When independent contractors make more sense than fulltime employees | By Cheryl Heinonen
Once upon a time, on a longterm assignment with a client in San Francisco, I came across The Lurker. I'd see him loitering in the lobby, the cafeteria, and the elevator banks. Coworkers spotted him wandering around in engineering and QA, even though he didn't work in either department. He was the only nonsmoker I've ever known to hang out on the "smoking porch." He was a nice, bright guy who obviously had way too much time on his hands.
After a few months, I met The Lurker's manager. He explained that he'd hired the guy as a fulltime employee several months before to work on a specific project. Then, the project was cancelled. The boss had yet to find another project that matched The Lurker's expertise. And so, in the meantime, the poor employee spent his days aimlessly wandering the halls, forever wasting his own time and his employer's money.
An extreme case, to be sure. But it does illustrate a valuable point for hirers: Fulltime employees aren't always the best solution. Recruiting a new permanent worker might be your first impulse when a project demands staffing, but you'd be wise to stop for a moment and consider the guru alternative. Here's how to figure out when hiring freelance talent makes the most sense.
What
You Need to Know
For finite projects, gurus have a passel of pros and only a couple of
cons compared to fulltimers. Some of these advantages are financial. Others
have more to do with allowing you to save time and get exactly the talent
you need when you need it. Think of it as just-in-time hiring.
Convenience Hiring
Gurus can save you money. You only have to pay the guru's hourly
or project fee. You don't have to pay for insurance or benefits, office
space and supplies (unless you want them to work onsite), computer equipment,
or a sandwich at the company picnic. You also save money on training costs:
While fulltimers demand (and deserve) all the training and career development
resources you can throw at them, gurus take care of developing themselves.
Gurus also give you greater flexibility. If you only need 15 or 20 hours of work per week for a couple of months, so be it, as long as you both agree to it up front. If you know you're going to need someone 12 hours a day for the three weeks leading up to a big product launch, you can do that too. Gurus don't require any messy longterm commitments. If you're planning a road show for your company, for example, you can hire all the analysis, marketing communications, and public relations gurus you need for the duration of the project. Afterwards, you pare the team back to your core employees, as the independents go their merry ways.
The Right Person for
the Job
In addition to being more convenient than fulltimers, gurus can also make
better workers. For one thing, they give you instant expertise.
As a matter of survival, independent professionals stay current on the
latest technologies and trends in their fields. If you suddenly need expertise
in the latest weird technology, gurus can give it to you without any expensive
retraining. Whatever the job, chances are you can find a guru with exactly
the skills you need. You don't have to settle for a fulltime staffer whose
skills are "sort of close." And you don't have to hire a new fulltimer
whose skills you may not need when the project is done.
Gurus also tend to be more focused: They join a project without the attendant baggage of a fulltime employee. By nature, they won't be as concerned with company politics, or their future with the firm, and it's much easier to keep them focused on the project at hand.
Finally, gurus are good for bringing in fresh perspectives. For example, I once had a client who was developing a new intranet to boost employee communications. In going over the new design, I noticed that it looked remarkably similar to the old one. It didn't look fresh or exciting -- both of which were stated design goals. I asked the client whether they'd considered using some new, fresher colors. The reply was no, because all of their intranet sites followed the same format. Why? It's just how we do it.
Then we brought in a guru, who promptly put together a design that was completely different from their other sites yet met their stated goals. Just having the guru designer in the room to question the logic of unwritten rules helped everyone to take a new look at their work. One nice byproduct of all this: After the in-house designer got over his hurt feelings, he found himself energized by this newfound permission to innovate.
When Gurus Aren't Right
Despite all these advantages, gurus aren't always perfect. For one thing,
because they don't have a longterm relationship with your company, they
can't always see the forest for the trees -- they may not see how their
specific project/product fits into your company's longterm strategy. That
lack of the long view can make them less effective than fulltimers who
have a better sense of their work's overall context. (You can offset this
by pairing gurus with fulltime employees, who can give them that much-needed
perspective.)
