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What the Gig Economy Means for Procurement

Gig Economy

The gig economy, which is made up of the 53 million Americans who work on a contingent basis, is changing how both employees and employers view work. With companies like Lyft, Uber and GrubHub rethinking “work” as being focused more on outcomes, contingent employees — such as drivers — are running their own little “projects” for the company each time they complete a ride or deliver an order. With a number of key studies touting the gig economy as the future of work, this shift will undoubtedly impact how organizations run. But what does it mean for procurement, specifically?

Better, more targeted consulting results.

Often, when outside consulting help is needed, companies reflexively turn to the big guys. And big guys come with big price tags that don’t always match the level of results you’d expect. But with independent or smaller on-demand vendors like those powering the gig economy, companies can secure innovative solutions at a fraction of the cost, leading to better overall business outcomes without the big firm overhead.

Simplified talent resourcing.

Good help is hard to find, but the gig economy certainly makes the search easier. With an increase of highly specialized workers searching for their next gig, companies have near-instant access to virtually any skill set they could need. And while talent acquisition is primarily an HR function, the cost savings of on-demand resourcing is an important consideration for procurement.

A sharper focus on risk and compliance.

Adding more people to the mix naturally means an increased risk. Controlling an influx of workers who have access to your processes, systems and technology can quickly turn disastrous if not handled appropriately. That’s where background screening organizations like JDP come in. As companies search for providers who have the legal, compliance and technical expertise to help vet contingent workers, procurement’s voice is essential in the management of the relationship with the chosen vendor.

Supporting the HR department through its new challenges.

In our flourishing gig economy, HR will have to make some adjustments around how it recruits, the policies it creates for non-permanent employees, and how it engages employees who work in other parts of the country or the world. These new job challenges come with new stakeholder challenges, and procurement may be able to step in and offer some time-tested advice on how to navigate the choppy waters of internal organizational politics.

Need to screen your gig workers? Let JDP help!

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