The New Staffing Reality: Workforce-as-a-Service

Posted by Peter Cannone, CEO of OnForce

Let’s face it. The dynamics of the workforce have radically changed over the past few years. Unemployment is holding steady at 7.4 percent. Unsteady economic growth is prompting employers to think twice about their staffing models. And without the safety net of employer benefits, a lot of talent is switching from being a traditional W2 employee to join the growing ranks of independent contractors. In fact, when it comes to IT professionals, 60 percent of them willingly joined the independent workforce.

What all of these factors have created is a new staffing model where businesses bring on skilled professionals for short-term assignments. For example, let’s imagine you need extra hands to quickly seize a hot market opportunity or you want to reallocate your staff to focus on a new initiative, yet need to sustain your existing product line. For companies in various stages of growth and development, the independent contractor model makes sense because it allows businesses to focus on operational efficiency and maximize productivity while reducing, if not completely eliminating idle time.

Of course, the concept of hiring 1099s is not exactly new. In many scenarios, a former colleague or a friend-of-a-friend was brought in for a specific task. What is new, however, is the way that independent contractor talent is identified, vetted and secured.

PREMIUM CONTENT: Online Staffing Platform Businesses ‐ 2013 and 2014 Industry Segment Forecast

Specifically, advances in technology enable us to not only access a skilled pool of talent that is located right under our noses, but also publicly share feedback on our experiences with the independent contractor. This way, we’re able to find the right talent when it’s needed, a.k.a. “Workforce-as-a-Service” (WaaS).

Going beyond job boards, online marketplaces or social media sites to identify and hire talent for short-term assignments, the WaaS model has three critical differentiators.

1. Each assignment is fully protected with insurance against general liability, workers’ compensation and errors and omissions.

2. The contract professional is properly classified as a 1099, therefore mitigating risks for the service buyer.

3. There is a 100 percent service buyer satisfaction guarantee to support quality outcomes before the independent contractor is paid for completed work.

Let’s examine these three differentiators a bit more closely.

The insurance factor is significant yet can be easily overlooked. What service buyers and independent contractors need to be mindful of are gaps in coverage that can expose both of them to risk. Before a contract is put into place, make sure that the assignment is not just partially covered or that insurance is optional. You need the guarantee that each assignment is fully insured before an independent contractor arrives to a job site.

As for the second differentiator, we’ve all seen or heard about the huge financial burden associated with misclassification of independent contractors. As more businesses look to the WaaS model, they need to be sure due diligence is executed when it comes to properly classifying independent contractors.

Finally, in fairness to all parties involved in the engagement, satisfaction ratings must be consistent and specific to the task.

WaaS is the natural, next step in the evolution of our workforce. Yet for the model to be successful for service buyers and independent contractors, both sides must agree to and enforce the principles outlined by those three critical differentiators.

Firm Takes On-Site Approach to Online Staffing at Enterprise Level

Online staffing and services firms continue to roll out enterprise-level offerings for large customers. OnForce, an online services provider, last week announced two new enterprise-level offerings — its “workforce expansion” and “workforce optimization” services.

OnForce allows client companies to find independent contractors online, manages the flow of work and facilitates payments. Buyers can find independent contractors online or use OnForce to build a network of independent contractors through its database of U.S. and Canadian independent contractors.

Online services is one part of the "human cloud" category that includes online staffing (firms such as Elance and oDesk) and crowdsourcing (firms such as Crowdflower).

OnForce differs from other types of online staffing and services firms in that buyers use its online platform to send independent contractors directly onto a site where work is to be performed. On other online platforms, the work takes place entirely online.

The company’s workforce, for now, includes information technology specialists and consumer electronics specialists (whose work includes product repair).

“We provide a variable workforce virtual engagement, but do local delivery,” said CEO Peter Cannone.

It’s “workforce optimization” offering will design a customized workforce model for enterprise customers, an optimized labor plan and provide key performance metrics.

The “workforce expansion” offering allows large companies to add to their workforce to expand a product line or conduct a new product rollout. One example is a cable television provider who wants to provide network installation along with other installation services provided by its workers so customers have one place to go. Instead of hiring more workers, the company is providing the network installation through the OnForce platform.

Resource - Staffing Industry Analysts

New Offering Shifts Online Staffing Model

By Andrew Karpie

OnForce, a provider of platform services that enable businesses — like cable companies, electronic equipment providers, etc. — to engage and dispatch “field service contractors” across the U.S., has introduced a set of service offerings that enable any kind of large enterprise to deploy an IT-related “managed contractor workforce” in almost any U.S. location.

