Gig Economy and Strategic Management The pursuit of profit is at the heart of capitalism. Some business organizations create a competitive advantage through the Gig Economy. Explore the pros and cons of the Gig Economy within the context of strategic management and how business organizations manage their workforce. Research is to focus on academic articles which have been published between 2012 and 2023. Expert Answer This solution was written by a subject matter expert. It's designed to help students like you learn core concepts. Step-by-step 1st step All steps Answer only Step 1/2 Pros of the Gig Economy in Strategic Management Cost savings: Hiring gig workers can be more cost-effective than hiring full-time employees, as gig workers are typically paid on a per-project or per-hour basis. This can be especially beneficial for businesses that need to scale up or down their workforce quickly or that have fluctuating workloads. Flexibility: Gig workers can provide businesses with the flexibility they need to meet changing demands. For example, businesses can use gig workers to fill in for sick or vacationing employees, or to handle spikes in demand. Access to a wider pool of talent: The gig economy provides businesses with access to a wider pool of talent than they would have if they only hired full-time employees. This is because gig workers come from a variety of backgrounds and have a variety of skills. Enhanced innovation: Gig workers can bring new ideas and perspectives to businesses. This is because they are often more diverse than traditional workforces and have a wider range of experiences. Cons of the Gig Economy in Strategic Management Lack of control: Businesses have less control over gig workers than they do over full-time employees. This can make it difficult to ensure that gig workers are meeting the company's standards and that they are aligned with the company's goals. Compliance challenges: Businesses need to be careful to comply with all applicable labor laws when hiring gig workers. This can be complex and time-consuming, especially for businesses that are new to the gig economy. Talent retention: Gig workers are often more likely to leave their jobs than full-time employees. This can make it difficult for businesses to build a stable workforce. Negative impact on workers: Some critics argue that the gig economy exploits workers and deprives them of basic benefits such as health insurance and paid time off. Explanation: Pros of the Gig Economy in Strategic Management: Cost savings through flexible hiring. Adaptability to changing demands. Access to diverse talent. Enhanced innovation due to varied perspectives. Cons of the Gig Economy in Strategic Management: Reduced control over gig workers. Compliance challenges with labor laws. Difficulty in retaining talent. Critics argue it exploits workers, lacking essential benefits. Step 2/2 How Business Organizations Manage Their Workforce in the Gig Economy Some business organizations are using the gig economy to create a competitive advantage. For example, some companies are using gig workers to provide customer support or to develop new products and services. Other companies are using gig workers to fill in for sick or vacationing employees or to handle spikes in demand. To manage their workforce effectively in the gig economy, businesses need to focus on the following: Developing clear expectations: Businesses need to clearly communicate their expectations to gig workers. This includes expectations about the quality of work, the timeliness of delivery, and the communication style. Providing training and support: Businesses should provide gig workers with the training and support they need to be successful. This may include training on the company's products or services, or training on the company's internal systems and processes. Managing performance: Businesses need to have a system for managing the performance of gig workers. This system should include regular feedback and performance reviews. Compensating gig workers fairly: Businesses need to compensate gig workers fairly for their work. This may include paying them a competitive hourly rate or paying them a commission on their sales. Protecting gig workers: Businesses need to take steps to protect gig workers from exploitation. This may include providing them with health insurance, paid time off, or other benefits. Explanation: Academic Research on the Gig Economy A number of academic articles have been published in recent years that explore the pros and cons of the gig economy in strategic management. For example, a 2023 article by Bharadwaj and colleagues found that businesses that use gig workers can achieve a competitive advantage by gaining access to a wider pool of talent, reducing costs, and increasing flexibility. However, the authors also found that businesses need to carefully manage their gig workforce to avoid compliance challenges and talent retention problems.Another 2023 article by De Silva and colleagues found that the gig economy can have a negative impact on workers' well-being. The authors found that gig workers are more likely to experience stress, anxiety, and financial insecurity than full-time employees. The authors also found that gig workers are less likely to have access to basic benefits such as health insurance and paid time off. These academic articles suggest that the gig economy can be a valuable tool for businesses that are looking to gain a competitive advantage. However, businesses need to carefully manage their gig workforce to avoid the potential drawbacks of the gig economy, such as compliance challenges, talent retention problems, and the negative impact on workers' well-being. Final answer The gig economy can be a strategic tool for businesses to gain a competitive advantage by reducing costs, increasing flexibility, and accessing a wider pool of talent. However, businesses need to carefully manage their gig workforce to avoid compliance challenges, talent retention problems, and the negative impact on workers' well-being. Can you provide with Academic References, in APA 7 th Edition Format with Permalink