I’m pleased to introduce you to Ardent Partners’ newest analyst and contributor to CPO Rising – Christopher Dwyer who joins us as a Research Director and VP of Operations. Chris has been an industry analyst for the past 8 years, writing some of the strongest and most insightful research that we’ve seen in the market. We’ll do a more formal introduction very soon, for now, I’ll just say that we are very lucky to have him.

Chris has published research on almost every conceivable supply management topic, but has a passion for complex categories or complex spend management. Today he greets us all with a primer on contingent workforce management.

A Primer for Contemporary Contingent Workforce Management

by Christopher Dwyer

Nearly a decade ago, the vast majority of organizations viewed contingent labor (typically carrying the name of “temporary labor” back then) as just another indirect spend category that did not warrant either a sharp procurement focus or a strategic plan of attack. In modern times, this perception must change for enterprises to effectively drive visibility into the now-evolved complexities of contingent labor and ensure they are mitigating both external and internal risks.

The contemporary “contingent workforce umbrella,” a term I coined back in 2010, is utilized to describe the growing complex nature of contingent labor beyond what we experienced years ago. This umbrella encompasses three major components, including:

• “Classic” or traditional temporary labor. This cog of the umbrella will be the most familiar to organizations. Traditional temporary labor typically involves sourcing contract talent via staffing agencies, suppliers and vendors. This type of contingent labor is usually utilized to fill short-term needs across administrative, finance, accounting or IT roles within the average company.
• Independent contractors. Independent contractors, colloquially known as “ICs” to many organizations, represent the area of the contingent workforce umbrella with the most risk. Engaging, managing, and utilizing ICs comes with their own set of dangers as a direct result of mismanaging relationships with these ICs. Significant threats, such as co-employment or federal audits, can arise from poor management of ICs. Independent contractors are directly engaged by the organization and are typically paid via 1099.
• SOW-based projects and services. Out of the three major components of the modern contingent workforce umbrella, this is the area that has been garnering the most attention and focus from companies across the world in recent times. This umbrella aspect involves an individual or group of individuals on a project that is typically based on a statement-of-work (SOW) or similar agreement. Consultants and professional services are just two prime examples of SOW-based labor. The reason for so much attention? There are a variety of aspects to consider when leveraging SOW-based labor, such as milestone- and delivery-date-tracking, management of project / service expenses and how these projects affect the greater organization.

Stay tuned as we commence coverage of this exciting category of spend and publish articles (on CPO Rising) and research reports that will highlight both traditional and evolutionary best practices for managing the three major components of the contemporary contingent workforce umbrella and the providers who enable them.

Tagged in: Category Management, Christopher Dwyer, Complex Categories, Contingent Workforce