Business managers and owners now need, at the very least, to start thinking about the talent engagement/contingent workforce management future they will be sailing into in coming years and start to chart the course to navigate it.
Delay in doing so could be hazardous.
According to CXC Global, a number of key trends and developments are clearly pointing to the emergence of World Wide Workforce of critical talent which successful 21st century businesses will learn to engage and leverage.
Freelancer marketplace platforms are emerging as extensive aggregators of skilled, educated, knowledge-worker talent across the world and should be viewed as potential new “critical talent” sourcing opportunities, which can be coupled with other contingent worker engagement processes for quality and compliance assurance.
However, to truly function for businesses in this way, they will need to be complemented with the crucial services Work Arrangement Services (WAS) intermediaries – in a way analogous to how limited independent contractor engagements have been handled through traditional “contract workforce intermediaries (i.e., Payrollers, employers or agents of record).
New intermediaries are emerging to support this global labor ecosystem and businesses’ contingent workforce management programs must be extended and new components introduced to make it all function effectively. In the end, technology and Online Work Platforms may be a driving force in the development of the World Wide Workforce, but Work Arrangement Services intermediaries may trump the latter in their importance in achieving a functioning labor ecosystem. It is essential for managers to begin thinking about and exploring how they can develop this new 21st century channel of engaging critical talent.
The world of business engagement of needed talent has shifted dramatically over the past 20 years.
At this time, business are engaging a global workforce for a range of reasons, including the increasing incidence of operating in different countries and the need to access talent that is not available domestically.
The highest impact part of engaging global workforce is more about “critical talent” (diverse, highly-skilled, specialized, individual knowledge workers) as opposed to an “off-shore outsourcing workforce” (a large homogenous population of relatively low-skilled workers).
The dynamic and competitive nature of the economic environment and the ongoing maturation of business practices for engaging and using contingent workers (versus permanent employees) means that the engagement of workers globally will very often occur in a limited, arms-length, contractual work arrangement.
Information technology is and will be a playing a greater and greater role in enabling flexible, contingent work arrangements as the workforce across the world becomes increasingly digitally connected and profiled, making “discovery” and business-to-worker matching of workers eventually become as normal as a Google Search is.
Technology is already making possible global online freelance marketplace platforms that complete millions of work arrangements between businesses and knowledge workers across the world.
Already large numbers of online freelance marketplace, online staffing, and freelance management system (FMS) platforms–what we are calling Online Work Platform (OWP) intermediaries–are becoming a part of the new contingent workforce labor market and procurement supply chain. In addition, we are seeing the evolution of the Work Arrangement Services (WAS) intermediaries, that can provide localized, country-specific compliance, payment, and other “contractor care” services for businesses engaging contract workers all over the world.
These two types of intermediaries will continue to develop and complement one another, leading to the full realization of the World Wide Workforce consisting of millions of “critical talent” workers contingently engaged by millions of businesses—small and large—across the flat-world economy of the 21st century.
The World Wide Workforce is not a far off prediction—it is already happening and, within the next 10 years, will be considered a normal part of business reality and way of engaging “critical talent” in an increasingly globalized economy.
This may seem like a rash assertion when after 20 years businesses are still adapting to the post-industrial, non-permanent employee economy and are still in the process of adopting adequate contingent workforce and blended workforce management processes, systems, and programs.
However, the already established globalized economy and the ongoing tsunamis of technological development suggest continuing acceleration of economic structural changes, including in labor markets.
The businesses that begin now to prepare themselves to navigate and take advantage of these changes and shifts (and begin to learn what it will take to access and leverage the World Wide Workforce) will significantly increase their chances of avoiding the fate of others that will sail over the edge of the flat world.
For this purpose, a WAS is needed to:
provide services on a truly world-wide basis,
provide a wide-range of appropriate services for businesses and workers localized in specific countries, and
have the competencies and technical capabilities to integrate across the processes of an extended CW program that may include the use of internal or outsourced sourcing/recruiting as well as a range of OWPs (whether various freelancer marketplaces platforms or a business’ dedicated FMS).
In a sense, WAS services becomes the essential ingredient that holds together all the other components of engaging and leveraging a real World Wide Workforce.
To date, procurement-driven models of managing/controlling contingent workforce have relied largely on the assumption of upstream supplier performing sourcing and recruiting; however, this assumption is no longer reliable in a world of specialized talent requirements, “on-demand” cycle times, and Online Work Platforms, etc.
Most managers’ mindsets today are still moored in assumptions of full-time, permanent employment of local workers and trying to catch up with the already well-established reality of increasing use of and practices for contingent staffing. However, it is necessary to begin to internalize the new, fast-developing reality of engaging and leveraging the World Wide Workforce as a strategic imperative.
Technology may help us to source a worker with the right skills, but it cannot ensure that the worker is engaged in a way that is compliant and consistent with the normative environment where that person works and lives. That is the crucial role that a WAS intermediary fulfills, for businesses and workers, in the context of the World Wide Workforce.
First of all, a WAS intermediary ensures that a given work arrangement is compliant with and meets the legal and regulatory requirements of the country where the worker is working. This extends to worker classification, application of tax and labor laws, and to ensuring worker payments occur in legal, secure, and culturally appropriate ways. These kinds of services provide a significant benefit to businesses in the form of avoiding serious risks, compliance problems, potential fines and potentially substantial liabilities.
They also benefit the worker in having the work arrangement and payment process occur in a compliant and smooth manner.
In addition, a WAS provides a range of other in-country services that are beneficial to both business and workers. Contractor on-boarding and off-boarding services ensure smooth and compliant transition of workers in and out of contract work roles.
Additionally, a WAS can provide/offer workers customary benefits, like insurance, on behalf of the business engaging the worker. A range of other explicit or implicit “Contractor Care” service can also be delivered to workers. These can include reducing a worker’s administrative burden, providing guidance on certain matters (as would an HR department, if the worker was an employee in a company), and ensuring that the work arrangement and the contract engagement is culturally consistent with the worker’s customs and expectations. It is clear that all of these services would be important to any business engaging independent contract workers anywhere—and vice versa.
CXC Global offer contingent workforce Staffing management, contractor payroll, taxation, recruitment processing outsourcing, and compliant contractor management.