Leveraging a contingent workforce in today’s business landscape is a risky but rewarding strategy. With the velocity of emerging technologies, skills gaps in the workforce, shifts in employment attitudes and increasing customer expectations, employers need to be able to engage talent quickly and flexibly to remain competitive.
Contingent Workforce Management
It’s a tight labour market, and both Canadian and U.S. organizations are grappling with the challenges presented by a candidate controlled workforce. When there was once very little perceived pressure for employers to accommodate candidates during the hiring process, the tables have turned, and an intentional focus by employers on engaging talent with a candidate-driven approach is now essential to acquiring skilled contingent workers.
Because they can afford to be choosy, and employers can’t afford to remain stagnant in their hiring strategies if they want to remain competitive. Yet, only 7 per cent of organizations are doing it right: attracting qualified talent, quickly filling open positions (in under 10 days) and optimizing costs. However, a solid talent acquisition strategy will help employers pinpoint problem areas in their hiring programs and tap into why their choice candidates could be turning them down. And if you don’t have a talent acquisition strategy, now is the time to start—because the war for talent is getting harder to win.
The following considerations are areas we recommend employers evaluate in order keep candidates from rejecting offers.
Candidates expect a unique experience, forcing organizations to work harder to attract and retain their attention. This means employers need to demonstrate their eagerness to hire and avoid poor hiring habits.
The following is a list of mistakes employers could be making that are turning off candidates:
• Communication lacks a personal touch and isn't tailored to a candidate's unique needs.
• The hiring process was too long and/or required too many interviews.
• The job description didn't accurately portray the role once the candidate reached the interview stage.
• There's a lack of communication between your organization and your staffing partner.
• The hieing manager didn't effectively "sell the role or organization."
Tools like Inavero. These tools measure the NPS score a candidate gives at each stage of engagement (a satisfaction ranking of 1-10), easily allowing client service teams to take control in identifying areas in which the agency is exceeding candidate expectations and areas where it can do better, allowing for continuous improvement to the recruitment process and the client’s employers brand.
Negative employer branding
Negative employer branding makes it all the more difficult for organizations to engage talented workers, with 55 per cent of job seekers abandoning an application after reading a negative company review online. Yet, there are ways to improve your employer branding.
Glassdoor is a review website where previous and current workers can leave feedback on their employer, and it’s important for organizations to appoint a monitor to oversee their reviews ( yet only 45 per cent of organizations are doing so). The appointed monitor should also provide insights into how the organization will address the concern(s). If you've successfully taken the steps to resolve issues, data about trends in your improved reviews will be visible.
Communication with candidates at each stage of the hiring phase is key to keeping qualified talent engaged, yet some organizations are still going radio silent on candidates when they find others more qualified for the role. And it’s a mistake. As nearly a quarter of job seekers ( 23 per cent) will ghost a company who previously stopped communicating with them. And more than one-third (35 per cent) of job seekers find it very iresponsible for employers to go ghost.
• It’s imperative for hiring teams, recruiters and client service teams to actively return emails and phone calls within 24 hours or risk losing that resource to a timelier organization.
• Hiring teams need to follow up each communication with the next steps in the hiring process and what the expected timeline will be like.
• Nearly 40 per cent of job seekers (36 per cent) receive no response at all when a company rejects them. To expect engagement in the future, organizations and staffing agencies must have transparent communication with their candidates—even if it’s an awkward or uncomfortable conversation.
When it comes to making an offer, it's critical to get an understanding of what’s important to your candidate by asking yourself, “What do they hope to gain out of the role, and where is the balance between what they’re looking for and the expected rate?”
• Ensure your rate card is up to date to reflect current market
• Consider non-monetary drivers unique to their requirements like remote work options, a flexible work schedule, exciting project work, career growth or the use of new technologies.
• Non-monetary drivers must include incentives relevant to what matters most to that candidate, because what is an attractive incentive to a Gen X worker won’t be as attractive to a Gen Z candidate.
Diversity and Inclusion (D&I)
Sixty seven per cent of job seekers say that a company's level of diversity affects their decision to work there. For organizations that do have a D&I program, only 17 per cent consider Diversity and Inclusion as a key part of their EVP. And it’s a major mistake. Because younger workers are entering the workforce, and they're the most diverse generation employed -- with 77 per cent of Gen Zs stating that an organizations level of diversity affects their decision to work there.
Who are these diverse workers candidates want to see?
• Lesbian, Gay, Bisexual, Transgender (LGBT)
• Military veterans
• Different ages
• Workers with disabilities
• Varying thinking styles
Organizations with inclusive cultures are twice as likely to meet or exceed financial targets, 3x more likely to be high-performing, 6x more likely to be innovative and agile and 8x more likely to achieve better business outcomes.
Identifying and understanding gaps in your current recruitment program is critical to designing a talent acquisition strategy that will effectively source, screen, onboard and redeploy contingent workers.
The world of work continues to evolve – quicker than it ever has before – and competitive organizations are increasingly investing in the power of a contingent workforce to become more agile in these disruptive times. As employers everywhere are using more forms of contingent workers, it’s likely that your organization is also getting on board with the same transformation.
