Should You Be Direct Sourcing Contingent Labor?

At its core, direct sourcing is a strategy where a company begins to look toward an internal candidate pool as a potential source for temporary employees. While every organization is a bit different, a direct sourcing environment usually has three basic elements: a technical solution that is used to get the aforementioned candidates into the recruiting funnel, a process or strategy to then curate those candidates, and compliance.

Examples of how direct sourcing is used include tapping into employees who may have recently retired, those who are “silver medalists” in that they may not have been selected for a previous role but are still viable, and those who have been referred by others.


Why Use Direct Sourcing?


All told, direct sourcing brings with it a wide range of different benefits that cannot be ignored. Maybe the most immediate of these is that a business gets to use the power of its strong employer brand to not only attract top talent for an available position but to retain them as well.

This also gives them the ability to get someone into an available role as quickly as possible, which in turn allows them to start performing faster than would be traditionally possible. In other words, by leveraging an internal candidate pool, companies can potentially reduce the time and resources required to identify and recruit suitable candidates.

Other benefits include the fact that direct sourcing gives businesses access to known, proven talent (as opposed to requiring them to go searching for them), along with the fact that they are already well aware of a candidate’s experience within the context of the position that needs to be filled.


Benefits of Direct Sourcing


In a larger sense, direct sourcing can save your business time. By filling available positions quickly, it decreases the amount of time it takes for those positions to start being productive and generating revenue. Direct sourcing also can be a viable way to drive cost savings across the board. This is especially important given an organization’s current rate structure. 

From the point of view of the client, another benefit of direct sourcing is that it helps significantly improve worker quality. The people you’re tapping into are already familiar with your organization, therefore they can “hit the ground running,” so to speak. You have a robust pipeline of pre-identified candidates to draw from, which also comes with the ability to redeploy known talent in a way that makes sense given your current goals. The productivity gains that come with this alone can be enormous in most situations.

From the perspective of the candidate, direct sourcing is also a great way to continue to build a long-term relationship with the client. It’s access to an opportunity that they might not otherwise have if they were on the outside looking in, which can be a potential chance to further their career. It also gives them the ability to work and be productive in a known environment, as opposed to “starting over” with a new employer. It’s also a way to choose positions that they’re inherently interested in, which can be a way to drive their commitment to the workplace as well.


Principles of a Direct Sourcing Program


Generally speaking, there are five main principles of any viable direct sourcing program to be aware of. They include:


  • Strategy: Businesses need to utilize their brand to build a talent pool that may include retirees, referrals, recruited talent, and more.

  • Technology: A digital platform is required to create talent pools by leveraging ATS, HRMS, and VMS systems.

  • Curation: Candidates need to be managed in a way that connects the right people with the right open jobs through curators, such as Monument Consulting.
  • Payroll: A payroll provider is also required to act as the employer on record (EOR) for any temporary workers on assignment.

  • Redeployment: Finally, businesses need to be able to quickly redeploy known workers who can begin immediately and excel quickly, thus reducing the time to fill available positions.


Timelines for Implementing Direct Sourcing


Again – every organization is different, which means that the timeline for direct sourcing can and will often vary wildly. Having said that, direct sourcing implementation typically takes between 13 and 18 weeks. Through Monument Consulting, this includes a program readiness assessment of the current program, strategy, goals, and best practices.

During this period, there will also be a review of a business’ technical operations and procedures to help make sure that all technical configurations, integration requirements, and financial resources are being met. Based on what you discover, various teams can be set up for operations, training, and a larger program office.

At this point, a technical build can proceed. This can include setting up and configuring client instances, branding, VMS integration, job board integration, and other key factors. Once completed, testing and a complete user training program can be conducted.

Finally, a candidate campaign and a proactive marketing strategy can be developed that includes social media, various recruitment sites, and an effective email campaign.


Ingredients for a Successful Direct Sourcing Program


In addition to access to known talent and client branding/marketing efforts, ingredients for a successful direct sourcing program include:

  •  Buy-in from all key stakeholders. That includes at the executive level and in terms of talent acquisition, marketing, legal, and even business users.

  •  Program ownership and accountability, especially from those at the top of the organization and with regard to team leaders.


Key Success Factors


One of the key success factors for any direct sourcing program involves the ability to identify skill sets to source via this channel. Businesses also need to drive volume through the direct sourcing channel to promote healthy activity.

Overall, success depends on your ability to provide “preferred” status to direct sourcing channels for release and distribution. A client’s brand will also need to be leveraged and an internal careers page should be created. This will go a long way towards attracting the largest pool of potential candidates to each open position – which in and of itself is the most important benefit of all.

If you’d like to find out more information about whether you should be utilizing direct sourcing contingent labor, or if you’d just like to discuss your own situation with a professional in more detail, please contact the team at Monument Consulting today.