External Workforce Key to Business Agility During Pandemic

SAP | Apr 17, 2020 at 12:15 PM

As companies scramble to hire the external workers they need to meet historically unpredictable demand surges, COVID-19 is redefining business agility.

Healthcare, food, manufacturing, logistics, and retail are among the hardest hit industries, struggling to find people who can quickly come up to speed. From keeping supermarket shelves stocked with food to retrofitting factories that can quickly churn out PPE equipment, the challenges are mind boggling.

To find out more, I reached out to Arun Srinivasan, general manager at SAP Fieldglass, after watching him in a virtual SAP Ariba Live event session. Srinivasan talked with customer Lisa Zak, director of Indirect Supply Management for Human Resources (HR) and Contingent Labor at Medtronic, a global medical technology company with more than 85,000 employees worldwide.

“The supply and demand equation in markets worldwide is so dynamic, and being disrupted so significantly, that practices considered the norm one week ago – in some cases, days or hours ago – are no longer valid,” Srinivasan said. “Companies are adapting talent sourcing channels to quickly get the right external workers they need to the right places while also managing risk. We are seeing a tremendous uptick in SAP Fieldglass activity volume in certain sectors, including healthcare and retail”.

Most urgently, hospitals are adding traveling nurses, technicians, ER-certified staff, and outpatient management staff. Food suppliers need more pickers, packers, warehouse workers, and drivers to get food to communities.

Widespread Staffing Disruption

The cascading impact of COVID-19 is causing havoc with staffing supply and demand just about everywhere. With mandatory shutdowns, remote workers need higher levels of network connectivity, more IT, and other equipment – not to mention set-up help and ongoing support while they are at home. The airline industry may be effectively shut down for fun trips, but millions of call center staffers are working remotely to help would-be travelers navigate restrictions that have left many in limbo – whether they’re stranded or at home, worrying about booked itineraries.

In certain industries, worker mobility is another huge challenge for organizations that are trying to shore up staffing levels. For example, the pandemic’s impact varies across states, provinces, and countries. For all those companies looking to hire external workers, travel restrictions might force them to compete for people in smaller local talent populations. Worker health and well-being is just as important when it comes to travel.

“Our customers want to make sure they are exercising caution and appropriately tracking the movement of external workers,” Srinivasan said. “Before bringing these workers on board, and as they move between worksites, organizations want to conduct health checks, protecting the health and safety of the broader workforce as well. At any point in time, it’s important for companies to have a holistic view of workforce spend for faster response and accurate planning”.

Communication during this crisis is also paramount. This includes contingent workers and service providers who represent 42 percent of workforce spend according to Oxford Economics research conducted before the pandemic. With more visibility into the external workforce, Srinivasan said that SAP Fieldglass customers are staying in touch with all workers as consequential health and safety notifications spike.

Pandemic Sparks External Workforce New Normal

Staffing agencies, consulting companies, freelancers, and others have long been part of the modern talent pool. In the same research from Oxford Economics, almost 60 percent of executives said the external workforce helped them compete in a digital world. In addition, 74 percent of executives reported that the external workforce was critical to operating at full capacity. One question is how COVID-19 and its aftermath will change workforce norms even more.

“Stakeholders in HR and procurement had begun to fundamentally rethink how work gets done with a combination of traditional employees and external workers,” Srinivasan explained. “Now there’s a greater need to build elasticity in the workforce so organizations can ramp up quickly, supplementing the existing employee base through various sources of talent when demand grows”.

He added that many organizations, pressured by the pandemic, have changed how they balance control and efficiency. Some have found that it makes sense to fast-track hiring processes for external workers while following company guidelines and legal regulations.

Workforce Management in Post-Pandemic World

While it is too early to predict what will happen as COVID-19 recedes, more organizations will likely realize the strategic value of external workers.

“In times of crisis, having a solid external workforce strategy that complements your broader workforce approach is what helps companies thrive in the best of cases, and survive during challenging times,” Srinivasan said. “In this fast-evolving market, companies are finding strategic ways to differentiate. Eventually, organizations will look at their entire talent pool to find the best people for the job. One thing is certain: The way work gets done has forever changed”.

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This story originally appeared on SAP BrandVoice on Forbes.