What the labour market can learn from AirBNB

Milwaukee is only 2 hours away from Chicago where I will land at the airport. What if I fly in a few days before the meeting and arrive there on Saturday already? That will give me a day and a half to catch a glimpse of the famous Windy City in Wisconsin. Staying there will be at my own expense and as a real Dutch Man I want it cheap and simple, so no hotel for me. Time for Air BNB.

The online platform that successfully matches house owners who want to lease their apartments to travellers looking for a place to stay around the world. I typed ‘Chicago’ and filtered the results on ‘private room’ and a cost per day range. On the map I selected the Lincoln Parc neighborhood, which should be nice and safe, and browsed the images, amenities, guest reviews, rating and the approximate location on the map. Within 24 hours three house owners I contacted replied.

I made my final selection based on the best match with my criteria and was then guided to the identification and

payment process on the same Air BNB platform. After typing in my telephone number, within seconds a text message arrived with a verification code that I had to type into the appropriate field on the website. Next step was to show my passport to my webcam. After one minute Air BNB had checked and verified my ID. I was really Radi Jaarsma! Next was the credit card payment (payments via Air BNB are guaranteed and insured). My reservation was now final. After this verification and payment I now had access to the exact location of the apartment and full contact details of the owner.

Done.

Within a couple of hours my host personally let me know that they were looking forward to my stay, and that they would sent me a list of all things to do in Chicago, plus tips on public transport and tours.

And with that, Air BNB had cut out all the middle men; the travel and real estate agents.The completely digitized online platform brings together supply and demand. Self serviced. User friendly designed workflows for matching, reservation, reviewing, payment and ID verification. And all without the (human) interference of a middle man; just direct contact between the two parties. Completely scalable and distributed over the Internet as a website and a mobile app, potentially reaching everybody around the globe with access to internet.

But this is strikingly similar to the recruiting business….In the labour market, the house owners are the business owners. Some large, some small. Candidates and freelancers are the travellers. Looking for new opportunities in a specific city, region or industry. After the match, we also need to do the ID verification, agreements and payments. Currently recruiting companies are the real estate agents of the labour market, bringing the two parties together, making the match. When will the Air BNB of the labour market arrive that knocks out the agents?

The professional segment saw the rise of LinkedIn, and in the freelancing segment of the labour market www.Twago.com is already gaining ground in Europe (and bought by Randstad in the meantime), while www.freelancer.com is growing rapidly in the US. In general TAT-tools (Talent Acquisition Technology) is exponentially growing.

Platform business in the Human Capital management sector on the risePlatform business models, that by

nature are two sided, are gaining ground rapidly. In my mind there is no doubt that the leading company’s in this world all will be platform players. Platforms that are AirBNB-like could enable the complete work arrangement from source to pay, building a Human cloud. But also platforms that offer toolkits for business to run their HR business as a platform. For example www.NextCrew.com that offers a white labeled cloud based toolkit to ‘Create your own online staffing business’, including tools for talent pools and time sheets.

Strategic choicesTraditional businesses in the labour market have some strategic choices to make. Do they want to become a platform player? Or do they risk to become dependent on the possible future platform players in the market? Do they want to disrupt the industry, or at least transform it? Or be disrupted?

A platform player needs to be breathing software and development. A company with IT at its core. Programming in the veins, agile structured, scrum working, innovative and decisive. That is a challenge for traditional players, big and small. Not by accident we saw that company's like Booking.com, Amazon, Spotify and AirBNB have no roots in the industry they disrupted.

I think there are three choices: Make, Buy or Outsource and configure.Making (building/developing) a platform will be hard for traditional players as discussed. So that leaves two options: 

1. Buy a rising (start-up) platform player and translate traditional business to that new platform
2. Outsource the work by paying for a platform toolkit (PaaS) and create hit-teams to configure and grow it, preferably in a of co-creation 

Air BNB: ‘We imagine a world where you can belong anywhere'
It’s not that far off: ‘We imagine a world where you can work anywhere’ :)