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Talent Management Perspectives

Published August 2009

A Contingent Workforce: The New Staffing Response

 

  Thomas Bonney and Kathryn Kehoe

As the economic recovery continues, business leaders must challenge the traditional assumptions of workforce planning and management and think beyond blindly adding headcount and supplementing it with staffing solutions and outsourcing. An integrated full-time, part-time, temporary and outsourced expertise workforce management solution will allow organizations to more nimbly respond to the dynamic interconnected global business community.

As businesses enter the 2010 budgeting season, many are hesitant to budget increases in headcount - despite probable needs.

Given the volatility that management teams now realize can arise in any aspect of an organization, a nimble staffing response is needed. Some of today's most progressive businesses are answering this demand with a contingent workforce talent acquisition model, in which expertise can be optimally managed in a just-in-time manner similar to manufacturing resource planning and inventory control.

Responsible Organizational Management
The contingent workforce model effectively breaks an organization's ingrained practice of fulfilling talent needs with full-time hires and forces a preliminary analysis of how it hires and whom it hires - from part time to full time, from fully outsourced to partially outsourced - conducted through the lens of flexibility to determine the appropriate levels and quality of resources necessary to get work done, make customers happy and improve worker morale.

The cornerstone of this model is the strategic integration of contingent workers with full-time employees. By starting every talent acquisition initiative with a determination of the true current need, whether it be a full-time employee or a contingent worker's expertise, businesses can prevent painful defensive restructuring tactics when needs change due to competitive pressures or shifts in internal core competencies.

The economic downturn has reinforced the benefits of maintaining a variable cost structure. With a more conservative investment in full-time employees and increased use of contingent workers, an organization gains the opportunity to "plug and play" the appropriate level of expertise for changing situations. Further, ongoing use of interim talent creates a mechanism for controlled deployment of expertise. Smart buyers will look for staffing firms who are expert at knowledge transfer and can help to build internal competency.

Responsible Personnel Management
Once an honest assessment of what work needs to get done and who will do it is completed, organizations should determine an optimal ratio of contingent workers to permanent employees. Five percent to 25 percent of full-time employees are typically terminated during a reorganization, so the optimal contingent worker percentage likely falls within this range.

While all functional areas and employee levels stand to benefit from a contingent worker element, a "responsibilities analysis" can help target the most applicable roles. Positions that entail transactional responsibilities - must-do, no-return tasks, such as payroll - are ideal for contingent outsourcing or part-time employment. In positions that involve essential responsibilities critical to achievement of short-term business plans, such as many management roles, the use of contingent staffing and specialized consultants best applies to cyclical activities and special projects. In positions requiring strategic responsibilities critical to longer-term business plans, such as executive leadership roles, specialized consultants are the most suitable contingent worker solution.