Contingent-Workforce Management Systems: Understand the Options

Computerworld - Andrew Bartels tracks contingent-workforce management tools and services for Giga Information Group Inc. in Cambridge, Mass. Computerworld editor at large Gary H. Anthes asked Bartels to comment on the state of today's products and how these tools will evolve and integrate with other enterprise software in the future.

There seem to be so many companies now specializing in contingent-workforce management systems. Will they all make it? When you have a new technology space such as this, it's typically smaller start-up companies that come up with the new solutions. They are looking for a gap left by the bigger guys. Then two things happen. First, there's a consolidation; not all the small companies can make it. Second, the big guys recognize this is an opportunity, and they move into it through acquisition or building their own products.

So would a buyer be wise to pick one of the few big players already in the game, such as PeopleSoft Inc., rather than one of the boutique suppliers? If you are already a PeopleSoft customer, its an easy decision. You go with them because it will fit with your other PeopleSoft modules. For a non-PeopleSoft company, it's not quite as clear. The PeopleSoft offering still is not quite at the level of some of the more advanced vendors, such as Elance or CascadeWorks. So it's a trade-off: Do you want to go with a more secure vendor or a more advanced product?

What are the risks in implementing one of these systems? On the technical side, the issues are whether the product works as promised, and integration of the application into your environment and with your other applications.

How about on the nontechnical side? There's the issue of usability. The harder it is to use, the less likely employees are to use it. Then we get to issues of organizational and process change -- training of employees, support from the CFO and audit department and so on. For example, you need to use the audit trail embedded in the technology for post-purchase monitoring, to look for noncompliance or misuse by employees. That's a process change.

How feasible is it to roll your own contingent-workforce management systems from your existing accounting, purchasing and HR applications? You could, but the missing piece in most companies is management of the contract and performance against the contract. That's critical, because the cost savings typically flow from things like making sure that you've got all services you've paid for, that you are tracking the vendors' performance on atimely basis, that you pay on a timely basis to get payment discounts and so on.

How are these systems evolving? They are moving from the contingent workforce to, for example, the advertising contract, the building services contract, the construction contract or potentially to the legal or accounting contract. They are applying to a broader range of services. And [payments and fees] are getting more complicated -- project-based, time-based, milestone-based, deliverables-based. There could be three or four pieces of the compensation for a project that you need to track.