All businesses struggle with seasonality or variability in their labor requirements, in one way or another. Resort hotels are busy in summer and much slower in winter. Tax preparation firms are swamped during the April crunch. Alaskan seafood operations work around the clock in summer and then stop completely in wintertime. In the reference publishing industry, there were always peaks and valleys in production schedules driven primarily by print production cycles and these, thankfully, have mostly disappeared with the rise of online publishing and the shift to real-time database maintenance.
The principle of maximizing productivity in an environment of variable demand, however, has certainly not disappeared and one solution comes in the form of managed crowdsourcing. Crowdsourcing data tasks involves having a large network of vetted (qualified, tested, experienced) freelance resources available on a moment’s notice to handle surges in data processing volume. So, for instance, if you have a baseline year-round requirement for, let’s say, 320 hours a month of data management labor, you would simply hire two full-time employees. However, if for two months of the year you needed 20 full-time equivalents, what would you do? Worse, and perhaps even more typically, what if the volume of work varied widely over the course of the year?
Well, as you can see from the chart below, the traditional model is to staff up in increments of 160 hours/month of labor (1 FTE) and attempt to map that labor as closely as possible to the requirements. This “stair-step” model is, as the chart indicates, not very efficient and wastes a LOT of money. By breaking projects down into their smallest individual parts and having crowdsourced labor work on them, however, companies’ available resources can track almost exactly with their labor requirements.
We call this approach the application of “human bandwidth” to a problem. Bandwidth is never absent, on vacation, or sick. It can surge to huge volumes, or stop completely without any adverse impact on the firm using the labor. It’s a lot like the electrical or water services, which are delivered on a pay-as-you-go basis.
So, does this mean that full-time jobs will disappear? Not at all. It just means that inefficiencies in some existing processes can be eliminated and the resulting cost savings can be reinvested to make firms more flexible and more profitable. In fact, when combined with effective automation, the relocation of certain types of labor tasks to full-time offshore resources overseen by capable in-house managers, this flexible human bandwidth can give firms a significant competitive advantage.