3 min read
In today’s dynamic business environment, the imperative to locate optimal candidates who will bring value to your organization cannot be overstated. While the traditional view was that hiring full-time employees was the sole means of accomplishing this objective, the landscape has shifted significantly. It is now becoming increasingly evident that a strategic approach to recruitment that encompasses the use of external resources can yield significant cost savings, resource optimization, and time efficiencies. As such, the integration of an external workforce could represent a potent strategy for your enterprise, and the ensuing discussion will provide a detailed analysis of the reasons why.
What is the external workforce?
The external workforce is employees who work for a company but are not on its formal payroll. They can be identified as contractors, temporary workers, freelancers, gig workers, and more.
Fieldglass identified two categories of the external workforce, these are:
- Contingent workers: they’re hired by a company to do role or project-based work on its behalf, but are not classed as traditional employees. Contingent workers could be contracted via suppliers and other talent pools such as staffing agencies, freelance markets, or even sourced directly.
- Service Procurement: also known as services providers are companies that deliver people-based services to an enterprise – such as consulting firms, marketing agencies, or facilities management companies. They’re mostly contracted to do project-based work via a Statement of Work (SOW).
What are the advantages employing external workers?
Large talent pool
The external workforce is a large talent pool asking to be tapped into. External workers are in-demand, which could be daunting. However, because it’s such a large talent pool there are many highly skilled workers for the picking.
As the desire to work remotely gains traction, more individuals are seeking opportunities to work from home. In fact, according to a recent study by the Pew Research Center, a staggering 60% of workers expressed a preference for remote work all or most of the time. In light of this trend, it is highly likely that the demand for the external workforce will continue to rise as more and more individuals seek to meet their work-from-home requirements.
Another advantage of hiring external workers is that you can hire people from all around the world – which in itself can provide tons of benefits. Firstly, you will be diversifying your business which is ALWAYS an advantage – profit, productivity, brand image, and more. It will provide your business with a diversity of cultures and with that a variety of perspectives. This can lead to innovative ideas surrounding your business, and impactful solutions when needed.
Consider the numerous obligations that come with hiring full-time employees, from providing training, healthcare benefits, bonuses, and sick pay to ensuring their productivity. However, by engaging external workers, these responsibilities shift to the third-party, freeing you of any related obligations. Your sole focus becomes the task at hand and the adoption of a Statement of Work, which serves as an efficient framework for managing external workers.
Using a Statement of Work is vital
For companies working with external workers, it is essential to adopt the use of a Statement of Work (SOW). This framework enables efficient management of your external workforce by paying for specific tasks rather than the hours worked, leading to substantial cost savings.
Furthermore, an SOW protects your finances by eliminating the risk of hourly wage exploitation, ultimately incentivizing workers to complete tasks more efficiently, resulting in increased productivity and faster task completion.
The contemporary business landscape has demonstrated an insatiable demand for external workers, and it’s clear why: businesses stand to derive substantial benefits from their engagement.
The external workforce represents a large talent pool, providing access to diverse skill sets and expertise that grants companies a competitive edge. Leveraging this external talent could potentially unlock a wealth of advantages for your enterprise, and its strategic importance cannot be overstated.
It is imperative to note that engaging external workers via a Statement of Work (SOW) is a sensible move. Doing so grants protection to parties on both sides, while simultaneously fostering cost-savings, making it a compelling pathway to success.