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Summary:

Unemployment is high, yet companies are having a hard time finding talent. The war for talent has been declared. Gary Swart, CEO of oDesk, explains how his company found remote workers and, more importantly, how the company rebuilt its culture to help them thrive.

Toy soldiers line up for battle

Toy soldiers line up for battleUnemployment remains disturbingly high in the United States, and at the same time, employers can’t seem to find the right people. Despite there being a massive surplus of people looking for work, companies are having a hard time finding talent. You can read about companies’ struggles statistically in the recent Manpower Talent Shortage Survey (“52 percent report difficulty in finding the right talent, up from 14 percent in 2010”), or you can look at the “We’re Hiring!” billboards lining the freeways in Silicon Valley. When big companies like Zynga, Facebook and Groupon need to take out billboards, you can imagine how the fierce competition weighs on small- and medium-sized companies. Why the short supply on local talent?

There are a few factors involved. Manpower notes that many jobs in the 21st century are evolving quickly, and job seekers haven’t yet mastered the necessary range of skills. And there’s the classic problem of the right talent not being where the jobs are. A dozen software engineers might be fighting for one job in Portland while companies in Los Angeles can’t find anyone with that same skill set. Manpower recommends that companies “manufacture” talent, investing in training their teams and in paying to relocate the right people to fill key vacancies.

Move the work, not the workers

I believe that talent is always a worthwhile investment, but relocating skilled workers isn’t going to be enough to close the gap between the growing demand for talent and the limited local supply. Why relocate the worker when it’s so much easier — and far less expensive than packing, movers, rental housing, etc. — to relocate the work? Yes, some positions still must be filled locally, but in a world with email, instant messaging, desktop sharing and video conferencing, a lot more jobs can be easily moved out of the office and onto the home desk of the best-qualified candidate, wherever he or she may be.

At oDesk, our remote contractors outnumber our in-house talent by four to one. We rely on the same online work marketplace that we’ve built for our users to supply our own team with the talent we need. For example, the majority of our customer support team comes from the Philippines. That team has excellent English skills and is very well educated, motivated and great with customers. We’ve had so much success building a strong team in the Philippines that we never had to look locally.

Rebuild your management and culture from the bottom up

But building this kind of team doesn’t just require a different approach to hiring; it requires a whole different approach to management. You can’t manage by walking around when the team is remote. So how do you keep track of the work and how do you keep both your remote and in-house staff engaged? The things that are important in the face-to-face business world are only amplified online.

Here at oDesk, we had to develop both our management and our culture to meet these challenges. To replicate the most important elements of face-to-face group communication, we outfitted a few conference rooms and meeting areas with microphones and cameras to create cohesive group chat experiences for team calls. Our team relies on Skype video calls for small group and one-on-one remote meetings, to create a stronger rapport among the distributed team.

We also had to make sure management was clear about where the company is going, how the employees’ can help us get there, and what metrics we’d use to measure success. We do this by having a shared company dashboard, which profiles the performance of our key business metrics. Each project has its own goals, which are reviewed regularly within each department, and our monthly company “stand up” meetings are open forums for departments to share their progress and answer questions from the rest of the team. We also have an all-hands quarterly business review meeting, where results, insights and lessons learned over the past quarter are shared.

Step into your employees’ shoes

We also had to shift our culture to be more conscious of what it’s like to work online. To do that, we had to be comfortable with working online ourselves. You never grasp how hard it is to be on the other end of the phone, when everyone else is in the room; or how creative time with your team has to be scheduled, rather than a casual gathering around the water cooler. At oDesk, we encourage our local team to work from home every Tuesday so that they can feel firsthand what it’s like to work online – both the challenges and the freedom. One of the outcomes of these remote days is a set of meeting best practices drafted to diminish the negative impact of being off-site (issues like dropped calls, frozen slides, or even a presenter who wanders away from the microphone.)

The results have been astounding; we’ve been able to double our business every year, servicing more than 1.5 million users with only 55 in-house employees–total. We’ve found that remote teams are a solution that is faster, more flexible, and more cost-effective than importing talent from other regions. Sure, it takes some adjusting. But the ultimate result is an integrated staff who has a clear sense of how their work contributes to the company’s goal. That should be the goal of every company.

Gary Swart is CEO of oDesk. He has more than 17 years’ experience in enterprise software, working at such companies as Intellibank, IBM and Pure Software.

