A recent trend has been the growth of the labor-as-a-service model that various companies are beginning to offer in the B2B scene. The value proposition of labor-as-a-service is clear – labor on an immediate, flexible and scalable basis. Small companies can use labor-as-a-service providers to help smooth the huge differences in work capacity between hiring permanent team members as well as allowing each existing permanent team member to leverage their time to get more done. Large companies have been using labor-as-a-service providers in various existing forms to help outsource non-core competencies.
Examples of the labor-as-a-service model in existing applications abound. In essence, law firms, accounting firms and most B2B services firms provide LaaS in one form or another. Your neighborhood corner store could easily go out and hire a partner out of an accounting firm and do all their tax accounting in-house, but they probably don’t. That’s because it’s not central to what they do and they don’t have enough demand for those services to make it an economically wise decision. In larger firms, companies such as Office Tiger have allowed the outsourcing of word processing and presentation design work to countries with cheap labor for many years in a very successful way – successful enough for Office Tiger to sell at a $250 million price tag to RR Donnelley. Companies have used temps, elance and odesk for similar reasons, and virtual assistants are popping up all over the internet.
As the economy rebounds and the capacity of firms are stretched, LaaS will become an even more appealing model for firms looking to stretch their labor and break the common cycle of over-hiring and firing. And looking to fill that LaaS demand are several players on the market already, including crowdflower, solvate, and (of course) optask. Each addresses a different area. Crowdflower looks to harness the decision-making abilities of thousands of workers in the cloud as an add-on to mechanical turk. Solvate provides a more pure-play LaaS service where you can have someone do whatever can be done remotely at $25/hour. Optask is also a pure-play LaaS player, but with two clear differentiating factors: 1) immediacy and 2) outsourcing. Optask is the only solution that allows you to type in what you are looking for, hit submit, and have it automatically routed out of the country to be done at $3/hour.
While the LaaS model has been around in one form or another for a long time, the pure play angle of providing labor to do “whatever can be done remotely” is relatively new. It should be interesting to see how it evolves moving forward. It is an idea that is likely to stick on account of the fact that labor on an immediate, flexible and scalable basis is a very compelling proposition in changing times — and, let’s face it, times are always changing.
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