The idea of “gigs” has become commonplace in India. But the glitzy term is nothing but a glorified word for temporary employment where the individual worker’s income potential is at the behest of the employing organization.
Many young Indians are attracted to the gig bandwagon. Who doesn’t want the freedom to be their own boss? The flexibility to work at their own will and ability to quickly switch for better money-making options? And when there is no limit to how much you can work, these young and eager workers stretch themselves to maximize earning. For the youth, the appeal of limitless income potential’ tends to supersede job security or full-time benefits like insurance and paid leave.
The ‘Uberization’ of startups has made gig employment an enticing supply model for companies as well. Many app-based delivery companies hire gig workers as delivery executives to have the flexibility to ‘scale supply dynamically and rapidly to match demand’. But naturally, the cost benefits are the real appeal. Companies do not have to provide any benefits which they provide to their full-time employees. No sick leaves, no insurance, and no health care. As companies compete with each other to cut costs, increase discounts for customer retention; customers too enjoy tossing between companies to get the best deal.
But of course, the gig economy has a dark underbelly. For many individuals, being a gig worker is not a choice but rather the only feasible option. As tech-driven startups have flooded the market, gig economy opportunities have grown at a faster pace than opportunities available in traditional employment. As the gap between education levels and appropriate employment grows, the over qualified driver might just be there because he couldn’t find a job hiring for his skills.
Many individuals overlook that this ‘limitless income potential’ is actually an unsteady source of income. The earnings of delivery executives or cab drivers are based on an incentive model completely dictated by the organization’s cost implications of choosing one executive over another. As new gig workers enter the force, organizations can slash incentives or stop allocating trips to ‘expensive’ riders without any prior notice.
But the problems don’t stop there. Besides the insecurity of losing their income stream, the repetitive and hands-off nature of gig employment creates plateaus and inhibits professional growth. As Maslow’s hierarchy dictates, everyone aspires for personal and professional growth and learning when financial needs are covered.
The gig-economy is not quite rosy for the organizations either. Delivery executives are the most critical piece of the brand puzzle. The absence of mentorship or skill development training leads to failure and inconsistencies in drilling down the brand’s vision at the grass-root level and fails to set a standard for customer service. As a matter of fact, the lack of exclusivity in gig employment means your executive may be simultaneously working for a competitor, ready to serve the highest incentive. It’s unsurprising when you book a ride with a company but the vehicle that shows up has multiple brand logos printed on the side with the driver juggling between smartphones and apps to find his sweet spot and maximize earning. Resultantly, the brand image of the company is diluted, and you’re left with a lingering thought – “if the drivers aren’t loyal, why should I be?”
Economically, the gig economy hasn’t taken companies to the promised land either. The lack of exclusivity also means an unpredictability of supply. In order to tackle this problem, companies often pay excess ‘incentive’ to bring workers online and serve orders. These incentives can actually create losses at a delivery level if the collected payment for that order is lower. The past decade of gig-economy popularity has also revealed that despite theoretically being scalable, almost 80% of all orders for a company are serviced by under 30% of the registered supply. Additionally, in periods of exceptional demand, the gig-economy also has a glass ceiling beyond which customers remain unhappy and disgruntled because of a lack of service.
It’s time to relook at the employment choices. Hiring full-time delivery executives means creating a stable supply that reflects your brand values. Gig workers just won’t have the same level of commitment the vested full-time employees do. The skills that you take time to build with your team are unique, something that can not be imitated. A deferential and proficient supply created in-house helps provide unique, consistent, and exceptional delivery experiences. A stable supply can also be more beneficial in creating stronger unit economics and creating sustainable value. The predictability, rostering, and efficiency of supply are sufficiently adequate to match dynamic demand and effectively create long-term viability.
Brands, not just businesses, should be working on the development of their delivery executives, their actual customer touchpoints. Customers today are smarter and more socially conscious. They are considerate yet have lofty expectations and can sense a genuine initiative to improve brand value.
At Pidge, that’s what we do. Our delivery executives are the core of our business and critical to customer happiness. By providing them with benefits, regular training, and a care and respect that covers guaranteed income through parental leave, we help them feel confident so that they can truly cater to our customers. A happy employee makes a happy customer, and at Pidge, we make happy employees.