Whether you call them contingent workers, your non-employee workforce, independent contractors, or just temps, it’s likely that contingent labour is becoming an increasingly important part of your HR strategy. Or is it? Perhaps you started with the occasional contractor, when a project needed additional resource or a key individual was out of action, and over time your reliance on independent professionals has grown to represent a significant proportion of your total resource, without any planning having taken place.

If this sounds familiar, now might be the time to take a more strategic approach to your flexible workforce.

Who owns it?

This is a key question. If you think the obvious answer is the HR department, think again. In some organisations contingent workers are managed by procurement. This brings a very different dynamic to contractor engagement. Procurement or finance departments may see flexible labour as a financial resource and manage it accordingly – as an expense. However, a talent management strategy may be more relevant. Is your contingent worker strategy mapped to your human capital and total workforce strategy? If it sits in procurement there may be a disconnect…or even a conflict…between the two.

Governance

Have you reviewed your policies and procedures recently? Do they accommodate contingent labour? Do you have meaningful controls in place and does your risk strategy include recognition of and mitigation for the risks associated with contractors (theft of intellectual property, etc.)?

Even if your policy framework is up to date, what about your internal communication practices? Do you advise the right people when you make a change to a policy or procedure? If you engage your contractors through a third party, terms and conditions, annual leave, etc. may be governed and managed by the contractor management service. But that doesn’t eliminate the need to keep all staff…employees and contractors alike…informed about company policy on key issues such as internet use or smoking.

Metrics

Let’s assume for a minute that you have great systems. You know how many contractors you have in every department at any given time (you do, don’t you?). Your records are current and you have nothing to fear from the taxman when it comes to correctly categorising all your workers. But how do you measure the inputs/outputs of your contingent workforce? Do you have robust mechanisms in place to ensure you can quantify the value added by your temporary teams? Peter Drucker famously said, “You can’t manage what you can’t measure.” Do you measure the success of your contractor programme, so that you can defend it if faced with budget cuts or challenged about results?

Skills, structure, standards, strategy

Have you conducted a skills analysis to determine precisely what expertise you need, now and in the future, to meet your business objectives? If you’ve used contractors purely to fill gaps on an ad hoc basis, you may not be optimising this key talent pool. A contingent workforce can…and should…be part of your total resource management strategy, feeding into your overall business strategy.

It’s worth taking some time to think through structural issues such as reporting lines; roles and responsibilities, i.e. what roles do contractors fill and to what extent are responsibilities delegated to them; key stakeholders; and cross-functional collaboration. Strive for efficiencies wherever possible and make sure you engage all the necessary organisational functions, e.g. legal for any compliance issues, IT for data security, etc.

Apply the same standards and rigour to decisions concerning your contingent workforce as you apply to your permanent employees and to other procurement decisions. This includes thorough background checks, unless a contractor management service does this for you. A contractor may only be with you a short while, but untold damage can be done in that time if an unscrupulous worker slips through your defences.

Communicate your strategy to all hiring managers. There may be departments within the organisation that haven’t considered the use of independent professionals but may benefit from a skills injection or more flexibility in resource management. Along with the strategy, ensure everyone in the organisation who may eventually hire contingent labour is familiar with the policies and procedures you have so carefully put in place so the correct process is always followed.

And finally, ensure your permanent employees understand why and how you are using temporary or contingent workers. They may feel threatened, either by the individuals or by your approach – they may worry that you want to replace permanent positions with flexible labour to cut costs, or they may think the temporary workers are after their jobs. Reassure your teams that contingent workers add value and enhance productivity and therefore profitability, and everyone benefits.

You’re not alone

Turn your contingent workforce into one of your strongest assets. Highveld can help you put the right strategy in place and the best contractors in your vacancies. If you want to know more about our contractor management services, contact us on 012 367 5600 or info@highveld.co.za. Take your business to the next level with Highveld.