Organizations are increasingly realizing the need to create an agile workforce; a workforce where full-time employees and temporary workers are able to contribute equally to specific projects and work requirements. In this article, we look at the direct sourcing method, and how your organization can benefit from using it.
Achieving workforce agility gives organizations the ability they need to pivot their workforce at a moment’s notice - accessing new skills, remote workers or specialized consultants at the exact moment that they are needed.
This is the future of work, where organizations will focus on optimization by transforming their business operations, creating deeper talent pools (of both employee and non-employee workers) and implementing new flexible ways of thinking.
Due to its ability to provide organizations with high-quality skills, greater staffing flexibility, lower employment costs and a huge range of qualified temporary workers, the contingent workforce is the perfect place for those companies looking to achieve greater agility.
Yet, despite these positive trends, many organizations are still struggling to effectively source and engage temporary workers in an efficient and cost-effective manner.
Using staffing agencies to source temp workers is certainly an effective method when combined with the use of a vendor management system (VMS) to consolidate and manage those vendors, but combining this with a strategy that allows you to also source temps internally can improve your access to non-employee talent even further.
One of the most popular, and increasingly trending, methods is direct sourcing.
So, what is Direct Sourcing?
Direct sourcing is simply the action of finding and engaging non-employee talent for temporary and contract positions directly through your vendor management system, rather than through traditional staffing suppliers and staffing agencies.
This recruitment strategy uses the information that you have stored on your VMS to identify temporary workers and create a talent pool that allows you to engage or re-engage highly-skilled workers when required.
This talent pool can be built from workers that you have engaged with before, those who almost landed a position with your company and just missed out, as well as those who have engaged with your business through social media, applied on job boards, LinkedIn, the company career page or referrals . This gives you everything you need to create a talent pipeline for future contingent positions.
Why Direct Sourcing Matters in a Contingent Workforce Program
Organizations are facing unprecedented workforce challenges - talent shortages, cost pressures, and a growing reliance on contingent labor. Direct sourcing helps address all three:
1. Faster Access to Talent
Traditional staffing channels can take weeks to fill a role. With direct sourcing, hiring managers can tap into a ready-to-go pool of known talent - people who already understand your business and culture.
2. Cost Savings and Transparency
By bypassing agency markups, companies often save 15–25% per hire.
And because everything is managed in-house, you have full visibility into spend, rate consistency, and performance metrics.
3. Stronger Employer Branding
Every interaction in a direct sourcing program happens under your brand - creating a positive, lasting impression with contingent talent. That means better engagement, re-deployment, and retention over time.
4. Agility and Workforce Flexibility
Direct sourcing gives organizations the ability to scale teams up or down quickly based on project needs - an essential advantage in fast-moving markets.
What are the benefits of a Direct Sourcing Strategy in your Contingent Workforce Program?
There are a number of benefits that come with the implementation of a direct sourcing strategy, when used in tandem with staffing agencies. We have listed just a few of the key benefits here.
Create a pool of established talent
Direct sourcing empowers your organization to create a talent pool from your internal recruiting activities and brand reach, whether that be former employees, retirees or previous applicants. This talent pool decreases hiring risk since you can already be confident in their abilities, and makes it significantly easier and faster for you to reach out to skilled workers at the exact moment they are needed.
Improve time-to-fill metrics
When you have a pool of candidates in your VMS that you already know about, and that know about your organization, you can dramatically improve the time it takes to fill headcount requirements. You won’t have to wait for staffing agencies to find candidates for you. Instead, you will be able to fill open temp positions in rapid time with workers who have already engaged with your organization previously.
Cut down recruitment costs
Staffing agencies are still highly beneficial for your contingent workforce, and can help you access the best available talent. However, mixing the use of staffing agencies with direct sourcing will help you to cut down on recruitment and transaction costs by having a ready-made pool of temp workers that you can engage internally when required.
How a VMS Strengthens Your Direct Sourcing Strategy
A Vendor Management System (VMS) is the backbone of any mature contingent workforce program. It acts as a centralized hub for managing all contingent workers - both directly sourced and agency-supplied.
Here’s how it amplifies the power of your direct sourcing program:
1. Centralized Workforce Visibility
A VMS provides a single view of your entire contingent workforce: who’s working, where, for how long, and at what cost.
This transparency helps HR, Procurement, and Operations make data-driven decisions with confidence.
2. Process Automation
From requisitions and approvals to onboarding and payment, a VMS automates key steps in the hiring process - eliminating bottlenecks and freeing teams to focus on strategy.
3. Compliance and Risk Management
A VMS standardizes documentation and compliance workflows, ensuring every worker - direct or vendor-sourced - meets corporate and legal requirements before starting work.
4. Reporting and Analytics
With built-in analytics dashboards, a VMS tracks key metrics like time-to-fill, spend, and performance - helping organizations measure and optimize ROI.
5. Integration and Scalability
Modern VMS platforms like Conexis VMS integrate seamlessly with HRIS, ERP, and payroll systems - creating a connected, scalable workforce ecosystem.
Final Thoughts
Direct sourcing represents the next evolution in contingent workforce management - giving companies the speed, control, and agility they need to stay competitive.
But to unlock its full potential, you need more than a strategy - you need the right technology foundation.
Learn More about Direct Sourcing
Check out our Direct Sourcing Guide to learn more about Direct Sourcing, its benefits and how a Vendor Management System strengthens a Direct Sourcing Strategy: View Direct Sourcing Guide
Discover the Power of Conexis VMS for Direct Sourcing
Conexis is an award-winning Vendor Management System built for organizations that want the power of enterprise software without the complexity or cost.
Leveraging the latest technology, Conexis delivers the expertise, reliability, and security of enterprise systems, while offering the flexibility, user friendliness and tailored, personal service you require. Learn more about our Company and why organizations Choose Conexis VMS.
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Additional Articles on this Topic:
- Direct Sourcing: What is it?
- Direct Souring vs. Traditional Staffing Models
- 5 Benefits of Direct Sourcing
- 5 Direct Sourcing Retention Tips for Contingent Labor
- Building a Direct Sourcing Strategy
- Why a Vendor Management System is Essential for a Direct Sourcing Program
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