Effective Contingent Workforce Management Strategies
The ways in which organizations hire and manage their workforce to deliver their products and services have significantly evolved to fit the needs of their customers. Current employment trends—like the gig economy, contracting, consulting, and freelance work—have emerged out of necessity. Labor shortages, economic slumps, and seasonal fluctuations are a harsh reality for many businesses, and they’ve had to adapt their workforce strategies to remain profitable and competitive.
Leaning on a contingent workforce has become an increasingly popular solution for many companies, but getting it right is often challenging. Employers are typically unprepared to effectively manage contingent workers, especially those who don’t have the proper strategies in place to ensure success.
Here, we’ll dive into the best contingent workforce management strategies to improve operational efficiency, employee satisfaction, and, ultimately, the bottom line.
What is the Contingent Workforce?
Organizations with a contingent workforce hire individuals (called contingent workers) to carry out project- or role-specific tasks. Contingent workers are not considered traditional, salaried employees, but are instead hired and paid by a company on an as-needed basis.
Businesses across a wide variety of industries—like healthcare, construction, IT services, and retail—employ contingent workers to better support their labor needs. Contingent workers are also sometimes referred to as consultants, freelancers, independent contractors, independent professionals, temporary contract workers, or temps.
Benefits of contingent workforces
Regardless of what you call them, hiring and effectively managing a contingent workforce can help an organization reap a variety of key benefits, including:
- Lower labor costs – Instead of racking up the unnecessary costs of hiring a full-time, salaried employee to complete tasks that are outside the scope of their workforce’s expertise or capacity, businesses can bring on a contingent worker to fulfill those needs. Occasionally hiring someone to handle jobs that require specialized knowledge, skills, or training can be much more cost-effective than keeping them on the full-time.
- Increased flexibility – Companies only hire contingent workers when they need them, which gives them the flexibility to meet customer needs during times of higher demand while avoiding excess costs associated with overstaffing. Whether the business is in a period of growth or volatility, a contingent workforce is flexible enough to fill in the gaps without the commitment of hiring and onboarding full-time employees.
- Enhanced customer satisfaction – In the age of instant gratification (thanks, in part, to businesses like Amazon and Uber), customer expectations are rising. Contingent workers enable businesses to provide that same level of on-demand customer service and support—and even offer specialized services—without accumulating excess costs.
- Improved employee experience – It’s estimated that by 2030, 75% of the U.S. workforce will be millennials, a generation that highly values the allure of flexible working practices. As part of a contingent workforce, employees have greater flexibility and balance between their work and personal lives, and can utilize their special skills and expertise in ways they may not otherwise be able to in more traditional, full-time roles.
Recruiting a contingent workforce
While each organization utilizes its own practices for recruiting and hiring contingent workers (depending on the specific role, intended customers, project length, etc.), there are a few common routes they typically take.
If the business has an HR department with enough resources and bandwidth, they may take on the contingent recruiting and onboarding processes internally. If their HR teams are hyper-focused on the needs of their full-time, salaried workforce, the company may choose to hire a third-party staffing agency for support. The external, outsourced HR service will take on the recruiting, vetting, and onboarding tasks associated with hiring contingent workers.
What is Contingent Workforce Management?
Contingent workforce management refers to the tools, processes, and practices a company uses to manage the contingent workers it hires. It’s important to note that managing a contingent workforce is different from managing traditional, full-time employees. To ensure success, businesses should carefully consider the unique challenges, needs, and objectives of their contingent workers—and how those factors impact the organization’s broader operational challenges, needs, and objectives.
This is especially true for companies with a mobile or deskless workforce, as the tools and processes they require for adequate support can be further complicated by adding a layer of contingent workers. There are many moving parts involved in scheduling the right contingent to the right job site and getting them there on time; and identifying those factors can become extremely complex.
Contingent workforce management challenges
While managing any workforce can be challenging, contingent workers bring with them a distinct set of obstacles, including:
- Varying compliance standards – Different states, regions, and cities often have various labor laws (like wage standards, role classification, and workplace safety rules) that companies must uphold. If the business doesn’t have the proper understanding of these legal rights—or tools that help track them—they put themselves at risk for costly litigation.
