Outsourcing, consulting, fractional, contractors, temps, part-time help…

What does it all mean and when do we need it?

This is the time of year when many organizations wrap up projects, assess their resources, forecast for the upcoming year, and evaluate if they have the people to do the work. Sometimes they make plans to improve processes and tough decisions to reorganize, perhaps even letting people go.

There are many work statuses, like contractor or outsourcer, that can garner some questions and confusion among people — and for good reason. As we know, change is constant and from time to time we may need help in a pinch yet can’t afford to add to our headcount. In general, these are convenient, creative, and cost-effective methods for adding human resources to your company to help with the workload and/or strategy. These resources can provide subject matter expertise, short-term project management, and sometimes extra hands because of seasonal needs or temporary vacancies on your team.

Let’s put in some brief definitions to start.

Outsourcing

Funneling work to another person or company because of their expertise.

• We outsourced recruiting so we could get fully staffed to scale up our business and meet a new contract.
• We outsourced our HR function while we determined what our needs would be for the next year.

Consulting

Hiring a subject matter expert from a company or independently on a temporary basis, often for projects.

• We hired a consultant to help us create a new onboarding plan.
• We used a consultant to review our practices and processes and improve our workflows.
• We used a consultant to do all of our DEIB training.

Fractional Help

This term is popping up everywhere lately, from fractional CFOs to fractional HR Directors. Basically, it’s someone who lends their expertise to a startup or smaller company on a contractual, part-time, or retained basis.

• We hired a fractional HR Director to give us strategic direction and poise us for the growth that our startup company has planned.

Contractor or Freelancer

An independent worker who has autonomy and flexibility but does not receive benefits such as health insurance and paid time off.

• We used a contractor to help us implement a new HRIS (HR Information System).

Part-Time Employee

An employee on your team, on your payroll, and in a regular role with responsibilities and benefits that come from the company.

• We hired a part-time recruiter because our recruiter couldn’t keep up with the volume of hiring and we knew it would continue.

It’s important to understand that some of these definitions overlap and are similar in nature. Many of these workers consider themselves gig workers and enjoy the flexibility of their roles. Some may even work for multiple companies at the same time, while others may be hired as full-time consultants for a consulting company where they are sent out to clients. For example, at Purple Ink, we have full-time and part-time consultants who work with our clients. Sometimes they are outsourced for a contracted period with a certain client. Occasionally, if there is a special project or higher demand for our services, we will contract with someone on a temporary basis to work with us to service our clients.

How do you pay them?

You may put the person on your payroll or pay them as a 1099, where you don’t pay payroll taxes for them, etc. You may also contract the work through a company and pay the company instead of the consultant directly.  

When might you need this temporary help?

1. If someone on your HR team has left and you aren’t sure if you need to replace them, you may want to outsource their work while you assess the situation.
2. If you are in a growth phase and need to staff a new operation, consider outsourcing some recruiting help.
3. If you have someone on a leave of absence and don’t want to burn out the rest of the team, you might outsource their role until they return.
4. If you need some expertise to help you navigate change, outsourcing can help.
5. If you or your team are buried with the day-to-day and can’t get the big rocks moved, an outsourced consultant can take on some of the work.

Want to chat about a scenario of your own? Reach out to Purple Ink and we’ll be happy to brainstorm with you about these and other creative talent solutions.