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There is nothing like biting into a vegetable freshly plucked from your home garden. So it is not shocking to see many new gardeners eager to get outside on the first warm day of spring and start planting the vegetables they love—whether they are lettuce, tomatoes or peppers. With enthusiasm, they dig up their garden, throw some seeds into the ground and excitedly wait to see the vegetables pop up over the coming weeks and months. Yet these gardens often fail, leading their caretakers to believe they are not privy to the secrets of growing a flourishing garden. They might wonder why their lettuce looks wilted or their tomatoes have become infested with pests. However, the truth is there are no secrets to growing a thriving and blossoming garden; it just takes planning, preparation, maintenance and patience. The best, most diligent gardeners know to find the perfect ground for their garden; plan the best layout, taking into account the soil, sunlight and moisture; prepare the garden bed and nurture the vegetables as they grow. Taking these steps will help to ensure the heads of lettuce heads sprout well, the tomatoes taste sweet and the peppers have a delicious crunch.
Just as gardeners need to prepare and plan in order to enjoy homegrown vegetables, IT employers need to prepare and plan when hiring contingent workers. Contingent workers can add to an IT team, but in order to truly reap the reward that these employees offer, IT leaders must build sourcing and screening processes, prepare onboarding practices and develop and nurture contingent employees throughout the engagement with performance management systems. And finally, like when it comes time to harvest the crops, IT employers need to have effective offboarding processes. The methods for growing a flourishing garden are not mysterious, and neither are the techniques for successfully managing the contingent workforce.
TEKsystems surveyed nearly 1,000 IT professionals about their views on working as a contractor and more than 500 IT leaders to learn how they manage the contingent workforce. This paper explores the survey’s findings and provides recommendations and best practices for managing the growing contingent workforce.
IT professionals are in high demand, and with only one worker available for every four job postings, employers struggle to find the talent they need. One solution is to leverage the contingent workforce to augment staffing needs, relying on independent contractors, freelancers, consultants and temporary workers to bridge the gaps in the workforce. According to Gartner, the world's leading information technology research and advisory company, the contingent population currently represents 10 percent of all American workers—but 20 percent of IT workers. And it’s growing. Staffing Industry Analysts (SIA) estimates global spend on contingent labor was $2.5 trillion in 2012, a 95 percent increase since 2009. In addition, SIA expects the IT staffing industry to increase by an additional 7 percent in 2014.
Hiring contingent workers provides many advantages, and organizations recognize this. Nearly half of IT leaders (46 percent) surveyed say contract workers make up 11 percent or more of their IT department. In the next five years, 59 percent of IT leaders expect that contract workers will make up at least 11 percent or more of their IT workforce, an increase of 13 percentage points.
With the growing demand for contingent workers, organizations need to be prepared to manage these employees. According to IT leaders surveyed, human resources (HR) and procurement departments are involved in 72 percent of hiring decisions. However, only 11 percent of IT leaders say they strongly agree that HR and procurement understand their workforce needs, especially when it comes to hiring contingent workers. IT leaders need to take control of their hiring decisions and recognize that they will need workforce management procedures specifically for the contingent workforce, such as sourcing, screening, onboarding, performance management and offboarding processes.
IT leaders should consider how they will benefit from contingent workers and why they might hire contract workers to complement the full-time employees on their teams. IT leaders surveyed acknowledge that contingent workers are essential to any IT team. Though only 21 percent of IT professionals cite contingent work as their ideal type of employment, 69 percent of IT leaders agree contingent labor is a critical component of the success of business operations. Often contract workers have a wide array of experiences across various industries, which broadens their knowledge and skills and enables them to offer fresh perspectives and innovative ideas. In addition to these value-adds, IT leaders identify three primary reasons for hiring contingent workers:
As discussed above, contingent workers can have a significant positive impact on an organization’s IT team. However, once IT leaders hire these workers, they must also manage them properly. Yet IT professionals do not feel like they are being managed well, and nearly half (47 percent) of IT professionals say that employers’ expectations of their skills and experience are unrealistic. When it comes to understanding, managing and developing talent, IT leaders are struggling.
In order to help IT professionals grow and thrive, employers must first understand their employees’ driving forces. In our survey, we asked IT professionals to identify their motivations for working in contingent positions. The top four drivers for IT workers to perform contingent work include the opportunity to learn new skills, higher salaries, increased autonomy and more flexibility.
