For those of you who missed the early installments of our “13 for 2013” series on contingent workforce management, I invite you to check out Part One and Part Two. CPO Rising readers should take note: one of my true passions in life is the study, research and evangelism of complex spend management (sometimes referred to as complex category management or services procurement). I began my journey into this world by tackling one of the largest of these complex categories: contract labor management (what I and many others called it back then).

A category that was viewed by procurement as a quick-win category for a new eSourcing deployment in the 2000s (huge savings could be driven by aggregating spend that was often highly-fragmented across providers with huge disparity in admin mark-up rates) has taken a new shape. What’s happened since then? Evolution, my friends. Evolution. While the savings opportunities are still available for many organizations who’ve yet to tackle this category (and yes, these organizations do exist – Andrew just met with one group last month), the category has taken on new meaning from a work type and a worker type standpoint. So, join me as we tackle part three of our best practices series for contingent workforce management.

  • Independent contractors may be the top-level talent in any given industry, but most organizations walk a fine and often dangerous line when utilizing this form of temporary labor. Earlier this month, I wrote about my perspectives on the world of independent contractor (“IC”) engagement and management. The fact of the matter is this: those individuals that enjoy the flexibility and “freedom” of working for themselves often have the know-how, expertise and clout to be able to do so. They don’t want to be locked down within any single company. Your organization, needing this specific talent, will overlook the various risks in IC engagement to reap the benefits of contractors…and, often enough, you’d surely want to trade back those benefits to get out of a federal audit, misclassification or co-employment case. What to do? Understand the implications and develop a formal program to pinpoint the utilization of ICs across the entire enterprise, then create a specific, action-oriented plan to properly evaluate the relationships between ICs and the greater organization.
  • MSP, VMS…or both? A few weeks ago, I led a webcast for HR.com on the hot-button issues and strategies within modern contingent workforce management. For those who missed it, one central takeaway from that webinar was the outside “help” that organizations require for maximum efficiency in managing contract talent. Managed Service Providers (MSPs) and Vendor Management System (VMS) solutions have long been viable options for outsourcing and automating the wide array of processes within contingent workforce management. MSPs bring a “consultative” and day-to-day operational approach to the space, while VMS solutions present a robust series of capabilities, such as analytics, supplier management, requisition and SOW project creation that can transform how an organization drives value from contingent workforce management. The question remains, however: use one…or both? There are benefits to each solution, and many groups tell me that leveraging both may be an ideal answer to managing all facets of the contingent workforce umbrella. If you’d like to discuss your specific situation and options, send me an email, I’d be happy to discuss.
  • SOW-based projects and services must be a program focus. A couple of years ago, one major thought I heard from the end-user community was this: SOW-based projects and services are fast-becoming the focus of our contingent workforce management programs – and, rightfully so. More and more organizations are finally beginning to understand that, in a project-based world, any temporary worker or professional service falls under the contingent workforce umbrella that we talk about so much here at CPO Rising. Let’s face it: many groups have started to master the art of traditional temporary labor management (i.e. talent sourced via staffing suppliers, vendors or agencies); but, as any business area evolves, so do the necessary strategies for managing that evolution. SOW and services management requires next-generation solutions and capabilities which are generally much, much more complex than those that have been relied upon years ago in classic programs.

Stay tuned for the fourth and final entry in our “13 for 2013” series on best practices in contingent workforce management when we’ll take a look at the future of this industry (did I mention it’s evolving?) and where organizations should focus their efforts to be better prepared for what’s coming up.

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