While attracting and retaining top talent has always been a cornerstone of successful business, the way that companies are connecting with workers is changing. The COVID-19 pandemic, coupled with a fragile business landscape and rising unemployment, has exacerbated the need for contingent workers. This has led to a shift away from traditional recruitment methods, with companies utilizing direct sourcing as a means of quickly filling vacant roles.
1. Direct sourcing is the process by which an employer develops its own candidate pool to leverage contract, casual, or freelance workers — known as contingent workers.
2. 90% of HR professionals anticipate that their company’s contingent workforces will grow or remain the same size in the next three years.
3. Direct sourcing often results in cost reductions, faster hiring, and the ability for companies to engage with proven talent.
4. The top direct sourcing solutions include Managed Direct Sourcing, Freelance Management Systems, Talent Marketplace, and Talent Network.
5. Alternatives to direct sourcing include external recruitment, employment agencies, and active sourcing on job boards and social media.
In recent findings published by the HR Research Institute, 90% of HR professionals anticipate that their company’s contingent workforces will grow or remain the same size in the next three years. In addition to these findings, many employees are choosing to prioritize flexibility over stability, opting for project work rather than long-term service with a single organization. Consequently, it’s hardly surprising that direct sourcing – or hiring from pre-screened talent pools – has grown as an alternative to traditional recruiting and staffing methods.
Definition: What is the direct sourcing model?
As a concept, direct sourcing has existed for as long as companies have hired people. It is the process by which an employer develops its own candidate pool to leverage contract, casual, or freelance workers (otherwise known as contingent workers).
For more information on contingent workers check out What’s the Difference Between Employees and Independent Contractors?
Direct sourcing, which is occasionally referred to as “self-sourcing” in the recruitment industry, can help to remove a company’s reliance on third-party staffing and recruitment agencies. This often results in cost reductions, faster hiring, and the ability to engage with proven talent.
Direct sourcing allows a company to save time and costs by filling its vacancies with contingent workers. These workers can include past contingent workers, manager referrals, silver medalist candidates (worthy applicants who just missed the mark on a previous job posting), returning retirees, and boomerang employees (those who return to work on a contingency basis for a company they have previously left).
One caveat regarding direct sourcing: While it is simple in concept, effective direct sourcing is often more complex, and involves a combination of organizational readiness, technology, and program management. For companies that wish to take advantage of direct sourcing, they should consider how to use it as part of a wider recruitment strategy, and take the necessary time to build and maintain their talent pool.
What are the benefits of direct sourcing?
There are significant benefits to be gained from direct sourcing your contingent workers. Here are five of the key advantages that direct sourcing can provide your business:
The top four direct sourcing solutions
Before a company can implement direct sourcing solutions, they need to establish which method is best for their business. Here are several direct sourcing solutions for a company to consider:
What are the alternatives to direct sourcing?
While direct sourcing has seen a spike in popularity, there remains a host of alternatives for companies to choose from. These include:
Direct sourcing is defined by companies leveraging their own brand and network to attract and engage contingent workers. That is, they create a talent pool of candidates for temporary positions that arise at their company.
Direct sourcing is an effective way for companies to expand their talent pool and quickly access contingent workers. More recently, direct sourcing has emerged as a viable (and often preferred) alternative to traditional forms of staffing and recruitment.
There are many factors that make direct sourcing an attractive proposition for employers. These factors include cost savings, quicker time to fill positions, and the ability to maintain talent pools that are filled with available, pre-screened candidates.
As the only PEO with a dedicated, in-house recruitment team, Horizons recruits professionals across all verticals. We implement direct sourcing for all our ongoing clients, enabling them to connect with the world’s top talent and establish their compliant operations internationally.