External Workforce Management: Lack of flexibility, agility, and global reach means risking your most valuable assets
In today’s environment, it’s important to make sound judgement based on facts and information, and not the fake news we hear everyone talking about. Politics aside, turns out there is quite a bit of fake news in the procurement space as well. And when it comes to workforce management, overselling can have real implications on the ability to manage and support a customer’s most valuable asset: their people. With the procurement of contingent labor, there is arguably less room for error. The safety, well-being, and efficiency of an organization’s people resources is indisputably of top importance, and in the current environment, it has become even more in focus. The question then becomes, what as an organization are you willing to risk here? Quick response and agile adaptation are key.
When it comes to people – your people – it’s worth looking beyond tag lines to see if the message holds any weight. The reality is, many organizations imply a flexible and agile solution and that’s just not the case. For example, some competitors slam SAP for having a ‘modular’ approach – but what’s wrong with a modular approach anyway? It offers complete flexibility to tackle the categories or areas that are most important to your business, at this moment.
Let’s think of it this way: It’s a bit like being able to buy wine glasses individually or having to buy the entire set. Yes, it makes sense to buy things together – and you will likely even get a discount – but back in the day when I was a broke student, I didn’t need a set of 8 (nor could I afford it). I bought a few nice glasses, received a few more as birthday gifts, and went to buy one to replace the one I’d broken. The point is, flexibility in how we consume is important; being able to start with one critical area in focus – say, Workforce Management – and expand into other categories of procurement is essential, not least given the current global crisis. I want to be able to buy the set (think: Best of suite) or buy a single glass (think: Best of breed).
Sure, I’m biased – but SAP realizes that in the cloud world, it is important to provide value from single category management all the way through to an integrated Intelligent Spend Management suite. We need to provide Customers value within a single module – as well as exponential value in an entire suite. Focusing on the workforce here, we’re in a volatile world where needs and the prioritization of those needs is constantly changing. Our new reality is that most of these companies are looking to fill their increased demand with temporary workers, as it’s much easier to scale the workforce up and down depending on the fluctuating need and provides lower financial risk when budgets are tight. Consider this – outside of crisis mode, the “normal” (I know, what is normal anymore?) total workforce is comprised of about 40-60% contingent labor. We can get even more specific here: External Workforce makes up 42% of total workforce spend (on average); contingent labor is just over half of that – representing nearly 25% of total workforce spend. Amplify those numbers with disruption, like what we’re seeing now, and how do you flexibly manage – on a global scale – agreed pay rates and variable costs, new onboarding requirements, flexible approval changes, and more?
I could throw nice statistics out there – like the fact that Customers achieve 9-12% cost savings on average when implementing SAP Fieldglass – but let’s focus on what has propelled current SAP Fieldglass customers to be resilient through this crisis: The ability to adapt to the change quickly. SAP Fieldglass has flexible, open admin capabilities for a reason: We’re not buying office supplies here, we’re supporting people. COVID-19 has brought on new requirements we wouldn’t have even dreamed about last Christmas; organizations everywhere are implementing new onboarding protocols, such as trainings and compliance requirements, with little to no room for error here, so that people returning to work have the proper safety knowledge and tools they need. This flexibility is not just valuable, it’s necessary. Customers who have left competitor solutions and come to SAP Fieldglass have reported that this was one of the biggest differentiators for them, particularly over the past few months.
Next, let’s focus in on the agility (and technology) required to expand your global reach. In fact, the unfortunate reality is that many organizations cannot go to nearly the places they might want to go – or need to go – in the future. What if you need to flip your manufacturing site to accommodate emergency supplies? What if you need to expand your operations to Southeast Asia to accommodate crisis demand? And here is the underlying problem: With labor of any kind – full time or contingent – there are labor regulations around the globe that are unforgiving. Speaking of areas you don’t want to gamble, let’s talk about tax compliance and finance laws, tenure policies, data privacy restrictions, work councils, complex pay rules, and local legislation (did you know there are Typhoon Days?!). Ensuring that your investment today will support your business tomorrow is critical. For the avoidance of doubt, SAP Fieldglass supports 180+ countries, translated in 21 languages, and adds 589 users every hour). Ok, yes we at SAP talk a great deal about ‘global footprint’ – which has undeniable value when it comes to services, best practices, and lessons learned (among other things) – but the takeaway here is that we’re talking about data insights and compliance to laws and regulations that help keep your people and your company safe.
Royal Philips, a well-known leader in the health technology industry, saw value in the ability to access flexible, cost-effective skills and have the visibility needed to make quick, smart decisions. Philips now manages more than €500 million in contingent workers each year with SAP Fieldglass. When COVID-19 came crashing down on the world, Philips had the ability to leverage SAP Fieldglass not just to adapt their business but it was a part of the company’s IT ecosystem that allowed them to create new solutions to help people survive the epidemic. Last month, Philips announced the first-of-its-kind mobile Intensive Care Units (ICUs) in India – one of the top 5 nations in the world for most COVID-19 cases. These ICU units are manufactured by Philips in India and can be deployed in one day. That kind of agility can only be supported by robust, agile software solutions and processes. When you think about it, the effective management of contingent labor can in fact be lifesaving. Learn more here.
When it comes to Workforce Management, flexibility and global reach is more than just a catchy marketing slogan – and has real implications for your people and business agility.