Having the flexibility to adapt to changing business requirements is a major benefit for an organisation using a contingent, on-demand workforce as part of its total talent strategy.
Learn how to improve the agility of your business by reducing the time to engage freelancers, consultants and contractors.
In this guide:
With REC estimates that recruiting a permanent hire takes up 60 days, businesses face huge costs as a result of lost productivity, but this could be a conservative estimation of the true length of time for a new hire to become productive.
A number of factors cause the huge delay in getting a permanent member of staff productive:
The first delay is the decision making process. Hiring a permanent member of staff should not be a decision made lightly. This business case takes time to put together and sign-off. For larger businesses, this process is complicated further by additional stakeholders needing to approve the creation of the new position.
After the sign off, the position needs advertising to internal and external candidates. Most vacancies will be advertised for at least 30 days.
Coordinating calendars between 2 or 3 candidates and an interview panel over 3 rounds of interviews is not a simple task! The interviewing process can easily take a fortnight.
The UK statutory redundancy notice periods are:
However, it's extremely common to have up to 3 month notice periods as standard on senior or important roles.
A new employee usually has at least a fortnight of inductions and training sessions to attend before they even start learning the ropes. Then they need to establish a working relationship with their colleagues and get to understand their new working processes and systems.
In comparison, it takes between 1 and 3 days to hire and onboard a freelancer. This can easily decrease to a few hours when Talent Pools are used correctly.
Freelance marketplaces effectively reduce the time to find a freelancer. In most cases projects receive high quality, relevant applications in minutes. A professional, experienced freelancer is also more adept at getting up to productive speed. And they can also bypass the usual internal induction sessions.
The REC estimate the average cost of having an unfilled vacancy is £285 per day. This means the five month productivity gap costs a business £5,700 on average.
It's easy to see how these costs can stack up, and could be significantly more:
Hiring a freelancer, for example, is an extremely quick, effective solution for resourcing most projects, but there are some considerations before hiring a freelancer instead:
There's a simple and a not-so-simple answer to this question. Let's start with the simple.
There are projects where you cannot afford to wait. In highly competitive fast moving industries, if you wait for a key hire to start before you begin working on a new product or development, you'll never survive. Your competitors will leave you behind and you'll never catch up. In other words, you need an interim freelancer in place as soon as possible.
For all other scenarios, the answer isn't as straightforward and needs some consideration.
First, you need to establish how much the productivity gap is going to cost you.
You work for an ecommerce business selling red widgets. You have hired a new developer to improve your checkout process. The new hire will join you in 3 months, and they are going to help you hit your targets of increasing revenue by £5,000 a month and reducing the cost of inaccurate order fulfilment by £1,000 a month. There is also added pressure on your new hire because, if you don't hit your targets, you're going to need to spend an extra £10,000 on advertising to sell your stock.
To save you getting out a calculator, in the above scenario, the cost of your productivity gap is roughly £28,000 over the 3 months. About £310 a day.
If you can hire an expert freelance developer to produce results for less than £310 a day, it is financially viable and you should proceed with a freelancer.
In general, freelancers are an ideal interim solution for two types of project:
As shown above, there are projects that simply can't wait for five months before they start. As a freelancer can be hired and in placed in a couple of days, they are a perfectly suited to resourcing urgent projects.
Another good use of an interim freelancer is help make the permanent hire productive as soon as possible. For example, a new marketing manager will want to review competitor and market research as soon as they start to pull together their strategy. An interim freelancer could conduct all the necessary desk research and produce a suite of reports for the incoming marketing manager.
Despite the fact it's faster on average to engage contingent talent, there are a couple of factors that can slow down the process when choosing to resource your project with contingent talent:
When organisations try to manage their contingent population and engagement processes using legacy HR software, or even worse, manually with Excel, things can slowly significantly. Without end-to-end visibility and control, contingent workforces can become slow and inconsistent.
Of course, tools like Talon are designed specifically for the fast, direct nature of contingent worker engagements and provide a platform to enable quick, methodical project resourcing.
Good freelancers and contractors are almost as hard to find as their permanently employed counterparts. And without a joined-up, branded, user-friendly experience to welcome them, the challenges of attracting them are just as tough.
In the scenarios where engaging an off-payroll freelancer, consultant or contractor, speed is inevitably a factor driving the decision. There are a number of things you can do using Talon to make sure the process goes quickly and smoothly every time you need to engage your contingent workforce:
To future proof your contingent population, TalonFMS' searchable directory provides a consolidated, top-level view of your entire talent population. As its taxonomy and filtering is bespoke to your requirements, proactively identifying and managing skills gaps is as simple as loading the directory and applying a filter.
Take time with every project to review the applicant funnel to get project by project insight into the need to look for additional resources.
Powered by the insights from your searchable directory audits and the applicant funnel reports, you can be very specific about the skills and experiences you try to bring on with your acquisition activity.
Talon's integration options means advertising requirements on job boards and social media platforms is made simple. Pre-screening for applications from projects posted to job boards and social media means you can receive applications from users outside of your private talent population, however, these users are created in a separate ring-fenced 'pre-screening' area.
Pre-screening users are visible in your Application Funnels, which makes enables you to identify potential users who you'd like to invite to go through an onboarding process and become a full member of your private talent pools.
Before engaging a freelancer, consultant or contractor, your organisation will want to ensure they have been through a compliant onboarding process. This may include contract signing, vetting and/or security checks.
Talon provides configurable, templated, onboarding workflows to allow you to systemise and standardise any number of onboarding processes. Once configured, every new member of your contingent workforce will be systematically guided through the required compliance checks and balances – saving you the time having to manage this manually. An added benefit is that over time this creates further efficiencies as they are already vetted and ready to go, so the more established your high quality talent population the more time and money you save.
Talon's talent pooling functionality allows you to create and group individuals. This grouping can be done by:
As there are no limitations on the number of talent pools you create, they are a flexible, convenient way to manage cohorts inside your contingent population.
The real power of talent pools is the ability to create and post a project's requirements direct to a talent pool. This 'post to talent pool' functionality provides a time-saving shortcut for you to invite prequalified freelancers, consultants and contractors to respond to any given project brief.
Re-engaging existing contingent talent on new projects or existing project follow-ons are probably the fastest way for a business to resource a piece of work. Once you've identified your high-performers, you can review how you include them in your employer brand proposition.
Talon provides two features to help you to identify your best contingent talent, which makes it easier to decide which freelancers, consultants or contractors to re-engage.
For statement of work engagements, Talon provides configurable milestones. These milestones enable you to control the progress and cost of a project more closely.
Using the bespoke milestone reporting, you can quickly identify which freelancers, consultants or contractors are best at delivering projects on time and on budget.
Talon's Ratings and Reviews functionality allows an organisation's hiring managers and internal stakeholders to review and provide ratings on the suppliers they engage through Talon.
These ratings and reviews are viewable by all of the organisation's hiring managers through their instance of Talon, this helps other departments to discover high-performing suppliers who may be engaged elsewhere in the business.
This guide looks at the main differences between freelancer management systems (FMS) and freelance marketplaces.
Gone are the days of the rigid organisational structure, today's forward thinking organisations are adopting a resourcing model that's much better at flexing and scaling.
Discover how the 2018 Solutions rates our Talon Freelancer Management System and what this means for you, when you're looking to select and integrate an FMS into your HR and talent technology stack.