6 Benefits of Contractor Management Software
November 19, 2020 11:59 am
Categorised in: The Blog
You hire contractors. Or temps, locums, freelancers, consultants, or whoever else makes up your non-permanent, contingent workforce.
But right now, you’re spending way more than’s ideal on agencies. Or way longer than’s ideal internally, keeping the whole contractor management process ticking over.
Getting the right people into the right places at the right times and at the right cost probably feels like an impossible equation. It’s like navigating spaghetti junction blindfolded.
And you’re worried about compliance, especially with IR35 reform coming up. And you know delivery’s on the line. Which means your reputation amongst customers is too.
The point is, there’s a better way.
Here’re six reasons that’s contractor management software. (Or freelancer management software or locum management software – whatever you’re calling it).
1. Because you’ll save 000s
The more contingency workers you hire, the more cost-savings you’ll realise with freelancer management software. In three ways.
- You’ll save money on agencies.
If you currently hire temps, freelancers or contractors through a recruitment agency, contractor management software cuts out the middleman. So you have direct relationships and direct control over your contingent workforce.
So when you’re paying someone, say, £200/day, you know you’re getting someone worth £200/day. Rather than someone worth £160/day. (And that’s only a 20% margin. In some industries, you could be paying more – like healthcare’s average 31% staffing agency margin).
Agency margins are fine for short-term gigs, like urgent temp cover. But when you’re running lots of contingent workers for the longer haul – IT contractors for months at a time, say – those margins add up to 000s.
- You’ll save money because you’ll save time.
Even if you don’t rely on recruitment agencies, there’s major cost-saving potential.
Contractor management systems streamline hiring, managing, reviewing, mobilising and giving feedback on contractors – so your hiring managers and recruiters waste way less time on the process. Time they can spend adding value elsewhere.
- And you’ll probably lower your wage bill too.
Contractor management software empowers a more proactive approach to recruitment. That is, you build talent communities and nurture relationships.
Fewer of your roles are desperate, last-minute, throw-mud-and-see-what-sticks recruitment – and that’s the type of recruitment that pushes up prices. Beggars can’t be choosers, as they say.
Contractor management systems put you in a bargaining position of strength, so you can negotiate more favourable rates.
2. Because you’ll minimise risk with zero-hassle compliance
With IR35 reform on the nearing horizon, contractor compliance are the words on everyone’s lips.
(Getting IR35 wrong will be serious – and expensive. If HMRC determine you’re not compliant with IR35 regs, they’ll demand the unpaid PAYE tax and National Insurance Contribution – plus any late payment fines and interest. Plus, a penalty of up to 100% of that again on top, as an extra penalty.)
Plus all the other potential compliance requirements for your industry, like manual handing certificates for care workers. Discovering an accident wasn’t covered by your insurance because a worker’s certs weren’t up-to-date is everyone’s worst nightmare.
Keeping track is easier across your permanent workforce but if you work with lots of contingency workers, it’s worryingly easy to lose control.
Has someone remembered to check that last-minute temp? What about that contractor you worked with loads last year? Are they still up-to-date, or are you relying on assumptions?
Straightforward compliance management is a major benefit of contractor management software. Set your compliance requirements upfront – then the software automatically requests, stores, displays and tracks the info you need.
And sends automated reminders before documents expire, to avoid gaps in cover. (Well, Tribepad Flex does that, anyway…) The point is, managing compliance is too important to be governed by error-prone humans. Contractor management systems protect against risk by automating the process.
3. Because you’ll accelerate time-to-hire
Freelancer management software empowers you to build and maintain warm talent pools. The upshot is, you’ll have people ready-to-go much faster.
And even if you’re currently getting by with your ATS or CRM, they’re not specialist tools for managing contractors. They’re a reasonable workaround but they’re slower and more cumbersome than dedicated software.
That’s OK, if you don’t hire many contingent workers. But the more temps, freelancers, locums or contractors you hire, the more those inefficiencies add up – to slow you down.