In addition to understanding motivations, IT leaders should ensure they have effective workforce and talent management processes in place. This will enable contingent workers to integrate with the team and make a positive impact on the organization. However, few IT leaders feel confident that their organizations have effective workforce management processes, and 58 percent of leaders agree that finding great contingent workers who fit their companies’ needs is difficult. Improving these processes creates clearer expectations for employees and better communication, enabling the team to function more cohesively.
IT leaders understand that the success of their initiatives depends on the people leading them, and that attracting the best IT professionals to their organizations is challenging due to the competition. Hiring new workers is not an easy task, especially when hiring for contingent positions. When looking for contingent workers, IT employers cannot just create job postings and expect the dream candidate to find them. A strong sourcing process can help uncover the best IT talent in the area, yet 79 percent of IT leaders are not confident they know how and where to find the professionals with the skill sets they need. To attract the best of the best, IT employers need to build a clear employee value proposition based on what’s uniquely great about working for their organization, and they need to address what the candidates are looking for. Employers need to make sure candidates’ goals and interests align with what the company can offer, and they need to show that they understand the motivations and needs of contingent workers.
Once those candidates are indentified, IT leaders must also ensure they conduct proper screening for skills needed and certifications required. Most importantly, IT leaders should examine every candidate’s ability to work well with the team. Employers may overlook this cultural aspect of hiring contingent workers, believing the short-term nature of contract work makes this step irrelevant. Eighty percent of IT leaders feel their organizations could improve their screening processes. Taking the time and patience to develop custom screening criteria based on the organization, team and specific project will yield a stronger alignment between the candidate and the role. IT employers can also partner with recruiters to help source and screen potential candidates.
Once hired, contingent workers need to be managed and developed. They need to be brought up to speed when first joining the team, and an onboarding program can help them settle in and enable them to contribute quickly. However, only 18 percent of IT leaders strongly agree their organization has an effective onboarding program, leaving 82 percent of IT leaders citing room for improvement in new hire onboarding. As a result, only 16 percent of IT leaders believe their contingent workers are seamlessly integrated and performing well with the existing team. The strongest onboarding programs outline clear expectations and goals for the new hire, and they also allow the employee to evaluate the new team, leader and organization for long-term cohesion. In this way, onboarding plays a key role in employee engagement and satisfaction.
Once roles are defined, clear expectations are set and new hires get into a daily rhythm, a manager’s job is still not complete. An employee’s performance needs to be managed throughout an engagement. To remain motivated and productive, workers need constructive feedback and encouragement. Managers must define the objectives, skills and behaviors most important to organizational success, and align these attributes with clear performance expectations for their employees. Managers should then set a framework to measure progress toward team goals, and can use these assessments to build career paths and development opportunities for their employees. Next, these expectations should be documented and communicated to each employee. Both employers and employees recognize the importance of a performance management system, yet only 16 percent of leaders strongly agree they have an effective performance management process to supervise contingent workers throughout an engagement. Managing performance for the full work cycle will create a more engaged employee, and an engaged employee will positively impact company performance.
When an assignment is complete and a contingent worker’s contract has ended, IT teams can potentially lose a lot of value. After all, the employee has invested weeks, months or maybe even years contributing to multiple aspects of a project or many projects. The contingent worker has valuable skills and knowledge that an organization needs to retain. But only 14 percent of IT leaders strongly agree their organization has an effective offboarding process, and at the end of the contract, only 6 percent of IT leaders report that they conduct a formal offboarding process where knowledge and experiences are transitioned from contingent workers to internal staff.
When contingent workers complete their projects, they should perform a transfer of knowledge and conduct exit interviews. Effective offboarding ensures this critical insight and knowledge are retained and built into the organization’s operating rhythm. In addition, an effective offboarding program will enable organizations to attract the best IT talent, which is critical as the demand for contingent IT labor increases. Offboarding offers a way for employers to expand their referral potential, as previous contractors can refer their friends and colleagues. Moreover, with an effective offboarding program in place, contract workers will be more likely to act as brand ambassadors for the organization.
Contingent labor is on the rise. To achieve the greatest benefit from an IT team, IT leaders must be prepared to meet the challenges and demands of managing the contingent workforce;now what value the contingent worker can bring to the IT team; understand the motivations of the contingent workforce; welcome and integrate members of the contingent workforce to the team;ensure the organization is prepared with sourcing, screening, onboarding, performance management and offboarding processes; and be willing to provide contingent workers with development opportunities. Taking the right steps to prepare your contingent hires for success will help your IT team flourish.