Temp agencies have long been a part of the professional landscape. Like everything else, the temp agency model is evolving to take advantage of new technologies. However, while online freelance meat market platforms like oDesk and Elance might be okay for outsourcing knowledge work like writing, software development and graphic design projects, they are not necessarily a great fit for the service-oriented IT market.
The answer: the rise of IT-specific online workforce platforms that offer more than a reverse auction experience delivering the lowest cost workers possible. Many MSPs and VARs – and even direct end users – are already embracing the new workforce platforms to provide Just-in-Time IT resources when and where they are needed. But what does that new model look like? How does it work?
We’ve talked to the CEOs of two of the leading vendors delivering this new, so called Workforce-as-a-Service (WaaS) model, Pete Cannone of OnForce and Mynul Khan of Field Nation, to find out. We’ll highlight OnForce today and follow up with a Field Nation profile in a few days.
According to Pete Cannone, President and CEO of Lexington, MA-based OnForce, the whole employment landscape is in a state of flux, which isn’t surprising as it is tied so closely to the US economy which is itself somewhat volatile.
“One of the important things to keep in mind is what’s happening in the US economy,” he says. “US unemployment rates are running at seven or eight percent. If you include underemployed it’s probably approaching 20 percent. A further 15.3 percent – almost 18 million workers – are independent contractors.”
What’s more, he’s very bullish on the way those numbers are likely to grow. He predicts that as much as 50 percent of the US workforce will be independent contractors by the end of the decade.
A lot of those un- and underemployed people have valuable skills and the contractors need to be managed more efficiently than they traditionally have been which opens a door for Cannone and OnForce to act as a kind of clearinghouse for qualified technical resources. Thus the introduction of Workforce-as-a-Service (WaaS).
OnForce has two WaaS models: In the first model, the hiring organization directly accesses a network of IT professionals through a cloud-based platform. You can search, vet and connect with contractors in the geographic areas where you need them, and you can negotiate with them, hire them and manage the entire engagement through the OnForce platform. The second model is more hands off. You tell OnForce what you need and they will do all that stuff for you.
“A lot of IT companies are looking to tap into a service that allows them to aggregate and build a workforce of freelancers that can either augment or replace their old workforce,” says Cannone. “We come in with a platform that allows an enterprise to manage those networks of variable freelancers on demand.
“It lowers costs. We have enterprise clients today saving between 20 to 60 percent using our labour platforms. It depends on how much you want to balance your workforce (between traditional W2 employees and contractors).”
“It also reduces ramp up time, he says. “We’re doing a project now for a client with 175 retail outlets across the US and into Southern Canada, integrating iPads and Windows. We were able to do that within a week.”
But what about some of those awkward questions that come up in IT environments? Like who owns the long term relationships?
That’s up to you. If you are hiring and managing your freelancers directly then you own the relationship and can proceed however you want. If OnForce is managing them for you, then your relationship is likely to be more of an arm’s length thing.
What if an end user has hired an IT contractor directly and needs parts and equipment? Does the contractor do that or does OnForce act as a reseller? Or does the client order them directly?
Again, parts and equipment acquisitions have to be arranged between the contractor and the end user. The contractor might tell the client what’s needed, help place the order and then the end user makes the purchase. A lot of this stuff can be picked up at Best Buy after all. Obviously, in the case of a VAR/MSP hiring a contractor the VAR/MSP will order any equipment required and have it delivered to the end user so the contractor can do the work.
What about software licences? For example, if a client wants an Office 365 install, who is the partner of record? Who gets the 6% commission?
Says Cannone, “It would be the person authorising the service, so the MSP or the person asking for the work. They’d being doing the work on behalf of the MSP.”
Who carries the professional errors and omissions insurance? Who gets sued if something goes wrong?
OnForce does. OnForce provides all the liability insurance for the engagement. Additionally, OnForce offers a 100 percent satisfaction guarantee and a 30-day warranty for any service defects.
