Companies’ workforce increasingly depends on external workers such as contractors, service providers, contributors, developers and even technology

Companies’ workforce increasingly depends on external workers such as contractors, service providers, contributors, developers and even technology

A Deloitte-MIT Sloan study

Companies’ workforce increasingly depends on external workers, which include contractors such as temporary workers, service providers such as management consultants or communication agencies, external contributors, developers and even technology for workforce augmentation such as AI, robots, chatbots, according to about 90% of the respondents participating to the Future of the Workforce Global Executive Study, conducted by Deloitte and MIT Sloan Management Review. A third of companies (33%) expect to increase their dependence on external workers over the next two years, especially when it comes to technology (73% of respondents), developers (61%) and external contributors (48%). This trend was underway before the pandemic began and is likely to continue after its effects subside, the study underlines.

Although companies rely on external workers’ ideas and skills, more than 70% of them are not adequately prepared to manage such a workforce composition.

This new approach on workforce composition, which is called «workforce ecosystem» by the Deloitte research, is a significant change from the traditional view, according to which companies used to rely on full-time employees with rather linear career paths. On the other hand, companies’ management systems and processes, workforce planning, talent acquisition, performance management and compensation policies are designed to focus on internal employees. Reconciling these two realities and approaching them in an integrated manner is becoming a major challenge, with significant implications for strategy, leadership, organizational culture”, said Raluca Bontas, Partner Global Employer Services, Deloitte Romania.

In response to the COVID-19 pandemic, most organizations focused on offering their workforce learning and development opportunities (57%) and on moving existing employees into new roles (55%). Also, 65% of them increased the rate of automating processes and tasks.

The research underlines that the nature of work is changing, as companies have a team-based, project-based view of work, focused on speed, innovation and relationships. They also focus on remote work arrangements, a trend which started before the pandemic and was fueled in part by COVID-19 lockdowns, as it has benefits in multiple areas such as corporate real estate costs, immigration constraints, potential efficiency increases.

Another major trend highlighted by the study is the evolution of the preferences of workers, who are prioritizing purpose, flexibility, and personalized experiences over job stability and security and are experimenting new structures and duration for their careers, including aligning lifestyle with work style, upgrading skills and working beyond age 65.

Workforce strategy is seen as a top management team common effort, involving mainly the Chief Executive Officer (56% of respondents) and the Chief Human Resources Director (37%), but also the Chief Operating Officer, Chief Financial Officer, Chief Strategy Officer and General Counsel, according to the study conclusions.

The Future of the Workforce Global Executive Study was conducted by Deloitte and MIT Sloan Management Review among more than 5,000 professionals on all the continents.

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