According to McKinsey, up to 30 per cent of an organization's workforce in the U.S. is made up of contingent workers, with employers having unprecedented access to a talent pool of 42 million of them. And while the rise of a flexible talent provides many benefits, it also leaves employers grappling with the hurdles of managing the many complexities that come with these types of workers. For answers, organizations committed to a more strategic approach to contingent talent management are turning to a Managed Services Program or Managed Services Provider (MSP) as an effective resource.
If you’re considering investing in a Managed Services Program or are interested in learning how an MSP can help optimize contingent workers to drive real business value across your organization, the following insights will help you make an informed decision.
What's an MSP?
Today, Managed Services is one of the fastest growing outsourced talent acquisition solutions, with Everest Research Group reporting that the global MSP market surged 10.1 per cent between 2015-2016, with experts predicting the solution to outpace global economic growth.
Why do organizations partner with an MSP?
As tech and globalization continues to drive business strategies, it’s critical for employers to become more agile, and a contingent workforce is the widely-adopted answer to bridging skills gaps and driving both growth and innovation. At its most basic delivery level, an MSP will help an organization easily streamline and manage its entire contingent workforce program by improving efficiency, controlling costs and mitigating unforgiving fines, penalties and reputational damages associated with compliance risks.
While early MSP models maintained a focus on process improvements and cost savings, more mature MSPs, however, are now seeking ways to increase access and delivery of high caliber talent while reducing time to hire. To do so through the use of technology stacks, MSPs are leveraging direct sourcing solutions for greater access to talent pools and niche skills, sourcing alternative acquisition resources like Artificial Intelligence (AI) and other initiatives that increase savings while ensuring quality talent engagement and retention.
Different types of MSP models
Typically, MSP programs fall into one of these models:
Vendor neutral: All MSP vendors have equal opportunity to fill a position within a specific time.
Master vendor: A Preferred or Master Vendor is given preference to fill a position first but must release the role to other vendors if they fail to find talent within a specific time.
Hybrid: This type of model will include elements of the first two programs.
MSP drivers, MSP focus and benefits
For most organizations partnering with a Managed Services Provider, there are seven key drivers that are aligned with specific operational challenges. These drivers include:
1. Operational challenge: Minimizing risk of non-compliance
MSP focus: On/Offboarding with contingent workforce audits and rate compliance visibility.
Benefit: Improved compliance, including rate compliance and worker on/offboarding compliance; better worker classification audits to minimize co-employment risks.
2. Operational challenge: Controlling rogue costs related to spend
MSP focus: Cost control.
Benefit: Greater visibility into costs using vendor performance metrics to ensure effective negotiations and development of sourcing strategies.
3. Operational challenge: Drive for improved performance and cost efficiencies
MSP focus: Closer supplier management with access to benchmark rates.
Benefit: Increased contingent workforce quality and performance with reduced time-to-hire. This is a result of supplier base optimization and requisition optimization through hiring manager feedback on services and formal Service Level Agreements (SLAs).
4. Operational challenge: Sourcing hard to find talent
MSP focus: Developing new sourcing models.
Benefit: Support in implementing technology in conjunction with delivering process change.
5. Operational challenge: Speed of change and large ramp up of worker volumes
MSP focus: Agility to support peaks and troughs of contingent worker needs.
Benefit: Outsourcing the MSP program can be a more effective way to manage business cycles.
6. Operational challenge: An increase in complex operations
MSP focus: Souring optimization to support diverse needs.
Benefit: Scaling your contingent workforce program to new markets where internal knowledge may be limited.
7. Operational challenge: Managing VMS technology and integrations
MSP focus: Service and technology support.
Benefit: Significant operational changes can require a new solution as it remodels its blended workforce. An MSP will support these tech changes across the entire contingent workforce delivery.
Beyond these key drivers, competitive organizations are also turning to an MSP in order to build on their employer brand and leverage the use of predictive analytics to ensure a better contingent workforce program with access to niche skills.
Is an MSP right for me?
An MSP will require organizations to have a minimum amount of contingent worker spend in order for the program to be successful and self-sufficient. When deciding whether or not an MSP is the right solution for your organization’s needs, there are first some basic and more complex factors to consider. First, it’s critical to understand how much contingent workers are currently costing your organization. It’s a unique number to individual employers, yet can be difficult to account for, as nearly 60 per cent of contingent worker costs is unaccounted for in the average organization. You’ll also want to know how current buying is being done for the various elements of your contingent workforce and what controls are in place to manage the current program.
Additional questions on your checklist should include:
• Has my contingent workforce program outgrown my current management strategy and are my needs become more complex?
• Am I securing contingent workers in the time frame I need to?
• Do I have clear visibility into contingent worker spend?
• Have recent policy changes made me concerned about compliance?
• Am I engaging more contingent workers now than I have in the past, and do I plan on securing more in the future.
The role of a trusted MSP partner
A trusted partner should be committed to advising on the best solutions available to meet an organization’s business goals and to delivering innovative services that transform how they acquire and manage talent. This is done by listening to an organization’s specific needs and tailoring a solution that delivers both short and long-term value across an entire contingent workforce program.
Your MSP partner will also help manage and mitigate risks associated with operating a contingent workforce. If you're interested in engaging contingent talent, or want deeper insights into how to manage the risks posed by your current program, download our free whitepaper: A Checklist for Contingent Worker Risk:
Contingent Workforce Management