Offering general training to workers in flexible arrangements — such as gig or contract workers — may seem as though it has limited benefits to the firm when compared with company-specific skills training. But offering such programs can actually signal a company’s commitment to nurture workers’ development, and workers reciprocate by prolonging a more productive collaboration. The trick is to get buy-in from all parties, and new research published in Strategic Management Journal shows that using relational terms to frame general skills training programs increases both program promotion by managers and uptake by workers.

The research team — including Thomaz Teodorovicz, Sérgio Lazzarini, Sandro Cabral, and Anita M. McGahan — was inspired by an increase in alternative employment arrangements. Data from The World Bank suggests that the global gig economy makes up 12% of the labor market, and research from Staffing Industry Analysts estimates that the gig economy generated $5.4 trillion in revenue in 2021. With this growing trend in mind, the team wanted to study its effects on firms’ human development efforts.

The researchers partnered with a Latin American firm that had created a general skills training program targeting their contract workers. Teodorovicz and his colleagues were able to show the company that the program increases productivity and the longevity of the work arrangement; but despite the findings, the firm couldn’t account for the training’s low uptake. Through interviews, the researchers learned that firm managers weren’t promoting the program because they didn’t see the direct benefit to the firm.

The researchers designed a study that would test three different ways of framing the training. One group received messages saying this training would provide workers with skills that will increase their productivity within the firm; this framing led to high promotion by managers, but low uptake by workers. The second group received messages saying the training would cover general skills, such as time management or entrepreneurial skills; here, the managers didn’t see the benefit to the firm and were less likely to promote the training, whereas workers were more likely to sign up. The third group received messages that suggested the training would strengthen the relationship between firm and worker; this framing led to higher promotion by the managers and greater uptake by the workers.

“If we focus only on the nature of the skill — that is, whether a skill is generally applicable across contexts or it is more applicable within the firm — we increase the likelihood that managers and workers may be in a conflict,” Teodorovicz says, referring to either the firm benefitting or the worker benefitting from the program. “But if we focus on the relationship that workers and firms nurture with one another, the conflict resolves. The training leads to value creation that benefits the workers, the firm, and — by extension — the managers.”

Teodorovicz says the findings can have impacts for both traditional and nontraditional work arrangements, especially as the length of employment with a single firm has shortened over time. But he emphasizes the importance of this study not only because it takes place in an emerging economy, but also because it emerged from a partnership with a firm that employs mostly female direct sales workers, the majority of whom lacked a college education. As the World Bank data shows, demand for gig workers in developing countries is growing at a much faster rate than in developed parts of the world. In addition, the study highlights the importance of incorporating these contexts as a core topic in strategy research.

Regardless of the economy or work arrangement, firms should offer training programs that benefit the individual worker directly and, by turn, benefit the organization by strengthening the bond between the two entities.

Published Date
17 January 2024

Article Type
Article Press Release, Article Summary/Abstract, Full Article, Research Post

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