The Unintended Consequences of Agile Businesses Saying No to T&M-based SOWs

We’ve all heard a lot about agility. It’s been touted as an essential quality in a successful workforce. However, building an agile workforce is complex and has proven difficult. 

 An agile workforce is composed of both internal (full-time employees) and external (staffing/ contingent/temp, outsourced, and project-based) workers. The need for an external workforce grows every day as organizations increasingly think of work as project-based rather than role-based. Project-based services—which include freelancers, consultants, and other non-staffing service providers—are commonly governed by statement of work (SOW) contracts. 

 Although it’s one of the largest categories, external services spend is largely undermanaged. Modern organizations generally have control of their staffing spend, since the MSP model handles this across most role-based work. But project-based services are more complex and—outside of large, highly visible strategic initiatives—often left to the business to self-manage. Organizations have spent the last decade trying to find a magic solution for this that is cost-effective, drives compliance, and allows managers to effectively meet the unique needs of their projects across the enterprise. 

 At the same time, these projects have shown high failure rates. According to a 2019 report from Oxford Economics and SAP Fieldglass, one in four SOW projects completed by suppliers is not completed on time or on budget. Clearly, efforts to establish policies that favor compliance over outcomes have been ineffective and have hampered workforce agility. 

 In an upcoming SIG LinkedIn Live, my colleague, Alejandro Builes, and Amanda Prochaska will discuss cases where one common general-purpose policy they refer to as “deliverables only, no T&M” (time & materials) SOWs limits agility and gives a false sense of security against risk. 

 Want to hear more?  

Join Alejandro Builes, VP of Product – External Workforce Solutions at KellyOCG®, and Amanda Prochaska, Founder & Chief Wonder Officer of Wonder Services for their live discussion with Dawn Tiura, CEO of SIG. Register here >>

Meagan Maloney

Meagan Maloney

Product Strategy

Meagan Maloney supports product strategy for External Workforce Solutions at KellyOCG®. She has spent her career in procurement transformation consulting focused on Source-to-Pay optimization for Indirect / Services Procurement categories.