In this excerpt from Lead the Work: Navigating a World Beyond Employment, authors John W. Boudreau, Ravin Jesuthasan, and David Creelman examine how permeable your staffing boundaries should be.

A look around a typical office won’t show you whether work and workers reside inside a relatively sealed organization boundary or flow freely across it. A familiar example is when you discover that someone working in your office is not a coworker at all, but actually a consultant on an extended contract. That’s an example of a worker flowing into the organization without an employment relationship. Do some employees stay only a couple of years, to bolster their resume and then move on? That’s an example of workers flowing out across the boundary. Do employees leave for a few years, gain valuable experience, and then return? That’s an example of workers flowing both outward and then inward through the boundary.

We tend to think of the organization as a place where there’s clear inside and outside, and the way to cross it is to become an employee or to terminate employment. In the world beyond employment, work and workers flow through the organization quite freely, and often without an employment relationship.

As a leader, you decide how much of this inflow and outflow fits your mission—how much to allow your organization boundary to be permeable.

The better we get at deconstructing assignments, the more we disperse them, and the more they are detached from regular full-time employment, the more permeable the boundary can become, and the more important it becomes for leaders to choose carefully where they fall on the permeability dimension. The same is true for the workers themselves. There is a range of emerging relationships you can have with workers, from regular employees to consultants on secondment to using employees from another firm (perhaps an outsourcer or alliance), and the work they do can flow through your boundary or be contained within it.

 

For example, a large company valued its HR consultant because he was the only person who had been around long enough to know how and why certain decisions had been made. Many regular full-time employees in HR had come and gone, leaving no one else to match the consultant’s long-term connection and institutional knowledge of the company. In this case, the relationship between the work and the worker—the job of continuity in the HR department—had unintentionally been moved outside the firm and into the consulting firm that employed the consultant. Continuity is important, but if we see the organization as permeable, there may be ways to achieve it without relying on employees embedded inside the firm. Leaving such choices to chance, without a framework to guide them, may be risky in the new world of work.

Leading the work means using the flow of talent, work, and workers to sustain and achieve your mission. Making a sharp distinction between how you manage contractors and how you manage employees feels increasingly odd when people and work flow so freely in and out of the company, even if the distinction is important from a legal perspective. Thinking of free agents providing their work from distant locations as “outsiders” seems odd when the regular employees themselves are rarely in the office, and the work of both employees and free agents is intermingled as it flows in and out across the boundary of the organization.

There will be differences in how you treat people who are working for and with you. Some will be in the inner circle and some will be completely anonymous. Some will merit investment to cement a long-term relationship; others will do a microtask and disappear. The point is that increasingly the work they do flows across the boundary called your “organization,” that is demarcated by a regular full-time employment relationship. Your key people and your closest advisors need not be employees “inside” the boundary. You may shield trade secrets from employees who are inside yet share them with a trusted contractor who is outside. You may work hard to retain the work of uniquely skilled free agents yet accept the fact that less-uniquely skilled employees may leave. Leading the work means focusing more on how the work and workers flow through the boundary than on whether or not it is done by regular full-time employees sitting inside that (increasingly) imaginary boundary.

 

How much should you allow work and workers to permeate your organizational boundary? Dialing this dimension to zero means that no work will be done unless it can be done by regular full-time employees residing inside the boundary. Dialing permeability a bit higher might involve encouraging some employees to become onsite independent contractors, or offsite free agents working through a talent platform, or to form a microbusiness to which you outsource the work. That’s letting the work and workers flow out. Conversely, you could offer a talented free agent the opportunity to become a regular full-time employee, so they build more enduring ties with your organization. That’s what happens with the most talented coders on competitive freelance hub Topcoder; they are frequently offered regular full-time employment with companies like Google, Twitter, and Amazon.

Take, for example, the owner of a small company who hired what turned out to be a very talented software coder. The owner wanted to keep this talented employee but could not compete with Topcoder’s variety of projects, high pay, and visibility for talented coders. If you think of work as happening only inside the employment boundary, the inevitable result is that the programmer will leave forcing the small company to hire someone else. The owner was more creative. He encouraged his young programmer to work for Topcoder on the side. The employee was so pleased with this arrangement that he actually turned down a lucrative offer to work for a high-tech firm, to stay with his current employer. Seeing the organization boundary as permeable means that the owner could allow work to flow through the boundary, even when it flowed outward to the Topcoder platform, as long as the coder’s work for the small company was still useful. Dial up permeability a bit, and nonobvious solutions emerge for keeping top programming talent happy and close at hand.

The idea is to dial permeability up and down optimally. An organization boundary, with “insiders” that are regular full-time employees and “outsiders” that are not, matters less now; and leading the work means being more savvy about how freely work flows through the boundary.

Excerpted and adapted with permission of the publisher, Wiley, from Lead the Work: Navigating a World Beyond Employment by John W. Boudreau, Ravin Jesuthasan, David Creelman. Copyright (c) 2015 by John W. Boudreau, Ravin Jesuthasan, David Creelman.

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