Most programs with structured service-level agreements and key performance indicators include some requirements for providers to fulfill positions within a certain timeframe. This is most commonly measured from the time the requisition is submitted to verbal acceptance by contingent worker. Verbal acceptance is the usual measuring point because the supply chain has little-to-no influence on other factors that may affect the actual start date in the new assignment, such as notice periods, personal commitments or current assignment end dates.
Such SLAs and KPIs tend to provide a general time-to-fill across all categories of workers.
I would argue, though, that such provisions can be more of a burden than a benefit.
Much has been written about the true cost of hiring the wrong traditional employee — and this holds true for hiring the wrong contingent worker. While the math may be subtly different, contingent workforce programs should take great care when assigning the importance of the time-to-fill metric as an indicator of program performance.
Let’s consider two very different assignment types.
Unskilled. First, consider a short-term assignment for a resource that is in plentiful supply and is largely unskilled in nature. Time-to-fill here may be critical in order to get work done; the selection process is more straightforward (there may not even be one apart from background checks), poor performance can be dealt with almost immediately and a replacement worker found with minimal impact to productivity.
Highly skilled. Second, we may have a much longer-term assignment for a highly skilled worker who will have a major part to play in delivering a strategic project to a major customer, along with influencing the business in a greenfield area. While this hire may be urgent, poor performance is likely to be much harder to identify and take longer to observe. To make matters worse, the farther you are into your project, the harder it will be to exit this individual (due to perceived investment and dependency), and the associated costs (especially the hidden costs) can become excessive. In this example, it is arguable that time-to-hire should not be used in measuring performance of the supply chain, or at least not in a disciplinary sense where the provider is penalized in some way as this drives the wrong behavior.
In such situations, time-to-fill can still be a useful measure and efforts should be made to improve on performance; however, no matter how long it takes to hire the right person, the long-term outcome far outweighs the disruption and costs associated with hiring the wrong person, such as:
- Original hiring costs (including such items as company employee time, facilities and expenses)
- Compensation to the worker (including expenses and MSP/VMS/agency fees)
- Time spent by other employees and contingent workers in bringing the worker up to speed that will have to be repeated with a replacement
- Lost opportunity in terms of project delays and customer deliverables damage to brand reputation with your customers
- Repeated hiring costs for a replacement
One of the prime causes of making a bad hire is that the company feels the need to fill the position quickly. Therefore, especially for more highly skilled roles, it is better to focus on quality of hire, eventual productivity, retention and satisfaction with the worker, than be overly focused on time-to-fill.