Ideas for Successful Business Model Integration
Today’s workforce is broader than ever, composed of a labor pool that utilizes both full- or part-time employees and non-employees (contractors, freelancers, temporary workers, etc.). Whether a company is in the beginning stages of incorporating contingent workers into their business model, or if it has been utilizing this method for years, each organization will hold its own unique mix of traditional workers and non-employees. That being said, what works for one might not be as successful for another. It is important to look at the big picture and determine what will make sense for your company and employees.
While there are pros and cons of hiring contingent workers, most businesses that utilize a blended workforce have countless success stories to share. However, leadership at those same organizations will tell you that in order to integrate contingent workers successfully, you must be aware of the practicalities and legalities.
Through many conversations, much research and some experience, we have been able to give greater insight into preparing a business to incorporate a blended workforce. Here are a few general best practices for integrating the contingent workforce into your organization:
- Be conscious of the law: It’s wise to partner with a specialized legal team to minimize risk. According to a New York Times article, “It has become a much bigger issue in the last three to five years because the federal government is taking a much harder enforcement approach.” State labor requirements must be abided by, as well as federal tax laws. And then, there are new healthcare laws, which at this point, are still quite confusing. Employers that violate the IRS and other rules and regulations laid out for independent contractors may be required to pay penalties/damages, as well as pay back employment taxes.
- Create a strategic hiring process: While many non-employee workers are hired because they already have the required specialized skills, a detailed evaluation of the skills required for the project at hand must be carried out prior to matching a worker with the project. Contractors must be screened for these skills and requirements, and then managers must think about whether or not the individual meets the needs of the specific job components.
- Establish a common language: Because contractors are different from traditional employees, anticipate communications challenges and develop a common language. An established common approach using the same terminology and structure allows the organization to plan and discuss all workforce actions from a bird’s eye view. Standardization can help decrease process cycle times and allows for resource sharing across different areas of the business to minimize gaps.
Randstad Sourceright Vice President Karen Turner recently wrote: “While the ideal of a fully integrated blended workforce function has not been reached, the approach is beginning to deliver success for companies competing for scarce talent.”
A blended workforce of contingent workers and traditional workers can offer many benefits to organizations of all shapes and sizes because it allows the company to fully optimize their talent strategies. Aside from letting the business be agile to changes in the marketplace, it keeps it ahead of the curve and allows access to professionals with highly specialized skills without having to invest millions in training current employees.
Cindy Lubitz is Managing Director of inTalent Consulting Group