Sixty Million People Make Up Gig Workforce, Larger and Potentially More Valuable than Assumed per McKinsey

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Research from McKinsey & Company, one of the leading consulting firms, provides deeper understanding of the Gig Workforce.  The Gig Workforce is the growing number of freelance workers,contractors and independent businesses since the Great Recession.  In October, McKinsey reported that the gig workforce is much bigger than previously thought. “Up to 30% of working-age people in the United States and Western Europe are engaging in independent work, either as their primary source or supplemental source of income,” said Susan Lund, partner at the McKinsey Think Tank.  About 60 million people in the U.S. are in the domestic gig workforce. Furthermore, 70 per cent of these people choose to be independent to have more creativity and more opportunity to learn and grow. 

It was great to see that the study shattered the common perceptions that the gig economy was composed of primarily Uber and Lyft drivers.  The report did not mention that many Uber and Lyft drivers may be between jobs while they look for professional or career satisfying positions.  The report noted that these independents do grow into businesses and hire other contractors or employees.

What is important to me was the last line of the report which noted that gig workers represent all ages, genders, incomes and education levels.  They acknowledge that “independent work is growing and we (in America) need to redesign what it means to have a career or a job.”
I am pleased to see that the talent and business moxie of 60 million people is finally recognized as an important sector of the economy. 

My research indicates about 15% of independent workers and solopreneurs do form businesses and continue to grow.  For those 9 million future independent growth businesses here are my three tips from transforming from a solopreneur to a business:

1.Validate customer demand and the profile of your ideal customer
2.Create a vision of success for your business and hold on to it
3.Learn about business at a pace you can absorb and make improvements in your business
 
1.Validate Customer Demand and the Profile of Your Ideal Customer

First, think about who your current ideal customers are who recognize your value. Write down the key characteristics of these customers. Also describe customers that do not work out as expected. You want to avoid taking on clients with those characteristics.  For consumer products and services, business owners have to be specific about demographic characteristics of customers like age, gender, cultural profile and lifestyle.  With public information verify the number of ideal potential  customers and find out where they gather.   

2.Create a Vision of Success for Your Business

If you and your family are dependent partially or fully on cash flow from your independent business activities, then plan and work to be successful.  Start with describing, visualizing and setting goals for the success of your business.  Be realistic and aim for a sales level that covers your baseline needs and allows for cash to invest in future growth.  Growth may require a credit line or capital from friends, family or crowd funding. 

3.Learn About Business at a Pace You Can Absorb and Make Improvements in You and Your Business Work
 
You are now in business so learn about it. You can start with free workshops on money management, marketing and sales, and staff hiring and management.  It is also important to learn about yourself especially your strengths and weaknesses.  Of course build on your strengths.  If you are a good writer then improving your marketing and communications skills can help initially.  But at some point you have to decide if paying for marketing and promotion assistance is better so you can lead your staff toward your vision of success.

As independents, we have to acknowledge our shortcomings and make improvements in our skills and behaviors. We have to be honest about our receptivity to making change or hire a specialist to just close the gap.  Beating ourselves up or ignoring our gaps is non-productive.  Our job as owners is to fix problems and keep moving forward.  We have to manage the whole business to be successful.

Italian Fashion Week Makes a Statement

After writing the last blog post on Marc Jacobs, Italy’s Fashion Week in Milan illustrated the other end of the spectrum with a collective strategic statement on both American politics and the next stage of women’s equality. Italian Prime Minister Matteo Renzi kicked off Fashion Week by saying, “We’re all looking at what will happen, and we will be available to welcome the new President of America—whoever she may be.” The review of the collections revealed how fashion can support the changing role of women and insights as women seek power in politics and business.

A Shift in Fashion from Power through Sex to Self-Confidence with Power
In her New York Times article,  journalist Vanessa Friedman offered this very insightful comment on the Milan Fashion Week: “It crystallized a shift in emphasis from clothes that communicate power-through-sex to power-through-self-confidence. It’s a pretty significant change, and probably not coincidental.”  
 

The designers’ cooperative approach to selling products sent a compelling and impressive message to their customers, industry and the political stage. Designers including Bottega Veneta, Versace, Jill Sanders and Marni all showed clothing lines that set a tone for the commercial markets of what stylish woman leaders can wear in government, professional careers and as business leaders. Versace was quoted as saying it is “time for a woman to take the lead.” Real dresses without cut outs were showcased along with suits with big shoulders in pin-stripe fabrics and stylish boomer jackets

Confidence to Lead is Not Quite There
The progression of women seeking self-empowerment to women confidently seeking power in government and industry is a major shift that U.S. women have not fully embraced.  A recent study by the New York Times indicated that while women are pleased about a woman running for President, they are still not seeking leadership at the same rate men do. About one in two men want a leadership role in government and business. About 40% of Black women but only 25% of White women want leadership roles in government and business. Statistics for Latina, Asian and other women were not provided. 

