Against a backdrop of economic uncertainty, volatile market conditions and the lingering effects of the pandemic, more and more businesses are supplementing their permanent workforces with contingent talent.
And we’re not just talking about a handful of contractors here and there. Some companies now report that upwards of 30–50% of their workforce is made up of non-permanent workers.
With this huge external workforce comes the need to manage it — and in the 21st century, that means having the right technology. Read on to find out about the top features to look for in a contingent workforce management solution.
The problem with legacy tech
Almost every company relies on a stack of applications, platforms and software solutions to source, manage, engage and retain their permanent employees. And many of them have tried to integrate contingent workers into these tools, effectively treating them as employees.
But the problem is, these tools were never designed for contingent workers. Their needs are often very different from those of full-time employees. And there’s another issue: contractors usually don’t need access to the same level of data as permanent employees — and granting it could constitute a security risk.
But what about companies that have implemented specific tools like vendor management systems (VMS) to handle their contingent workforces?
While many of these tools work well, some of them are no longer sufficient now that contingent workers are making up a larger proportion of the overall workforce. Others find that, while these tools work well as standalone products, they don’t integrate well with other tools and systems, making them hard to use efficiently.
Lastly, many legacy tools were designed for procurement teams and MSP providers, who have an in-depth knowledge of the complexities of contingent staffing. But these days, they’re increasingly used by HR teams, managers, leadership and even workers themselves — who may find them clunky and hard to navigate.
Top 10 features of a modern contingent workforce tech tool
So, what’s the solution? In 2024, it’s time to wave goodbye to inefficient legacy systems, and opt for tools that can meet the demands of today’s market. Read on for 10 features to look for in a modern contingent workforce tech tool.
- Cloud-based platform
First things first: any modern tech tool should be cloud-based, and there’s one simple reason why. Legacy server-based systems that can only be accessed from your HQ are simply not fit for the modern workforce.
These days, if your teams can’t remotely access the tools they need, they’ll simply find workarounds to avoid using them. This leads to miscommunications, inefficiencies and mistakes — basically, a big mess.
Of course, the old argument against using cloud-based systems is that they might present a security risk. And it’s true that you probably use your VMS to store and process a lot of sensitive data.
But these days, many cloud-based systems are (at least) as secure as old-fashioned server-based ones — we’ll talk more about that later.
- Real-time data analytics
To effectively manage a contingent workforce, you need to collect a lot of data. That might include contingent hiring metrics like time-to-fill, cost-per-hire, quality-of-hire and attrition rates. In short, the things you’re probably already measuring for your permanent workforce.
And you should also be looking at data from the external market, including pay rates and the current and projected supply and demand for certain skills. Put together, this can give you a real competitive edge when it comes to workforce planning and forecasting.
The key thing here is to ensure the tool you choose lets you both gather this data and access it in a visual, understandable format. That way, your HR, procurement and leadership teams will be able to quickly get a snapshot of the state of your contingent workforce — and understand what the external market looks like too.
- Automated workflow processes
Sourcing, engaging and retaining contingent workers involves a lot of repetitive processes. And the best technology comes with the ability to reduce work by automating them.
Until now, this type of automation has been limited to simple tasks like signing contracts, onboarding new workers and performing compliance checks. But today, the increasing use of AI and ML models in contingent workforce technology means these tools’ automation capabilities are getting even stronger.
The tools that have invested the most in this area now allow users to automatically perform complex tasks like measuring a candidate’s fit for a role, determining the appropriate pay band for a worker and accurately predicting time-to-fill for a vacant position based on market supply and demand.
- Integration capabilities
Your contingent workforce management tools are probably just one piece of the patchwork of programs, apps and software that you use every day. And how all of these tools interact with each other can make the difference between smooth and easy workflows and an absolute nightmare.
For example, your VMS might need to integrate with your core HRIS, your back office invoicing systems and even identity management systems for badging and security. Your contingent workers may also need access to learning and development platforms, company intranets, communication systems and other work tools.
This means that, when you’re shopping for contingent workforce tech, you should check out the pre-built integrations that each provider offers, and discuss how easy it will be to build custom integrations where these don’t exist.
- User-friendly interfaces
There are a lot of different parties involved in managing a contingent workforce, including managers, MSP providers, suppliers, workers, your procurement and HR team, recruiters and more. And all of them will likely need to access your tech platform in one way or another.
And if you don’t want to make life harder for these people, you need to make sure the tool you choose is accessible and easy to use.
The easiest way to establish if a tool will work for you is by requesting a product demo from any company you’re considering engaging. That way, you’ll be able to see how its interface looks and feels for yourself.
- Mobile accessibility
Modern contingent workforce tech tools typically work across desktop, mobile, tablet and even wearable devices like smartwatches. They also provide a seamless, user-friendly experience across all of these different platforms.
Also, many contingent workforce tech solutions include an interface for workers to access information, submit timesheets and perform other tasks. And, since those workers may not necessarily be desk-based, a mobile app is a must if you want to keep them engaged and productive.
- Customisable features
Every company is different. Even your closest competitors probably don’t have the exact same contingent workforce needs as you do.
That means that any contingent workforce tool you choose to adopt should come with the ability to tailor it to your specific requirements. In practice, many tools come with a range of features and capabilities, which you can add and remove as required.
The more closely your solution matches your exact needs, the easier it will be to build a business case and get buy-in from your company’s leadership team.
- Scalable infrastructure
As your business grows, your contingent workforce needs will change too. And there’s little point in investing in a solution that will only work for you for a few years.
Instead, you should seek out solutions that come with a built-in ability to scale and flex as your requirements change.
Before working with a tech provider, you should ask them about how they’ll be able to cope if your workforce grows in the future. You can also look through their client testimonials to see whether they’ve worked with organisations with needs that are different to yours.
- Enhanced security measures
As we mentioned, contingent workforce tools are usually used to store, share and process confidential information. That means you need to ensure whatever tool you choose has the right security features to keep that information safe.
First, the best modern contingent workforce tools come with sophisticated permissions and access levels, so you can ensure data is only accessible to those who need it. These tools should also come with features like multi-factor authentication, password policies and audit logs.
You should also look for those tools with international industry certifications like ISO 27001 or SOC 2. These demonstrate that the company is committed to data protection and complies with established security standards.
- Compliance and regulatory tools
Hiring contingent workers can be an effective way of lowering your workforce costs and injecting flexibility into your operations. But it’s also a compliance minefield with a whole host of pitfalls to avoid.
Anything from worker misclassification to issues related to tax, immigration, co-employment or labour law could cause big problems for your business if you’re not paying attention.
For this reason, modern contingent workforce tech often comes with in-built tools for completing compliance-related tasks. One example is our own platform, CXC Comply, which allows our clients to quickly and easily perform worker classification, right-to-work and background checks with just a few clicks.
Transforming your contingent workforce strategy for 2024 and beyond
In 2024, the time for outdated, clunky legacy systems is past. If you want to get the most out of your contingent workforce, you need to make sure the tools you’re using to source, engage and manage them are up to the job.
The tool you choose might not come with every single one of the features we’ve listed above — and that’s fine. This is our wishlist, not yours.
Whatever you opt for, we hope it helps you to grow and develop your contingent workforce in 2024 and beyond — and that it makes your life easier, not harder.
Need some extra help managing your contingent workforce this year? Get in touch with our team to learn about our solutions.