Image courtesy of Flickr user dpape

  1. It used to be that employers would hire someone based on their potential and train them when they needed to fill positions, now everyone is so impatient they want the highest skill set immediately at the lowest financial cost so they exploit it and toss the ‘talent’ away when they don’t need it anymore. It’s cultural mindset of consumerism and impatience that permeates all aspects of decisions including business and personal relationships. Remote work = cheap and I don’t have to deal with you on a day to day basis, so I can more easily toss you if you don’t produce a ROI.

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    1. Elizabeth Boylan Saturday, August 13, 2011

      To clarify, the above is a personal observation by @ElizabethBoylan ( the goof ball I am, I posted while logged in with my company twitter account ) I’m not remarking so much about any one company so much as the growing trend in remote work relationships for technology. It’s sad that there’s such a high unemployment rate in the US while the jobs are being outsourced to other countries. Why aren’t those markets such as the Phillipines benefitting from their own local talent? Skype video calls aren’t enough to build real human rapport and commitment, there has to be that shared experience in a shared space. In Vancouver and Toronto all the nannies are imported from the Phillipines, and it’s not because they’re better talent for childcare than local moms, it’s about the Western families’ decision on the bottom line. When our focus is so much on the bottom line and predictable financial results, we can all guarantee one day being replaced by robots.

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      1. Its simple, they prefer cheaper manpower with high caliber standards.

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  2. Companies would do well to realize that good engineers are good engineers regardless of language or platform. Everybody looking for ‘Java’ talent or ‘.Net’ talent (or Ruby, Perl, Python, etc.) are letting talent slip through their fingers. There are more technologies then there are people, people!

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  3. Patrao Digital Saturday, August 13, 2011

    I disagree with VectorBloom. Managers always wanted highest skill immediately at the lowest financial cost. This is not exploitation. This is darwinism, where the fittest survive. Internet collaboration allows companies to find the highest skills anywhere else and so they hire remotely. Thanks to globalization, a new giant like Facebook will probably emerge through remote collaboration in the next few years.

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  4. If companies relaxed their education requirements a little, they could find what they are looking for easily. I had worked in my field for 15 years, and now that I’ve been laid off can’t find work because I don’t have a masters degree. Even if I had a masters degree, I could only make slightly better than minimum wage. So, now I do odd jobs and watch people choke on their student loans.

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    1. I agree. Companies like Intel require a Masters for a position that can *EASILY* be done with a Bachelors and 10 years experience.

      Retarded hiring managers…

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  5. Human children will pay a lower salary to save money

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  6. I don’t care for your use of the term “talent”. It denotes that the person was born with an inherent ability to do a skill the average person has to work hard to master. The problem here is not lack of talent, but lack of education. I live in Oakland, which is within commuting distance of Silicon Valley, and I’ve met a lot of people with raw “talent”, but very few who possess the proper schooling and knowledge to further themselves. Oakland would be a much different place if “Job Creators” placed more emphasis on training their new hires, and not expecting mastery on the first day when don’t nobody got their masters degree.

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  7. Requirements for Programming talent these days is completely unreasonable because:
    1) you must be trained to the max in the latest tech (i.e. Android AND iOS AND Blackberry
    2) you must be at a specific location because you won’t be relocated

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  8. Frankly, if you don’t have a masters, why even bother applying to Intel. I don’t get it… I have really great skills as a mobile UX designer with large eCom and consumer application experience, but never waste my time on most of the big companies or consultancies. And, that is fine. I make a lot more as a contractor, and have far greater flexibility. That I enjoy.

    Take advantage of the companies as much as they take advantage of you! Raise your rates. Incorporate, and avoid staffing agencies once your skills are better than those of competing talent. Sell yourself. Pool together with excellent adjacent talent. And, put the money in the bank and be prepared to metamorphisize again. Because you’ll have to. And, so will all of those companies that want to hire you today.

    It is exciting, brutal, and extremely lucrative to be on the cutting edge. And, you want a job?

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  9. I also used Odesk to hire talents for jobs that need to be done asap. I think that work these days is not defined by the work place anymore, but how work is delivered -faster, cheaper and better. So long as you do your research well, I guess you can always find the gem among thousands of freelancers, remote vendors and offshore services on the Web.

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  10. The war for talent does exist and there is definitely a paradigm shift whereby this trend of the remote workforce will continue to emerge depending on industry. To make this trend more acceptable in Corporate America, the skill set required by Virtual Managers need to be different and developed from that of managers who are responsible for face-to-face people management. Managing virtual workers will be a challenge that demands communication, trust and the appropriate tools to succeed from both management and employees.

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