74% of Leaders Believe Effective Management of External Workers Is Critical to Success

Recent research finds organizations unprepared to manage more complex workforce

Published: Tuesday, June 21, 2022 - 12:01

(Deloitte: London) -- MIT Sloan Management Review and Deloitte have released findings from their 2022 Future of the Workforce report, “Orchestrating Workforce Ecosystems: Strategically Managing Work Across and Beyond Organizational Boundaries.”

The report finds that while 74 percent of leaders and managers agree effective management of external contributors is critical to their organization's success, only 30 percent indicated that their organization is sufficiently preparing to manage a workforce that is more reliant on contractors and freelancers. In response, they offer a framework for orchestrating an extended workforce as more organizations bring in external contributors to support their strategic business objectives.

This marks the third year MIT Sloan Management Review and Deloitte have conducted joint research on the future of the workforce. Each year, the research team surveys and interviews executives and other thought leaders from industry and academia. “Orchestrating Workforce Ecosystems” finds that an overwhelming majority (93%) of survey respondents consider external contributors a part of their workforce. The authors propose viewing the workforce as a workforce ecosystem—a structure that encompasses an organization’s extended workforce with both its internal and external contributors and the relationships between them. Effective management, the report finds, demands significant shifts in management practices, technology and data considerations, and leadership.

“Organizations today are increasingly relying not only on full- and part-time employees but also on a more expansive and connected group of contributors—a workforce ecosystem. These structures include long-term contractors, temporary gig workers, subcontractors, complementors such as app developers, employees, and others," says Elizabeth J. Altman, MIT Sloan Management Review guest editor, assistant professor of management at the Manning School of Business at UMass Lowell, and report co-author. “Orchestrating them requires new approaches to leadership, new technologies, and new management practices.” 

“For leaders to see significant increases in innovation and performance among their employees and other key contributors, they will need to change the way they think about their workforce and how an ecosystem can help support organizational goals,” added report co-author Robin Jones, principal at Deloitte Consulting LLP.

According to the report, that alignment can be achieved when C-suite, senior business, and functional leaders work together, with each playing an essential role that contributes to the overall success of the workforce ecosystem. To do this, leaders must have a broad understanding of how each participant—internal and external—contributes to creating value for the organization.

Additionally, the research team grouped its survey findings into a maturity index and identified organizations that are most successful in the integrated cross-functional management of internal and external workers, recognized as “Intentional Orchestrators.” These organizations are:
• More adept at cross-functional coordination, with 66 percent of them reporting that their organization coordinates managing internal employees and external contributors across functions.
• More likely to focus on hiring and engaging the internal and external talent they need to meet their strategic objectives, with 79 percent of Intentional Orchestrators asserting that they will be able to hire the employees their organization needs over the next 18-24 months, and 80 percent agreeing that they are positioned to hire key external contributors over that time period.
• More likely (91%) to say their organization supports managers looking to hire external workers.

Global reporting includes insights from 4,078 leaders and managers in 129 countries across 29 industries, and interviews with 19 thought leaders.

About MIT Sloan Management Review

MIT Sloan Management Review (MIT SMR) explores how leadership and management are transforming in a disruptive world. We help thoughtful leaders capture the exciting opportunities—and face down the challenges—created as technological, societal, and environmental forces reshape how organizations operate, compete, and create value.

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