Learn best practices for managing these types of workers.
Managing contractors and consultants skillfully is a vital step toward optimizing your company’s overall performance. But what does that mean in practice, and how does it differ from managing full-time staff? Let’s review the ins and outs of managing consultants and contractors successfully.
In this article, we will cover each of the following aspects of working with consultants and contractors:
- Key benefits and challenges
- Setting clear expectations and build relationships
- Creating an inclusive working environment
- Managing project timelines
- Optimizing contractor performance
- Mitigating risks
- Tools to use for best results
Understanding Contractors and External Consultants
Contractors and external consultants are similar, but not exactly the same. A consultant provides guidance to a business within a domain of expertise. A contractor performs a specific job for a set duration of time. The number of hours worked per week, and assignment duration, can vary widely for either. And some work with clients periodically, on a repeat basis.
Key Benefits
Working with contractors and external consultants brings major benefits:
- Specialized skills or expertise
- Cost-savings
- Support for over-burdened employees
For instance, hiring a consultant can give you access to a level of experience you don’t have on your team. Or you could attract top talent in a particular skill area without paying a full salary.
Common Challenges
Managing external professionals can prove tricky. Issues like these can even derail projects:
- External professionals might have trouble fitting into the culture or adhering to group norms and expectations.
- Staff may resist consultants’ ideas or contractors’ methods, which represent change.
- Consultants or contractors may not feel included in the group.
- Contractors could have a greater sense of urgency around deadlines than staff if they’re paid on a project basis.
Let’s look at how to move beyond such challenges by starting off on the right foot.
Setting Clear Expectations and Building Strong Relationships
Follow these steps to start building a great relationship with external professionals:
- Define project goals and objectives. Provide the full context of why the project is necessary, explaining the problem it solves, along with key stakeholders.
- Establish roles and responsibilities for contractors. Outline what they need to do, and when. Also detail where their responsibilities end.
- Develop communication plans and channels. What platforms will they use, and what communication norms should they adhere to? Find out if you need to modify these norms based on their needs, too.
- Introduce them to key staff, explaining how they’ll be working together. Make sure external consultants and contractors have the contact info they need.
- Understand contractor motivations and needs. What type of environment do they need if they’re coming to your workplace? What helps them feel inspired and energized? Some may enjoy collaborative work; others may work best independently.
Creating a Flexible and Inclusive Work Environment
Offer scheduling flexibility, respecting contractors’ other commitments. After all, they may be working for multiple clients.
Making contractors feel like part of the team by extending invites for things like group lunches or work parties. Whether they participate or not, they’ll appreciate the gesture. And include them in core team meetings when necessary for the project, making sure the time works for their schedule.
Encourage collaboration and open communication as well. Let them know about collaborative meetups and platforms when appropriate.
Managing Project Timelines and Performance
Work hand in hand with consultants and contractors to create and adjust project schedules. Establish a regular routine of check-ins about project status.
Use project tracking software to measure whether you’re hitting key targets on time. Discuss any setbacks and renegotiate dates if needed. Review the external professional’s contributions periodically to ensure quality.
Optimizing Contractor Performance Through Support and Feedback
Understand that in most cases, external professionals will have well-established working methods. Don’t make them feel micromanaged by asking them to adhere to a certain set of practices unless it’s vital to the project or safety.
Provide training, resources, and support to contractors when needed. They’ll likely view this as a major perk of working with you.
Offer constructive feedback and recognize their achievements in front of the team. Contractors want feedback just as employees do, and it will benefit them professionally.
Mitigating Risks and Ensuring Compliance
Identify and address potential project risks, and avoid exposing yourself to unnecessary risks. For instance, avoid sharing sensitive data unless it’s absolutely necessary and can be done safely. Have a carefully designed contract created by an attorney that specifies the contractor’s responsibilities and prevents you from assuming any avoidable risks. And avoid liability for a potential workplace injury suffered by a consultant or contractor by having the necessary insurance in place.
Ensure compliance with industry regulations and standards, too. Make sure you’ve categorized a consultant or contractor accurately, based on the relevant standards. Review the criteria outlined by the U.S. Department of Labor, IRS, and various state laws.
Tools and Technologies for Effective Contractor Management
Use tools like these with contractors to facilitate a strong project workflow:
- Project management software. These tools will support strong collaboration and organization, showing all team members project status and tasks they need to complete. This boosts accountability within teams.
- Communication and file-sharing tools. Contractors working remotely will then have access to everything they need, avoiding bottlenecks.
Time tracking and invoicing software. Such tools make billing processes transparent and cut down on the time they require, which will ultimately benefit your contractors and your company.
FAQs
How can I select the right contractors for my project and build a strong working relationship?
Check references from past clients. Did the projects have a similar scope to yours? Make sure they have experience working with projects of the same size and caliber as the one you’re hiring them for.
What are the most common mistakes to avoid when managing contractors and external consultants?
Avoid “role creep” when working with these external professionals. Be very clear about what their role entails, and don’t expect them to take on additional responsibilities without compensation.
What should I do if a contractor is not meeting expectations, and how can I address it effectively?
Document any issues that occur, being as detailed as possible. Then talk with the contractor one on one and create a plan for improvement together. Discuss any areas of confusion or needs for support and training.
What are the best practices for maintaining positive and long-lasting relationships with contractors?
Give them plenty of credit for their hard work. And be as inclusive as possible, giving them access to employee perks like a company gym or coworking membership, as Harvard Business Review suggests. Such benefits cost very little and go a long way toward building goodwill.
In Conclusion:
Managing a team of internal and external professionals can prove challenging. By following these best practices, however, you’ll help build a cohesive team that works together adeptly. Communicating and clarifying goals and protocols will ensure understanding. Carefully monitoring project status and providing feedback will help things progress smoothly. And maintaining strong relationships will let you benefit from the consultant or contractor’s services in the future—perhaps for years to come.
Sources
https://ca.indeed.com/career-advice/career-development/consultant-vs-contractor
https://rmas.fad.harvard.edu/basic-guidelines-contracts-and-contract-risk-management
https://hbr.org/2021/04/a-fair-way-to-lead-a-team-of-contractors-and-full-time-employees
https://www.pmi.org/learning/library/challenges-managing-external-internal-consultants-6670