocal repudiation of the traditional establishment, and a crying call from millions of Americans who feel left behind, unable to find meaningful work and devoid of any economic opportunity.

The job boards and career sites do nothing more than aggregate resumes. The professional networking sites offer no real engagement or discovery.

At Work Market we truly believe in the power and potential of the connected world to drive opportunity and growth for all of humanity. The work we’re doing will have a profound impact on millions of people around the world. That’s what keeps me and my team going.

While that may seem like a grandiose statement, it manifests itself in real?life experiences that are pretty cool. I think about what we’re doing for Walgreens right now…

How is Walgreens using Work Market?

The technical store operations group inside of Walgreens was evolving. Walgreens was actively exploring how to use modern, cloud-based technology to delight their customers, empower their workforce and build a sustainable competitive advantage. The ability to automate, to leverage the power of data and algorithms to shape where and how labor is provisioned across the company’s U.S. footprint has tremendous ramifications in terms of productivity, engagement and growth.

We’ve also helped several other high-profile retailers build a nationwide workforce of premier service professionals in just a few weeks, so they could capitalize on a more nimble geographical footprint. In the case of Walgreens, the end result now is that everything in their core operating dashboard?—?the things that matter to a person who runs store operations for Walgreens?—?is reflecting the results.

Significantly?

Yes, significantly. Look, where do I go to get that kind of game-changing outcome? You don’t get that unless you fundamentally stop doing what you’re doing right now, and redo it in a new model.

You’re talking a major shift in how corporations manage their most important asset, their labor.

Yes, and it isn’t about, “Hey, the whole world’s going freelancing.” In an enterprise, labor spend will be a mosaic. It’ll be whatever the definition is of competitiveness for your company to survive and flourish. That will dictate what the table stakes are in terms of the efficiency of your model.

Here’s another example. We have a quite an innovative customer called NAVCO, one of the country’s largest security integrators. Big companies hire (them) to do physical and digital facilities management, the keypad that you have on the front door here, maybe the security cameras that you have, all of the digital infrastructure.

They handle all the security infrastructure for national brands, typically characterized by hundreds or thousands of locations. Here’s their before picture: If you were the store manager of the Issaquah store, and the security camera at the front door went out for some reason, you punch a button, you call the mother ship, and you went through a service dispatch.

When that dispatch came from the mother ship, it would route to NAVCO, and NAVCO would provision work. The trouble ticket would come in through their dispatch tool, an operator would look at their database and manually provision the work. Using Work Market and real-time data being fed into the platform, they’re now able to automate key parts of that process to provision the right person, at the right place, at the right time.

Not only has the company seen tremendous efficiencies in their operating model, but their innovative approach to service delivery has been lauded by their customers and their partners.

So they just had to input the skills and work tasks as parameters, right? And you had to get the business process and the business rules down, right?

We have a whole data team, and that’s all they do.

While everything I’ve taken you through is really cool, and it’s fun to show, and it’s easy for us to go sell that value proposition, it is our definition of the modern work market that has some really incredible potential to it.

The only retail storefront for the skilled worker that exists on the face of this globe right now is LinkedIn. That’s all there is. LinkedIn is a historic success but was built pre?cloud, pre?mobile, and when you think about it’s business model, it’s driven by recruitment fees and access charges, and that doesn’t seem to be aligned to the future of humanity.

I doubt Captain Kirk, when he needs a new weapon specialist, is yelling back to Spock, “Oh, hey, did you post this on our company page on LinkedIn?”

Research has said by 2030, there will be approximately 3.2 billion skilled workers on Earth, 100 percent connected. The only thing that separates every business and every skilled worker is search.

So what does that future look like? Let’s say you are starting your career right now, as a technical store operations manager at Bank of America. What’s your work life look like when you are 48, 20 years from now? Are you still associated with Bank of America, or are you a person who manages your career through a platform like Work Market where you market your expertise into, say, a clientele of 10 or 15 different technical operations?type roles around the world?

It’s going to end up there, and it will be a generational evolution to get there. There are so many other macro forces that are at play. There’s the global competitiveness, there’s global policy, there’s local economies, and protectionism. There’s legislation, there’s just so much morass in the system that I think it’s going to take another generation before the friction starts to go away. In between here and then, there will be the transition of the old model to the new model, and there will be a huge purging of old model inefficiencies.

