Reset your strategy for the modern external workforce.

Many business leaders share a common concern. A COO seeking our help put it best: "Are we actually managing how we use our external resources, or just reacting to one problem after another?"

Most already know the answer. Decisions get made in isolation. Spend migrates to channels no one is watching. Workforce strategy gets written in one room and ignored the moment a manager opens a requisition. The disconnects arise when an organization’s internally managed program or outsourced managed service provider (MSP) solution does not keep up with constant changes in a complex landscape.

A changed landscape leaves programs behind. 

Today’s external workforce extends well beyond contingent workers and their suppliers, the primary focus of traditional MSPs. Independent contractors, service providers, and gig platforms all play a larger, more permanent role — each with its own rules, suppliers, systems, and workarounds.

The research has been pointing this way for years. A Deloitte and MIT Sloan survey of more than 5,000 professionals found that 87% include external workers when thinking about their workforce. Yet most workforce practices, systems, and processes were still built around internal workers (employees).

A large part of the challenge is complexity and ownership: Contingent workforce programs cut across supplier management, workforce administration, and business execution, so no single function can own them effectively.

Fixing the disconnect with the external workforce.

Business leaders may see external workers as an integral part of their own workforce, but most internally managed and MSP programs were designed to govern a narrower world: contingent staffing and the suppliers behind it.

If that sounds familiar, you’re not alone. Now is a good time to step back, take stock of your current state, and consider your path forward.

A reset points the way to a unified approach that orchestrates the external workforce in its entirety. It doesn’t require a wholesale transformation or having all the answers. It requires knowing the questions to ask. Five of them define how well a program performs today and how well it adapts to change. Answer them clearly—understand the challenges at play and what is needed to address them—and you’ll know where to focus first.

1. Is your technology simplifying the program, or just adding to it?

Is your technology making the program easier to run and easier to improve, or just adding another layer to the same problems? Do your systems work as one program, or as separate tools?

Start with technology. It’s the bedrock that connects the tools, activity, and data spanning all parts of an organization’s external workforce into one operating system. The digital foundation should bring every part of the external workforce program together. In practice, it’s often what pulls them apart.

Challenges.
Most external workforce programs have accumulated technology reactively: a vendor management system (VMS) here, a procurement platform there, or an AI-powered sourcing tool added last year because it solved an immediate problem.

There’s no one technology to rule them all. Each tool may work fine on its own. The real problem is connectivity, not capability. Rather than replacing what works, the goal is to connect it.

What’s needed.
AI and integrated platforms make it possible to connect data across channels, suppliers, and engagements in ways that weren’t practical even a few years ago. The organizations that get the most from their technology stack look beyond the features and start with the decisions the technology needs to support.

For the program sponsor setting strategy and for the hiring manager filling a role, technology should make the job simpler. Done well, it reinforces governance, guides channel decisions, surfaces supplier performance, and turns fragmented data into usable intelligence.

Case in point.

A large retail bank in Australia ran two systems that didn’t talk to each other. One approved budgets and job titles. The other managed contingent worker requests, sourcing, and hiring. Everything in between was manual.

Recruiters chased approvals from multiple stakeholders. Job titles, cost centers, organization units, and project codes all required manual upkeep in the VMS. When workers were hired, managers manually requested network access and equipment.

The result: Our team connected the two systems through three integration points: automated approval routing, real-time data sync, and the flow of onboarding data. The five-day approval process dropped to 48 hours, and time to market improved by 60%.

2. Can your governance keep up with change?

When a market shift or new priority hits, can your governance adapt? Does anyone own the responsibility of improving the program after launch?

Real governance connects what leadership intends to what happens in execution. Without it, programs drift. Channels multiply. Rate cards go unreviewed. Compliance assumptions that were solid two years ago quietly become liabilities.

Challenges.
The governance model may be fine at implementation, but pitfalls emerge over the following year. Conditions change quickly. The regulatory environment shifts. Work preferences change.

