Yesterday’s New York Times ran a story by Adam Davidson on the Hollywood model of business, touting it as this great new, compelling model of the way work will evolve. And while I agree with Mr. Davidson that we are in the midst of a hundred year reset, I think there are a lot of shortcomings in the Hollywood model. First, some historic perspective.
Sorry, Mr. Davidson, there’s nothing new here. The entire AEC (Architecture/Engineering/Construction) industry has run this way since before there were movies.
Architecture firms consist of a core of skilled professionals (once upon a time called draftsmen) who are internally flexible in that they are assigned to a specific project, reassigned once their work is done, or let go if there is no next project. The firms then hire the specialized skills they need from a variety of consulting engineers (mechanical, electrical, structural, acoustic, fire protection, and so on) in order to complete the design and construction contract documents. Then the construction documents go out to bid to general contractors, or construction managers, who really only provide management and supervision and rarely, if ever, perform the actual work themselves. That task, really many, many tasks, is left to a variety of trade or subcontractors (plumbing, electrical, air conditioning, structural steel, carpentry, and so on).
Every construction project is, then, a stand-alone enterprise assembled for the purpose of building the building, the bridge, the power plant, the office space, or whatever else. It comes into being, executes the task at hand, and is then dismantled as the project players move on to the next assignment. While, unlike the Hollywood model, the project players are more often firms than individuals, everyone is expendable if there isn’t another assignment. Anyone who has ever worked in the AEC industry has been laid off at least once. Still, it’s a durable, efficient model, but before we embrace it as the new way to work, some reservations.
- Without training, there are no skilled workers. This model works in the AEC industry because schools of architecture and engineering produce educated entry level workers. Because these professions are licensed by the states, there is a mandatory apprenticeship in the profession, usually three years, before one is considered qualified to sit for the licensing exam. The unionized construction trades also provide apprenticeship programs as a prerequisite for membership, thus insuring a flow of skilled tradespeople (how the non-union world deals with this is anyone’s guess). Outside the AEC industry, though, corporate America has walked away from the notion of training and mentoring. Since to be recognized as a skilled person in any field requires a combination of experience, knowledge, and skill, where are these Hollywood model workers going to get the training they need to participate successfully?
- Without medical coverage, everyone is at risk. As a Hollywood model worker, you have to fend for yourself when it comes to medical insurance and other benefits. You will do this by paying the highest possible rates for medical insurance as a small business owner, sole proprietor, or single employee company, thanks to the way the insurance industry penalizes these kinds of workers. While there are organizations that help freelancers with this by setting up groups, no one has the bargaining power that large corporations have when it comes to dealing with health insurance companies, so no matter what, you will pay more. Much more. At the same time, as a freelancer or Hollywood model worker, you have very limited leverage when it comes to what you can charge your clients or customers. So you’re stuck in the middle of unreasonably high costs for basic coverage and a cap on what you can make. So you earn less.
- The work never stops. Before you think this is a good thing, think again. As a freelancer or Hollywood modeler, if you don’t work, you don’t earn. While the cubicle jockeys in corporate America think that freelancing offers income and freedom, any freelancer that with any experience yearns for a couple of steady assignments to take the edge off the uncertainty. Remember, most peoples’ costs are recurring things, like the mortgage, the rent, health insurance, and so on. So take your place on the treadmill and spread yourself thin between doing the work you have and landing the next piece of business; it it’s a 50/50 split, you’re losing ground. And in the meantime, try telling your landlord that your skills are magically re-evaluated by the market frequently.
- It’s not for everybody, and not for every skill. So far, the Hollywood, or AEC, model seems to work best with highly educated people who can do very particular things, have some, albeit limited, leverage when it comes to pricing, and either can, or want to be, flexible about the way they work. If you need a lot of support, as opposed to collaboration, which is a very different thing, to effectively do whatever it is you do, you are unlikely to succeed.
All that said, whether you call it the Hollywood model, the EAC industry, or just plain freelancing, it can be an efficient way to work as long as it works more or less equally well for employer and employee. But beware when corporate America takes this one up as the latest management mantra because it just means they have found another way to screw us all. Read the NYT article at http://nyti.ms/1bKiRsA