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HCMWorks Insights

4 Benefits of Optimizing Your Contingent Management Process

Posted by Julia Fournier on 27 Apr 2018

Successful companies are implementing methods that improve their productivity, cut down costs and better their service, and many of them have one thing in common: an optimized contingent workforce management process.

Unfortunately, those companies that aren’t so successful have a fragmented and disjointed management process across their various departments. This incoherent management can lead to added administrative effort, a higher risk of error, miscommunication and wasted time, particularly when the process is not automated.

With a significantly growing trend toward contingent labor, smart companies develop a management process that optimizes key processes such as automated management time, administration time, recruitment, alternative sourcing channels and invoicing.

Through client engagements, HCMWorks has found implementing a contingent workforce management process can yield substantial opportunities. The resulting outcome brings together your workers, operations and data, in an integrated and automated process that will significantly enhance your management efforts and cut costs.

A customized contingent management process, which starts with a complete assessment of your non-permanent workforce and ends with a custom design and implementation, will give your business the added tools to help achieve your objectives.

Our client engagements have found four main benefits of optimizing contingent workforce management processes:

Transaction costs

An optimized process for your contingent workers will allow your business to cut down on administration costs, meaning fewer calls, less emails and an automated process that allows you to store records rather than doing them manually. What exactly does this mean? Here at HCMWorks we’ve found, over our 15 years within the industry, that an optimized process can cut your costs per transaction down 90 per cent.

Purchasing demands

An automated process that provides visibility, analytics and offers regular staff reporting, can help cut the price of your purchasing demands by 10 per cent. A hiring manager will be able to evaluate the costs and productivity of external workers and compare that with similar contingent workers across the organization. The hiring manager will then be able to either renew the worker’s contract or analyze who would be best suited to hire for a new project. This increases productivity and reduces workforce costs.

Cycle times

Your organization’s cycle time could be cut from an average of 20 days to just five days, following the successful implementation of an automated process. The use of automated requests and the introduction of a service level agreement (SLA), will cut down on additional costs and ensure your contingent workers are delivering as per your agreement.

Compliance to agreements

By centralizing all your vendors and contractors in one place, organizations gain total visibility into their workforce. This allows a more structured approach to compliance, by ensuring that all vendors respect their contractual obligations from insurance requirements to agreed upon SLAs and pricing. As a result, overall compliance rises to 90 per cent from 60 per cent.

Organizations can expect to save between 7.5 per cent to 15 per cent in costs in the initial year of their program and 3 percent to 4 percent on an ongoing basis. Implementing a management process from compliance to agreement.

For many companies, implementing a contingent management process can seem a daunting task. It doesn’t have to be. Designing a proper plan that allows you to store, monitor, compare and assess workforce data at the click of a button will help you discover new best practices that can be applied across your business and will result in significant savings.

Want to optimize your contingent management process? Contact us today.

Tags: Contingent Workforce Management, Contingent Workforce