At HP I worked for three CEOs as a senior executive, sitting around the table of a $120 billion company. Being on the company’s management team, determining its future, is one of the most intense intellectual experiences I’ve ever gone through. Really, at the end of the day, what you’re seeing executed in Hewlett?Packard right now is a regression to the absolute essence of what HP is. What is its purpose for being? Because the $120 billion company that I helped run, it doesn’t exist in the future. It just doesn’t exist.

This seems true for many large corporations. You think about McDonald’s, Coca?Cola, GM, or Walmart. Their moats have been breached.

Everything’s been breached. At HP, we asked “Well, what is the essence of HP? What will ensure the brand’s longevity in the world of photonics and the post?Silicon era, the post?copper era?” You start dissecting your company down to its essence… When you refit it up, and you ask, “What do you want to look like?” You want to engage people based on skills, based on outcomes, against the company’s core purpose.

What was that core purpose for HP?

HP’s essence is its labs. It is the creation of technology that serves as a fundamental building block.

That’s interesting, that that was true at the start of HP?—?the founders, the garage, innovation, the labs. Then it got huge. They devalued the labs, because it’s a cost.

Most of those brands find it more attractive to invest in their dividends, and in share buybacks, than for the accretion of either intellectual property or positioning…

That’s the financialization of business, right?

Exactly, and so you can only ride that pony for a period of time…then the pony dies. Ultimately, efficiency for the enterprise will be based on expected outcomes. This gets into the whole purpose for what we’re doing at Work Market. Ultimately, it is our hope and our intention to provide a set of tools that allow skilled workers and enterprises to create engagement models that transform their business.

In the case of the modern enterprise, the last couple of years, we’ve seen cloud companies like Salesforce and Workday displace the legacy, premise?based software world that had huge inefficiencies. Companies rushed to implement these, and thus created huge wealth in this valley and huge disruption. But these platforms are just the beginning. Now the key is data-driven automation matched with human inspiration. That’s the chapter that comes after?—?“We took our business to the cloud.” But none of those first generation cloud platforms really provide any automation.

They’re just better versions of what they were before?

Better reporting, better self?service. They got rid of the software life cycle application hell. That certainly brought more favorable economics, but they haven’t yet addressed the fundamental productivity levers of labor spend.

By 2040, I’m pretty confident that every skilled worker will have their own signpost. You will be your own enterprise, in a much more meaningful way than the lip service of today.

I’m a skilled worker. I have a long background. But I don’t feel like (I am) my own enterprise. I don’t feel like I know what my worth is.

But that’d be second nature to your grandchild?

It’ll be second nature.

The way that he’ll build his career will look very different from the way you built your career?

Completely.

If you think about it, in the old world I’d go to work for a company. I’d do an annual review. If I’m lucky, I get something better than the cost of living increase. I don’t know, in the old world, what kind of skills I created. My performance review said I did A, B, and C, but, in fact, that’s not tied to any kind of data indicator. That will all transition, I believe, over the next 15 or 20 years, so that if I get skill A, I can charge three dollars more an hour to supply it.

You’re creating liquidity in skills and labor…

If I’m going to school at fill?in?the?blank, and I’m taking fill?in?the?blank courses, I know that when I come out of fill?in?the?blank university, that the going rate for these skills, which I’ll have as a 24?year?old with this track record, will generate this amount of income.

In the Boston area alone, every May, about 200,000 young professionals join the work market. These 200,000 young professionals between 21 and 23 years old have a certain amount of skills.

If I were to ask 1,000 of the Fortune 1,000 Chief HR Officers, “Do you have any interest in that community of 200,000 kids?” they would say, “Of course, I do. I want them to work for me.”

But how are you going to make that happen? It can’t be anything like what we’ve done in the past. It has to be open. It has to be extensible. This could disrupt a trillion dollar economy of waste, and inefficiency, and middlemen.

Tell me, who loses?

A lot of people. It’s carnage. It’s every manual process. There is an entire economy of inefficiency.

Here’s the before picture as an example?—?a big networking company. In order to go from stage six to stage seven in their Salesforce pipeline, all they have to do it agree on an install with the end customer. That’s it. This isn’t rocket science. An install. Now it’s going into data center, so there’s parameters, security, etc.

Here’s how they do the process today. This is a Fortune 50 company. A resource planning team ?? which means a whole bunch of people ?? look at every single deal. This company does billion dollars of revenue a quarter, so there are a lot of deals.

