Case Study Fueling the Gig Economy : A Case Study Evaluation of Upwork . com

With recent downsizing of talented professionals and the power of globalization to provide opportunities for more underdeveloped countries, the gig economy is a source of influence in today’s generation of professionals. Online outsourcing media have shown to be valuable resources for companies who need a specific set of skills for a limited period. This case study evaluates Upwork.com, one of the leading freelance websites in the gig economy; this article provides insights on how others should evaluate the power of this new economy in terms of opportunities for small businesses, entrepreneurs, and freelancers. Upwork has led the pack by providing a flexible platform for freelancers worldwide, including coders, writers, and web developers, putting businesses in touch with reasonably priced workers. The study begins by exploring the attributes of the gig economy. Data collection is achieved through qualitative analysis. The application of these conclusions could increase the survival rate of new freelancers on Upwork.com and in the gig economy. The study is significant because this research widens contemporary assumptions about strategic thinking for individuals engaged in e-commerce.


INTRODUCTION
With the large number of struggling artists who seek to advertise their skills in the open market, Upwork provides a direct connection to customers in need of specific services.The company promotes that one in five Fortune 500 companies hire freelancers through its website (Upwork.com, 2017).This type of freelance business is ideal in that it limits liability in business transactions through being an intermediary between two parties.In fact, today's economy has opened a global marketplace for independent contractors to expand their customer base nationally and internationally.Online outsourcing has proven to be a transformative medium in this global economy (Burtch, Carnahan, and Greenwood, 2016).Businesses can tap into a global market to obtain the necessary professional services beyond their own local markets.In fact, this global marketplace has allowed freelancers, often called contractors, to cast a broader net in hopes of finding more work.Companies such as Upwork enable these freelancers to do just that.Certainly, this type of business brings with it a long list of advantages and disadvantages (Carr et al. 2017).However, good professional reputations are created when companies or individuals take their time in looking for the proper contractor and make their needs explicitly clear; the contractor then meets their specifications within the specified period.In these cases, everyone involved feels as though value exists in the transactions.Soriano (2017) proposed that these companies do not intentionally recruit subpar freelancers.However, when a marketplace is driven by price, instead of value, quality of service often goes down.People, both companies and individuals, crave value in any professional interaction (De Stefano, 2016).When you create a forum that benefits everyone involved and set certain standards within that forum, there is real potential for growth.

Review of Literature-Gig Economy
Gig economies are those economies where individuals market their skills, whether in unskilled labor markets, such as Uber drivers, or as skilled professionals, such as coders who bid out their services on sites such as Upwork.Between 2005 and 2013, 85% of employment growth emerged from the gig economy.However, many workers are forced into this gig economy and not by choice (Friedman, 2014).Using gig economy companies, freelancers "[piece] together a livelihood from a range of activities" (Huws and Joyce, ID: 523634 https://doi.org/10.18639/MERJ.2018.04.523634 2016).Thus, freelancing allows companies to fill a specific need while cutting out costly hiring processesthis allows companies to retain monies for use on additional projects (Ricker, 2017).Additionally, this gig economy provides freelancers the opportunity to make lifestyle choices that a conventional job would not allow them.Gig economy workers may be able to choose when and where they want to work as well as how much they charge for their services.
Although gig economies have many benefits, freelancers should ensure that they are aware of the risks.Not all freelancing companies conduct business in the same way.Some companies, such as Upwork, allow the freelancer to choose their jobs, taking a percentage of the revenue earned for each job, while others charge a flat fee that is added to the final cost of the project (Kallenburg and Dunn, 2016).In addition, Upwork has a "noncircumvention clause that prohibits [workers] for twenty-four months from working with any client that identified the worker through the Upwork website" (Kallenburg and Dunn, 2016).Although the gig economy may represent a short-term stimulus in the global environment, only time will tell if this business model can achieve sustainable success in the future.

METHODS
This research uses qualitative content analysis for developing this specific case study involving UpWork.com, a freelancing website.In the case study analysis, individuals analyze a business case by focusing on the critical facts and using this information to determine the opportunities and problems facing that organization; this process helps students to learn by providing them real-world business scenarios where they act as problem solvers (Laudon and Laudon, 2017).In fact, students and instructors can move beyond theoretical concepts to practical ones (May, 2013).Case study analysis can be broken down into the following stages: (a) identify the critical facts in the case, (b) identify the key issue(s), (c) specify alternative courses of action(s), (d) evaluate each possible action(s), and (e) make the preferred recommendations.Laudon and Laudon (2017) suggested that the most critical item in case study analysis is identifying the most important facts surrounding the case.Through this methodology, researchers were able to gain new insight related to organizations operating in the gig economy.

