Why Field Services Organizations Should Embrace an On-Demand Delivery Model
By Mousa Ackall, Director, Work Market
So, what can field services organizations do to ensure they have what it takes to operate in a modern, unpredictable world? And with qualified talent in shorter supply than ever, how can they hire the best technicians to dispatch to their customers quickly and effectively?
The Status Quo is Insufficient
As the field services industry continues to change, organizations must be able to change with it. This means adopting new tools and strategies that enable them to compete and operate sustainably. Unfortunately, many organizations continue to rely on outdated methods that have proven to be insufficient in today’s complex and fast-changing environment.
For instance, many companies still rely on a workforce consisting primarily of W-2 employees to run their field operations. Yet, maintaining such a large, fixed-cost workforce, and the associated payroll and unemployment taxes, can limit financial flexibility. It can also hamper operational agility, as the organization typically must fly their employees around the country to various project sites. Therefore, it can be difficult to be responsive to customer and market opportunities with a legacy workforce model.
Even for companies that do leverage contractors to supplement their traditional workforce, many still use manual processes like spreadsheets and phone calls to track their contingent workers. Such outdated processes are often costly, time consuming and prone to human error. Those that have sought to leverage new technologies to automate some parts of the process often use a fragmented approach. They may rely on one software solution to recruit talent, another to manage their talent and a third for bookkeeping. However, the lack of a centralized strategy means their data is in disparate locations, and they miss out on a comprehensive view of the information and analytics needed to guide their processes.
Another problem area for field services organizations is the use of third-party staffing companies. Although they have leveraged these partners to grow their footprints, the reality is that they often lack visibility and control around who showed up to do work at their client sites. Moreover, despite the promise of convenience, many still manage a majority of the service event anyway. And, as the partner ecosystem continues to expand and the value chain becomes ever tighter, margins begin to evaporate and the model becomes too cost prohibitive.
As the field services industry continues to change, organizations must be able to change with it
The Rise of On-Demand Talent
The field services industry is currently undergoing a revolution. The confluence of mobile technology, changing societal habits and new ideas about work has altered the way in which services are delivered and consumed and has brought new possibilities to field services. The main driver of this change? The growing freelance workforce. Recent research from Ardent Partners shows that freelancers and independent contractors currently make up 32 percent of the U.S. workforce, and this number is expected to rise to 50 percent by 2017. The emergence on the on-demand talent pool has allowed field services to synchronize their labor supply and demand in real-time, giving them a more agile approach to service delivery.
The value of using this model is clear; in an unpredictable service world, the ability to operate cost-effectively and scale the workforce according to business fluctuations is key to operational efficiency. By embracing the freelance workforce, field services organizations can benefit from a variable cost model, reducing their W-2 workforce expenses and boosting margins by sourcing talent directly. They can also expand market coverage, building an on-demand workforce of qualified contractors around the country, closing skills gaps and gaining access to new markets to further drive growth. Moreover, field services organizations can ensure a nimble workforce able to meet customer demands more quickly, reducing response times, improving customer satisfaction and ultimately outperforming their peers.
A Modern Approach to Service Delivery
Recognizing the value of the on-demand workforce is only the first step to optimizing field service delivery—organizations will also need to implement the framework to build an effective freelance management strategy. Typical steps include:
• Identify coverage and talent needs: When transitioning to an on-demand workforce, it is important to understand current market coverage, biggest coverage gaps and where the company is looking to expand. Just as crucial is to determine the type of talent that is needed and the specific skills, certifications and insurance required.
• Implement compliance controls: When shifting to a workforce of 1099 contractors, businesses must comply with all state and federal labor guidelines. As a result, proper reporting capabilities and audit trails are key to mitigating compliance risk; ensuring workers are classified properly is equally as important.
• Ensure alignment: As with any process change, the move to leveraging an on-demand workforce will require new processes to facilitate the management of the on-demand workforce. Determining the new roles and responsibilities of key stakeholders is essential to achieving proper process alignment.
• Define success: With the plan in place, it is important to define what success looks like, by way of the cost and value metrics the company wishes to improve. Conducting weekly and monthly reviews will help gauge the process of the roll-out and identify areas for improvement.
• Leverage the right technology: Once the strategic plan is in place, the final step is to adopt the technology solution that can facilitate the transition. A SaaS-based solution is ideal, enabling a quick, easy and affordable process. It should also enable a centralized approach to each stage of the freelance life cycle, from recruitment and onboarding to training, dispatching and compensation. Such on-demand workforce technology can revolutionize how field services organizations leverage contractors and benefit from the changing face of the workforce.
Achieving Success in a Modern World
As workforce models continue to evolve, field services organizations must be able to keep pace. This means not only embracing the freelance workforce, but also adopting the technology solutions to manage these workers seamlessly. By rethinking their people strategies and leveraging the on-demand workforce to optimize labor costs, enhance service quality and drive operational efficiencies that enable them to thrive, field services organizations will be able to overcome their most pressing challenges and gain a significant advantage in this dynamic, highly competitive world.