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Building Diverse and Flexible Workforces
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Building Diverse and Flexible Workforces
This week, we’re revisiting a hot-button issue that always warrants a closer look. No, we’re not talking about AI—we’re talking about the never ending struggle of hiring a strong workforce.
Struggling to improve your hiring strategy? Determined to create a more diverse mix of workers? I recently sat down with Hugo Malan, President of Kelly Science, Engineering, Technology & Telecom, to tell me about his approach to hiring. He leads a team of workforce solution specialists who help companies recruit talent ahead of industry trends, so he knows his way around the modern workforce.
From a mixed labor strategy to reaching underrepresented talent pools, here’s what Malan shared on a recent bonus episode of The Business of Tech.
What is a mixed labor strategy?
If you haven’t heard the term ‘mixed labor strategy’ before, Malan defines it as using different forms of labor to ultimately create the optimal mix for your particular set of circumstances.
“In other words, you will have some folks that are permanent employees, you might have other people that are temporary employees, and you might even have firms providing various kinds of services,” he said. “By adjusting the various ratios between these different kinds of sources of labor, you can create a more fixed or a more flexible cost structure and ultimately increase the per unit cost or decrease the per unit cost.”
That calculation has a lot of different levers to get exactly right. So, what does the data tell us about how to build a good workforce?
Despite Malan’s data-focused definition of mixed labor, he believes data points like attrition rates and the cost of labor acquisition can only tell you so much. He sees more value in asking qualitative questions like, what are the core skills that I need to have in-house to preserve and protect my secret sauce? And what skills are more transactional that I might only need for a project?
By answering those questions, Malan believes you can glean value from diversifying the type of workers at your organization.
Can small companies succeed with a mixed labor strategy?
While experimenting with that approach may make sense for a large organization, smaller companies tend to feel the weight of every hire when one person is such a significant percentage of the labor force. How does Malan recommend using mixed labor among small staff?
Turns out, he thinks mixed labor is particularly beneficial to small organizations, mainly due to fluctuations in demand:
“If you’re a small company, then one big change in client demand could radically alter your economic prospects. You want to have the flexibility in your cost structure to respond to that. If you’ve built in a lot of fixed rigid costs, it makes it much harder. So it’s actually, in some ways, more advantageous for small companies to use temporary labor,” he said.
He’s seen this play out recently in the startup scene. Startups have to be very thoughtful about how they deploy cost, but they also need to scale as quickly as possible – to remain nimble and flexible, they’re turning more and more to staffing agencies to balance talent and spending.
Now, many small IT providers and MSPs also serve small clients. Outsourcing even further doesn’t make sense in that relationship, so how can you scale up and prioritize keeping highly skilled people around?
Malan recommends looking at an SOW if you’re looking to use a third-party provider:
“Typically, if you source your labor through an SOW, you can tap into a talent pool that really resembles the talent pool you draw on because it’s typically a longer-term assignment… so it actually resembles, from the candidate point of view, a very closely a permanent position, you just happen to have a different employer sending you your W2,” he said.
In other words, you can still benefit from a flexible labor arrangement while enjoying high-quality, long-term talent.
AI’s impact on hiring
Of course, we can’t talk about modern hiring without talking about AI. It’s one of the sectors with tons of AI buzz, so how is Malan seeing AI’s impact on hiring and workforce development?
For now, he says the impact still feels somewhat mundane, but the answer changes daily. Large-scale hiring is where AI saves the most time, and the holy grail of AI application in recruiting is ingesting job descriptions to generate skills, experiences, and other requirements, as well as screening and matching candidate profiles.
However, he’s still a proponent of maintaining the human touch. In his words:
“If you’re only looking for a set of very specific qualifications that are very precise, and you don’t care about things like long-term career aspirations, cultural fit, or anything of that kind, then the AI can do the job. But for anything beyond that, and that would be probably 98% of the roles that are placed out there, you still need a human to take that shortlist and start having conversations in both directions to really understand, is this the right fit?”
In a services organization where career aspirations and long-term engagement matter so much, I’d have to agree that AI can’t yet build the most critical components of work culture.
Diversifying your labor pool
Let’s pivot to diversity. For many business owners, widening the gap to hire a more diverse workforce can be difficult. How does Malan recommend doing so in a thoughtful way to embrace diversity and maintain high-performance teams?
His recommendation is simple: focus on the business benefits. When you overlook large pools of talent, you miss out on benefits you may not even realize you’re missing:
“If you’re looking at science, for example, there are more female life sciences graduates than men every year. And if your hiring practices are not sufficiently inclusive so that you’re adequately accessing that talent pool, you’re really not doing your business any faith,” he said.
He also cited veterans as an untapped group worth reaching.
But how can we tangibly reach these groups? What tactical insights are we missing?
Malan says to start with the folks who already work for you. Have actual conversations with people who represent underutilized talent pools and ask them what’s needed to create a friendly and inclusive environment for them. If your organization is big enough (20+ employees), encourage people to form affinity groups, and find ways to loop those affinity groups into operations and business development initiatives.
Then, when it’s time to recruit and hire, advertise and highlight the ways your organization actively promotes inclusion. In Malan’s words, “Before you know it, there’ll be a significant increase in applicants from that particular group.”
What’s your approach to hiring these days? Are you embracing mixed labor solutions? As always, my inbox is open for stories, questions, insights, and whatever else is on your mind.
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