As CW programs mature and find efficiency in their operations, it often becomes challenging to find new ways to add value year after year. You have likely created all of the standard infrastructure needed to run a well-oiled staff augmentation program and now find yourself looking for ways to continue to be a competitive differentiator.
One of the more popular ideas that is hitting its stride is the concept of direct sourcing, which buyer organizations are starting to see as a way to increase quality, improve efficiency, reduce costs and take more control of their talent brand. While direct sourcing has been a buzz word in the market for over half a decade, there is still much that is unknown by many buyer organizations.
Direct sourcing defined. SIA defines direct sourcing as the process by which a company leverages its own internal candidate pool as a source for temporary employees and most often places on the payroll of a third-party organization. This concept has buyer organizations taking on more sourcing and candidate engagement activities in order to reduce service cost as compared to a traditional staffing partner.
While this does not imply a program can do everything that a staffing provider can do, it does suggest that there is a population of candidates that you already have access to and that may be better engaged directly. The key then becomes how effective a company can be at attracting key talent, pooling their known talent and keeping them considered and engaged through the life cycle. While this skill set may not currently exist within a CW program, it is found within most talent acquisition areas, which is why many companies are seeing direct sourcing as a springboard into total talent management through total talent acquisition.
The right time. The market has never been riper, with solutions coming from every direction of providers. While many service organizations may have originally seen this as new competition in an already competitive war for talent, several have found ways to adapt and even catalyze their offerings to better appeal to clients looking to explore this approach. There has been an emergence of talent curation and client sourcing services that were born from existing relationships with MSPs, staffing providers and payrolling/compliance companies.
And let’s not forget about the ever-increasing technology landscape that is coming in the form of evolved VMS tools and pure-play talent pooling/CRM applications. With this combination of services and technology flooding the market with various approaches to direct sourcing, buyer organizations now have options for how they build the right model for their culture and brand.
Additionally, buyer organizations are collectively becoming more comfortable with the idea of co-employment and realizing that the risk in these types of activities may be far outweighed by the potential value. There have been more and more noteworthy case studies emerging from buyers that are proving what can be gained when taking a different approach to staffing. The innovators and early adopters in this space continue to strengthen the best practices around direct sourcing contributing to an overall increase in the market’s ability to support this concept.
Over the next series of articles, I will focus on direct sourcing to provide both an overview of this concept and a deeper dive into how to explore this opportunity and assess the right way to establish it. The momentum direct sourcing has across our industry is proving to only be speeding up. With very few initiatives having the same potential to provide value across quality efficiency, cost and risk, this trend is proving be worth paying attention to and developing.