With an estimated 40 percent of the U.S. workforce engaged in contingent work before the rise of COVID-19, companies already had realized the importance of agility and access to talent. Before the outbreak, more than two-thirds of American workplaces reported that they planned to increase their use of freelancers, consultants, and independent contractors. Now, with many more organizations and workers working from home, there seems to be no turning back. More than ever, companies must embrace the possibilities of a total workforce solution that includes a variety of external workers. COVID-19 has shifted the work paradigm, both in the near term while it still continues to infect the population, and later when organizations maximize productivity by building the optimal combination of all worker types.
To ensure they are ready for this new reality, companies must make plans now, learning the lessons presented during the pandemic in order to position themselves for success:
The last several months have demonstrated the need for businesses to be able to respond to rapid changes in labor demand. Late 2019 and early 2020 saw some of the tightest labor markets in U.S. history – virtually full employment. The pandemic changed this statistic completely, plunging the country into severe unemployment. If they haven’t already, companies that relied on full-time staff to meet their talent needs soon will experience the pain of layoffs. Firms with robust contingent worker programs who relied heavily on contract workers may avoid much of this heartache, by simply allowing contracts to expire. Organizations that implement measures for dealing with their dynamic worker needs will prosper during the next boom and bust cycles. The recovery, when it comes, will start slowly. Companies will be reticent to hire in case an upturn proves to be a false start. Competition will be fiercer than ever for the best non-traditional workers; a plan for attracting them will be paramount. And as the country’s economy rebounds, that ability to scale the workforce will translate to strategic advantage for companies that are prepared for the future.
Access to Talent
As many sectors of the economy are doing their best to survive, a few are being buoyed by the outbreak. Companies providing essential services that were working at near capacity before the crisis now find that demand for groceries, healthcare, medical supplies, and transportation is taxing their talent resources. Part-time labor and independent contractors can provide some relief, but companies without the infrastructure for securing these non-traditional human assets will need help keeping pace.
COVID-19 is influencing most companies to learn more about and improve their remote-work capabilities, from employee productivity and managerial oversight to data security, customer service, and logistics. This experience should make organizations more comfortable with using off-site workers, which will accelerate the move toward a larger contingent workforce. As firms realize the old 40-hours-a-week, in-office routine isn’t the only way to get work done, their attitude toward remote employees and contingent workers will change, removing any lingering mindset attached to freelancers and independent contractors. This unexpected work-from-home experiment highlights many advantages of using contingent workers:
- Better talent – Eliminating geographical constraints and the need to justify the high salaries that the best IT professionals, marketing gurus, and other experts can command, companies are able to engage the services of technical and creative geniuses when they need them.
- Lower costs – Hiring critical skills only when they contribute to major projects is smart business. It saves on payroll and, though rules and best practices are evolving in this realm, using non-employee workers eliminates the cost of insurance, sick days, and paid time off.
- Increased productivity – Freelance workers can develop schedules that work best for them. They may toil late at night, after putting their kids to bed. Or they may prefer to put in ultra-focused marathon sessions to solve problems, then take a day off to replenish the creative juices. Allowing talent to find its own routine makes people more efficient and effective.
Contingent talent delivers all the benefits companies are finding with their remote workforce. Even better, organizations with workforce management programs using healthy doses of contingent talent reap these benefits without the growing pains and logistical issues companies faced during the COVID-19-mandated work-from-home experience.
Dealing with Disruption
How well companies maintain business continuity can determine whether they survive the next crisis. Diversifying the workforce with talent derived from staff, the freelance community, contract workers, crowd-sourcing, and other pools can spread the risk and help firms secure customer data, maintain distribution, and manage other key business operations.
Decentralizing project teams, customer service representatives, database managers, and business communicators helps companies minimize the effects of disruptions during each stage of the crisis:
- Response – Businesses need to keep lines of communications open and reestablish acceptable levels of service to internal and external customers as the first step to recovery. This can be done more easily if the workforce is dispersed. If a hurricane knocks out internet and email in Florida, a company with a help desk staffed by external workers in Indianapolis, Honolulu, Wellington, and Manchester can still provide 24-hour service.
- Mitigation and Restoration – In widespread disruptions such as COVID-19, some industries and companies will experience greater demand for their products. Contingent workers can help meet this demand, helping factories add shifts, preparing products for delivery, communicating with customers, and ensuring compliance with company procedures and government regulations.
- Return to “normal” – Companies will learn from COVID-19 that a formal response plan can lessen the severity of business disruption and accelerate recovery. A strong contingent workforce management program will include multiple diverse, redundant labor sources. Many firms making the transition to total workforce solutions will benefit from working with managed service providers (MSPs) that can leverage workplace data, help forecast demand, set up training programs, and offer other valuable services.
Adapting to the new reality of expanded dependence on remote workers will require many companies to alter their management approach as well. Whether key contributors are traditional employees working from home or external talent working on contracts or ad hoc assignments, managerial style, performance appraisals, compliance, communication, and work/life balance all must be reevaluated and redefined. The future of work will include not only the composition of the workforce, but also the skills managers develop to keep employees and contingent workers productive and happy. Metasys has addressed many of these in a previous post, but here are three considerations not to overlook:
- Diversity – Building an external workforce, by definition, means engaging talents from different cultures and geographies and soliciting input from a variety of sources. A diverse and inclusive non-employee management program creates more well-rounded solutions. Managers will have to recognize and overcome any familiarity biases and ensure everyone’s voice is heard.
- Collaboration – Work teams distributed across time zones and specialties increasingly will work through iteration, project phases, and micro-tasks. Keeping everyone organized and informed will be key to eliminating wasted effort and sharing best practices across the organization.
- Soft skills – Remote workers, whether employees or freelancers, are not always able to separate work time from domestic time. Managers’ pragmatism and organizations’ policies will have to adapt to accommodate family obligations. More than in traditional work settings, they will need to motivate and inspire workers, who can easily become overwhelmed.
Metasys stands ready to help your company develop and implement workforce strategies to overcome the difficulties presented by COVID-19 and prepare your organization for further tough times and the inevitable recovery. Contact us to learn more about sourcing critical workers and disaster-proofing your workforce program.