The most successful organizations don’t have time to waste when it comes to filling vacant roles with contingent workers. The faster businesses can fill roles with high-quality talent, the more competitive they’ll be.
Traditionally, businesses use staffing agencies to fulfill their contingent workforce requirements. While this is of course still the best way to fulfill your contingent workforce requirements (as long a highly-strategic contingent workforce program is in place), there are further methods that can improve your talent acquisition initiatives.
That’s why some companies are turning to direct sourcing to expedite the process of hiring highly-quality contingent workers. In fact, Some 39 percent of large companies that use contingent workers use direct sourcing to find their own contingent workers, and 23 percent plan to use direct sourcing in the near future, according to data from Staffing Industry Analysts.
In this blog we take a look at what the direct sourcing of contingent labor is and how implementing a direct sourcing strategy into your contingent workforce program can bring a number of benefits.
What is direct sourcing contingent labor?
Direct sourcing is when a company leverages its own employer brand to build a private talent pool of workers - made up of freelancers, consultants and temporary talent - who can be engaged on a contingent basis.
Organizations are able to use this talent pool to identify and hire suitable candidates for open vacancies by hiring them directly. Direct sourcing is often used in addition to the traditional method of using staffing agencies to source contingent workers.
Direct sourcing talent pools are often filled with the following workers; manager referrals, past contingent workers, ‘silver medal’ candidates, returning retirees and boomerang employees (those who left the company before returning on a contract basis).
In a direct sourcing program, businesses will source, engage, manage, onboard and offboard workers internally. This is usually used in tandem with an outsourced contingent workforce management program, such as a managed services provider (MSP).
What are the benefits of direct sourcing contingent labor?
The creation of a direct sourcing program can bring a business both soft and hard savings. In terms of soft savings, organizations are able to mitigate the costly process of screening, interviewing and onboarding new talent since successful direct sourcing relies on a talent pool that is already willing to work with the organization. In terms of hard savings, a direct sourcing program helps companies avoid paying a markup to staffing agencies, freeing up capital to reinvest in other areas of the business.
Attracting and retaining permanent employees has long been a talent management goal for top businesses, but companies have typically avoided building strong relationships with contingent talent due to a fear of compliance risk. Direct sourcing allows businesses to attract and repeatedly engage contingent talent on an ongoing basis, allowing them to build stronger relationships with their contingent talent pool and simultaneously build a more flexible and agile workforce.
Managing staffing agencies is complex. If businesses don’t manage their staffing vendors properly then they’ll lack the visibility and control over their performance, and that can quickly lead to low quality talent acquisition. There is uncertainty when it comes to engaging unproven contingent workers, especially if you don’t have a highly-strategic contingent workforce program in place. With direct sourcing, businesses have a pre-screen pool of vetted, proven workers that are ready to step in and fill your contingent roles with high-quality talent that you can trust.
When companies turn to a staffing agency for hiring, there’s a process they must follow that takes company time. This includes creating a job description, reviewing the talent sourced by the agency, interviewing qualified candidates and onboarding workers. While this should be a crucial aspect of your contingent workforce program, the addition of direct sourcing gives businesses a small cheat code. Direct sourcing can be used to circumvent this process for vacancies that you know you have a qualified worker to fill. By filling these positions with proven, known talent, businesses can streamline the process of acquiring contingent talent and filing open vacancies.
Organizations that are able to source and hire the right people quickly are able to gain a strategic advantage over their competition. Direct sourcing can help organizations speed up the process of hiring contingent workers by having a talent pool of engaged individuals who are willing to work for the business at a moment’s notice.
Do you need help better managing your contingent workforce program? Get in touch with Contrax today. We have a range of contingent workforce management solutions to help your business realize improved ROI from its external workforce.
