By Diane Mulcahy*
Shifts in corporate supply and demand as a result of the global health event, and the halt of business travel have led to an increase in contingent workers for many companies. Independent workers give businesses more flexibility to staff up and down as the market environment changes, and to access the precise skills, expertise, and experience where and when they need it.
The need for the resiliency and flexibility that contingent workers provide is only increasing. There is still much uncertainty around the pace and stability of re-opening in this new normal. Companies that plan to "level up" and grow their contingent workforce as the economy re-opens can benefit from taking the following steps:
Concentrate Contingent Workforce Management
I was working with the senior management team of a Fortune 1000 company to implement better management practices for their independent workers. One problem they had was the "rogue" hiring of contingent workers across the company. Individual managers were hiring independent contractors for projects and tasks that fell within the budget limits they could manage without additional oversight. As a result, the senior management team had no visibility – and no way to manage, track, or control – the number of independent workers, or how much the company was spending on them.
A better approach is to concentrate oversight and management of contingent workers within your talent group. Creating a "one stop shop" for managers to access preferred workers, standard contracts and onboarding materials, and process invoices and payments makes it more efficient for hiring managers to bring on and manage contingent workers. It also allows the company to exercise control over cost and quality as well as how and where they are being deployed.
Manage your Talent Brand
Companies perceived as great places to work, the thinking goes, can attract the best talent, and retain their most valuable employees. Therefore, most companies spend considerable time and energy developing their employer brand.
The same notion extends to the contingent workforce. Creating a reputation as a great place to work will ensure that your company gets, and keeps, the best independent workers. The important distinction is that independent workers prioritize and value different company attributes than employees.
Several surveys of independent contractors reveal that their preferred client companies are ones that value and appreciate the quality of their work, allow them to control their schedule, and provide the opportunity to work on projects they enjoy. The operational issues that topped the list were getting paid well, quickly, and on time, and an efficient onboarding process.
These results suggest two specific actions companies can take to create a great brand among independent workers. The first is appointing a 'brand ambassador' in talent to manage and support contingent workers. In addition to ensuring workers feel valued, the ambassador can work with managers to provide a positive team and work experience at the company, and that the right workers are matched with the right assignments. The second is to manage the administrative experience by making sure that onboarding is smooth, efficient, and online, and that an expedited invoicing and payment processing is in place.
As the contingent workforce continues to grow, companies that create the best place for them to work will be best positioned to attract the top talent.
Keep Knowledge from Walking Out the Door
It's easy to imagine that the continuity and growth of institutional knowledge about customers, tasks completed, and deliverables will be disrupted by the coming and going of independent workers on short-term assignments.
This risk is one of the easiest to mitigate by using widely available technology. The use of technology such as Slack and emails to retain conversations, Google docs to preserve drafts and edits, and a shared drive to track customer updates or feedback, can easily and cheaply preserve the work products and knowledge of any project.
While these technologies are easy to access and low cost, the key is for companies to ensure that basic knowledge management practices are included in standard contracts with contingent workers. For example, the contract can specify which technologies the independent contractor should use in communicating with customers and employees, and completing assignments, as well as include a standard waiver to permit recordings for internal use of any meetings or conference calls.
Mitigate Risks of Contingent Workers
There are risks associated with hiring any worker, and contingent workers are no exception.
One risk specific to independent workers is the possibility of worker misclassification. Our current labor market classifies workers as either employees or independent contractors, but the distinction between the two categories lacks a clear, bright line test to determine worker status. To mitigate this risk, company talent leaders must work with legal counsel to create standard contracts and consistent documentation requirements for independent workers.
IT and cybersecurity are another risk. Giving independent contractors access to company equipment, online information, and shared resources offers new points of entry to corporate IT systems. Ensuring internal or external IT professionals create protocols to safeguard proprietary information and restrict access can limit the chances that the company's tech infrastructure will be compromised.
It's an old sports saying that "champions are made in the off season," but it applies just as well to teams in business. The current "off season" is a very challenging time, but many companies will return stronger and better than they were. Contingent workers add the flexibility and resilience that teams need to successfully navigate change. The champions that emerge from this trying time will be teams that are agile, efficient, and made up of both employees and independent workers.
Launch this webcast: The New Normal of Work featuring Diane Mulcahy
Download our guide, Freelance Management System 101: Everything You Need to Know
*About the Author
Diane Mulcahy wrote the book on The Gig Economy (Harper Collins) and writes for Forbes and Harvard Business Review about how work is changing. She also created and teaches the first MBA course in the United States on the Gig Economy, which includes independent contractors, consultants, freelancers, and on-demand workers.