OnForce announced yesterday it is introducing two new service offerings coupled with its sophisticated online contractor management platform. The company places both of these service offerings in a new enterprise workforce solution category that it calls “workforce-as-a-service.”

Effectively, workforce-as-a-service provides an enterprise with a fully managed workforce of contractors who can perform work assignments on demand. But unlike a managed service program/vendor management system kind of model, where contingent workforce suppliers (like staffing firms) are managed as vendors, in this model OnForce manages the contractors directly, and provides crucial services such as workers’ compensation, general liability, and errors and omissions, as well as risk mitigation for misclassification of independent contractors. In this sense, OnForce acts as a general contractor, but one which can provide different kinds of (highly-flexible, even on-demand) managed contractor workforce service offerings based on its digital platform.

The two managed workforce solution offerings being launched are:

• Workforce Optimization, a solution is designed for businesses that need to increase operational efficiency and maximize productivity due to a variety of reasons such as the need to sustain existing product lines while new ones are in development. 
• Workforce Expansion (a solution designed for companies that need to rapidly expand to support a product rollout or new line of business, especially in a new geographic market area.

This is an important development in the shift toward online platform models enabling innovative, flexible, on-demand work-outputs for large enterprises. Online platforms typically have been leveraged to support remote freelancers in virtual work categories like software development. Now we are seeing online platforms deliver ‘boots on the ground’ in offerings that shield businesses from independent contractor compliance and similar risks. These new offerings are unique in that they provide companies with a “managed workforce” service that delivers work outcomes as opposed to workers.

Resource - Staffing Industry Analysts

What Lurks Beneath? A Tectonic Shift in the Work Arrangement Landscape?

Earthquakes occur when sufficient stress has built up along fault lines, such that the earth moves all of a sudden, and what’s on the surface is often drastically altered. Things in our 21st century world are now happening so quickly that we rarely pause to examine what changes actually occurred and how those changes overtook us (they often come quietly from behind).

Just over the past 20 years, we have known many such instances. One of the most visible ones (you can think of all the rest!) was the advent of iTunes. Prior to that, we were all very comfortable with our time-tested way of consuming music: we would own our own player devices (phonograph, Walkman, CD player) and we would buy our music on some corresponding physical medium (vinyl, cassette, CD containing the IP/content we desired) from some retail outlet (first a physical store and eventually an online store like Amazon.com).

Even as digitization set in, this old pattern or form of arranging access to musical content we did not own — but could pay to use — did not change right away. But at some point — after internet, MP3 technology, and Napster — it did (rapidly and completely). At some point, technology, economic forces, human behavior shifts brought about a major shift — not some major discontinuity or leap in underlying technologies or a suspension of the laws of supply and demand (or laws of intellectual property, for that matter), but a substantial change in how access to music was structured or arranged.

So is such a shift possible in the world of “work arrangements?”

Until quite recently, human capital-related information technology (including HCM and TMS) has not had much impact on the shape of “work arrangements.” Job Boards did not change the form of the traditional permanent employment work arrangement, and Vendor Management Systems (VMS) did not change the form of the traditional contingent/temporary/SOW work arrangements. Both of these information technology developments basically targeted improvements in talent supply chain performance, not the “restructuring” of actual “work arrangements.”

However, over the past six years, a set of forces has been converging (these include, increasing global economic competitive pressures, businesses requiring more flexible workforces and scarce talent, and changes in workforce demographics, expectations, and preferences). These forces, mixed with new possibilities engendered by integration of technologies like social, cloud, mobile, et al, have been having significant impacts on work arrangements (actually spawning new forms). Perhaps one of the most radical of these has been “crowdsourcing” work arrangements, while one of the most pervasive has been “online freelancing” enabled by online staffing platforms like oDesk, Elance, and others. Concepts of “extended workforce” (Accenture), “private talent clouds” (Elance), “workforce-as-a-service” (OnForce) are now not just fantastic ideas, but in 2013 refer to functioning “work arrangements” that have unprecedented characteristics of being fractional, variable, mobile, on demand, etc.

SIA started studying this phenomenon over the past two years, and we continue seeing clear signs of development, innovation, and growth--in what today still looks like a small spot in a petri dish. Some of these visible signs can viewed through the microscopes of two recent SIA reports, The “Human Cloud” in 2013: What It Is, and Why It Is An Emerging and Real Opportunity For Staffing Firms and “Online Staffing” Platforms: 2013 industry segment landscape.

