Organizations are rethinking their contingent labor strategies during uncertain times and technological changes.
By Debbie Bolla
Contingent labor has often been lauded for the flexibility it offers, especially during uncertain economies and challenging hiring markets. This said, flexibility allows organizations to respond to talent needs without major, long-term cost investments.
“When businesses face fluctuating or uncertain hiring plans, the flexibility of contingent labor is compelling,” says Anamarie DeVito, vice president of client services at Sevenstep. “Contingent labor eliminates the uncertainty of committing to permanent hires and helps companies control costs.”
In fact, research from Deloitte finds that 41% of companies expect to increase their use of contingent workers. By leveraging an MSP to help manage non-permanent labor, organizations will increase access to talent, improve cost control, and maintain compliance. Organizations will also see a streamlined approach to sourcing and managing and offboarding contingent workers, says DeVito, which can boost operational efficiencies and talent agility.
AI and advanced technologies are also starting to play a role in the effective management of contingent labor. “A really important aspect is the role of AI and machine learning in enhancing the capabilities of talent management platforms,” says Tim Pröhm, vice president of digital transformation at KellyOCG. “They elevate the overall efficiency and effectiveness of talent management strategies.”
Pröhm says AI has the ability to identify skill gaps and help optimize workforce composition of both full-time workers and contingent labor. Having the right talent mix can allow organizations to hit their strategic goals and adapt to market dynamics.
“The application of AI tools gives us a predictive analytics and cost optimization function that was not available to companies in the past,” says DeVito. TA leaders will see improvements in transparency around hiring patterns and will be able to better forecast demands. This enables a proactive hiring approach instead of reactive.
AI-driven predictive analytics can greatly influence talent and hiring strategies by providing an overall picture of the effectiveness of full-time and contingent roles. “Reliable talent management analytics enhance your decision-making through data-driven insights, improve visibility into your talent pools, and offer predictive capabilities for workforce planning,” says Pröhm. “This enables HR leaders to identify trends, measure the effectiveness of their HR initiatives, and forecast talent requirements, all of which leads to more strategic talent management.”
Data is playing a larger role in talent decision-making. In fact, research from HRO Today finds that more than three-quarters (77%) of HR leaders use data to a moderate or great extent for talent acquisition.
Talent technologies and the data they provide often require close attention to detail due to a lack of integration. “Companies are seeking more powerful technologies to make sense of the many data sources influencing contingent workforce strategies,” says DeVito.
Pröhm agrees that this challenge needs to be addressed. “Many organizations today don’t have visibility into all of their talent needs. Often, each talent population is managed by its own siloed technology –an applicant tracking system, CRM, VMS, or service procurement tool,” he says. “When you have powerful analytics layered across all these technologies, you can access mission-critical information.”
The integration of data from multiple platforms like VMS, ATS, HCM, and data analytics tools will provide a powerful talent ecosystem. From this, organizations can experience many benefits, says DeVito, including improved visibility and streamlined operations. Leveraging today’s technology and crucial data will allow TA leaders to achieve strategic decision-making.
What’s ahead for MSP? “Companies are looking for value-based full-suite services and capabilities, not just a set of capabilities packaged separately. That could mean expanding SOW management, using direct sourcing or taking on different types of talent and skills,” explains DeVito.
