I’ve always been fascinated by how labor markets work. People are the foundation for how things get done. How we organize across and within companies impacts both creativity and efficiency.
The first big labor market shift in my lifetime that I can remember was outsourcing. Fueled first by globalization and ignited further by Internet connectivity, arbitrage opportunities in labor costs shifted both manual and knowledge work to developing economies. The torchbearers of this movement online were Upwork (f.k.a. Elance-O’Desk) and Amazon’s “Mechanical Turk”.
After decades of shifting work abroad had tightened the “spread” in labor markets, the 2008 financial crisis was a forcing function to encourage a concept known as insourcing. Jobs that had previously been shipped overseas, such as manufacturing and customer support, were brought home, and many times done within a company’s own four walls.
This minimized the logistical burden of managing multiple time-zones, managing logistics during the production process and all else that is lost in translation.
Over the past five or so years, as the mobile computing era has come into full bloom, a new peer-to-peer layer to the service economy has emerged.
People are the foundation for how things get done.
Workers who used to find employment via a contingency staffing agency or an online bulletin board like Craigslist connect directly with prospective jobs via an app, and work when they want. Apps like Uber, Handy and Instacart are largely businesses built around convenience, where consumers trade their own time for money.
While these companies are still relatively early in their development, they appear to be the generationally defining online businesses of 2010–2015.
Over the past few months, we’ve witnessed a new type of labor organization that fascinates me. I call it “desksourcing.” Managers in the business world have for some time been firing off emails and texts from their cell phones, asking their associates to take care of financial models or do desk research. But desksourcing has started to become a consumer phenomenon.
You can see it in the use of “conversational commerce” businesses, like General Catalyst-backed GoButler, wherein the consumer effectively text messages with a concierge service to fulfill generic requests such as “can you help me buy some new light bulbs for the office?” or “can you send a bouquet of flowers to my girlfriend?”
The concierge services use agents who sit in front of desktop computers with larger screen real estate — better fit than the phone for more complex tasks.
These agents use a traditional customer service messaging infrastructure to respond to consumer inquiries and dispatch consumer requests to the appropriate vertical labor marketplace (such as DoorDash, FlyCleaners or Shyp) to fulfill the order, while remaining the sole “throat to choke” for service quality.
To accomplish these tasks on the go before such services existed would require users to find a long-tail mobile native or web app, download it (if appropriate), register, pick out the requisite item and pay. While the purchase experience in some mobile apps (native or web) is highly optimized, most are pretty clunky.
On the whole, the tasks are much easier to accomplish on the desktop web. These new concierge services are ways of shifting the work to the lower-cost labor center, the desktop.
Desksourcing business models in the category are still in flux. Some services, like FancyHands, operate on a subscription model. Other services, like Magic, operate on a transactional model, whereby the consumer pays a premium on top of the price of each item procured.
And still others, like GoButler, are free to the consumer, with the belief that the businesses with which they partner will pay to acquire their customers.
It’s possible that as native mobile user interfaces evolve, the cost of doing any of this “work” from our phones may fall enough to become on par or even cheaper than desktop, making the labor arbitrage no longer favorable.
However, as we seek to accomplish more and more on the go in our 24/7 always-on world, the paradigm of desksourcing will often be ahead of the native UI paradigms of the day.