You see in this world , there's 2 kinds of people , my friend, those with loaded guns and those who dig. You dig.
The Vanished
About 12-15 years back there were small shops on every corner that would set up a basic website for your business for a mere USD 1000. While it wasn’t the most lucrative business, it kept them going. If they had a bit more creativity or skill, they could charge USD 2000 and even offer a bonus- logo design.
Sadly, these shops have all but vanished. The few that remain target the naive and digitally illiterate. And not just web designers- remember the Graphic designers – who worked with small Restaurants, Accounting firms, hardware shops on creating logos, business cards and marketing flyers- all gone.
So where did they vanish- …from personal experience- Software ate them up. A couple of years after I had founded AceProHR I realised that if I really want to live the Nomad life- I need to have complete control on my digital assets- and this included this website
It took me 14 days- of moonlighting- which included courses in HTML and CSS on Coursera and finally a YouTube video on WordPress which made me realise the above HTML and CSS Course was not really required!!
The website is no “Accenture” – but what it does is give me complete control on Content including a job board for senior roles and its certainly better looking than what I would get in my budget . If you are an entrepreneur/ solo entrepreneur and do not want to give kings ransom to get an exceptional website created, you can definitely make one , which is much better than most using
- Website- WordPress, Webflow, TypeDream
- Logo- Looka, brandmark.io, Canva
- Writing assistant- ChatGPT, quillbot….
And there are like 10 more which I have used and can recommend- but that will be another post.
The point of the above is to emphasise that SAAS, took away middle/ lower income jobs and reduced them to the bastion of few elite / skilled & network folks available. It is like asking even the most ardent Tennis followers to name the top 20 in both men and women rankings- I do not think anyone will know the complete list beyond the top 10
Only the exceptionally skilled, creative, and well-networked are thriving ; The rest, unfortunately, are mere chaff or Uber drivers.
The Winner take all precedent from software product/ programming economy
Steve jobs used to say the difference between average and great software engineer is 100X. Reed Hastings at Netflix believes that the average difference between an average and the best is not 5X it is 10 X. Bill Gates used to say that there were a handful of people at Microsoft who “made” the company and if they left there would be no Microsoft.
And somewhere in between resides the truth of why their are such high fluctuations in salary within the software industry . The hierarchy is skill , technology & geography dependent. The large product firms understand one truth- its easier and more “economical” to take a person out of the market rather than trying to find replacements after losing them to the competition
I recently came across a Software testing & QA person with 14 years experience being hired at one of the FAANG firms in India at USD 100,000 base + another assured 200,000 in the next 3 years . A similar profile in one of the big 4 software services firms ( Wipro, TCS, Cognizant & Infosys) will be at max 40,000 USD base + 5000 USD variable
Automation & AI tools will soon mean that the middle and bottom will vanish from the pyramid . So what does a winner take all market look like- see the image below
this is how the usual “technology replacement ” diagram look like – but AI will accelerate it further because — as Garry Kasparov says
AI wins not because it is smarter than humans, but because it simply makes less mistakes
The power law distribution defines- the winner takes all market
And its not going to be limited to artists, senators, sportsmen, software programmers but you and me . So what does this mean
The new Vanishing! - ------
What does it mean for us
- Outsourcing industry – be ready for seismic shifts as AI/automation based products will replace vast swathes of pixel pushers
- Middle level & Junior level compensation will be in stress, while gap between the average and the elite will become exorbitant- I am talking Economy class and Private Aircraft different.
- And those who think the industry will ease into this change- you forget the basics- Capital does not give a **** about easing into a change- and if you are confused- ask the 200,000 “pampered” folks let go by some of the most profitable companies in history- Alphabet, Meta, Amazon, Salesforce… in the last 6 months when they realised they were overstaffed .
- I have seen 3 recessions and none of them have been kind for DIE ( Diversity Inclusion & Equity ) efforts- an AI and automation fuelled one will be even more lethal
- What does it mean for HR
- Be ready to have vast- and I mean Mariana trench- level compensation differentials within roles
- Be ready to let go – people , facilities
- Be ready to Fight to invest and retain
- Start learning
- DIE does not end when recession begins
- Unions – the “white collared” / and generally the folks who snubbed them would embrace it slow the pace as they try to play catch up
The last 2 people creating orginal content on Linkedin
References
- The Myth Of The Bell Curve: Look For The Hyper-Performers- Josh Bersin Forbes 2014
- The Best and the Rest: Revisiting the Norm of Normality of Individual Performance- Ernest O’Boyle Jr., Herman Aguinis,
- We Need to Let Go of the Bell Curve- Adrian Gore HBR 2022
- Ahead of the curve: The future of performance management- By Boris Ewenstein, Bryan Hancock, and Asmus Komm Mckinsey Quarterly
- Price’s Law and the Trouble of Operationalizing Performance
- Power Laws, Pareto Distributions, and Performance