The Innovation Category

There are numerous factors today that have led many procurement professionals to view non-employee workers as just another resource delivered through a supply chain. Both buyers and suppliers of work contract with each other for specified outputs, with projects and cash moving in a transactional manner. While this can keep work on track and costs contained, such an approach leaves little room for innovation — a competitive necessity in today’s digital economy. The answer to this disconnect is to reconceive contingent workforce programs as contingent workforce ecosystems.

Leading procurement organizations today don’t just measure what they spent. They push their definition of spend analytics to encompass their total value contribution to the business, taking advantage of both conventional and newly accessible data sources to enable true supply analytics. How have they done this? While strong leadership and evolving best practices have played an important role, the simple answer is that analytics technology has finally advanced to the point where it can enable a supply analytics strategy. Key to this evolution is the rise of artificial intelligence within the enterprise.

Businesses operating in today’s disruptive economy need innovative thinking and agile teams to meet rapidly changing customer demands. Yet standard models of workforce engagement remain antiquated and inflexible, limiting companies’ ability to respond to new opportunities. The ascendance of the knowledge economy and the explosion of new technology applications, however, have created new opportunities for organizations to rethink how mission-critical, highly skilled talent is sourced, managed and consumed. Accordingly, new models of workforce engagement have begun to emerge, allowing organizations to break free from their legacy processes and tap a new source of innovation for the enterprise.

Leading procurement organizations today know that investing in supplier relationship management pays real dividends for the enterprise. But knowing a practice is beneficial and knowing how to implement it are entirely different things. To help take SRM from theory to practice, we teamed up with David Atkinson, distinguished procurement leader and Managing Director, Four Pillars Consulting, who answered these top real-world questions on SRM during a recent webinar: “Supplier Relationship and Value Management: The Five Programme Killers and How to Overcome Them.”

The modern contingent workforce manager faces a challenge unlike any her predecessors have ever faced: innovate or die. Disruptive technologies are battering old business models, eroding market share and feeding calls for procurement to tighten organizational belts. All of this and more is forcing business to acknowledge that human capital requirements are also changing. In response, high-performing organizations are reinventing the way they approach their workforce, experimenting with new models for sourcing, structuring and consuming vital work, services and knowledge.

It’s no secret that talent is tougher to find these days. From skills deficits and low application levels to intense hiring competition between companies, contingent workforce managers know the search for the right candidates is fraught with challenges. No wonder, then, that one survey from the Society for Human Resource Management reported more than two-thirds of organizations hiring full-time staff are struggling to fill job openings. One result of this talent dearth, understandably, is that the lack of full-time talent translates into a reactionary need for contingent staff to fill the gaps. Scrambling to do this in a cost-effective and timely fashion, contingent workforce managers ultimately approach sourcing workers as a transactional activity.

Forget digital. The 2020s will be powered by super intelligent, human-like applications that all but replace their creators. This is the dawn of the cognitive era. At least, that’s what the software market has been saying for the past year or so. But given that most organizations, particularly those in a B2B or supply chain context, have barely come around to adopting even plain old “digital” strategies, cognitive’s penetration in the enterprise is, perhaps, a bit oversold. To understand why, here are three examples of how we're still laying the groundwork for the transition from digital to cognitive — and what to expect when it really starts.

In this two-part series, we examine the state of technology-based sourcing, specifically in the IT workforce/services category. In Part 1, we looked into environmental factors that are driving innovation and other elements that are motivating openness to new approaches. In Part 2, we investigate different kinds of innovative sourcing solutions within the IT category and explore the emergence of an alternative supply chain or work/services sourcing ecosystem. We also provide recommendations for organizations to nurture and build alternative sourcing models and programs alongside existing IT services procurement channels. Providers reviewed in this brief include Hired, Toptal, Upwork and Kaggle.

Talk of machine learning (ML) has dominated the inner sanctums of heady supply chain discussion of late. While there’s no consensus on where the first game-changing applications are likely to emerge, most everyone understands that running complex algorithms against big data spells growth for the predictive analytics industry. And with the ML providers now offering their products on a subscription basis, well, it’s not hard to imagine where things are likely headed.

Technology-based innovation in workforce and services sourcing has been a major focus here at Spend Matters over the past years. And though we have tracked the trend of increasing work platform specialization (platforms serving up anything from data scientists to marketing content deliverables to food service workers), we have not really zeroed in on sourcing innovation in any specific workforce or services category.

In this two-part Spend Matters Plus brief, we take a look at what’s happening in the IT workforce/services category. In part 1, we look into environmental factors that are driving innovation and other elements motivating openness to new approaches. In part 2, we examine some examples of different kinds of innovative sourcing solutions in the category.

A supplier can have the best product or service in the world, but if it never appears somewhere the end user can become aware of it, it will never be purchased. Hence the importance of what logistics professionals call “the last mile” in physical supply chains — the final leg of the transportation journey that delivers a product or service to the consumer. The concept of the last mile applies to corporate purchasing, as well.

Adopting a new way of leveraging talent means changing critical parts of an organization’s underlying musculature and nervous system. Ultimately, such a change requires a transformation of the reflex response of “how we get things done with talent.” This means a departure from well-established practices for hiring talent and managing work, projects and outcomes. In many ways, this is a decentralized, bottom-up process, but it cannot gain traction without the proactive support and power of the C-suite.