Ardent’s State of Contingent Workforce Management report (available for complimentary download here, here, or here) features a variety of groundbreaking concepts and ideas, one being the industry’s very-first official Contingent Workforce Management Framework (click here for a refresher on the Framework). While the capabilities highlighted in the Framework traverse across a series of both talent management and spend management competencies, it is quite apparent that procurement plays a major role in the development and execution of some of these key strategies.
The convergence of procurement and other key functions like finance, marketing, business travel, is now a current market trend; enterprises across the world can feel procurement’s influence across a spectrum of organizational strategies, all of which greatly-benefit from this unit’s deep (and valuable) expertise. Just as finance benefits from procurement’s spend management prowess, or marketing can gain value from its collaboration across design projects, the modern-day CWM program’s very core if fused with procurement proficiencies.
For the purposes of this CPO Rising article, let’s deep-dive into each official category of the CWM Framework (traditional, complex and ICs) and highlight how procurement’s influence, and, ultimate convergence, is making waves in how the average enterprise manages its contingent workforce.
- Traditional temporary labor. Travel back 15 or 20 years, and the vast majority of contingent workforce management programs revolved around procurement’s ability to easily track, monitor and manage a wide variety of staffing suppliers. Granted, these were simpler times back then (the complexities of modern-day CWM weren’t even close to rising to the business surface), yet the current approach to this category still centers on procurement’s ability to apply core principles, such as supplier performance management and supplier optimization, in managing traditional staffing suppliers, agencies and vendors.
- Complex contingent labor. Here’s where procurement shines the brightest. The intricacies that comprise complex contingent labor typically include project-based attributes and a “deeper” baseline of suppliers (consultancies, professional services, etc.). These aspects fall right into procurement’s wheelhouse, as SOWs and similar agreements are best managed by this group to ensure that projects stay on-time and on-budget, and that critical milestones and delivery dates are hit in a highly-effective manner.
- Independent contractors. Some enterprises may fail to realize just how important procurement’s influence can be in managing the many risks of independent contractors. Lest the world forget, compliance has been a long-standing thorn in the side of many a Chief Procurement Officer over the last decade. Negotiating favorable contracts is certainly beneficial, but if rogue spend avoids these preferred terms or buyers ignore contract stipulations, the efforts are lost in vain. ICs bring a great deal of value to the average enterprise: high-quality talent and special skillsets. However, the threats of misclassification and federal audits are constantly looming overhead, and for those companies that mismanage ICs, any value deteriorates quickly. Procurement’s influence is required to engage and manage ICs “to code” by placing emphasis on assessment management and conducting regular compliance reviews.
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