Organizational Background
If an individual was looking for one of the most popular platforms to connect with a remote employee or a freelance job, then look no further than Upwork.Upwork is truly the surviving member of a triumvirate of freelance platforms (San Francisco Chronicle, 2015).At one time, on the freelance frontier, there was oDesk, Elance, and Upwork.In 2013, Elance and oDesk merged to form Elance-oDesk.In 2015, the company was re-branded to Upwork.This website is a global freelancing platform where businesses and independent professionals can connect and collaborate remotely (San Francisco Chronicle, 2015).Today, Upwork is the world's largest online freelancer marketplace with over 10 million freelancers and 4 million clients; these freelancers perform a variety of activities including web and software development, graphic design, creative content, advertising, digital marketing, translation, writing, and administrative and customer support (San Francisco Chronicle, 2015).One of the greatest advantages of using a company such as Upwork is the ability to interview, hire, and work with freelancers or contractors from around the world using the company's platform.The company has also added a real-time chat feature.Upwork is a great place for quality contractors to make money.In this gig environment, businesses and individuals can save money while acquiring the services they need.However, Carr et al. (2017) suggested that buyers still need to move cautiously with global freelancing owing to the varying risk.Thus, Upwork provides a tremendous opportunity to freelancers, businesses, and individuals in the gig economy, yet these virtues of using the website are not without risk.