When a governance structure does not adapt, people work around it. Managers start making things up as they go, defaulting to whatever is fastest or what worked last time. Too often, governance documents how the program worked at launch and stops there.

What’s needed.

The most effective governance models are built to evolve. Instead of depending on more rules to earn compliance, they focus on making the right choice the easiest one when a manager makes the decision.

Programs rarely fail at launch. They stall afterward, when no one is accountable for acting on what the data shows, and manual work creeps back in. Someone must own improvement and the outcomes.

Case in point.

A global pharmaceutical organization operating across the U.S. and Europe managed contingent workers through a strategy that varied by location. They needed a program structure that worked consistently across geographies while staying responsive to local regulations and shifting business needs.

KellyOCG designed and launched a multi-country MSP with standardized processes where consistency mattered while allowing variations for local regulatory requirements. We built the governance framework to adapt over time while preserving structure and improving overall performance.

The result: a program managing $90 million in global spend across the U.S., Switzerland, the U.K., Germany, and Austria, delivering $31 million in cost savings over three years, with cross-country analytics to help stakeholders anticipate hiring trends and skills gaps.

As the organization’s needs have shifted — new geographies, new role types, new analytics requirements — the program has moved with them. That adaptability is what the governance structure was built to make possible.

3. Do your managers know where to go for talent?

Do you have access to the channels your work actually requires? Are managers guided to the right one at the point of purchase before the wrong decision is made?

The external workforce spans at least a half-dozen distinct talent channels: staff augmentation, services procurement, direct sourcing, independent contractors, and human cloud platforms, among others. Each channel has its own cost structure, compliance profile, and timing and delivery expectations.

Challenges.
Many programs formally cover only a few of many channels and processes in play. The rest get used informally, or not at all, and that’s where spend starts to migrate to channels no one is watching. Managers aren’t workforce strategists. Without guidance, they default to the channel they used last time, whether or not it fits.

The result is a talent scarcity gap. Leave channels you need untapped and you shrink your available talent supply — causing longer time to fill, delivery bottlenecks, and higher costs. Managers end up fishing in a small pond when a much larger ocean of talent is available.

What’s needed?
The goal isn’t to open every channel. It’s to make the right ones available and obvious the moment a manager decides they need them.

Case in point.
A large energy and infrastructure company started with a straightforward MSP program after a merger—core staff augmentation, 98 suppliers across North America, and 14% year-one cost savings. The company faced a persistent imbalance between its talent demand and supply, causing slower delivery, limited cost optimization, and reliability and quality challenges.

The solution was to reach the entire supply of available workers by expanding the program to include all key channels. Direct sourcing opened access to interns, silver medalists, retirees, and new talent pools. A direct-hire program cut recruiting costs. Services procurement followed. Worker tracking extended visibility across the full external workforce.

The result: 100% workforce visibility, all SLAs and KPIs in the green, continuous year-over-year savings, and more than 30% of spending with diverse suppliers. A single platform guides each channel, and the same program structure governs them all.

4. Which suppliers have earned their place?

Do you know which suppliers in your network are genuinely outperforming, and which are just comfortable? Is the work going to the right kind of engagement in the first place?

Many organizations manage the external talent supply base in a fragmented way, leading to significant value loss. McKinsey found that procurement savings pipelines lose 20% of their value in execution. In the contingent workforce supply chain, the loss stems from inconsistent management.

Challenges.
Trust in a supplier network should be earned and verifiable. But in many programs, supplier relationships have become habitual. Preferred vendors stay on the preferred list because a handful of managers say they must have them. Newer, better-fit suppliers might not get evaluated because the program lacks the bandwidth.

Worker classification compounds the problem. People-based and outcome-based work are genuinely different — in governance requirements, compliance implications, and cost structures. Yet they get conflated regularly.

A statement of work may cover what should be a staff augmentation engagement, or staff augmentation may deliver what should be a defined-scope project. Either way, the rates, risk, and compliance exposure don’t match the work. Few programs have the visibility to see where it’s happening.

