Managing-Contingent-Costs

Are You Measuring Your Contingent Workforce Costs?

A recent article on the DCR Workforce Blog, called ‘Who is Managing Your Contingent Workforce Costs?‘ highlighted that as much as “60% of all contingent labor is unaccounted for in financial planning, forecasting, and budgeting within the average company”.  A truly shocking statistic if it’s true.

 

From our perspective operating a Contingent Recruitment Platform, understanding and tracking contingent worker spend is definitely no trivial matter. The info sits across various systems in different parts of the business which will vary further for different types and different locations. Add to this the often reactive nature of contingent hiring and you can start to see why forecasting and budget control on CWs isn’t anywhere near the established level seen with perm staff who are simply measured via payroll systems with further comp and bens on top.

We have seen recently the major ERP players have invested heavily to provide useful HCM solutions which can counter this inefficiency in business process . This will work for big business but for startups and SMEs I think the challenges and risks are still being understood.

A recent CW event in Amsterdam laid bare the five stages of CW programme maturity with the crucial driver being to understand where your company is on that spectrum. Be realistic and don’t try to accelerate too quickly or you will find these type of forecasting and budget issues stored up, hidden and overlooked as the business finds a way to flex the checks and processes you put in place.

 

 

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