RESULTS
Strategic analysis is an important tool for analyzing Upwork.com.Effective analysis reviews the competitive environment, defines key issues, and recognizes critical assumptions on which organizational strategies are built (Harris and Lennox, 2013).These management tools "provide a structured method for organizing and understanding the complex trends and developments" that are occurring across this business sector (Palmer, Dunford, and Buchanan, 2017).This research probes deeper into the infrastructure of Upwork by evaluating the company's strategy, structure, and organizational culture.A comprehensive strategic analysis includes (a) an identification of the organization's current competitive environment, (b) a consideration of the pros and cons of its actions, and (c) the advancement of a set of recommendations based on its strategic analyses (Harris and Lennox, 2013).Laudon and Laudon (2017) maintained that, in case study analysis, it is critical to identify key issues surrounding the case.Thus, researchers should identify the problem and determine why it is occurring.In reviewing the freelance website, the first evaluation utilized is the PESTLE Analysis.PESTLE is an environmental analysis of several critical factors, including political, economic, social, technological, legal, and ecological (Palmer et al., 2017).Upwork was reviewed not only in relation to other professional freelancing sites such as Freelancer.com and Clickworker.com,but the company's business practices were also assessed in context to other well-known freelancing sites such as Uber (see Table 1).
Political: From the political perspective, there is a lack of government laws to protect freelance workers.In fact, gig economies are exempt from certain governmental taxes (Wells and Chemi, 2016).Owing to their status as self-employed entities, many workers do not enjoy the assurances and rights that unions and laborers' developments have spent over a century battling to accomplish (Marx, 2016).Furthermore, most laborers in the gig economy are not protected by a "no lowest pay permitted by law" clause, they do not have job loss benefits or paid sick time; they are not afforded the benefits of retirement annuities; they are also not protected by laws that regulate working hours.Freelancers make their way in this new segment, yet they have no protection and are at the impulse of the platform(s) with which they have associated themselves (Marx, 2016).This reality may cause changes in regulations in the future for gig economies.
Economical: Using PESTLE analysis, individuals can see that there are dramatic changes that emerge from gig economies; this economy is a new way of working compared to traditional jobs.Gig economies have grown dramatically over the past five years, despite reporting lower wage earnings when compared to equally educated traditional workers.Rapid growth in this sector has caused gig economies to quickly become a large part of the global economy.A current report uncovered that 20-30% of the U.S. workforce comprises temporary workers and independently employed specialists (Marx, 2016).
Social: Today's customers are empowered with unlimited sources of services.With a global market, buyers can enjoy cheaper prices for services.Individuals working in the gig economy are also empowered with maximum flexibility of working hours and wages.In today's environment, there is a multigenerational workforce (Green and Roberts, 2012).Workers can create their own hours and their own workload.Many younger workers enjoy this flexibility.In fact, many millennials are not interested in permanent full-time jobs; this may be because they feel that they were pushed into the independent workforce during the recent economic downturns and had remained in this area of work owing to the residual soft economy.This causes concern that millennials may not be learning key skills such as communication, leadership, and teamwork that are essential to survive in a corporate culture, thus causing them not to understand the time that it takes to truly master a skill or earn a promotion (Brown, 2017).Technological: From the technology perspective, Upwork, as part of a gig economy, displays tremendous innovation in the work process when compared with the traditional work fields.Simultaneously, the gig economy also has benefits for companies that use these freelance employees-companies can cut costs and funnel those savings into materials, products, and services.Gig economies, such as Upwork, as an industry do not consume considerable raw resources, such as paper, in their work.They do not need large office spaces for employees or prestige.They also save employees' time by communicating with clients through the company website, phone, or other online methods.Owing to innovation playing such a large part in gig economies, companies such as Upwork must keep up with the developments in innovation if they want to stay current.
Legal: Legal issues abound in the gig economy.Owing to the success of companies such as Uber and Airbnb, many government regulators have started paying attention to these types of internet-based businesses and the United States' outdated labor laws.In the gig economy, there is no union and no clear laws to protect workers.Kennedy (2016) maintained that these labor laws have not kept up with the fast pace of the gig economy.In general, labor laws regulate the relationship between an employer and its employees.Yet, freelancers in the gig economy often operate independently, negotiating with different clients (Kennedy, 2016).These labor laws provide additional cost to a business and create uncertainty in the marketplace with unclear guidelines about working relationships as it relates to online-based businesses.Kennedy (2016) outlined the following possible solutions in reforming labor laws for the gig economy: (a) The government could create a new category of worker, between full employee and independent contractor; (b) Congress can reevaluate the country's major labor laws so that they can achieve specific goals; and (c) Government officials can develop a well-written statute to ensure that all workers, customers, and other stakeholders benefit from the gig economy.As traditional companies continue to utilize freelance workers, legal ramifications will continue to exist.
Environmental: Environmental factors have minimal impact.With freelancing, there is no need to commute to work, reducing environmental concerns such as pollutant emissions.Furthermore, Palmer et al. (2017) argued that physical factors, such as environmental concerns, can create external forces that garner management attention.Freelancers utilize computers and software.They operate paperlessly and do not contribute significantly to the continued amount of waste going to a nation's landfills.
In conclusion, several factors influence the gig economy and the emergence of freelance websites such as Upwork.Utilizing the PESTLE analysis for Upwork can assist the strategists in forging the right decisions and taking advantage of other opportunities in the market.
Competitive analysis: Additionally, understanding the competitive environment is critical to Upwork's future success.Conducting a competitive analysis is very helpful, because the results can strengthen an organization's strategic approach.In a competitive analysis, strategists evaluate the business' competitors in order to assess and predict the durability of any competitive advantage.In fact, a successful strategy requires some barriers to competition that prevent others from entering the business' market and duplicating its core competencies (Harris and Lennox, 2013).
In the competitive analysis conducted for this case study, Upwork was compared to two other competitors, Fiverr.com and Freelancer.com(see Table 2).Nevogt (2016) argued that Upwork is popular because of its size, boasting of millions of freelancers on its platform.However, the site's strength is also a major weakness that competitors are they using this to leverage their organizations or are they leveraging against their organizations?Opportunities and threats emerge when strategists examine customers, competition, and external forces (Perreault, Cannon, and McCarthy, 2014).
Upwork: Upwork has one of the highest positions in the market.Using Strengths, Weaknesses, Opportunities, & Threats (SWOT) analysis, Upwork's strengths and weakness as well as what has helped them thrive and what risks they could be experiencing from their competitors, and more importantly, possible changes in laws and governmental restrictions for companies that work with freelancers were identified HATASO merj.scholasticahq.com(Kennedy, 2016).One major opportunity for Upwork is expanding into other services.Yet, one clear threat is that more new competitors are entering the market with the same services or better services.For buyers, posting a job on Upwork can be a hassle owing to the size of the website and the number of freelancers.
Even with a rating system available for buyers, it is difficult to locate the right freelancer (Nevogt, 2016).Upwork can provide many opportunities to freelancers.However, there still exist risks to those who contract

