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External Workforce Fuels Recovery, Cementing Role in the Future of Work

By Vish Baliga, Chief Technology Officer, SAP Fieldglass

For businesses taking steps toward recovery, the external workforce has proved indispensable in providing much-needed flexibility, agility and high-value skills at a time of profound disruption. Even as contingent workers, temporary labour, consultants, contractors and freelancers take centre stage to perform essential roles at this critical point in history, the way they work is evolving.

External workers are among the unsung heroes providing healthcare services in our hospitals and intensive care units. They step into crucial, high-demand roles to maintain supply chains, making sure that medicine, dairy products, fresh produce and other items reach supermarket shelves and pharmacy aisles. They are engineers, information technology professionals, skilled machinists and fabricators who sustain factory operations and perform critical infrastructure roles across industry sectors.

The evolution of the external workforce

Before the pandemic, external workers accounted for nearly 42 percent of organisations’ overall workforce spend. The trend gained momentum following the 2007-2009 recession, though it began to take shape in the 1990s.

The millennial generation, having watched parents lose jobs to downsizing, brings a different perspective to work and careers. Young people witnessed family members’ pensions disappear. They saw employer loyalty wane. Partly as a result, many of them today find the external workforce appealing. People now change jobs and seek new experiences more frequently.

Much in the same way that software engineers like me prefer to “fail fast” with product development and apply lessons to our next idea, external workers seek out a multitude of experiences. They find work more interesting that way – and the flexibility it affords more rewarding.

In the wake of the coronavirus, flexibility has never been in greater demand. This past spring, we saw high demand for talent to fill essential roles amid the lockdown across wide swaths of our economy. Now, we see businesses battered by the pandemic under tremendous pressure to find new ways to operate with less revenue as they reopen. Amid the uncertainty presented by the virus presents, external workers offer precisely the flexibility that many organisations require to get work done.

Leveraging digital platforms for success

A digital solution for contingent workforce management can help organizations to gain visibility into the growing number of external workers they have on their books, where they are located, what projects they have completed and for how much. Meanwhile, we’re seeing more than ever before how workers with skills in certain industries could well apply their talent to other sectors to fill crucial roles. Leveraging a cloud-based solution can help to match workers with transferable skills to other industries as roles become available. The technology exists to help equip employers with the visibility they need to maintain continuity, demonstrate resiliency and extend competitive advantage.

In addition, businesses can look to a digital marketplace for external talent to help jumpstart the return-to-work process and match open jobs with skilled temporary workers. Again, by leveraging the power of a digital platform, businesses are provided with a single place to access vetted candidates from multiple suppliers so hiring managers can save time and find people with the skills best suited to critical roles.

Hiring external workers already comes with its challenges. Companies need to ensure they know who works for them; what data, systems and facilities they access; and how long they are engaged. Longer-term engagements are also common, whereby companies keep records of who their external workers are, making them more likely to re-engage. Meanwhile, government regulations established around the world provide guard rails for external talent management to help ensure fair compensation.

Now, COVID-19 is creating even more change in external workforce requirements. The physical presence of some external workers is required whether at a hospital, water plant, factory or elsewhere. Others need to work on-premises during seasonal hiring bumps in the retail, hospitality and shipping and logistics sectors. Whereas some workers who do not need to be at a specific facility may be outsourced to call centres, for example.

These are all new challenges that businesses need to weigh as they consider their external workforce needs. However, rather than adding pressure to an already challenging scenario, technologies exist to ease this process, supporting organisations on their road to recovery. Embracing the external workforce – and the digital tools that empower them to hire and manage it effectively – goes a long way toward ensuring business continuity and future success. The best run businesses are those that look for solutions to help them keep pace with the rapidly unfolding future of work.