To be competitive and agile, your organization needs a flexible, adaptable workforce that can deliver on your business goals. With the right blend of permanent hires and contingent workers, businesses across all sectors are achieving just this. But how can you identify that ideal combination to deliver the right skills at the right time for the right price?
Using a vendor management system (VMS), you can gain access to a single source of contingent worker data that details skills, availability, location, and cost. With this increased visibility, your HR and procurement functions can overcome internal barriers and collaborate to find the right mix of employees and non-employees who can achieve your organizational objectives.
This concept, total workforce optimization (TWO), is enhancing the people strategies of enterprises across a number of industries. It is reducing their outlay on workers while maximizing their return on investment.
TWO is one of two elements of total talent management (TTM). According to Staffing Industry Analysts (SIA), total talent management is:
An emerging model of talent or workforce management that includes an organization’s management of ‘permanently hired’ workers as well as ‘contingent’ workers. It seeks to integrate the respective management of permanent hires and contingent workforce by HR and procurement functions.
The second element of TTM is total talent acquisition (TTA). Traditionally, talent acquisition focused on hiring permanent employees for an organization. However, as more organizations use contingent workers, TTA now includes finding and hiring both contingent workers and permanent employees.
So, how does TWO fit into TTM, and alongside TTA? Essentially, TWO is finding the right blend of employees and non-employees to achieve specific outcomes at an enterprise level and departmentally. Or, in short, TWO is ‘fixing the mix’ of employees and contingent workers.
In biology, symbiosis is where two organisms seamlessly co-exist for mutual benefits, like clownfish and anemones. The relationship between TTA and TWO is the same. You can’t optimize your workforce if you can’t acquire the right talent at the right time for the right cost. And you don’t know what talent to acquire unless you know the optimal contingent and permanent skills needed to ‘fix the mix’ and to achieve the specific outcomes your organization wants.
For contingent workers, the same analogy applies to your HR and procurement functions. Following an operational request for a particular skill set, HR creates the job requisition specifying what skills are needed and for how long. Procurement, usually via a staffing agency or vendor, locates and acquires the worker.
This sounds straightforward, but there are barriers to achieving this balanced symbiosis. HR and procurement are often siloed. In global enterprises, the functions may be separated by entire continents. They use a different vocabulary and often separate technology platforms. This disconnect can lead to the wrong skills arriving at the wrong time, all costing far too much.
As a result, the first step towards optimizing your contingent workforce is the need to coordinate HR and procurement so the functions are performing symbiotically. How can you do this?
A range of focused tech and collaboration solutions, such as an extended workforce platform specifically configured for your organisation, can help you overcome the challenges of disconnected HR and procurement functions. Such a solution will connect all your contingent staffing activities and simplify processes, while providing greater visibility over your contingent workforce.
Use the following six-step process to transform your internal data into actionable insights and, ultimately, TWO:
Choosing the right VMS provides deeper insights as well as supports contingent workforce optimization. Use the data to choose the best-performing staffing suppliers, manage your contingent workforce risk more effectively, and ensure proper spending controls.
To learn more about what a VMS is, what its key features are, and what benefits it can bring to your organization, download our free guide. This will show you how a VMS can aid contingent workforce planning, forecasting, management, and procurement.