Unique selling proposition
The company promotes itself as always finding a way to deliver an easy and professional service The company showcases some of the cheapest services among freelance competitors The company positions itself as having the simplest process for customers to purchase services

Customers get professional services
Customers have many ways to fulfill their needs

Core competencies
The company helps to hire managers, and it provides consulting to businesses looking for services The company specializes in different jobs The

Overall impressions in the market
The company is considered an industry leader in the freelance arena.It provides very professional services including well-defined specific services The company is considered an industry leader in the freelance arena owing to its low-cost strategy.It provides many services, but there is no accurate measure for quality The company is considered one of the industry leaders.However, it has sometimes offered inaccurate budgets on projects.Yet, this business is a strong competitor to any other freelance website in this market ID: 523634 https://doi.org/10.18639/MERJ.2018.04.523634 through these sites that do not exist in direct employment positions.Additionally, a difference of opinion makes it difficult to assess the value of jobs on Upwork, because job satisfaction highly depends on the type of job a person is seeking.Some freelancers are looking for small quick tasks; whereas, others prefer long-term projects (Kallenberg and Dunn, 2016).In general, Upwork is a good value for most buyers.The company provides very professional services, including well-defined specific services.Fiverr.com:Fiverr.com is a prime competitor to Upwork primarily owing to its inexpensive pricing structure.The company has a high position in the marketplace owing to its low-cost strategy.Fiverr claims to be the world's largest freelance services marketplace for lean entrepreneurs who want to focus on growth offering services starting at $5 (Fiverr.com, 2017).In fact, buyers can purchase a variety of services equivalent to those on Upwork.The purchasing process is different from Upwork-sellers post these services, not buyers/employers.Buyers can search for services or browse the Fiverr platform.However, it is the sellers who post what they are willing to do and for how much, not the buyers (Nevogt, 2016).Sellers and buyers can access the site easily.In fact, starting a freelance business is simple with few barriers to entry.With that said, buyers are subject to an onslaught of low-quality products owing to the lack of adequate quality control.As an individual might expect, Fiverr is not a great place for freelancers to earn a substantial income.
Based on the company model, customers' options are limited.Sellers are clearly in control (Nevogt, 2016).In general, Fiverr is a good buy for customers who desire freelance services at cheaper prices than Upwork.The company provides many services.However, there is no accurate measure for quality.
Freelancer.com: Freelancer represents another viable alternative freelance website to Upwork.The website boasts of more than 9 million projects posted and more than 17 million users (Nevogt, 2016).Similar to Upwork, the business model is massive, offering similar benefits and similar weaknesses.The company's platform is set up where customers drive the process.A customer posts a project to get started, complete project details (including skills needs, pricing options), and waits for freelancers to bid on the work (Freelancer.com, 2017).Posting a project is free for customers.However, employers can also skip this process entirely by hiring freelancers directly.However, there are some noticeable weaknesses in Freelancer.com.Although Freelancer offers time-tracking tools, these services are not free.Nevogt (2016) suggested that this process might incentivize freelancers to bill as many hours as possible if projects are being paid by the hour.Additionally, payment processing has been noted to be very slow with lackluster customer support.Freelancer is an adequate replacement for Upwork.Yet, the company has sometimes offered inaccurate budgets on projects.However, this business is a strong competitor to any other freelance website in the market.

