Independent Contractors Seen as Key to Companies’ Resilience - nextSource

In the 2023 Gartner Board of Directors Survey on Business Strategy in an Uncertain World, CIOs cited a need for a technology workforce model that is resilient in the face of a volatile economic market exacerbated by a shortage of critical skills. Nonexecutive board of directors members (BoD) said implementing digital initiatives (60%) and investing in the workforce (55%) are among their top five business priorities.  

Enterprises are shifting toward a blended workforce model that includes nontraditional workers (independent consultants, gig workers, freelancers) robots, and AI-augmented resources. To address talent shortages, the survey showed that 29.8% of CIOs plan to hire external talent for non-generative-AI/machine learning skills, while 35.6% plan to upskill/reskill existing IT talent for AI/machine-related skills. For the same skills, 39.2% of CIOs plan to hire IT consultants or contractors. 

A resilient workforce model enables CIOs to pivot, using short-term contingent labor solutions while working on a long-term option.  When seeking high-demand IT skills, Gartner advises CIOs to evaluate the internal IT team to determine availability of skills needed to implement the digital initiatives and provide ongoing technological support, then supplement those skills with external resources and technology.   

Long-Term Strategy vs. Short-Term Need 

Considerations in choosing the right worker type (employees or contingent professionals) are based on answers to the following questions:  

• How interchangeable is the talent and work in the organization? How will it change in the future? 
• Can the enterprise gain access to, and acquire, the necessary talent and skills to support new capabilities? 
• Can the organization reskill and redeploy workers whose work will be fully or semiautomated? 
• What is the impact on the enterprise’s ability to be customer-centric? 

Deriving Value from Independent Contractors 

Gaps can be filled using independent contractors or other contingent workers, benefiting the organization: 

• Upskilling existing employees takes time. Independent contractors can maintain on-time delivery of strategic initiatives while existing staff are trained in digital skills and competencies. 
• Internal staff with adjacent skills can learn from the independent IT consultant, speeding up the time needed to expand internal competencies. 
• Greater access to talent results from tapping into unconventional talent sources. In the 2023 Gartner CIO and Technology Executive Survey, among respondents who use third parties to provide digital capabilities, 21% use government agencies or nonprofits as conduits to untraditional workers. Nonprofits can develop tech skills by working with underserved, marginalized populations or those trying to get back into the workforce after gaps in service.  
• When initiating multiple transformative programs with aggressive revenue growth targets, contingent workers will ramp up and down more rapidly. This helps contain fixed personnel costs. 
• An expanded talent base results from access to IT professionals working remotely from other countries based on an employment contract made across national borders. This is most easily done when engaging independent contractors, as there is less complexity than associated with hiring an employee. In the 2022 Gartner Borderless IT Workforce survey, 58% of respondents use a borderless workforce approach. The study reveals that 44% use this strategy to address talent scarcity, while 36% use a borderless workforce to attract talent who want the flexibility to work from anywhere. 

Getting Started

Many organizations do not have internal capacities or processes to plan, source and develop the capabilities required for a resilient workforce model that can keep pace with their technology needs. 

nextSource offers consultants who can fill this gap by providing an effective methodology for determining the appropriate talent mix for the IT workforce model and by identifying resources that can provide access to needed talent, resulting in a blended workforce that is agile, scalable, and high performing. Many enterprises find that the premiums paid for talent in the post-COVID period have resulted in inflated workforce costs. The workforce composition plan will examine workforce cost structures, ensuring that they are competitive in today’s market. Reach out to us to learn more.