Why procurement and HR should collaborate to manage the external workforce

Talent is the difference between a company’s success and mediocrity, so it’s critical that leaders know who works for them, and if their skill needs are being met.

To best manage a total workforce, there must be a partnership forged between procurement and human resources teams, especially when working toward visualising and managing the external part of the workforce. Enterprises with this established relationship benefit from efficient processes, best-practice approaches to sourcing talent, adherence to policy and increased communication, which set the right tenor of their programme.

The first step is to figure out what constitutes your existing external workforce programme, including the key stakeholders and your existing organisational processes for sourcing contingent labour and services. From there you can determine how to best manage these elements together.

This first step may be the most challenging, as a recent Ardent Partners report noted fewer than 35 per cent of enterprises currently aggregate their external talent under a single, centralised strategy. Procurement and HR teams may be aided by establishing a programme office that is managed internally, or through a managed service provider. Adoption of technology that centralises many elements of an external workforce programme, like a vendor management system (VMS), can also aid in goal setting and organisation for managing your external labour and services.

A best-in-class external workforce management programme establishes defined roles and responsibilities. Its success will depend on how effectively ownership of strategies, plans and initiatives are outlined. The easiest way to split up ownership is to let the experts lead. Procurement specialises in contracting across the supply chain, managing vendors and overseeing their success, while human resources brings policy guidance and recruiting expertise to the table. It will be important to set attainable goals, and to acknowledge short-term successes.

The knowledge exchange from this collaboration, and adoption of a VMS to seamlessly support the external workforce programme processes, will help both teams find success in their roles. Procurement will learn the needs of HR including the road-map for upcoming full-time employee hires and may be able to support them through strategically sourcing workers with an eye on conversion. HR will learn how to better manage vendors, suppliers and market intelligence. Additional benefits include: Streamlined onboarding and departures, invoicing, finance and payment processes for contractors and services.

This more strategic partnership, supported by technology, will standardise traditional contingent workforce management processes and provide a total view of your external workforce. The overall result will be a best-in-class external workforce programme that allows you to easily identify strengths and weaknesses of your talent pool.

Arun Srinivasan is vice president of Strategy at Fieldglass

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