Confidence, as we all know, comes from more than clothes. Women and people of color will be the majority of small business owners by 2018, per the U.S. Census. In business, women can gain confidence and stature by doing more to manage and develop products that are relevant to the majority of the population. In addition, we can expand distribution to more communities which benefit the larger economy.

To aid in these efforts, I am finally (after years of careful refinement) rolling out my value-creation decision and implementation frameworks. The Great Decisions Framework™ (GDF) and the Seeing Solutions Map™ (SSM) are strategic thinking and action frameworks that have been taught to over a thousand graduate students and used with hundreds of managers and business owners over twenty years. This rollout will include webinars to be released in October, ongoing half-day workshops starting in December, and eight-week implementation programs in 2017.

If you have questions contact me at dcrane@thecraneworks.com.

Marc Jacobs’ Team:  Small Decisions Make for a Big Blow Up

​I have to comment on the decision making of the Marc Jacobs team for the New York Fashion Week runway show with faux dreadlock hairdos. This internet blow up is an example of business decisions made without knowledge and sensitivity to the social and cultural envirnment that can affect a major product launch. The New York Times article on Sunday pointed out how the big and little players in the Marc Jacob show were uninformed, insensitive and unprepared for the blowback. 
(Faux Locs, A Real Uproar. NYT 09/18/16)

Last Thursday, the Marc Jacobs models had their hairdos structured as faux dreadlocks out of multicolored yarn for his New York Fashion Week show. When the pictures hit the Internet it triggered a social media blow up about cultural appropriation. Comments by Black women highlighted the double standards for high-fashion Caucasian models wearing dreadlocks, versus Black women or anyone with non-traditional hair as not being a good fit to hire into companies. 

These are my comments from a business point of view on how social/cultural awareness and sensitivity are now essential elements of marketing research, communications, product development and sales promotion. I am struck by the lack of product marketing, planning and decision making at all levels of the hair debacle by Marc Jacobs, Guido Palau (the hair stylist), and Jena Counts (the hair-piece artisan). Even if you are “just” a team member or a task doer, you want to make sure you as the little guy in a chain of decision making have both local market information and a voice with the decision makers to achieve a desirable market and customer experience. 
 
Marc Jacobs’ initial response to the negative social media comments set off another blow back, but he finally apologized Tuesday afternoon. Mr. Jacobs did not anticipate nor test his dramatic hair styles on a diverse audience. He got a lot of publicity but the headlines were not about his clothes and designs. 
  
All business is local
The hair designer Guido Palau said he was inspired by a “mishmash of things” from punk rock to Japanese Harajuku styles. He forgot that all business is local. In a U.S. show, sensitivity and respect for the role of hair in the African American and all ethnic communities is essential. More than anyone on the runway show team, he should know how much time and money diverse women spend straightening, dying and styling hair to appear in public with “good hair.” Alicia Keys’ statement to style her own hair and not wear makeup is a powerful role model for me as a women of color to let my hair go where it wants to.

The very last paragraph in the article mentioned the artisan Jena Counts who constructed the hairpieces. She was quoted as saying, “It is so hurtful to me. It was never in my head that it would be brought up as an issue. I don’t understand why they would react that way.” 

She may feel hurt now, but hopefully she can turn it into a learning moment for herself, small business owners, contractors or team members who assume there is little risk by being the quiet dutiful task-doer on the team. As a part of a highly visible project, she can take responsibility for understanding trends in her industry, location and asking if the concept had been previewed with a diverse group. She could have even asked for a focus group with diverse women to develop styles they loved and felt were respectful of their social, cultural communities and values. 

This runway show could have been a great success, building trust with new customer segments in the lucrative New York and broader U.S. market. Testing for audience response from strangers on the street is one of the best tests before any consumer product launch. 

If you are a contractor or business owner of any size, prepare for high visibility opportunities. Define your guidelines for success for these big opportunities. Be sure to ask questions to bring to the surface issues and risks that must be addressed before you go public and hit the Internet. Be the leader who delivers the project or product results that generate trust and confidence with your ideal customers and public. 

