When uncertainty looms, a robust contingent workforce empowering your business means you have the ability to pursue steady and sustainable growth. To be sure your business can scale up and down as needed for this uncertain economy, you can choose to rely in part or whole on a managed service provider (MSP) to hire and/or manage your contingent workforce. When managed well with a quality provider, an MSP can deliver on average, cost savings between 10-20% in the first year.
In our experience, the most successful contingent workforce programs are led by procurement teams, in conjunction with strongly aligned partners from both HR and the business. In addition, we’ve seen that robust processes and complementary technology underpin effective and efficient programs.
So how do you know if you need help with your contingent workforce program? Here are our top 3 critical questions to help you assess whether your contingent workforce is operating efficiently:
Understanding the true cost of your contingent workforce is critical to understanding whether there are opportunities to save costs. First, you need to assess how many contingent workers are working for your organization today and the cost, including what they are earning and the other costs you are being charged, such as supplier markups and statutory on-costs. Don’t forget to compare their salaries to equivalent permanent roles and the external market.
The benefit of a contingent workforce is the ability to scale up and down as your organizational needs change. However, the key is to have robust processes for hiring, on-boarding, managing and off-boarding your contingent workers. Contractors need to be correctly classified as PAYG, Independent and SOW, while the right checks must be in place to ensure compliance with all legislations which can vary per region. Having the right technology can be an advantage in streamlining these processes.
Performance metrics vary per organization and industry, and it’s essential to keep track of the indicators and targets you have set for your organization. For example, understanding how often contract periods and reutilization dates run over and why, are valuable insights into helping you optimize your contingent workforce. Additionally, having the necessary processes in place to offer high performers permanent positions is another.
Have these questions highlighted any challenges or areas for improvement? Now is the time to revisit your contingent workforce program strategy by getting in touch with an expert.
The right MSP provider can offer:
Hudson RPO‘s Managed Service Provider (MSP) Solution helps companies make the smartest, most effective use of their contingent workforce spend. Click here to read how we helped our clients, or get in touch for a confidential discussion with one of our Talent Experts.