What would you do, if right now, your CEO asked you to show them recent performance management reporting for your contingent workforce?
Would you run for the hills?
Or would you welcome them into your office, with the latest metrics and output data?
Whether contingent workers are new to your business, or whether they are a staple of your workforce strategy, there’s one vital constant that must be in place in their adoption: assessing their performance and value.
As you’re no doubt aware, there’s a multitude of benefits to your organisation from engaging contingent workers:
- you have access to experts and specialists not ordinarily on your books
- you can scale output – up or down – based on market conditions
- you can achieve significant cost-savings thanks to the project or short-term nature of their involvement in your business
- and the flexibility contingent workers offer means your operations are responsive and dynamic
However, because these workers are industry experts, and may only be with your business for a short period of time, it doesn’t mean they get a free ride when it comes to performance management.
Put simply, it’s important to have an established framework in place to measure contingent workers. Reporting on output, achievements and impact on your business are critical for all stakeholders to the worker relationship.
And importantly, it validates your workforce strategy direction.
We are often asked by our clients what the best approach is for contingent worker performance management.
So today, I’ve provided the top three strategies to deploy, so you can achieve optimum ROI from your investment in them.
1. Establish Performance KPI’s
Firstly, don’t think you can use the same KPI’s for measuring contingent workers that you’re currently using to measure your permanent staff. Unfortunately, one size doesn’t fit all.
And the typical HR method for measuring cost-effectiveness doesn’t necessarily apply to contingent workers either (that being, collating HR data on remuneration, training, benefits, management and assessing these measures against worker output).
Instead, you need to determine the key reason or reasons the worker/s were brought into your business. This will provide you with a performance management framework to lean on.
Start collaborating with your internal stakeholders who are involved with the contingent worker relationship so you can determine the following:
- Primary goal for engagement: is it to speed up a project? Or to maintain output during peak periods? Perhaps it’s to lend specific knowledge or expertise to a project, that’s critical to successful project completion. Whatever the primary goal is, agree on it, document it, and establish it as the benchmark of your contingent worker performance management
- Secondary goals: document the specifics of why this worker was brought in, and rank them after having determined the primary goal/s
- Timeframe of engagement: agree on a realistic timeframe for worker engagement. Consider the project deliverables, the primary and secondary goals for engagement, and any foreseeable obstacles. Document the expected timeframe, in your assessment framework and upon completion consider this: how long did project completion take? Was it in line with your expectations?
- Agreed budget: this will obviously be aligned with the workers’ experience and seniority; and with the specific parameters of the project.
The metrics you select to achieve quality performance management of your contingent workers must be aligned to the agreed business objectives.
Importantly, it’s critical to share with and agree upon the objectives, goals and budget with your contingent workers, before onboarding commences. This way, everyone is on the same page. Everyone is working towards a common goal. (There’s one caveat however: things change, stuff happens, disasters occur… we’re talking here on the assumption ‘all things being equal’).
Make sure you set and manage the expectations of these workers. And remember, no one individual can be a silver bullet.
2. Measure the Broad Business Benefits
In the introduction to this post, I noted a number of key benefits your organisation can gain from the use of contingent workers. These are primarily focused on the positive commercial or financial impact contingent labour may offer your organisation.
But there are other impacts you may not have considered.
And they’re just as important to include in the performance measurement approach.
Contingent workers are capable of broadening their reach of influence in your business.
And if you measure and assess this influence, collate and analyse the data, you’ll be in a fantastic position to tweak your workforce strategy accordingly.
Consider this a ‘bonus’ in the winning stakes of contingent workers.
Examples of a broad reach of influence from your contingent workers might include:
- A rise in positive customer feedback, during peak trading periods
- A shift in team performance and employee engagement: often the contingent worker will be filling a skills gap in a project. This can lead to a positive influence on the team around them through knowledge sharing and collaboration
- A boost in your reputation with clients: if unique or rare skills are demonstrably evident to your clients, they’re impression of your organisation will elevate. Don’t miss the opportunity to enhance your standing in the industry!
- The broader business sees an operational and productivity lift in your department or project. Another potential reputation lift, this time internally
- Hiring permanent workers can be a lengthy, eye-rolling process leaving progress and operations in a state of inertia. However, with the right contingent workforce management structure in place, time-to-productivity is fast and efficient. This may look risky to other departments in your business, but instead, you’re setting an example as an action-oriented, goal-striving, unstoppable machine
Another important point here relates to less tangible performance measures.
Are there positive or negative cultural or interpersonal changes evident from having these workers in your midst?
Factor these considerations into your performance management framework as well.
3. What about Peer Assessments?
Introducing a contingent worker into an existing team enables the permanent employees to get a realistic and valuable insight into their worth.
This is a perspective that is often quite different from that of the hiring or line manager, and of the organisation’s senior leadership.
The people ‘on the ground’, interacting with contingent workers’ day-to-day will have a far more detailed understanding of how these workers operate, their sphere of influence, their knowledge and the nature of their work. And importantly, as contingent workers are often in the business for only a short period, issues or triumphs may be less visible to management.
It’s a great idea to gain insight from your employees – the contingent worker’s peers – on the value, impact, knowledge and performance of the contingent worker. Undertaking this process in a structured format, from multiple team members, will draw an unbiased perspective. It will also deliver valuable insight for you to measure the success and potential future re-engagement of the contingent worker.
As one of the world’s top suppliers of contingent worker management solutions, CXC is perfectly positioned to optimise all elements of your contingent workforce strategy. With operations in more than 50 countries across 5 continents, and with decades of experience, we can assist with every aspect of your program.
If you would like to find out more about how we can help with your contingent workforce solutions please contact us here.