With the U.S. unemployment rate still meager by historical standards, companies continue to grapple with the changing nature of the nation’s workforce. Many organizations want to impose return-to-office mandates on employees but fear losing their best talent. Others have gone fully remote but are still figuring out how to onboard and train new employees and reshape an organizational culture built on face-to-face, daily contact.
Adapting to these new realities can also mean viewing the relationship between employer and employee in a different light to maximize a company’s investment in human capital. To understand how the relationship might change within finance, Katie Kuehner-Hebert spoke with Ryan Doyle, the CFO of Worksuite, a global freelancer management system based in Wilmington, Delaware.
The post-pandemic future of work has disrupted traditional business operations. How has this transformation affected the role of the CFO?
CFOs are more involved in technology-buying decisions than ever before. Post-pandemic, a flurry of software spending occurred as companies moved to remote working. That led to waste, as companies signed up for software-as-a-service tools that were duplicative or unused. Over the last 24 months, finance functions have been working to rationalize that software spending. Post-pandemic, CFOs play a more prominent role in supporting their teams with technology buying decisions.
Why is it crucial for CFOs—and the entire C-Suite—to grasp the advantages of establishing and expanding a contingent workforce?
Executives are always in pursuit of the best talent. In 2023, an all-time high of 38 percent of the U.S. workforce comprised contingent workers—those who perform specific tasks on a temporary or contract basis. Globally, the contingent workforce is expected to increase by 34 percent in 2024 and by another 25 percent in 2025.
Contingent workforce growth is materially outpacing growth in the total workforce. What does that mean? This means talent is shifting from the traditional employee/employer model to a more flexible freelancer one.
Individuals realize there are more ways than ever to monetize their skills. Working on a contingent basis allows people to maximize earnings and live their personal lives without the geographic constraints of an office. The office of the CFO needs to provide its team with the opportunity to adopt this new way of working. That includes integrating freelancers into finance’s daily work and operations.
What are the top three ways organizations can benefit from a contingent workforce?
Organizations that successfully build and utilize a contingent workforce are miles ahead of being prepared for the next decade of business than those mandating a return to the office. The former focuses on achieving a positive organizational impact.
The benefits of adopting contingent workforce strategies include:
- Save on costs. The average employee costs 25 to 40 percent more than the average contingent worker. Organizations can achieve a competitive advantage by optimizing their cost structure by leveraging contingent labor. Employees come with payroll taxes, benefits and insurance, which drive up the average cost per team member.
- Engage the best talent. Leveraging contingent labor increases the talent pool available to organizations. Competing for the same employees due to geographic or in-office requirements drives up salary costs. For example, the average price of an engineer in Silicon Valley is materially higher than the average cost of an engineer in tier 2 or tier 3 cities. Is the talent materially better? Some of the best engineers are moving to new locations, knowing they can work remotely.
- Easily set up in new geographies. Expanding to a new country usually includes a material investment to establish a local workforce presence.
What three things do CFOs need to have on their agenda that weren’t a factor before the pandemic?
The first is to embrace training or learning to train in a fully remote environment. Most CFOs were trained in person at an office, and the old training models won’t work for fully remote companies. CFOs need new ways of training and engaging finance team members.
The second is that CFOs are now technology buyers. While finance has always negotiated or helped negotiate certain vendor purchases, CFOs today are being asked to weigh in on more purchasing decisions to rationalize tools and evaluate capital allocation decisions, in addition to being involved in the negotiation process.
The third is AI. While the use and adoption of AI aren’t a post-pandemic response, they are imperative because AI is the most transformative technology of our time. Guided by the CFO, every finance team needs to experiment with AI to see how it can increase efficiency and do more with less.
