As we wind down another year and set our sights on the future, we can expect to see more evolutionary changes in the workplace brought about by the growing influence of the contingent workforce. While experts differ on penetration rates, it is clear that the contingent workforce is growing in both size and influence, beyond the ability of employers to either ignore or marginalize this increasingly important contributor to organizational performance and the achievement of growth goals. Even as some organizations adopt highly sophisticated strategies to leverage the potential of the contingent workforce, others struggle with basic questions about how to manage this resource; in some cases, with HR, procurement and business leaders drawing straws around the issue.
Redefining the Workforce
Walk into any office, factory, call center or distribution facility today and you will likely see both traditional employees and contingent workers side-by-side. It would be highly unusual if you could tell which are contingent workers and which are not. As a rule, they do not dress differently or sit in isolated areas, separate from employed staff. While they might carry a different type of access badge, you would probably have to get up close and personal to distinguish one from another. In fact, in a typical workplace, you might see several different types of “non-traditional” workers, e.g.:
- Flexible staff employed by a staffing agency
- Independent contractors
- Project consultants (also known as SOW consultants)
Take a closer look at independent contractors — or 1099 staffers — and see if you can tell which are truly independent or those that are company-sourced (possibly through internal referrals or alumni networks) and simply payrolled by an agency.
Today’s workforce is a blended workforce. It is made up of individuals, both on and off the host company payroll, whose common bond is the work rather than who pays them. While the makeup of the workforce has changed significantly, workforce policies, practices and management structures in many organizations have not yet caught up to the new reality. They remain a work in progress as businesses struggle to define new ways to manage the new workforce.
The Impact of the Contingent Workforce
The growth of the contingent workforce impacts not only the way work gets done, but the individuals doing the work and the managers who oversee it all. Consider this:
How the Work Gets Done
- Project teams comprised of traditional employed staff and contingent workers may collaborate seamlessly, but who gets rewarded—and how—at the successful conclusion of the project when reward systems must be separated to avoid the risk of co-employment issues?
- When contingent workers complete discrete tasks in a larger enterprise initiative, can they give their best if they do not see the results of their efforts?
- Is information shared differently with employees vs. contingent workers (which can lead to division within a project team), or conversely, are contractors given access to too much proprietary information?
Who Does the Work
- When contingent workers are brought in for their unique skills and experience, how can you ensure they mentor employees and transfer knowledge?
- Does managing your contingent workforce put an additional strain on employees?
Who Manages the Work
- Which function is best suited to handle the acquisition and management of the contingent workforce? Is it procurement, HR or business managers?
- How can you promote greater collaboration across all three areas of responsibility so that you get the benefit of the expertise that each can contribute?
- Do business managers who supervise contingent workers understand how this differs from managing employees?
The new workforce calls for new ways of configuring the work, blending teams to get it done and managing the different types of talent doing the work.
The Enterprise Perspective
There are bigger issues to be considered from an enterprise perspective. While contingent workers carved a unique niche in the workforce decades ago as a temporary, occasional or ad hoc fill-in for employees on leave, in the past 20 years, the contingent workforce has become an integral part of the workplace and an important contributor to how work gets done. How do you drive engagement within a blended workforce? Can traditional roles and responsibilities be adapted to accommodate inclusion of a contingent workforce or should you start with a blank page and rewrite all the rules? With lots of questions in search of answers, one thing is certain: workforce strategies must continue to evolve to fully leverage the potential of the contingent workforce to drive high performance in the workplace.