Resource - Staffing Industry Analysts

Workforce-as-a-Service Scales to Meet IT Staffing Needs on Demand

What if you could scale your IT personnel requirements as you would computing resources? Using a workforce-as-a-service model lets you add a skilled, vetted and insured workforce when you need it and release it when you don't.

-By Sharon Florentine

Cannone says that OnForce has nearly 1,000 independent contractors signing up with the company each month, but that doesn't mean they're all hired. Applicants go through a rigorous screening process, he says, that includes a personal and skills questionnaire, an online battery of tests, a phone screening, a background check, drug testing, all to guarantee that customers are receiving 'W-2 quality' workers.

OnForce says it also uses proprietary talent matching algorithms that take more than 20 data points into account to make sure workers are a good match for the job. These algorithms are constantly reviewed based on on-site performance, and workers are given continuing assessments and performance reviews to make sure they're performing at peak levels, Cannone says.

"One issue we address with this WaaS model is the misclassification of workers - how many times have you hired someone for a position and found their skills weren't quite right? That's a costly mistake, and one we can address," he says.

Consistency and Communication

OnForce also ensures its workers are covered under the umbrella of its insurance policy, which can remove a major administrative headache for customers, says Leslie Rudolph, vice president of Operations, Field Services Division, for Tampa, Fla.-based OnForce partner Vital Networks, which delivers networking solutions, monitoring and management, as well as rapid-response support.

"We are a services delivery company, but we saw that with the increasing mobility of our customers that it was tough to provide a consistent staffing solution; we have our own field services engineers, but it was hard to communicate with them consistently, and difficult to manage all the insurance and risk management for all of them," Rudolph says. "It was becoming an administrative hassle and a quality assurance problem," she says.

"We still have our own teams of field service engineers, but we partnered with OnForce to increase our efficiency for customers," Rudolph says. "This is an innovative way to approach the business. It's flexible to the needs of our customers, and it means we can be responsive and fast at addressing their needs," she says.

Resource - CIO

How the Sharing Economy is Evolving Into Workforce-as-a-Service (Infographic)

Posted by Peter Cannone, CEO of OnForce

It would be impossible to overlook all of the talk about the collaborative, sharing economy, which is estimated to be a $110B plus market. Even Thomas Friedman penned a New York Times op-ed column on it. Not to mention IT luminary Irving Wladasky-Berger’s take on it, which recently appeared in the Wall Street Journal.

With companies like TaskRabbit and Airbnb capturing the spotlight, it’s easy to lose sight of the fact that there is a significant opportunity in the IT slice of this market. In fact, of the $3.5B that will pass through the sharing economy this year, approximately one-third of it will go toward IT.

So how exactly does IT play in today’s sharing economy and how is it evolving into Workforce-as-a-Service (WaaS)?

Well, let’s first step back and understand what we mean by the sharing economy. Jeremiah Owyang of Altimeter Group offers the best definition. He explains the sharing economy is “an economic model where ownership and access are shared between corporations, startups and people. This results in market efficiencies that bear new products, services and business growth.”

Now you already know that this whole notion of sharing isn’t exactly new. Rather, the sharing economy has resulted from the evolution of our workforce since the days of the Industrial Revolution.

During that time, the majority of employment opportunities for the first generation workforce were in manual labor and it wasn’t until the World War II economy that healthcare was introduced by employers as a recruiting tool.

As innovations in the Industrial Revolution eventually led to the Digital Revolution, the second generation workforce, marked by the rise of knowledge workers, soon outnumbered all other workers by a ratio of 4:1.

Then, as the Internet age morphed into Web 2.0 where collaboration reigns, came the third generation workforce. In this sharing economy, contract employees double as entrepreneurs carving out flexible work arrangements, funding their own healthcare, and taking more control over their destiny.

It’s not a coincidence that the sharing economy has taken off during a time of unprecedented change in the workforce, especially when it comes to IT. Let me explain.

On the one hand, you have businesses that want to optimize efficiencies without bringing on a slew of full-time employees. On the other hand, there are a growing number of skilled IT professionals that, after weighing the pros and cons of being on someone else’s payroll, voluntarily joined the ranks of the independent workforce and are thriving as entrepreneurs.

When you look at the converging forces in the economy, advancements in technology and the shifts in the traditional employer/employee arrangement, you can see how we’ve arrived at the sharing economy and how it’s evolving into the on demand “Workforce-as-a-Service” (WaaS) business model.