If hiring fast matters for your business, contractor management software makes sense.
4. Because you’ll make recruitment easier for hiring managers
- When recruitment takes too long, it’s hiring managers stuck picking up the slack – or letting end clients down.
- When recruitment is demanding and complex, it’s hiring managers stuck working extra hours over their day job. Or dropping the ball on other projects.
- When contractors aren’t the right fit, it’s hiring managers stuck working with them. And hiring managers who’re in the firing line if work isn’t up to scratch.
That’s why a contractor management system is great for hiring managers. Because it makes hiring, reviewing, managing compliance, mobilising, giving feedback and rehiring freelancers totally painless.
Even if managers only hire a few favourite freelancers, contractor management software makes sense because it creates a central hub. Managers can see all relevant info – like communication history, past jobs, contracts and pay rates – in one place.
Driving cultural change amongst end users like managers is often a big barrier to implementing new tech. It’s a much easier path if your end users see immediate value from the software.
Plus, from the business’ perspective, this central system means nobody can go rogue – like poaching freelancers from other teams or offering unauthorised rates.
5. Because you’ll improve contractor relationships and loyalty
Contractor management software isn’t just an internal process improvement tool. It’s not only about introducing efficiencies. Rather, such systems actively drive top-line growth, by improving relationships with the contractors who deliver for your customers.
Take a temporary carer, for example. If your relationship’s bad, that could translate into the carer having a bad attitude. They’re certainly less likely to go the extra mile for you. But the problem is, ‘for you’ really means ‘for the people you care for’.
The same’s true in every industry, wherever you use temps, locums, contractors or freelancers in a customer or client-facing capacity. They’re the face of your business. You’ve a vested interest in having a great relationship with them.
That’s where contractor management software adds value. (Or good software, anyway!)
Take Tribepad Flex. With a mobile-first self-service interface, profiles parsed straight from LinkedIn, intuitive availability and custom rate settings, automatic rate calculators, job summary pages and one-click applications, we constantly hear that contractors love using Flex.
They get paid the right amount, on time, without chasing. They only get contacted about jobs that’re a great fit, when they’re available for work. They don’t have to send information multiple times. They get clear onboarding info.
That’s a roadmap for easier relationships that translate into more loyalty and better on-the-job performance.
6. Because you’ll improve reporting – for better cost-control
When you have a dedicated tool for managing contractors, you have heaps of useful data about those workers. And that data’s easy to access, because it’s not siloed across multiple systems or hidden behind complex queries.
Answering important questions suddenly becomes easy. Questions like:
- What did we spend on temps last year?
- What did we spend on contractors this year compared to last?
- On average, how many contractors do we hire more than once?
- On average, how many days do temps work for us in a row?
- What’s our average time-to-hire broken down by site?
- Are there any trends about when and where we hire temps?
And when you know that stuff, you can spot problems – and opportunities to improve.
Like, maybe you’re using many of the same contractors reliably – would they consider coming onto payroll instead, to lower your wage bill while increasing their job security?
Or perhaps your time-to-hire is consistently higher for one site, so you can investigate further. Maybe the cost of parking is higher, so your pay rates aren’t as competitive.
And you can build reports that prove ROI, to engage stakeholders and bolster your credibility, proving you deserve a seat at the table. Invaluable for the next time you’re building a business case.
Three factors: Flexible, scalable and intuitive.
Investing into contractor management software can feel like a big step. Is total in-house talent management realistic for us? Will the training burden be too big? What if we change our workforce composition?
The truth is, adopting a new way of managing your contingency workers does take some adjustment. But we’ve worked with a number of businesses – including the BBC, who use Tribepad Flex to manage all their global freelancers – to make the adjustment an easy one.
The key is to choose a contractor management system that’s flexible to your exact needs, scalable if those needs change and intuitive for recruiters, hiring managers and contractors to use.
Find out why that’s Tribepad Flex here. Then book a demo to see under the bonnet.