What’s needed.
A well-orchestrated supply chain can recapture lost value from suppliers through rigorous oversight. The fix starts with managing your suppliers like a supply chain: active performance management, consistent SLAs, and regular evaluation against everything you buy, not just staffing. That’s what separates a passive supplier list from a supply base that performs.

Case in point.

A global manufacturing company had a supplier problem — declining engagement, inconsistent processes, and too many suppliers in the program. Opportunities for high-performing suppliers were diluted, and overall delivery, cost, and quality suffered.

Through a supplier optimization initiative, KellyOCG identified top performers who were underutilized, removed inactive and non-performing suppliers, and introduced coaching for those worth developing. A targeted supplier summit made the changes fully transparent. The streamlined network gave top suppliers more opportunities and motivated them to align cost and delivery timelines, building a more productive relationship with the manufacturer.

The result: supplier engagement up 300%, 89% diverse candidate submissions per requisition, and $766,000 in cost savings.

5. Can your data tell you what to do next?

Is your data built to tell you what happened, or to help you decide what to do next? Can you compare results across every channel and engagement?

Data is a problem for many organizations. A 2024 Gartner survey found that 63% of organizations don’t have, or aren’t sure they have, the right data to make confident decisions. The problem persists today.

Challenges.
The issue is usually about fragmentation, not a shortage of data:

• • Contingent labor data lives in the VMS.
  • Services procurement data lives somewhere in finance or procurement.
  • Market rate benchmarks come from a third-party tool.
  • Human cloud spend lives somewhere else.

Fragmentation creates consistency issues. If a hiring manager uses three different talent channels for similar work, but the performance evaluation after each engagement asks different questions, you end up with data you cannot compare.

Without consistent data, you cannot determine which channel performs best for the work. You cannot build a program that gets smarter every year. And you cannot identify risk, like compliance drift, rate inflation, or underperformance, until it has already cost you.

What’s needed.
Most organizations have data. What they’re missing is intelligence they can act on the moment a decision is being made. We refer to that as the “insight gap.”

A report tells you what happened. Insight tells you what to do next, and that only works when data is collected the same way across every channel and every engagement. Closing the insight gap is what turns a well-run program into an intelligent one.

Case in point.
A global technology and communications company spanning 20 countries faced a distinct data insights challenge. Data was being captured, but hiring managers lacked a central place to access the tools, resources, and intelligence to make informed decisions. Forecasting future external workforce needs was largely manual.

Working with the company, KellyOCG configured their technology solution to serve as a one-stop talent portal connected to the program’s knowledge management framework and integrated with its email infrastructure. Decision trees guided managers toward smarter hiring choices, and a unique forecasting tool allowed leaders to anticipate future workforce needs.

The result: reduced response times for queries, increased visibility across the full MSP program, and a platform that continuously improves — monitoring queries to address recurring questions and surface training opportunities. The system has transformed reporting data into guiding intelligence.

A reset, not a rebuild: the external workforce program. 

The people who come to us arrive with different needs. Some have a specific problem: a technology gap, a process integration challenge, or a program that simply isn’t working. Others aren’t sure what they need and want a place to start.

Most programs have real capabilities, supplier relationships, and institutional knowledge worth preserving. A reset isn’t about starting over. It’s about looking honestly at where the structural gaps are and approaching them with a framework rather than a series of one-off fixes. That’s the thinking behind the KellyOCG external workforce program.

Our approach builds on distinct interconnected disciplines that specifically address the key questions driving program success. A program just getting started may need only a few channels and a handful of suppliers. A mature one may use them all. The foundational approach is the same. What changes is what gets turned on.

The questions above are where it starts. Expect at least one of your answers to surprise you. Getting honest about those gaps, before assuming the solution is more technology, more suppliers, or more process, is what a reset actually looks like. The complexity doesn’t disappear. But it becomes something you’re managing, not something that’s managing you.

Alejandro Builes leads external workforce solutions strategy at KellyOCG, working with organizations to design, evolve, and optimize enterprise external workforce programs.