Approximately 34% of the total workforce in the U.S is freelancing – that’s an amazing 53 million Americans, with the percentage forecast to increase to 50% by 2020. As the amount of available freelancers continues to grow, we should expect companies to embrace this growth by preparing for a boom in on-demand labor – which is where Freelancer Management Systems (FMS) come in.
The current landscape for tech talent management primarily divides between HCM (human capital management) software and VMS (vendor management systems) which allow companies to manage employees and track labor. Though these methods have their merits, neither address the growing freelance market. An FMS solution could therefore be the ideal opportunity for businesses to transform the way that they find talent, manage freelancers, and source independent contractors.
What Does an FMS Do?
Companies that are already utilizing Freelancer Management Systems are discovering new and effective ways to establish dominant SaaS ecosystems for their contingent workforce. The idea considers connecting independent contractors with organizations to get work done well, and the Freelancer Management System aims to deliver a single-sourced, powerful, and one-stop solution to organizing this type of labor.
Though they share similar characteristics, FMS solutions are separate from the traditional web-based staffing platforms that medium and small-sized businesses have been using. While online staffing platforms facilitate one-off, or one-to-one engagements between individual workers and buyers, an FMS allows for an enterprise-wide deployment and engagement model. While still permitting interaction between workers and buyers, the FMS enforces rules and processes across an entire organization.
Freelancer Management Systems are more robust, designed to serve as a talent management system for larger organizations. They work to help organizations discover talent and provide the tools required to manage engagement, thereby creating long-term relationships that grow business for companies and freelancers alike.
The Benefits of Freelancer Management Systems
At a basic level, it’s fair to say that an FMS is beneficial because it gives businesses access to approved contingent talent, compliance services, and workforce program insight and control. Freelancer Management Systems place everything into one neat package, so that you don’t forget anything – from filling out forms to dealing with paperwork. However, the true worth of FMS goes much further than this. Freelancer Management Systems allow businesses to:
- Find the best workers for their job, at the right time, in the right place by allowing for the launch of targeted recruiting campaigns and algorithm-based search capabilities.
- Verify the skills, qualifications, and credentials of the workers they choose using a learning management system and screening tools.
- Engage with workers through real-time communication to negotiate contract terms and manage job expectations. This could also include segmenting workers into groups by talent and skillset for streamlined assignment delivery.
- Manage hundreds of workers at once through a single central dashboard using powerful reporting tools and systems that allow bulk assignments to be loaded into a marketplace.
- Automatically pay workers using a preferred method.
- Rate and evaluate worker performance using quantitative and qualitative metrics and powerful analytics.
It’s no surprise that the adoption of FMS technology has begun to rise over the recent years as the number of independent contractors and freelancers continues to grow. Dated solutions are no longer suitable for managing the distribution of workloads in an efficient and cost-effective manner, forcing businesses to seek out more streamlined options.
Freelancer Management Systems are the Future
With FMS technology, it is possible to manage hundreds of workers at once, consolidating your entire workforce into one fluid organization based on streamlined assignment routing and universal expectations. Freelancer Management Systems can even improve work quality by establishing rigorous requirements for assignments and ensuring that you work with only the most talented group of freelancers available. They also assist in ensuring labor compliance, distinguishing between W2 employees and 1099 contractors, tracking contractor usage, and mitigating compliance risk with updated audit trails.
Today, businesses need to become more engaged and proactive in managing the growing number of freelancers involved with their workforce. The emergence of Freelancer Management Systems is finally making this engagement possible and simple.
This article was originally published online by Business Solutions and was written by Mynul Khan, founder and CEO of Field Nation.