- Lack of integration – Organizations sometimes choose to allow their contingent worker to utilize their own tools (like productivity apps, time trackers, communication platforms, etc.) to complete their work. But this leads to confusion, misalignment, inefficiencies, and mistakes that negatively impact their workforce operation. Let’s say, for instance, a company hires a contingent home health care provider with the specialized skills necessary to care for a particular patient. Rather than managing the provider through integrated technology, the business allows her to use her own tools for support. She uses Google Maps to navigate to the appointment site, manually tracks her working hours on a sheet of paper, collects patient details in the notes app on her phone, and emails her temporary supervisor when she needs information. After she completes the appointment, she sends an email to her supervisor regarding patient details, then fills out and sends a spreadsheet of her working hours to payroll; both of which are time-consuming, error-prone, and risky. Without proper tool integration, the business can’t ensure their temporary employees are delivering quality work when and where they’re supposed to—nor can they guarantee the security of confidential customer data. On the employee’s end, they waste valuable time re-entering information into emails and spreadsheets, and might struggle to contact supervisors for help while in the field.
- Fragmentation of management – While organizing teams and hierarchies for a traditional workforce is relatively straightforward, assigning, understanding, and monitoring contingent workers can be tricky. If the company doesn’t have a clearly-defined management strategy (backed by powerful tools to ensure nothing or no one falls through the cracks), tracking and managing their contingent workforce can quickly become a fragmented, ineffective mess.
Strategies for Effective Contingent Workforce Management
With the right strategies in place, organizations can optimize their approach to contingent workforce management. These sophisticated techniques can have a measurable impact on both business operations and employee satisfaction:
- Integrate your platforms – If your critical systems don’t talk to one another, it may be time to rethink your approach. It’s likely that your disparate tools are causing your workforce management to suffer—especially if you employ contingent workers. By integrating your scheduling, communication, CRM, dispatching, routing, HR, billing and finance, and other platforms, you can streamline your workflows and operations for a more efficient, productive workforce. It’ll save your back-office, full-time deskless, and contingent workers the time it would otherwise take to enter, re-enter, and sync data across your systems. Plus, the visibility you gain from proper integration can help your business better understand capacity vs. customer demand, and accurately staff to accommodate your needs, even as demand fluctuates.
- Real time updates – Last-minute changes are an inevitable reality for businesses with a contingent workforce. Employees call in sick or end their contracts earlier than expected, customers cancel or reschedule, and both client and worker preferences constantly shift. To keep up with these changes, businesses need cloud-based tools that offer real-time updates, so everyone always has access to the most up-to-date information; regardless of their worker classification status. Employees are more connected to one another and are more productive, and operations teams have increased visibility into the entire workforce.
- Prioritize compliance – Because contingent labor is complex, it’s essential to emphasize compliance within your workforce management strategy. To avoid strict penalties (and compliance breaches that negatively impact employee satisfaction) make sure you do your research and put guardrails in place to abide by the necessary mandates. It’s helpful to use powerful workforce scheduling and management tools that track these details for you, especially if you have teams that operate in different regions. These technologies eliminate the stress and burden of keeping track of and adhering to compliance standards, which otherwise falls on the shoulders of already-busy staff schedulers.
- Use intelligent scheduling software – Outdated, manual scheduling methods (like spreadsheets, emails, online calendars, or whiteboards) are error-prone and time-consuming to create and adjust. Automated scheduling tools can eliminate the frustrating, manual component of scheduling so your team has more time to focus on higher-value initiatives. The right software securely uses your company data to create schedules that accurately fit contingent workers’ skill sets and the level of your customer demand—which maximizes the productivity and efficiency of your entire workforce. AI-backed scheduling tools generate the most effective schedules with a single click, matching the right contingent worker to the right job every time. The result is a happier customer base, more fulfilled employees, and an optimized workforce that’s ready to represent your company in the best light possible.
Powerful Tools for a More Effective Contingent Workforce
Whether your company employs traditional, desk-based employees, full-time mobile workers, contingent laborers, or a combination of the three (and more), you need modern processes and tools that help you optimize your workforce operations. While traditional, manual tools and outdated strategies won’t cut it, a sophisticated approach to workforce management will help your business thrive.
Skedulo’s Deskless Productivity Cloud is built with the deskless workforce in mind. With fully integrated tools for real-time accountability, intelligent scheduling, streamlined communication, flexibility, and more, Skedulo can help your team maintain compliance, productivity, and performance.