Feel free to modify these guidelines to use as you build public visibility:

  • Be clear on your business values and how they help you and your team be successful
  • Clearly define the public reaction you want to generate from specific audiences
  • Surface risks or challenges that could result from going public and address the issues
  • Do the market research and anticipate possible internet reactions
  • Be actively involved in the decision-making process for products you contribute to in any way

 
Here are some questions for you:
What do you think about this controversy?
Do you have other ideas for how the Marc Jacobs team could have been successful? 
What are you doing to build the voice you want to be known for on the Internet?
How have you dealt with difficult internet conversation you may have experienced?

Webinars and webinars and workshops in October. 

More Great Conversations at Step Up to Growing Your Business 

 Theme for the Evening Became:  Shift from Overwhelmed to Focused Action

The highlight of the workshop last week to Step Up to Growing Your Business was seeing business owners really engaged in the breakout discussions to grow their businesses and be ready for the challenges small businesses face continually. Thank you to Marc Siegel of Townsquared for helping out and bringing the great pizza and salad.

Join in the discussion of the top three strategies for generating Good Revenue (which is predictable, profitable, and diversified) and comment on the notes from each breakout group.
Modernize your marketing and promotion efforts with great content and simple consistent social media: Lisa Cain of MarketingU encouraged everyone to keep it simple and doable. We all agreed content is becoming more important to get noticed, social media should get the content to your ideal customers.  How are you shaping the content you are sending all over the world when you post? Is your best content getting to your ideal customers or clients?

Review and update your business model:  Amy Barr of A2B Strategy led a discussion of the Business Model Canvas to review your current business and find opportunities to increase revenue and manage expenses. What are you doing?  Do you know how the Business Model Canvas could help? When did you last update your Business Plan or review your whole business model?

Modernize or develop products to create multiple revenue streams.  As I led this group the phrase, focus on your ideal customer came up as the starting point and ending point.  The Internet now makes it possible to enhance and develop products at more reasonable costs. But product development has more risks because success is determined by the customers’ very specific decisions to buy.  How can you deeply understand your new customer?  Are surveys and interviews enough? How can you as a local business owner build a unique and loyal customer base in a more diverse world?

This is when the discussion for the whole group turned to The Great Decision Framework. Our new Podcasts and workshop this fall will help owners use the framework to ask great questions, make decision and take focused action on business growth.
 
Shift From Overwhelmed To Focused Action:

Great Conversations at Step Up to Growing Your Business 

Stepping Up To Leading the Growth of Your Business on Tuesday was fun and energizing. The breakout groups were the high point where everyone shared suggestions and thoughts on the challenges small business face.  Thank you to Townsquared.com for sponsoring the lunch. You are invited to join this smal lbusiness network.  But the one hour workshop was too short to get into deciding on a course of action.  We cover decisions that generate value in the two-hour workshop Step Up to Growing Your Business this Tuesday on August 23.

Here are the suggestions and ideas on the three BIG issues from the break out sessions:

Issue One: The complexity and rising cost of marketing without clear results

  • Give top priority to content for marketing since that is what makes you stand out
  • Focus marketing messages, promotion and social media on a consistent marketing theme
  • Keep the tools and steps to publish as simple as possible

 
Issue Two:  Hiring quality employees, managing turnover and rising wages

  • Hire in stages if you can before making the employee permanent.  Use probationary periods or internships before you make the candidate a permanent employee.
  • Have an on-boarding process so you have lots of opportunities to give feedback and determine the level of trust and confidence in the worker and the work.
  • For tech companies you may want to develop non-traditional recruiting and training processes. Develop a program to hire interns with diverse backgrounds from local colleges and train them for full time positions. The employees are more likely to be loyal because of the career support.  The positive contribution enhances the reputation of the company. The CraneWorks worked with a local tech services company using this hiring strategy and it helped manage turnover.

Issue Three:  How to Manage the Rising Costs of Commercial Rent?

  • The classic response to this issue is to purchase a commercial building. Owning a commercial building supports long-term business and financial strategies, such as retirement and securing financing for future growth.
  • When you negotiate a lease for commercial space build in the right to sublet space. Then you can sublet space to offset partial or the total cost of the lease payments.

In the two-hour workshop Step Up to Growing Your Business on Tuesday, August 23 from7 – 9 p.m. at NextSpace Berkeley use a framework to decide on the number one strategy to act on. 
 Our key topic will be how everything the company does supports revenue generation.