A recent Gartner survey revealed that 32 per cent of organisations are replacing full-time employees with contingent workers. In addition to helping save money in the short term, contingent workers provide employers with greater workforce management flexibility and increased business agility.
Engaging with contingent resource means that your existing permanent employees do not have to develop new skills overnight, and businesses can scale their team in line with demand and other external market factors. Additionally, using contingent resource can be an effective way to identify potential permanent employees that are a great fit for the business.
While the dependence on a temporary workforce has risen in the last decade, today’s rapidly-changing and unstable economy has meant it has become increasingly critical. Businesses utilising contingent workers have been able to reduce costs in the short term while remaining confident they can bounce back quickly when opportunities change and grow.
Some of the things to consider when scaling your contingent workforce to support business agility include:
Gaining visibility
A vital component of any contingent workforce strategy is conducting an initial audit. The key questions to ask are:
- Who is doing work for your company?
- What are they doing?
- How much are you paying them?
- Do they have the right qualifications to be doing the job?
- Identifying any contract work that is being delivered on an adhoc basis outside of your main supplier agreements (Rogue Spend)
Such groundwork is more straightforward for SMEs, but those organisations with a large contingent workforce should invest in a Vendor Management System (VMS) to ensure all talent is recorded and tracked.
Managing usage
Contingent workers can be highly-skilled and valuable additions to the workforce. However, if they are engaged to fulfil an urgent need but were extended again and again, you may fall into the trap that many organisations do, where contractors possess an intimate knowledge of the business and become single points of failure.
There are also the changes to off-payroll working rules in the private sector to consider when IR35 comes into effect in April 2021.
Reviewing compliance
In addition to IR35, there are other pieces of legislation to be considered when hiring contractors. If you or your supply chain do not have the correct documentation and processes in place to hire these workers compliantly, you could risk significant financial penalties.
Strengthening the supply chain
It can be challenging to find highly qualified, specialist contingent workers for open positions and projects. Now, with contract workers set to be more in-demand than ever as businesses seek to achieve agility, it is imperative to work with talent supply experts who understand your company, its culture and the landscape of the industry in which you operate.
Achieving agility
Our Adapting to Agile series explores how organisations can maximise business agility through effective talent management. Our experts explain how businesses can gain a complete understanding and take control of their talent supply, including:
- Building a robust contingent workforce strategy
- Identifying talent strengths and gaps
- Forecasting future skills needs in the business
- Developing collaborative partnerships that deliver
- Establishing an employer brand and Employee Value Proposition (EVP).
Stay tuned to the Omni blog to find out more. Coming soon: Our comprehensive guide Adapting to Agile: The Flexible Solutions You Need to Ease Business Recovery.
