Would you consider filling a senior role from a contingent workforce pool? Apparently, it’s the way of the future.
The business case for utilising a contingent workforce is quite clear. Financially, it’s often advantageous, especially for some business models. You spend more money on talent when you’re making more money, and you can have less people during quieter times.
It’s a little like the perceived benefits of a shorter romance over a marriage; both parties get the short-term benefits they’re looking for without having to commit too much of their time, energy or finances. But there are risks that you should consider before diving into the deep end of the contingent talentpool.
The future is transient
According to recent research from HR consultancy firm KellyOCG, who specialise in outsourcing and contingent workforces, companies should shift their focus from modes of engagement and instead zero in on where they can best find highly-skilled professionals.
Surveying 200 C-suite leaders, the study found that 30 per cent of organisations’ workforces are contingent. Half of the leaders expect this percentage to increase in the next two years.
Interestingly, the research also found that some workforces aren’t set up to effectively embrace the future of work, showing that some of the necessary skills required by businesses can only be found in the contingent workforce.
“Eighty-six per cent of business say they turn to the contingent workforce as their top strategy for dealing with talent shortages and a further 60 per cent of those were doing so because they weren’t able to find permanent equivalents,” says Peter Hamilton, vice president and regional director for Asia Pacific at KellyOCG.
“When it’s managed well, it does provide organisations with flexibility and access to highly-skilled talent that they’re not necessarily having to train and develop themselves. But this process is essentially what’s driving the skills shortage, because organisations want to buy ready-made skills.”
What’s the underlying cause of this? Perhaps it’s the consequence of a deluge of new technology in our lives – this expectation that we can get everything we need in an instant. This belief has changed how we eat, how we date, how we communicate, and how we work.
The long term effects
KellyOCG’s research is just looking at one side of the coin. You shouldn’t ignore what relying on a contingent workforce could be doing to the overall culture of your workplace. If people are able to come and go on a whim, how can you truly have cohesive and consistent expectations of your staff?
As outlined in this Deloitte article, having a shared set of values is incredibly important for a businesses success and the contingent workforce may not be as invested in an organisation’s end goal as a permanent worker might be – for obvious reasons.
“Imbuing culture to the remote and contingent workforce may not seem to carry much urgency at companies where such “alternative” work arrangements have historically been few and far between. But when faced with rapid societal and technological change, many of these companies will [likely begin] to experiment with remote and contingent work arrangements,” say the article’s authors.
“In this effort to achieve consistency of culture across all worker types, both location and employment type have distinct implications; therefore, leaders need to develop a nuanced strategy to extend organisational culture to alternative types of workers.”
A new employee, just add water
Elliott Young believes the contingent workforce is ripe with potential – so much so that he’s made a career out of it. As growth manager of Weploy, an on-demand staffing solution app, Young has seen the positive side of temporary workers first hand. He also has a stake in a future where more and more people work on a contingent basis.
“The contingent workforce offers flexibility for people looking to change careers without the negative connotations of having had lots of different permanent jobs. Workplace health is of huge importance; people don’t want to be trapped in careers that leave them feeling mentally fragile,” he says.
Weploy markets itself as catering to professionals who might want to dip their toe into a new industry, mothers who are returning to the workforce and former CEOs who might want to branch into a new direction.
The tenure of what Young refers to as a “Weployee” can range from a four-hour cover role to six-to-nine month long contracts. Young says it varies across the different industries they service.
A temporary senior team?
One of surprising findings to come from KellyOCG’s report was that 45 per cent of people working as part of the contingent workforce were doing so for mid-to-senior level positions. You have to wonder what effect this would have on a team’s cohesiveness, especially if it were a management position that the transient worker was taking on.
When asked if he thought it would have a negative effect on a company’s culture, Hamilton said: “I think that the most innovative organisations are figuring out ways to mitigate any of those perceived risks. For example, someone coming in at a very senior level and then leaving shortly after could be an intellectual property (IP) risk.
“Innovative organisations will find a way to configure their teams so that IP doesn’t fit with one individual. There are also ways for organisations to cover that particular risk contractually.”
While KellyOCG’s data reflects a rise in mid-to-senior level contingent workers, Young says that “Weployees” are mainly junior-to-mid level.
“They are support workers within businesses, relieving permanent workers so they can complete more complex work that only they can do,” says Young.
Deloitte’s article suggests that in order to create a “consistent culture” across various talent groups in your organisation – in this case, transient and permanent staff – employers must intentionally create an environment that makes workers feel valued and perform to their best, no matter where they’re working from or how long they’re working for the organisation. This would be no easy feat, considering the time it takes to properly understand a company’s ethos and the complexities around instilling corporate values en masse.
Keep up to date on the legislative and regulatory changes that influence your organisation’s risks, rights and responsibilities, with the AHRI short course ‘Managing the legal issues across the employment lifecycle’.