4 min read

How to Start Using On-Demand Labor the Right Way

By Jonathan Katz on Nov 23, 2020 8:24:55 AM

You’ve heard of on-demand labor, and maybe you’ve been looking for a solution to add flexibility to your operations. But it isn’t always easy to take those first few steps. So, what’s the right way to start using on-demand labor?

Veryable has helped thousands of companies launch their operational initiatives with on-demand labor through our online marketplace. The outcome? A custom-built flexible labor pool and a drastic reduction of the traditional labor constraints in just a few months using our platform.

In this article, you’ll learn how to reduce labor costs and gain flexibility. These five steps will help you get started using on-demand labor the right way:

  1. Commit to incorporating on-demand labor
  2. Involve multiple people in the process
  3. Focus on one area first
  4. Use on-demand labor for general work
  5. Build your labor pool


Step 1. Commit to incorporating on-demand labor

On-demand labor by itself will not be a magic solution to your company’s problems. There, we said it. As much as we wish that were the case, to see results like reduced turnover costs and flexibility to meet demand, you will have to go through the process of building a flexible supply of on-demand labor. This process should only take between six weeks to four months depending on your business size. The good news is that during this time you will already be reaping some of the benefits of on-demand labor.

If multiple managers will be using on-demand labor, ensure they are committed to coordinating this effort. This includes posting work opportunities, ensuring operators are trained for the work, rating them when they finish their work, and following best practices when selecting a mix of new and familiar workers to build a labor pool.

Commit to this process of building your own labor pool with the understanding that the end goal is a flexible supply of workers. Not just having a labor pool either, but one that understands your processes and wants to work with you again. If you establish this mindset, you will be off on the right foot in using on-demand labor in your business.


Step 2. Involve multiple people in the process

It is a best practice to add multiple users to your on-demand labor platform to ensure full transparency within your team.

Much like you have a leader in every department of your organization, you’ll want multiple users to manage the different work areas. In our on-demand labor tool, multiple users in your organization can access the portal to post opportunities and accept workers.

As you begin to use an on-demand labor platform more, you’ll need more people administering the tool to promote transparency and synchronization among your team. 


Step 3. Focus on-demand labor in one area first

The quickest way to see results with on-demand labor is to attack one pain point first. Focus your workers from the on-demand labor pool in one area of your business. This allows you to start identifying great workers and work out how you will implement on-demand labor.

For example, you could only assign on-demand workers to the packing area at first. That way you can use this area as a trial to establish how you will use the on-demand labor platform, how you will train the workers, and who in your company might be able to help you grow your use of on-demand labor to other areas when you see results.

By focusing on one area first, you can address one of your business’s pain points while improving your on-demand labor setup. As you see results here and start expanding on-demand workers into other work areas, you will build a solid foundation of workers you like in your labor pool.


Step 4. Use on-demand labor for general work

When choosing which area of your business to focus on-demand labor in first, keep this tip in mind: use on-demand labor for general work. This will free up your specialized workers to focus all their efforts on producing their output.

Imagine a visit to the dentist. A majority of the time, a hygienist cleans your teeth and handles most of the visit. Then at the end, the dentist comes in and pokes around while making the same five dentist jokes you’ve heard all your life. 

You probably spend twenty minutes with the hygienist for every one minute you spend with the dentist. That’s because the dentist is a specialist, and the practice is set up in a way to let the dentist focus on doing what they specialize in. The team of hygienists handle the time-consuming tasks so the dentist can focus on their specialty.

This story can be applied to manufacturing. Imagine if a CNC machinist who has other duties like cleanup or prep work could remove those obstacles from his day and focus solely on operating his machine. There will be huge boosts to his output by removing the clutter from his day!

Talk to your specialized workers about the tasks that take away from their main goals, and give those tasks to someone else at a different pay grade.


Step 5. Build your labor pool

This is the grand finale you’ve been working towards: building your labor pool. While the  concept might be new to you, you’ve already been chipping away at this continual process. 

A labor pool is a network of independent workers familiar with your operation that can work on an as-needed basis. Those workers who you’ve already worked with and trained are considered part of your labor pool. This means they will not require training again, saving you time and money. 

As you continue using on-demand labor, you should cycle in new workers consistently so that more people are exposed to your work environment and you can identify new, reliable workers to add to your labor pool. That way when you post opportunities in the future, there will be more  people who are ready to work that are already familiar with your operation specifically.

Intentionally and continuously building your labor pool allows you to increase the number of on-demand workers who understand your business, allowing you to precisely match labor to your demand. As more and more people have been trained in your operations, you will start to see the value added to your business by an on-demand labor pool.


Looking for an on-demand labor platform?

All of this sounds great, but if you don’t have access to workers on demand, there isn’t much you can currently do. 

To start working toward reduced labor costs, reduced turnover, and greater flexibility for your business, create your free business portal with Veryable.

Jonathan Katz

Written by Jonathan Katz