Pros and Cons of Flexible Workforce
Table of Contents
In the world of technological advancement and restrictions caused by pandemic we must be flexible to balance for success. In this article we discuss what flexible workforce is, advantages and disadvantages of a flexible workforce and how to implement it in your business.
What is a flexible workforce?
Today many organizations in an effort to remain competitive and dynamic increasingly rely on the services of external specialists whom they hire around the world in a variety of ways, sometimes beyond the traditional employment model. The globalization of labor and technology markets provides companies with an excellent opportunity to continually experiment to fill talent gaps while saving on staff costs. This process is called flexible employment.
To be more precise, flexible workforce is the employees which are hired to help company achieve its goals within the time limits overcoming difficulties appearing on the way, e.g. geography, skills, organizational issues, etc. It is a chance to adapt to circumstances using required resources without fixation. This allows finding solution much faster and reducing costs while focusing onto results. In this case, new people are hired occasionally to work on a specific project or task, when there is no need for a permanent employee. For some job positions it means no 9 to 5 routine and remote \ distant \ in-office work options or contractual\freelance employees to perform the task. Organization decides itself how to meet its own needs. However, flexible employment is not a magic pill, it has pros and cons which you should know.
Advantages of flexible workforce
As any other innovation implementation of flexible workforce can be risky, but it brings a lot of positive changes with it. For example:
Advanced search for cadres
There is ability to hire professionals from all over the world. High percentage of flexible workforce is remote employees who can perform the tasks from a different country without physical presence onsite. They can be the most appropriate and qualified persons for a particular job, but unable to move closer to your office location. Or this particular skillset in not required constantly, so you hire a professional only for a certain period. This is a good compromise for both of you.
Meeting employees needs
Satisfaction of every generation of employee becomes higher when differences are considered. Today we can witness an amazing phenomenon when 5 generations of workforce presented in the market. But all of them are focused on different values and want different things from their work. Baby-boomers think about soon retirement and social package, generation x is concentrated on balance between professional and personal life, millennials are looking for realization of their potential, and Gen Z is craving for equality and democracy. While giving all of them right to choose the most suitable work scenario, we also make them happier about their workplace (read “more motivated employees”).
When you have less permanent onsite employees, you are able to save tons of money. First of all, paperwork is cut significantly, while freelance services are used. You do not need to follow all the bureaucratic hoops while hiring new cadres. And you do not need to compensate many formal expenses if they are working remotely, e.g. transportation, meals, office supplies and even working space. You basically can have a small building for meetings or permanent workers when the rest are working from home\co-workings\coffee shops.
Control of staff size
You are able to vary number of your co-workers according to seasonal demands. Maybe your business does not require every employee or even department all the time. You can hire specialists occasionally taking into account your current needs. Outsourcing will save you money on several job positions.
Loyalty and productivity growth
Freedom is appreciated by workers. In the era of burnout rise, ability to have flexible conditions is vital. If employees do not have to obey strict regime, they will have more energy for more important sides of the work. With best cadres you will also be rather focused on productivity than location or some administrative issues.
Less responsibilities for managers
Among benefits of having a flexible workforce is also some perks for management. As you have temporary workers you could spend fewer resources on them in a long run. You do not need to invest emotionally and build a strong bound or reward system to motivate temporary cadres. They are likely to be eager to perform their duties on a high level.
Disadvantages of flexible workforce
Flexible forms of employment characterize an increase in the diversity of opportunities for a fuller use of people’s abilities, their human potential and overcoming the limitations of standard employment. At the same time, the risks of replacing strong social networks arising from stable labor relations with situations in which individuals become isolated, insecure and alienated are increasing. The most common problems are:
As you cannot meet on a regular basis your communication may suffer. Not everything can be done via Zoom conferences. Different time zones, bad connection or poor sound quality and other problems influence the level of understanding and sometimes slow down the interaction. Sometimes it also can be hard to deal with new contractual employees due to personal reasons. And you simply do not have time to accommodate yourself to them.