They look at every deal and say, OK, this is two routers going to Bank of America location in Detroit. The customer said the acceptance window is December 5th at 2:00 AM, because it’s a data center. It requires two people. It’s an 89?pound router, so you’re not going to lift it by yourself. You’ve got to put it in a rack. You need to know all these skills to perform the task, you need to be security cleared, you need this, and you need that, go.

Here’s the process they were doing, “Oh, we have thousands of employees that could do this, so what tool do I use to provision work to my employees?” It doesn’t exist.

And they’re not the only people that could do it. There are 11,000 value-added reseller (VAR) companies who could as well…There are also thousands of skilled independent technicians trained in their technology that could also perform the task. How does this whole world come together in real-time against the ask?

So they do it essentially by hand. What’s the after picture?

Fully automated. The deal gets to stage seven. It creates an event. The client’s cloud talks to the networking company’s cloud. They go through their algorithms and provision the work. Now that entire resource planning team doesn’t need to exist reducing cost, the perfect, most efficient resource resource is provisioned the work, and outcomes improve.

If I’m the Secretary of Labor, and I grok this shift, don’t I say “Whoa, wait a minute, you’re talking about millions of jobs across the entire economy. Skilled people who went to Stanford, doing resource planning for a big tech company?—?they’re out of a job?” What do I do about that? Just hope the economy is resilient enough to find other things for them to do? They all get Work Market credentials and start to figure it out?

We all market our skills. Period. We all want to get the best return on what we’ve invested in to develop those skills. I’m a real-world economist and I believe markets that facilitate open access, free from friction will ultimately assign value to all variables. In some cases this may compress wages for some tasks, in others it will dramatically open opportunities. If philosophically that scares you, I’m sorry.

Won’t wages equalize to the value of the work done?

No question about it. Ultimately, as certain skills accrete in value, they will, like surge pricing brings more drivers onto the grid…

If all things are equal, and there’s four people on the platform who can do a particular job?—?and all four of them raise their hand and say “I’ll take that for 60 bucks” ?? now you’ve got a competitive bid situation.

Correct.

Do we have a race to the bottom where the guy who says $40 wins? Or is there another way of scoring work?—?that includes parameters for the worker who is also super pleasant, great to work with, and whose work lasts longer and returns more to the enterprise? Those softer qualities matter, no? If we are coding the economy, coding the workforce, corporations can lose sight of the human parts, and focus only on a few parameters that they think are core signals for success?—?like the lowest cost.

You’ve hit the essence of it. You can mine the intangibles of human performance, task performance, and the variables that add that next level. There is human curation, and there is also culture.

Take the industrial manufacturing sector. There are so many examples of legacy American stalwarts whose historical operating model has been or is being rendered non-competitive. We saw the outcries of so many communities during this past election. Big employers that have shaped their way of life. There are heavy cultural values at play. These company are the local economy.

This is a very difficult transition for these companies and towns. Add to this the immediate reality that our society’s getting older. How are we going to deal 40 years from now with the workforce that is between 60 and 100? These aren’t going to be 9 to 5 workers, nor do we want treat them like we do our air traffic controllers. I have a friend who’s in his late 50s and was just put out to pasture. I’m like, “How do they put you out to pasture in your fifties?” He says, “Well, because based on their testing and parameters, I can’t do the job anymore.”

“Well, you’ve been doing it for 30 years. Don’t they have you come back and mentor people?” “No, I get my pension and I’m gone.” I’m like, “Isn’t that just absurd?”

It is.

How do you lose that value? There’s no perpetual engagement model with those that posses the skills and know-how to achieve the outcomes your businesses needs. The modern model traps the collective capabilities of your interns to your alumni, couples that with the power of the Cloud to bring skilled independent workers to the mix, and finally reconciles that with your supplier mix. All evaluated in real-time for tasks and provisioned based on the rules that drive the best possible outcomes.

Recently one of our traditional manufacturing clients built their first cloud-based talent pool. Literally in 20 minutes they had about 300 people apply to their talent pool. Of those 300 people, many were former employees. Ultimately, this type of human inspired, data-enabled automation will transform their operations.

They reached back to their network …

They reached back to the network and it’s a super?efficient way to get work done. They were like, “Oh, man, it really is this easy to go from a horrible model to a way more efficient model? Everybody seems to win in the equation. We can’t continue to do what we’re doing right now. We will lose. Our workers will lose. We can’t let that happen. We have to emerge in a model where everybody wins.”

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