A proven outcome resulting from comprehensively managing your entire contingent workforce, including your independent contractors, is a sizeable and measurable reduction in costs.
At a high level, a lack of visibility of your contingent workforce headcount and services procurement spend can translate into some significant challenges for an organization. To name just a few:
A thorough analysis of your total spend and vendor base, serves as a baseline to optimize current spend and identify savings opportunities. Managing the number of service providers and staffing vendors you deal with is the first step to enhancing your buying power. By consolidating your services procurement activities between a handful of best-of-breed vendors, you can more effectively negotiate margins, rate and long term (volume) discounts.
In addition, you can create a sense of partnership among your preferred suppliers and more effectively share information to support your sourcing objectives. In the medium to long-term, creating healthy competition within this pool of quality vendors will help drive down costs and simplify the management of your procure-to-pay process.
Perhaps the greatest challenge faced by most organizations using various forms of contingent workers is properly accounting these individual within your organization. Why? Because these resources are often sourced and retained directly by hiring managers; rogue hiring and spending that escapes traditional accounting and control.
Not only does the time-to-fill stretch out far beyond the acceptable norm, but the entire procure-to-pay process, from “procure-to-pay ” as the expression goes, becomes bogged down and convoluted.
Rogue recruitment and spend is by definition highly inefficient since hiring managers are generally venturing into unfamiliar territory. They are subject to information asymmetry, a lack of market information and often hire or pay for human capital in excess of 40% above competitive market rates.
Hiring managers are not to blame. Yet, how could a vehicle with real, historical and strategic information help them make more informed decisions? This all comes together with the help of a well planned workforce management solution. Furthermore, beyond the hiring decision, a poorly managed contingent workforce, is prone to costly (double) time sheet data entry, fraud and reporting errors, on top of a slow and cumbersome recruitment process. This is the kind of marketplace chaos that your organization can convert into tangible savings opportunities.
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Our solution included:
The future of work is changing. The contingent workforce - which is made up of freelancers, consultants, independent contractors and part-time workers - now makes up a huge percentage of the world’s workforce.
In fact, a report from Intuit predicts the number of contingent workers will only continue to increase worldwide. The study notes that today around 25-30 per cent of the US workforce is currently contingent, with that number expected to exceed 40 per cent by 2020.> Read More
Competition for labour in today’s business market is constantly growing. This is largely driven by a shortage in skilled workers, which is affecting almost every industry across both the US and Canada.
In fact, the Society for Human Resource Management claims that around 83 per cent of organizations are currently struggling to find workers with the right skills. Meanwhile, a report by American Action Forum (AAF) found that, by 2029, employers in nearly every US state will face significant shortages of qualified workers due to an ageing population.> Read More
Large businesses in today’s market work with a wide range of vendors. In fact, most companies are more dependent on vendor relationships for the success of their business than ever before, whether it be for talent acquisition, procuring office supplies, service providers or accessing equipment manufacturers.
That’s because vendors have specific expertise in a particular area of your business, making them a far more effective and cost-efficient way of accessing specialized knowledge without having to pay for an expensive in-house team.> Read More