Gurus are also less than ideal for assignments that require detailed, intimate knowledge of your company's internal dynamics. Every company is idiosyncratic in the way it communicates with employees, parcels out responsibilities, and does its work. If your open position requires someone who understands these idiosyncrasies -- if, for example, the job means marshalling resources from different departments -- you're probably better off hiring a fulltime employee.
Finally, using a guru can mean losing valuable knowledge. If they're functioning properly, organizations learn from experience. But when a given project is over, your gurus can take much of that experience away with them -- and it won't be added to your company's institutional memory. That's why it's important to assign a fulltime employee, who's been specifically asked to distill and communicate the experience to others, to manage every project. That way, each project's lessons can be added to your company's longterm knowledge base.
What
You Need to Do
To decide between a guru and a fulltime employee, you need to ask yourself
a bunch of questions. You first need to assess the skills needed for the
project/position. Then you need to look at the position in the context
of your company's longterm plans. Finally, you need to figure out a realistic
timeframe for filling the position.
Assess Your Requirements
The first question: Can someone already on your staff do this job? There's
no quicker way to torpedo employee morale than to hire a consultant for
a job that someone on staff feels they could do. If one your permanent
employees has the skills and experience you need, consider them very,
very seriously for the job. If on closer examination you don't think that
person has all the skills you require, make sure you make them part of
the project team. That way, they may learn enough from the guru to tackle
a similar project on their own next time around. Don't get me wrong: Gurus
aren't trainers, unless you've agreed on it upfront. But employees can
benefit hugely from working with them.
Next, ask yourself: Will this project benefit from outside input? There are some jobs -- particularly creative ones -- for which you don't want someone in-house. For instance, a website designer who only works with one company can easily fall into a tired routine. If you're looking for a new, fresh approach to a problem, better to use a guru who regularly deals with a variety of companies and is thus forced to be more creative. On the other hand, does this job require in-depth company-specific knowledge? Does it require, for example, diplomatically marshalling resources from within the company? If the answer is yes, you should probably hire a fulltime employee.
Take the Long View
Next, look at the hiring decision in view of your company's longterm plans.
Is the job really a shortterm position or could it be an ongoing project?
Are you sure the project isn't going to turn into a permanent campaign?
Are you positive you won't need this particular set of skills again? Would
the skills you need to complete this job be useful for other projects
your company is planning?
If you know this project won't be an ongoing part of your business, hire a guru. Otherwise, you run the risk of having a fulltime employee without much to do at the end of the immediate project. Saying goodbye to a guru at the end of a project is a lot easier -- for you and your staff -- than watching someone like The Lurker wander the halls.
If, on the other hand, you think the job could develop into a fulltime gig, or if you know the skills are transferable to other projects within the company, consider a permanent employee. Just make sure the employee knows upfront that they'll be moved to another area at the project's end.
If you do hire a new fulltimer, or transfer an existing employee, to the project, will you be able to keep him or her fully engaged in his or her area of expertise? If, for example, you hire a graphic designer who spends 20 hours a week pasting HTML, you're going to have one disgruntled designer on your hands. There's no quicker way to send employees to the job boards than to hire them as experts in one field and then hand them jobs from another.
Watch the Clock
How much time do you have to fill this position? If you're working in
an area of the country with a labor shortage, it can take months to find
the right candidate for a permanent position. Even if you find that candidate,
the hiring process doesn't move quickly. While hiring times have shrunk
(five years ago, a five to six week interviewing process was not unusual;
now the average is closer to one to two weeks), it still takes time to
get to know the people you're considering as fulltime employees. Will
their personalities fit in with the rest of the staff? Will they make
a longterm commitment to the company? Will their skills complement the
rest of the team? Getting the answers to these questions can take time.
If the work absolutely must be done by a certain date, and you don't have time to make a permanent placement, hire a guru. You'll need to focus on their skills, areas of expertise, and reliability, but you won't be distracted by the longer-term personal fit issues.
What should you do if you don't know all these answers? Go with a guru. You can always hire a fulltimer later, and in the meantime the guru will be getting the job done. And that's the ultimate goal, right?
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