Going beyond tactical tasks of the sharing economy, the WaaS model applies to the fourth generation workforce. In it, knowledge workers are able to satisfy the needs of businesses by successfully executing short-term assignments, anywhere.

For example, let’s consider WaaS for IT. Imagine a business that needs to ramp up quickly or perhaps sustain an existing product line while they focus on other initiatives. In both of these real world scenarios, independent IT service professionals can help with these transitions.

WaaS is an ideal work arrangement when you look at a company’s desire for modular staff to complete a project or get geographic reach quickly, and the rise of independent contractors that want the flexibility and consistency that come from steady, short-term assignments. Yet before you embrace this model, be sure that the assignment is fully protected should anything go awry.

More specifically, what a lot of service buyers may not be aware of is the fact that many assignments are only partially protected, therefore exposing their businesses to significant risk.

If you’re a business or an independent contractor that wants to seize part of the multi-billion dollar sharing economy as it evolves into WaaS, you must have the assurance that each assignment is protected against liability, errors and omissions, and workers’ comp.

Now you may be thinking this adds too much complexity to the idea of hiring on demand but don’t let it be a gating factor. Instead, look to those proven online networks that bring together service buyers and IT service professionals and ask the tough insurance questions before you commit to bringing an independent contractor onsite.

There’s tremendous upside in the WaaS model for businesses and independent contractors as long as both sides are properly protected throughout the engagement.

With flexibility and expertise as it’s hallmarks, and the prediction that 50 percent of the American workforce will be classified as 1099s by the year 2020, it’s clear the WaaS model is here to stay.

Reference - http://insights.wired.com/profiles/blogs/how-the-sharing-economy-is-evolving-into-workforce-as-a-service#ixzz2eWQYMFZg

Poor Attendance Leads to Poor Results

By Terry Stockham, Human Capital Advisor at OnForce

According to The American Heritage New Dictionary of Cultural Literacy, the definition of absenteeism is:”Habitual absence from work, thought to reflect employee demoralization or dissatisfaction.”

Absenteeism at work is not only about the direct costs related to an employee’s absence (sick pay, overtime, etc.), but also about the related effects that ripple throughout the organization. Here are just a few examples of the extended impacts of poor attendance:

• Safety implications: working short-handed, hiring inexperienced temporary staff, or relying on overworked employees on overtime can all lead to increased accidents and downtime, as well as have a negative impact on cost and profitability


• Productivity loss: because of reduced staff, your company may shorten certain processes to get things done


• Quality compromised: product and service defects tend to increase when you do not have sufficient staff; also, employees already working a full schedule and asked to put in additional hours tend to make more mistakes


• Performance loss: high-performing employees with good attendance will gradually become disengaged and their performance will suffer as a result of carrying shifted burdens and workload, especially over an extended period of time


• Employee turnover: poor attendance may eventually lead to more high-performing employees leaving, compared to low-performing employees. Over time, this dynamic can drastically impact your organization on multiple levels and inhibit its ability to meet the needs of customers in a quality-driven, sustainable, and profitable manner.

As you can see from these examples, attendance issues are reflected not only with employee cost, but also have cost and performance impacts that can affect your entire organization and your bottom line. While attendance is a relatively complex issue with no single solution, there are things you can look for in your organization such as:

CULTURE: Take a hard look at your culture and how employees are treated and recognized for performance. Do you have a culture of inclusion and collaboration rather than “command and control”?

TALENT: To borrow Jim Collins’ phrase: “Are you getting the right people on the bus…in the right seats?” Work environments, cultures, and jobs change over time. The right person, in the right place, at the right time, doing the right things is crucial. Conversely, mismatches result in disengagement and poor attendance.

RECOGNITION: Pay and benefits come to be perceived as entitlements to an employee in a very short time. They are important, but not true motivators. Look at how your organization recognizes the contributions of employees. It is human nature to desire and seek acknowledgment of successes and performance, which is why recognition is a cost-effective way to get lasting results with positive impacts to the bottom line.

JOB STRUCTURE: Review how your jobs are structured. Maybe it’s time for a change. Does the structure of the job challenge and motivate the employee? Does the employee feel he/she can make a difference in his/her current role? If the answer is “no,” it is time for a change. Some jobs may need to be restructured or redesigned to improve employee satisfaction with the work. If this does not help, some duties may need to be outsourced or fulfilled via an appropriate contingent labor model.

If your company has an attendance problem, the key is to act quickly, before it negatively impacts your entire organization.

Reference: OnForce