3 Ways to Align HR and Procurement on the External Workforce

Procurement has grown into a strategic sourcing organization for many businesses, handling complex and high-risk purchases as well as invoicing. As procurement has moved toward taking on operations efforts and a more strategic role, HR services are often purchased with procurement as an envoy. At the same time, many organizations have found that the services that were once primarily held in procurement, such as the hiring and management of the external workforce, are now requiring more HR involvement.

With HR and procurement growing closer, it’s difficult to reconcile the vast budget that HR needs for acquiring top talent with procurement’s emphasis on reducing costs. Bridging these departments is something that managed service providers (MSPs) such as KellyOCG do every day. “The balancing of the cost-effectiveness that procurement craves with the talent quality and worker experience that HR champions is not mutually exclusive, and achievable to foster a win-win for the business and the workforce,” said Basant Abraham, VP MSP, KellyOCG. By creating a solid partnership between HR and procurement, you’re building a functional team to leverage the contingent workforce to meet talent acquisition goals without breaking the bank.

Building the Partnership to Streamline the Management of Your External Workforce

Here are three key strategies for creating a relationship between HR and procurement that benefits both your business and your external workforce.

1. Share the management of contingent workers between HR and procurement.

Contingent workers need more than just basic management. By leveraging the core competencies of both procurement and HR, you’re building a better experience for external workers overall, and dividing the resources needed to support contingent workers among a larger part of your business.

For example, procurement often manages the reconciliation of invoicing, which supports the most important issue for contingent workers: how they get paid. However, procurement doesn’t have the bandwidth to ensure that every new contingent worker has properly filled out their onboarding materials. HR is better suited to attracting and mobilizing external workers, such as contractors, gig workers, or consultants.

Sharing the responsibility of managing contingent workers provides the external workforce with support for their needs across the board. Whether it’s getting paid or slotting them into the right team to fill a much-needed skills gap, contingent workers will reap the rewards of a partnership between HR and procurement, and the business will maintain a more holistic talent strategy.

2. Find common ground and compromise when making decisions that affect contingent workers.

Even when you’re consistently bringing HR and procurement together, it’s important to consider contingent workers in these decisions. Providing detailed data on how your contingent workforce program is performing is just as important as worker feedback. “HR and procurement can sometimes feel like they’re on opposite sides of the table. But with strong sponsors in both corners, the key is finding common ground. Focus on the company’s goals, and be willing to compromise. It’s about finding the best talent, but also making sure it’s a smart use of resources,” said Jacquillia Hooper, VP global MSP solutions, KellyOCG.

Emphasizing company goals and working together to not only find efficient ways to manage contingent workers, but to also provide them with the support they need is crucial. Sharing everything, from data insights on costs to worker surveys, is a way to get both HR and procurement on the same page and ready to compromise. You may even find that streamlining your processes to conserve resources can also benefit the workers who gain a simpler way to complete their work.

3. Find technology that simplifies processes for both HR and procurement.

Technology to support the contingent workforce is essential. Rather than treating your external workforce like a line item in an invoice (which lacks visibility) it’s important to treat external employees as just that—employees. Of course, this requires ongoing compliance with local legal requirements for contractors, gig workers, and so on, but your business still needs a way to manage them compassionately.

The right technology can bridge the gap between HR and procurement. For example, a vendor management system (VMS) can provide talent management tools as well as a simplified way to pay your external workers. Having technology in place to help manage your workers is key, but that technology should also make sense for both your HR and procurement teams.

The value of a VMS comes in many forms, but one value is that it becomes a shared hub for all of your contingent workforce needs. This means there is one place for your workers to find everything they need, while your HR and procurement teams can easily manage their various responsibilities related to the contingent workforce.

Benefitting Workers and Businesses Alike

Adopting a total workforce strategy that considers both full-time and contingent workers from the start is a key aspect of continuing to build the relationship between HR and procurement. The right technology in place, and both HR and procurement ready to collaborate, provides workers with the support they need while also streamlining internal processes for managing those workers. When looking to start providing bigger benefits to the external workforce, the relationship between HR and procurement is the place to start.

To learn more about the external workforce, their role in bolstering organizational agility, and how they fit into a skills-centered talent strategy, read our e-book The Future-Ready Talent Strategy.