More and more businesses are recognizing the benefits of incorporating freelancers and independent contractors into their workforce as a way to better respond to the ever-changing demands of the modern economy. Even if your business doesn’t now rely on freelancers, more than half of the U.S. population is expected to perform freelance work by 2027. This means that in the near future, you will most likely be working with a contractor regardless of the industry in which you operate.
Unfortunately, there are additional management issues that come along with hiring independent contractors. From work hours to payment, ineffective contractor management can create havoc for a business. If you are searching for a better approach to managing your contractors, then you are probably in need of a contractor management system.
A contractor management system is a platform that enables you to control all operational, financial, and legal aspects of dealing with contractors, helping you reduce paperwork and increase efficiency. There are many reasons why you should invest in contractor management software. Let’s take a look at the major ones.
Help Teams Identify Talent Quickly and Easily
It is difficult to find competent, trustworthy contractors. Large contractor sites like Fiverr and Upwork are good for short-term gig work, but you probably can’t find highly trained, qualified contractors looking for long-term employment. Businesses often locate external talent via service providers and personal networks.
Each of these approaches is like taking a shot in the dark and praying it will land on the right person. With all the potential choices, picking the best one may seem impossible. The time spent screening contractors, examining portfolios, and handling requests for proposals across many platforms is only going to expand as more marketplaces for freelancers appear.
With the help of a contractor management system, you can build your own database of highly qualified contractors. This eliminates the need for time-consuming and costly talent agencies and facilitates the process of finding the right freelancer for the job.
Automated Onboarding
Fast and quick onboarding is the key to getting contractors up to speed and ready to work. This is presumably why you hired them. Still, without a consistent method for onboarding new employees, you may expect to encounter roadblocks caused by paperwork. A contractor management solution can help you streamline and simplify the entire onboarding process.
You can modify the system’s onboarding steps to meet your specific requirements. The necessary legal papers are uploaded, and all contracts are signed. The IT department can be involved as well to make sure that access to the system is restricted to the necessary time period and that all activity is recorded.
Access to the Entire Financial Picture
Investing in contractor management software can help you better understand how much you spend on contractors and budget accordingly.
Two distinct modes of operation can be used with contractor management software. You may assign budgets to each group or project and monitor actual costs as they occur. Another alternative is to have the finance department manager review and approve each invoice. If nothing else, it allows managers complete autonomy over spending.
Easy and Fast Payments
As you expand your freelance workforce, you’ll notice a wide range in their rates, currencies, and preferred payment methods. Paying contractors after examining and approving their individual invoices is a tedious and time-consuming task. Your accounting staff probably doesn’t look forward to this part of their work too much.
This time-consuming task is eliminated thanks to a contractor management system, which compiles all of your contractors’ bills into a single location. So, once the invoice is approved, you can easily find all the necessary information and pay your contractors promptly.
Having relevant information in a single location translates into reduced chances of missteps, more timely payment of employees, and uninterrupted progress on projects. A Payroll software is a boon for finance departments, freeing up valuable time and resources previously spent on manual payroll tasks. Also, you get back one of your most precious resources once you no longer have to spend so much time on payroll. Simply put, a contractor management system is a blessing for finance departments.
Final Thoughts
Companies in the modern day require a method to make use of independent contractors and freelancers without exposing themselves to unneeded risk. An efficient contractor management system eliminates the need to compromise on compliance, risk employee misclassification, or spend time analyzing non-payroll worker invoices. When managed well, contractors and freelancers may boost overall company output.
By using a contractor management system, your business will be able to take full advantage of the increased responsiveness and flexibility of your temporary workforce.
Also Read: How Idea Management Software Can Change Your Business