Before starting work new employees usually receive practical instruction on what and how to do. But with temporary workers training cannot be fulfilled properly or takes time originally meant for other regular tasks. When managers need to train and educate new cadres they are doing it instead of other important work. And it is dangerous for productivity in long term.
Lack of inter-personal bound
Connection between employees without real life contact is weak. People tend to sympathize and work better with those who they know personally. All these informal chats during coffee breaks are glue in forming productive cooperation. Without them we can have organizational silos.
Less trust for a new worker
To see is to believe. But what if you have not ever seen your subordinate? You do not have time to get familiar with freelancers if you happen to work with them only from time to time. They may be not as reliable as they mentioned in their CV.
Bad customer service
Your clients are core value for the business. When you have only contractual workers it is possible that some responsibilities may not be covered on a daily basis. In certain occasions it results in delays which negatively affect customer service.
However, all of these problems can be easily solved with the right approach to staff management. You can create environment where even those who work only for a several days can feel as an important part of a team and offer high quality service.
Flexible workforce implementation
Many executives report that their organizations are increasing the use of freelance professionals. And although the price of the issue certainly plays an important role, nevertheless, according to managers themselves, the main advantages of such people are their flexibility, speed and ability to innovate. In other words, it’s not that they cost firms less, but that they perform better.
However, despite the fact that freelancers can completely change the alignment of forces and resources in business, they are not at all a panacea for all its ills. There is no single, accepted by all model of their management. Companies generally take three distinct paths. The first is hiring such people as an exception to the rule (predominantly using the traditional HR business model). The second is strategic support (moderate use of high quality freelancers, primarily to strengthen rapidly changing strategic directions). And, finally, the third way is the strategy of a complete transition to a flexible labor market (a transformational approach characterized by the predominant use of contract labor).
What other businesses prefer
The model aimed at strategic support of certain areas is the most interesting considering that it is precisely this model that we increasingly observe in the largest and most successful companies, like Unilever. At the moment, very few organizations are leaning towards a fully flexible workforce strategy. At the same time, in a series of workshops with middle managers and heads of human resources, more than half of the participants noted that their firms are slowly but surely moving towards attracting freelancers to expand their capabilities in certain rapidly changing strategic areas. For example, Apple hires external designers in this way, Rolls-Royce Aerospace hires engineers, and Workday hires systems implementation specialists.
Build a network of professional contacts
Mid-level managers who rely solely on Human Resources to find freelancers tend to find themselves in a difficult situation. Smart managers use their connections to make sure that the right people are recruited with the right technical skills and work discipline. These managers know how to build relationships and understand how important it is to take care of the high-quality selection of talented people that the organization needs so much in advance. They pay close attention to their professional network and spare no time and effort to support and develop it.
Get a good start to your work and relationship
Good managers know that outside professionals need to be well-informed so that they can get started right away with full energy. It is necessary to set clear intermediate and final tasks for them, determine a well-thought-out work schedule for them, agree with them on the expected results. In addition, early on, help them build working relationships between them and their colleagues within the organization. And while such concern for “outside” specialists may seem strange and contrary to common sense to you, you need to keep in mind that the likelihood of your project’s success is significantly reduced in cases where hired talents do not fully understand the task assigned to them and their role.
How to create flexibility step by step?
- Use flexible strategy. Rethink your resource planning and start relying on experts outside your staff.
- Have standards for hiring. Define the procedure of searching and managing new cadres.
- Find a good marketplace for employees searching. You can become partners with the platforms offering freelance services. It is much cheaper than asking a consulting firm to find someone for a vacancy.
- Be clear about responsibilities assigned to your flexible workforce. They must be sure what exactly you want them to do.
Flexible workforce is becoming more popular every day. But as any other business strategy it is not flawless. And it is up to you to decide whether to try it or not. Just remember, that with good management you can overcome any difficulties.