Discover how utilizing contract resources during tumultuous times can help companies innovate.
As businesses slowly reopen, the work environment of 2020 is nowhere close to being back to “normal.” Some have called it “the new now.”
In the best times, small- to mid-sized businesses face innumerable challenges – and these are not the best of times. Since the COVID-19 pandemic hit, existing business challenges have magnified, and new challenges have piled on top.
“This pandemic has either forced companies to temporally close or to move to a virtual environment. Regardless, what was once a mainstay of nearly every business – face-to-face interaction with coworkers, clients, and customers – is either a distant memory or has profoundly changed,” said Elizabeth Eiss, Founder and CEO of the talent curation and freelance recruiting platform ResultsResourcing.
“In addition, demand for products and services is down or uncertain across the board. This means that not only is a business facing uncertainty, but that company’s vendors and customers are also dealing with uncertainty. The traditional levels of supply and demand have changed. The old rules don’t necessarily apply today.”
When the economy is volatile and flow is uneven, there are very few aspects that a business owner can control. A company’s talent strategy is one of those very few areas.
Most companies spend between 15 and 30 percent of gross revenue on payroll expenses. However, this varies from company to company. For example, some service industries can spend up to 60 percent on payroll and remain profitable.
When times are stable and cash flow can be predicted reliably, it is easy to maintain this payroll percentage. However, when cash flow becomes unpredictable, this percentage can quickly fluctuate to unprofitable levels. This leads to payroll cuts and layoffs, meaning essential employees may be lost forever.
2020 further complicated matters because businesses are not merely dealing with economic uncertainty. There is also a potentially deadly pandemic that has forced every company to radically restructure how business is done. Whether that means plexiglass shields separating employees and customers or the move to remote working, every company has had to rework its business model.
“This move to virtual and the realities of the pandemic are forcing small- and mid-sized businesses to rethink how they add value. said Eiss. “Even with the ‘end’ of the pandemic, these issues will not go away. It will be some time before people resume old behaviors with indoor spaces, like offices, shopping places, and theaters.”
A nimble talent strategy is a method to help companies keep costs steady and predictable while being able to quickly scale up (and down) as needed.
“The first step when shifting to a nimble talent strategy is for business owners and management to clearly identify the company’s core value. What is it that customers will continue to pay for during these uncertain times? Next, they need to refocus the business around that core value. A significant part of that refocusing is identifying employees with the essential skills and relationships to deliver the core value,” said Eiss.
“The next phase is a review of the non-essential roles that still provide support to the core value delivery. These are the roles that can be performed by outside talent.”
Outsourcing possibilities include working with contract professionals or partnering with a complementary business. Even the hiring of independent professionals can be outsourced to a contract recruiting provider, especially if the business has limited HR/hiring expertise.
“Collaborations with quality contractors can deliver a high level of skill, dedication, and commitment that businesses historically counted on traditional employees to provide. Since many contract professionals are often owners of their own businesses, the commitment to serve may be even stronger than a staff employment arrangement,” said Eiss.
“A nimble talent strategy is a fundamental shift in thinking about flexible access to talent, rather than acquiring talent, which is the more traditional option. A business can build a supply chain of skills and abilities – core employees and on-demand contractors – that can easily be scaled up or down, as needed.”
Not only does a nimble talent strategy provide flexibility to a company, but it also routinely brings in diverse viewpoints that expand business horizons.
“Contractors often work with a varied portfolio of clients,” said Eiss, “and talent skilled in different markets brings independent thinking and expertise to the table affordably. These impartial views can help small- and mid-sized business reach the broadest possible markets for goods and services because they give insights to the needs of specific markets.”
Due to economic uncertainty and fears of a second COVID-19 wave (even as the first wave remains strong), employers are in the difficult position of achieving performance benchmarks while reducing overhead costs. A nimble talent strategy enables companies to quickly adjust to add specialized expertise on demand, keep overhead costs low (and steady), and adapt to or create a virtual work environment.
“Nimble talent strategies help a business bring in the expertise it needs, as it’s needed, to complement the staff that delivers core value. Additionally, virtual engagement is a necessity of ‘the new now.’ So, contractors skilled at virtual can be leveraged to make a company’s virtual work more effective and virtual customer events more engaging,” said Eiss. “This ability to add specialized expertise on demand gives companies the ability to succeed even during turbulent times.”
Are you looking to create growth for your business? Discover easy-to-implement business growth strategies through our FREE webinar replay, "Getting Back to Growing While Minimizing Risk!" Download Now!
Optimize your results by signing up to our newsletter and staying informed with the latest insights, tips, and news on meeting your talent needs.