The emergence of direct sourcing in contingent hiring
22 July 2021 — Within permanent hiring, direct sourcing is well established and is a key part of many talent acquisition functions. It delivers a return on investment in the shape of agency savings and the benefits of building a strong talent pool and brand enhancement for the organization. Direct sourcing within contingent hiring is less established, and in the US region specifically, the market has historically been dominated by a managed service program (MSP) approach.
This is beginning to change. According to the Ardent Direct Sourcing Toolkit Research Study, 70% of businesses cited direct sourcing and talent pool curation as their top priorities for 2020 and 45% planned to enable a direct sourcing service within the next two years — although we all know that 2020 threw a fair few curve balls!
Certainly, this fits with what we are starting to see: Organizations want a direct sourcing model with curated talent pools — a shift away from the traditional contingent hiring model.
The reason for this shift is not only the considerable dollar savings that can be made by reducing agency fees and time but also that organizations recognize the importance of selling their brand and using the power of their brand to attract the right candidates. It is a competitive market so using the brand to seek out the best candidates, create talent pools and reduce time to hire are all ways to gain competitive advantage.
Without a doubt, it is a candidate-led market and whether candidates are looking for permanent or contract roles, they want to know: What is the brand? The proposition? The organization’s culture and values? and how all this fits with what they are looking for. Having a direct sourcing team that can articulate the brand in a positive way builds strong employee engagement and is key to building the best talent pool for your business.
“It is tremendously exciting to see the high level of interest in contingent labor direct sourcing solutions across the Americas,” says Mark Jones, managing director of AMS’ Americas contingent business. “There is without doubt an education element to bring to life the benefits, but I have yet to find an organization that doesn’t want to at least discuss the concept.”
How to embrace contingent direct sourcing
In order to maximise the opportunity that directly sourcing contingent workers will bring, there are some key areas to get right.
Capability. Talent acquisition and the make-up of a recruitment teams has become more sophisticated over time and the role of a talent sourcer has evolved into a key role with a defined skillset and expertise. Certainly, within our business we have invested significantly in training programs for talent sourcers and we ensure they are trained in how to use the tools, how to engage candidates and how to use analytics to refine the process. It is important that a sourcer fully understands direct sourcing.
Methodology/engagement. Gain senior buy in on the concept/benefits and gain excitement using the organization’s brand to attract quality candidates and embedding it into to the overall candidate experience. Be proactive around finding and engaging with talent and create a robust talent pool. Identify what talent the organization needs and engage your diverse candidates. Organizations often have leavers that will return to the business again and a talent pool is the perfect way to capture such workers.
Technology. Technology has come long way in terms of its ability to support the process, and there are really good technology providers that specialize in contingent talent pool management and integration into career websites. Jones states that “Technology providers such as TalentNet are vital to the successful running of a contingent labor solution enabling the sourcing, management and engagement of contractors within one platform and analytics tools that will help the sourcer translate data into actionable insights.” AMS enables a complete end-to-end solution meaning we are accountable for all elements of the service including overseeing the chosen technology platform.
As the dusts settles following the trials of 2020, we feel now is a really exciting time and a big opportunity for organizations to consider how they approach sourcing contingent talent. Those organizations who embrace their brand in relation to direct sourcing and really engage their candidates are likely to gain a competitive advantage — and ultimately and will win the best talent.
Originally published 21 July 2021 in The Staffing Stream
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