STRATEGIC IMPLICATIONS
If individuals and organizations desire sustainable success in the gig economy, they must think strategically.Strategy sets the tone and direction for an organization, prioritizes tasks, and helps to guide the myriad of decisions that must take place in an organization (Harris and Lennox, 2013).On a global front, organizations must be able to navigate a very competitive landscape.Thus, organizations must have the capacity to address today's needs while looking far into the future at new market opportunities and new competitors.After conducting analyses, researchers should provide the proper course of action.Laudon and Laudon (2017) argued in the case study analysis that this process involved selecting the best course of action and providing a detailed explanation for the recommended solutions.This research produced several strategic implications: A. The gig economy is here to stay, offering unlimited opportunities to workers worldwide: Owing to the widespread adoption of the internet, millions of people worldwide are now able to compete for the same jobs.As this trend continues, this could cause an oversupply of labor in certain gig economy markets, such as Upwork, which would then cause the market price for work to plummet.This market is also strongly driven by ranking and reputation scores, thus allowing the creation of intermediaries-highly ranked individuals who then bid work out to lower ranked individuals at lower pay.One way that workers could try to guard against this is to create cooperatives or unions, which would allow for the creation of rules or laws to protect workers (Graham and Wood, 2016).
B. Freelancers will continue to struggle with insignificant income on Upwork owing to global competition: Most on-demand companies classify their workforce as independent contractors and not employees.However, many of these workers are not allowed to accept jobs from clients outside of the company platform, thus limiting one's ability to create a client base.Another downside is that once these workers are classified as independent contractors, they are no longer covered by the Fair Labor Standards Act or National Labor Relations Act, and most are not eligible for sick leave, health insurance, or retirement benefits.If Congress chooses to change this situation, they should create portable benefits programs or risk-pooling programs to allow some protection for these workers (Donovan, Bradley, and Shimabukuro, 2016).C. Upwork should further differentiate itself from the competition: With that being said, Upwork must work to implement this strategic approach.The analysis is clear that the services provided are uncomplicated, which opens the door for replacements.One unique factor that makes the company the market leader is the global network of freelancers.By upholding this factor, Upwork is able to identify a need in the market to connect talented freelancers with businesses in need.
The company has a strong understanding of how to leverage their online platform to make those connections happen.This has eliminated the restrictions that companies once faced in hiring a local firm with a few freelancers to create their brand identity.The company uniquely offers endless options for clients, allowing it to gain new clientele.The Upwork team will need to remain vigilant in the knowledge of their competition to maintain their unique offerings and may consider diversifying their business model to include goods in addition to their current services.

CONCLUSION
Global forces will continue to make the gig economy relevant.If individuals and organizations want to consider proactive strategies to beat the global competition, they cannot afford to ignore the freelance workforce.In fact, the gig economy has sufficiently gained momentum internationally to be a critical factor in the very near future.Today, Upwork is the industry leader in the freelance arena.However, the organization cannot be complacent.The analysis demonstrated that the current service offerings are uncomplicated, which opens the door for replacement and duplication by other competitors.In general, Upwork has been successful in driving their brand as well as the ideas of gig economies forward.The main strength of Upwork is their strong technological presence-not only in its own business platform, but also in many of the services that they provide to their customers.The company has also filled a void for those individuals who wish to work, but under their current circumstances were unable to obtain or did not desire a traditional nine-to-five job.In addition, Upwork has caused a disruption to traditional hiring and management strategies.Similarly, Uber has caused a disruption to taxi services.This level of disruption is something that has not been observed in the human resources arena previously (Ricker, 2017).For Upwork to maintain their lead in the freelance gig economy sector, they should carefully monitor the changes that may be coming in government and employment policies.Although there are challenges that Upwork and other gig economy businesses will experience in the future, it appears from this research that freelancing is here to stay.The application of these conclusions could increase the survival rate of new freelancers on Upwork.com and in the gig economy in general.The study is significant because this research widens contemporary assumptions about strategic thinking for individuals engaged in e-commerce.As technology advances, buyers will be able to hire freelancers to perform any task with a click of a button.

Table 2 . Competitor Analysis of Upwork.
Dr. Craig Walker is a Professor of Economics at Oklahoma Baptist University.He has earned an MBA from Baylor University and a Ph.D. in Economics from Southern Methodist University.He has professional experience in the defense industry and local economic development.Abdulrahman Alabulththim came to the United States almost 8 years ago.He worked hard at his studies and recently graduated from the University of Central Oklahoma with an undergraduate degree in Finance.He is pursuing a master's degree at Oklahoma Baptist University in International Business and is looking forward to pursuing his Ph.D.Michele Phillips, CLS (ASCP), MB, is the supervisor of the Biochemical and Molecular Genetics Laboratories at the Detroit Medical Center and is currently an Oklahoma Baptist University MBA-Leadership student.Her 15 years in management drives her to learn about what best motivates people and sets them on their path to success.Daniel Smith is a clergyman, college educator, and guidance counselor.He works with students to navigate the complexities of college life and achieve a quality education.He has supported thousands of students in their pursuit of a college degree and assisted in building the business program on the Sequoyah County campus of Carl Albert State College.He holds a Bachelor of Science degree in Business from Northeastern State University and will complete an MBA in International Business from Oklahoma Baptist University in May 2018.