Freelance management systems: 7 key features to look for
More companies are turning to freelancers and contractors to fill talent gaps and scale their workforce flexibly. However, managing a large external workforce comes with challenges around sourcing, onboarding, compliance, payments, and more. This is where freelance management systems (FMS) come in - providing a centralised platform to streamline the entire freelancer lifecycle.
But with many FMS options on the market, how do you choose the right one for your organisation? In this article, we'll explore 7 key features to look for when evaluating freelance management systems.
What is a freelance management system?
First, let's define what we mean by a freelance management system. An FMS is a software platform that helps organisations manage their contingent workforce - including freelancers, contractors, and gig workers. It typically covers the entire freelancer lifecycle from sourcing to offboarding.
A comprehensive FMS acts as a single source of truth for all freelancer data and processes. This centralisation helps improve efficiency, reduce costs, ensure compliance, and provide better visibility into the external workforce.
Why use a freelance management system?
There are several compelling reasons for organisations to implement an FMS:
- Streamline freelancer sourcing and onboarding
- Ensure compliance with worker classification and tax regulations
- Simplify freelancer payments across multiple countries
- Gain visibility into freelancer spend and utilisation
- Improve security and data management
- Enhance the freelancer experience
According to a report by Staffing Industry Analysts, companies using an FMS report an average 20% reduction in time-to-hire and 15% cost savings on their contingent workforce spend. With benefits like these, it's no wonder the FMS market is projected to grow to $4.5 billion by 2025.
7 key features to look for in a freelance management system
Now let's dive into the core capabilities you should evaluate when choosing an FMS for your organisation:
1. Talent sourcing and matching
A robust FMS should provide tools to help you find and engage the right freelancers for your projects. Look for features like:
- A searchable talent database or marketplace
- AI-powered matching of freelancers to projects
- The ability to create private talent pools
- Integration with external job boards and freelancer platforms
The best systems will allow you to source talent from multiple channels - including your own network, the vendor's marketplace, and third-party platforms. This gives you the widest possible talent pool to draw from.
2. Onboarding and compliance management
Efficient onboarding is crucial for getting freelancers up and running quickly. Meanwhile, compliance management helps reduce misclassification risks. Key features to look for include:
- Automated background checks and right-to-work verification
- Digital contract generation and e-signatures
- Worker classification tools
- Document management for storing compliance paperwork
A study by Aberdeen Group found that companies with standardised onboarding processes experience 54% greater new hire productivity. An FMS can help you achieve this standardisation for your contingent workforce.
3. Project and work management
Once freelancers are onboarded, you need tools to manage their work effectively. Look for capabilities like:
- Project creation and assignment
- Time tracking and approval workflows
- Milestone and deliverable management
- Collaboration tools (messaging, file sharing, etc.)
These features help ensure projects stay on track and provide visibility into freelancer productivity and output.
4. Global payments
Paying a global freelance workforce can be complex. A good FMS should simplify this with:
- Support for multiple currencies and payment methods
- Automated invoice generation
- Tax form collection and reporting
- Integration with payroll and accounting systems
Look for a system that can handle payments to freelancers in multiple countries while ensuring compliance with local tax laws. Some advanced platforms even offer instant payment options to improve freelancer satisfaction.
| Aspect | Employee | Independent Contractor |
|---|---|---|
| Control and supervision | Direct control over how, when, and where to work | Freedom to set their own schedules and methods |
| Payment | Regular wages; taxes withheld by employer | Paid per project; responsible for their own taxes |
| Benefits | Health insurance, retirment plans, paid leave | Must arrange their own benefits |
| Termination | Often requires notice and may include severance | Can usually be terminated at any time without benefits |
| Tools and equipment | Provided by the employer | Typically use their own tools |
5. Analytics and reporting
Data-driven insights are crucial for optimising your freelance workforce. Evaluate the FMS's reporting capabilities, including:
- Spend analytics by department, project, or freelancer
- Utilisation and performance metrics
- Compliance and risk reporting
- Custom report builders
Advanced systems may offer predictive analytics to help forecast future talent needs or identify cost-saving opportunities.
6. Integration capabilities
To maximise efficiency, your FMS should integrate seamlessly with your existing tech stack. Look for pre-built integrations or APIs for:
- HRIS and ATS systems
- Project management tools
- Financial and ERP systems
- Single sign-on (SSO) providers
Integration capabilities ensure your FMS doesn't become another siloed system but rather enhances your overall workforce management ecosystem.
7. User experience and support
Finally, don't overlook the importance of user experience - both for your internal teams and for freelancers. Evaluate:
- Intuitive, mobile-friendly interfaces
- Customisation options to match your branding and workflows
- Self-service portals for freelancers
- Quality of customer support and training resources
A user-friendly system with strong support will drive adoption and help you realise the full benefits of your FMS investment.
Choosing the right freelance management system
Selecting an FMS is a significant decision that can impact your entire contingent workforce strategy. When evaluating options, consider your organisation's specific needs, budget, and growth plans. Many vendors offer demos or free trials, which can be valuable in assessing the user experience and feature set.
It's also worth looking at case studies or speaking with reference customers in your industry. This can provide insights into real-world implementation challenges and benefits.
At YunoJuno, we've seen firsthand how the right FMS can transform contingent workforce management. Our platform has helped leading companies reduce sourcing costs by up to 80% while ensuring global compliance. By focusing on the key features outlined in this article, you can find an FMS that delivers similar value for your organisation.
Conclusion
As the freelance economy continues to grow, having a robust freelance management system is becoming increasingly crucial for businesses of all sizes. By focusing on these 7 key features - talent sourcing, onboarding and compliance, work management, global payments, analytics, integrations, and user experience - you can select an FMS that streamlines your contingent workforce processes and drives real business value.
Remember, the goal of an FMS is not just to manage freelancers more efficiently, but to unlock the full potential of your extended workforce. With the right system in place, you can build a more agile, cost-effective, and compliant approach to talent management in the digital age.
