Automation as the Key to Contingent Workforce Management


Streamlining and centralizing processes can make businesses more agile and give leaders the visibility they need to manage their extended workforce amid dynamic business conditions. In framing out an effective contingent workforce management strategy, digital transformation helps businesses in four key areas, writes Jens Audenaert, division vice president and general manager, WorkMarket, an ADP Company.

As the workforce continues to evolve, the needs of workers, businesses, and HR leaders are changing in tandem. With a rising gig workforce and a significant shift to remote work in response to current circumstances – a shift that will likely transform business policies moving forward – enterprises are faced with unique challenges in talent management and the notion of a blended workforce consisting of their traditional workforce and their extended workforce.

The extended workforce (gig workers, contingent workers, 1099 contractors, and freelancers) is already sizable and growing. Most estimates about the level of spending by global businesses range between $600 billion and $1.4 trillionOpens a new window . This major shift is impacting the future of the workforce, changing the structure of how labor is sourced by companies.

Business leaders need to find ways to manage this blended workforce. To paraphrase the adage, you can’t manage what you can’t see. The first step in managing your workforce is to gain visibility into it. Then you can organize it, and then you can optimize it. This is where technology and automation can help.

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4 Key Areas of Automation in Contingent Workforce Management

Technology is a critical component in managing these considerations and efficiently responding to the changing face of today’s workforce. Streamlining and centralizing processes can make businesses more agile and give leaders the visibility they need to manage their extended workforce amid dynamic business conditions. In framing out an effective contingent workforce management strategy, digital transformation helps businesses along with four key areas.

1. Uncovering data to gain visibility

When leveraging technology to centralize and manage an extended workforce, data becomes more readily available and actionable. Tools that track and report on a business’s extended workforce can offer visibility into total spend, market coverage, worker performance, and customer satisfaction.

Having a holistic view can offer both agility and data-driven insights, both of which can make a true difference in driving strong business outcomes. Adding technology, such as robotic process automation (RPA), to this visibility can enable front-line leaders to receive notifications and take actions automatically to assign work, or source the right talent in the right place, on-demand.

2. Streamlining payment processes to attract and retain talent

Having visibility into the workforce is only part of the goal of leveraging technology. The demands of the workforce are changing. To effectively attract and retain the talent you worked hard to secure, you need to be prepared to meet their requirements for faster, and more flexible payment options.

While employer branding is often top-of-mind for attracting traditional employees, the concept of branding to attract freelance talent is not often widely considered, though just as important when engaging an extended workforce.

A centralized end-to-end system can help businesses process invoices and make payments in a more streamlined and efficient manner while delivering visibility into key groups such as finance. Leveraging technology to manage an extended workforce can also provide visibility into the financial metrics, including the amount spent on the extended workforce. This same technology can streamline workflow and approval processes internally while capturing all spend across regions, business units, or departments. Additional efficiency is gained when the technology integration can capture this data within a company’s accounting system(s) or enterprise resource planning system.

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3. Organizing labor clouds

Digitally organizing workers in one place enables businesses to understand the makeup of their extended workforce and efficiently fill gaps, whether those are based on skills, credentials, or geography.

Automating talent pools or labor clouds can help by reducing the time-consuming and often manual process of identifying independent contractors or vendors and only assigning work to those that are pre-screened based on the parameters a business determines.

Technology can be used to organize multiple pools of talent to choose from based on parameters such as skill set, qualifications, experience, geography, and price. This savings in time and reduction in manual processes not only makes the business more agile but also reduces any errors along the way.

4. Mitigating compliance risk

The legislative world around the gig economy has demonstrated variation in laws, making it challenging for businesses to enforce compliance due to laws, industry regulations, or company policies. By leveraging technology, companies can maintain control over compliance risk and still be agile.

With compliance rules set up centrally, a company can still empower its team leaders to utilize talent when and where they need it while automatically staying within preset parameters and reducing the risk of worker misclassification.

Often, businesses set rules sporadically across lines of business and regions related to engaging independent contractors yet lack the tools for consistently enforcing requirements such as contractual terms, insurance, and work frequency.

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Bringing It All Together

Dynamic business conditions require businesses to be agile and quickly respond to changing environments. There is no question that the gig economy is here to stay, especially in light of the current business environment we find ourselves in. Leveraging technology that can provide deeper insight will be crucial in the long-term success of an organization’s on-demand workforce strategy.

When information stems from one common source, businesses are better equipped to navigate changes and new demands. By utilizing a technology-based contingent workforce strategy, businesses can extend their traditional workforce while also increasing the ability to be competitive. To win and excel in today’s marketplace, companies need to begin their transformation to workforce “as-a-service.”

Which technologies are you implementing for effective contingent workforce management? Tell us on LinkedInOpens a new window , TwitterOpens a new window , or FacebookOpens a new window .