A couple of days ago, headlines were swirling “IKEA enters the gig economy” and “IKEA buys TaskRabbit.”
Most of us know IKEA as one of the largest retailers that specialize in selling ready-to-assemble furniture.
TaskRabbit is a marketplace that matches freelance labor with local demand, allowing consumers to find immediate help with everyday tasks, including cleaning, moving, delivery, and handyman work.
Although a leading retailer, the IKEA experience isn’t all puppies and rainbows. I’ve personally bought some of that ready-to-assemble furniture. Within minutes of unpacking the box, losing a couple of nuts, bolts, screws, while deciphering the assembly instructions, I’ve been known to drop a few terms that would make a sailor blush. Obviously, I’m not the only one.
For some time now, IKEA has recognized this “assembly” process as an opportunity for improvement. They’ve provided additional services such as delivery and assembly for an extra charge. Just recently, IKEA and TaskRabbit partnered in November 2016 on a pilot program to make TaskRabbit available to IKEA customers in London for furniture assembly.
Upon learning about this acquisition, I immediately realized that someone within the IKEA organization strategically understands today’s U.S. labor market.
I wish I had overheard the discussions within IKEA when the key managers and executives were discussing how to handle this “assembly experience” for their customers. I’m confident that there was the traditional personnel approach presented that would have required IKEA to add more headcount, build up their assembly efforts by adding more employees, create a new internal department, more infrastructure, more everything. “If we just throw more full-time employees at it, we can fix it” approach.
Obviously, in that room, there was an innovative approach outlined contrary to the traditional approach. This innovative approach recognized the changing American labor market. Someone in that room recognized that the recruiting landscape right now is very difficult. Most companies have current openings unfilled because there is a war for talent taking place. This person also understood that there are 55 million Americans working in the gig economy with little interest in PT or FT employment. This person has obviously read recent publications outlining the trend that 39% of traditional American workers say they are likely to consider shifting to freelance work within the next 2 to 3 years. This person also recognized that one of the biggest activities TaskRabbit freelancers complete day in and day out is assembling IKEA furniture.
The stats are staggering. Monster.com, Carreerbuilder.com, McKinsey, Randstad, and many more have been writing articles about the growing Gig Economy. The American labor force is choosing independent work over traditional employee positions at increasing rates year-over-year. A McKinsey report on the Gig Economy makes a very strong argument that the Industrial Revolution moved much of the workforce from self-employment to structured payroll jobs. Now the digital revolution may be creating a shift in the opposite direction.
While most talent acquisition strategies focus on adding more FT & PT employees, IKEA took another path. They have saved millions in additional headcount costs and embraced an organization that is filled with freelancers who crave flexibility and control. From a labor perspective, everyone wins.
I don’t believe IKEA has any interest in entering the Gig Economy. Simply put, IKEA has recognized that the labor market is changing and the days of remaining fully staffed with a 100% employee model isn’t real or sustainable in today’s labor market.
By acquiring TaskRabbit, IKEA embraced the freelance workforce model as a portion of their staffing strategy. This, in my opinion, was a brilliant move based on the realities of today’s labor market.
For all of us responsible for our organization’s staffing strategies, we can learn something from IKEA. The trends are real. The American labor force is changing. Should we continue to follow the traditional path of trying to staff our organizations with 100% employee-based hires and complain month-over-month about positions that continue to be unfilled? Or like IKEA, should we embrace a more modern innovative approach that seems to be more in alignment with the direction of the current labor force, finding the right mix of employees and independent labor to fuel the growth of our organizations? Time will tell…
Written by: Rich Oakes, Executive Vice President of GigSmart