Getting full value from external talent

strategy+business, July 25, 2019

by Theodore Kinni



Photograph by Hero Images

Many recent studies of talent include some version of the prescriptive advice in PwC’s Preparing for tomorrow’s workforce, today report: “Harness the potential of flexible talent and innovation.” The wellspring of flexible talent and innovation is the contingent or alternative workforce — these days, that includes the fast-growing ranks of freelancers, independent contractors, gig workers, and the crowds whose collective genius companies can tap to address a variety of challenges.

The problem, as the PwC study found, is that 92 percent of companies are not managing these contingent workers as effectively as they could. Even as companies rely on contingent workers in ever-greater numbers, they often make it difficult — if not impossible — for them to contribute in full measure. Leaders need to do better.

This didn’t matter much 30-something years ago when I became a full-time freelancer. Most industries had little use for contingent workers then, and most workers wanted “real” jobs on the payroll. By 2017, however, 57 million American workers identified themselves as freelancers — that’s 36 percent of the workforce and nearly 50 percent of millennials. And contingent workers are in demand in a host of industries for a host of reasons. These include (but are not limited to): the record low unemployment rate, shortages of talent in emerging capabilities arenas (like AI and robotics), and the growing numbers of business models and workforce strategies that depend on contingent workers.

Yesteryear, managing contingent workers was something of a contradiction in terms. It seemed like a major reason to hire independent contractors was that you didn’t have to bother managing them. If there was a problem, the relationship could easily be terminated with a minimum of cost or conflict. And regardless of how well contingent workers performed, it was the rare manager who thought it might be worth cultivating an ongoing relationship. The operative managerial mind-set was “here today, gone tomorrow.”

That mind-set has been transformed over the last decade, as contingent workers have become more central to more companies’ operations. Read the rest here.