The contingent workforce is expanding rapidly as businesses adapt to shifting market conditions and talent shortages. Yet, many organizations still lack a formal, strategic approach to managing their external workforce. Instead of having a centralized contingent workforce program, temporary workers and staffing agency engagements are often handled ad hoc - with no standardized processes, no cost controls, and little to no visibility across the organization.
Instead of being treated as a strategic asset, the contingent workforce is often viewed as an afterthought - limited to “non-core” business functions. As a result, there's often no company-wide strategy in place.
Hiring managers frequently engage staffing agencies independently, using inconsistent processes and negotiating their own rates. This decentralized approach leads to inefficiencies, lack of oversight, rising costs, and increased compliance risk - that go unnoticed until it’s too late.
Risks of Not Having a Contingent Workforce Program
Without a formal contingent workforce management program, organizations expose themselves to significant risks that can impact both their bottom line and long-term stability.
- Rogue spend becomes commonplace, as hiring managers engage staffing suppliers independently, often at inflated or inconsistent rates.
- Lack of visibility into contingent worker headcount, performance, and cost makes it nearly impossible to track ROI or make data-driven decisions.
- More critically, the business is at increased risk of worker misclassification, which can result in costly legal penalties and compliance violations.
These risks are compounded by operational inefficiencies, inconsistent onboarding processes, and the inability to scale talent effectively - all of which hinder business agility in today’s fast-paced environment.
What is a Contingent Workforce Management Program?
Contingent workforce management is the strategic process of sourcing, organizing, and optimizing external workers - such as independent contractors, freelancers, temporary staff, and consultants - who are not part of your company’s full-time workforce.
With organizations increasingly relying on flexible labor to reduce costs, respond quickly to market changes, and access niche skills, managing contingent workers efficiently has never been more critical.
Most companies use a Vendor Management System (VMS) to gain visibility, control costs, and improve outcomes.
A Contingent Workforce Management Program is Essential
That’s why contingent workforce management is an absolute top business priority for any organization with an externally-sourced workforce. Without a contingent workforce management program, many companies have a lack of control over where money is being spent, and no visibility into how many externally-sourced workers are being hired. The end result is rogue spend that’s running rampant throughout the organization.
Why you need a Contingent Workforce Management Program
Here are four of the top reasons why companies need a contingent workforce management program:
1 -Access top talent, faster
Company’s today need to be more agile and flexible than ever before. Not only do they need to adapt quickly to ever-changing market conditions, it’s also becoming increasingly more competitive to acquire top talent - especially right now with the ‘Great Resignation’ making it so difficult to fill open positions.
Externally-sourced workers can be leveraged to address these changes, but it will only work when organizations have visibility into the performance of the staffing agencies they use. A strategic contingent workforce program gives businesses the ability to monitor and track vendor performance with visibility into important metrics such as time-to-fill, time-to-submit and workforce turnover.
2 - Improving your bottom line
Ineffective contingent workforce management programs lead to rogue spend that runs through your organization and significantly impacts your bottom line. Worst of all, you probably don’t even have the visibility to see that this is happening.
3 - Mitigate the risk of misclassification
The contingent workforce comes with a range of compliance risks that could lead to unforgiving fines, penalties, and damages for an employer. Contingent workers represent a complex workforce management set up, and risk can arise when this management isn’t done correctly.
An effective contingent workforce management program, whether done internally or outsourced to an MSP, will properly document all externally-sourced workers to ensure the business complies with local and national employment regulations.
4 - Build standardized processes and rates
Without a contingent workforce management program in place, it’s all too easy for hiring managers to hire externally-sourced workers through their own means. This means using their own fragmented processes to hire contingent workers from unauthorized staffing agencies outside of standardized rates. The result is high spend and no visibility into program cost or performance.
The creation of a strategic program will lead to vendor and process control, ensuring that all hiring managers across your company follow the same processes, pay the approved rates and document all actions appropriately.
Final Thoughts
In today’s dynamic business environment, the ability to scale talent quickly and cost-effectively gives organizations a competitive edge — but only if that contingent workforce is managed strategically. A well-designed contingent workforce management program provides the structure, visibility, and control your business needs to make smarter decisions, reduce costs, and stay compliant.
Whether you build your program in-house or partner with a VMS provider like Conexis, one thing is clear: managing contingent labor can no longer be left to chance. The time to take control is now.
Learn more about Contingent Workforce Management
- Contingent Workforce Terms You Need to Know
- Contingent Workforce Management Guide
- Contingent Workforce Stats you need to know in 2025
Articles on Contingent Workforce Management
- Contingent Workforce Best Practices 2025
- Contingent Workforce Stats you need to know 2025
- Cost Savings: How you can save 20% on your contingent workforce costs
- Reducing Risk: 5 Ways to reduce contingent workforce risk with a VMS
- Improving Compliance: 10 Ways a VMS helps improve contingent workforce compliance
- Managing Shift-Workers: 5 Ways a VMS helps you manage shift-based workers
- Improving Invoicing: 5 Ways a VMS streamlines and improves invoicing
- Increasing Visibility: 5 ways a VMS gives you visibility into your CW program
- Measuring Staffing Agency: How a VMS improves staffing agency performance
- Reducing Turnover: 5 Tips to Reduce Turnover in Your Contingent Workforce Program
- KPIs: 4 Key Metrics That Will Improve Your Temporary Workforce Management Program
Questions about Contingent Workforce Management? Contact Conexis VMS - We are here to help!
Do you have any further questions about your contingent workforce management program and how a vendor management system can help your business? Contact Conexis VMS today.
Discover the Power of Conexis VMSConexis is an award-winning Vendor Management System built for organizations that want the power of enterprise software without the complexity or cost.
Leveraging the latest technology, Conexis delivers the expertise, reliability and security of enterprise systems, while offering the flexibility, user friendliness and tailored, personal service you require. Learn more about our Company and why organizations Choose Conexis VMS.
Why Choose Conexis VMS
Conexis VMS is purpose-built for organizations seeking to manage their contingent labor spend effectively. Here’s why we're the right choice:
- Fast Deployment: Get up and running in weeks, not months
- Transparent Pricing: Flexible pricing with no hidden costs
- White-Label Ready: Customize the platform with your brand
- Real-Time Insights: Make faster decisions with built-in analytics
- Audit-Ready Compliance: Store contracts, worker data, and rates in one secure hub
Looking to Switch Your VMS or Just Getting Started?
Whether you are looking to Switch your VMS, or just Getting Started, we are here to help. Contact Us for a Free No-Obligation Consultation, See how Easy Conexis is to use by taking a quick 2 minute Self-Guided Online Demo, or Book a Personal Demo Today!
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