Managing Contractors Effectively

By March 21, 2014 Posts

If you are going to run a successful business, you can’t do it alone. You will need help. In some case, that means hiring contractors. Either for short-term projects that last for days or long-term projects that are ongoing and last for years, you will need to effectively manage contractors so that you can keep your timeline, stay on budget, your business goals and keep your contractors happy.

Managing Expectations

Employment relationships, like any other relationship, take two to tango. This is a reciprocal situation where both parties’ needs are satisfied. Both parties also have expectations that must be discussed. The premise is finding the right contractor(s) takes time –even years– especially that the competition against other clients and Project Managers is high. As such, there is an ongoing need for competing for the attention of the contractors before you may even start building their loyalty. As contractors come and go, there will always be good ones who will stay. These are the contractors who will contribute greatly to the success of your company.

Before You Hire

Before you start looking for contractors you must go through the following stages:


You need to decide on three most important things. First, you need to decide the job requirements including the training of the contractors. Second, you must also decide on the communication requirements including the establishment of proper cooperation and coordination. Third, you have to decide the requirements to make contractor management and supervision more effective.

Writing a Good Job Description

Afterwards, you also have to draft job descriptions where you will describe the job as well as your expectations. Job descriptions generally vary from job to job and from industry to industry. If you are struggling at writing your job description, you may simply Google how to make one. You may also look for templates and samples that are job- and industry-specific on Google.


When you interview freelancers, both of you need to discuss your needs. This is one good way of determining whether the client-freelancer relationship will work or not. Since there is no set format for interviewing contractors and questions vary from industry to industry, start with a Google search to find common questions to ask prospective contractors. Use those questions and combine those with ones that you formulate yourself to find you best fit.

Common Interviewing questions


When you select the contractor, the price that he or she bid for must not be your sole criteria. You need to select the contractor who is capable of demonstrating his or her competencies. Through this, you will ensure that the project will be finished with high satisfaction. Nevertheless, the competence required, and how such will be evaluated, mainly depends on the nature and difficulty of the job requirement.

As the Project Manager, you need to ask the applicants to provide specific details. Some of these are the experiences relevant to the job, relevant qualifications and relevant skills, all of which are required to finish the job.

Once appointed, the contractor must perform a risk assessment and produce method statements prior to starting the work. The Project Manager must help the contractor in doing such. It is the Project Manager’s responsibility to provide the necessary information so that the contractor may be able to evaluate the associated risks in performing the work.

Critical Phases of Management


Throughout the job duration, you need to monitor the contractor’s progress against the timeframe. As the Project Manager, you need to check if the work systems are being followed diligently and determine if the contractor follows the pre- drafted guidelines initially. Through this, the Project Manager and contractors will determine if there are any job-related problems. If there are, it means that the scope might also change which requires more serious monitoring.


Motivation… It’s what drives a person to do what they do. As a business owner, you must consider the types of motivation that drives the contractors you hire. Whether they are motivated by money, freedom or a feeling of accomplishment, you must identify their motivations and to some degree, satisfy them with your work, words and rewards. Otherwise, if a contractor is not motivated, he or she will find ways to avoid the work rush through your work or not give 100 % effort.

Here are the most common types of motivation:


Some contractors are motivated by the amount that the Project Manager pays. Contractors tend to be loyal to clients who pay fast upon job completion. You would not be able to find contractors who will agree to be paid after 2 months of doing the work. They will not do the work especially when the client is unresponsive to their messages. You have to guarantee the contractors regular workload and regular payment so that your project will be prioritized.

Feeling Valued and Appreciated

Some contractors are motivated by the way the Project Manager makes them feel valued and appreciated. This takes more than giving feedback. Feeling valued and respected is one of the key performance metrics. Contractors who feel valued tend to be more engaged and more satisfied with the work. This results to high motivation level and thus high productivity level. Assessing the needs on a regular basis is most advised for Project Managers.


Some contractors are motivated by having the freedom to work when they want. This is the reason why chose to become freelancers – the freedom to do whenever they want provided that they still respect the project owner’s time and deadline. These contractors are self-sustainable wherein they work whenever they feel like working for as long as updates are sent to the client regularly. There are Project Managers who bombard contractors with emails asking about updates that only pressure the contractor.

Sense of Loyalty

Some contractors are motivated by establishing a sense of loyalty. Loyalty is a very subjective matter. Those contractors who look for full-time jobs tend to be more loyal eventually. However, before they can be a loyal contractor, there are conditions to be met like consistent work and prompt payment. Sense of loyalty can be also developed through other factors like bonuses and positive feedback for a superb performance.

Communicating Common Goals and Purposes

Make sure that the purpose of the team is clear and understood by all team members. Devote enough time letting the entire team know of the performance goals and how they can and they should contribute in achieving success. Not all virtual teams do this, even those that are established years ago. Anyhow, purposes, conditions and goals can change, but make sure that the team is working toward achieving a common goal especially if you are a new Project Manager.

With this, you have to make each member understand his or her role in achieving the goal. There should be individual goals that must be also achieved that forms part of achieving the entire team’s and company’s overall goals. Individual goals must be very specific.


Project Managers also need to audit individual and team performance. When evaluating the contributed work, the focus should be the quality of the work contributed. For one-off jobs, evaluation can be conducted after completing the job. However, it is a must for contractors who will work for you for months or years. Evaluation must be conducted at regular intervals. In this way, you will provide the contractors the opportunity to learn based on the services rendered. Specifically, they will know which areas need improvement.

On the other hand, the Project Managers themselves must conduct own performance review. The performance systems must be also reviewed regularly. The review should be treated as an instrument in assessing the success of the job. Particularly, you will know which parts of the system need changes. Remember that an efficient performance measurement system is a must in keeping the company on its right track. Also, this is one way to ensure that you are getting your money’s worth – the money that you invest in creating the systems and in paying the contractors.


Effectiveness is one of the process characteristics that indicate the degree with which the output conforms to the requirements in actuality. It is like asking the question whether we are doing the right things or not.


Efficiency is another process characteristic that indicate the degree with which the required outputs are produced at the lowest resource cost possible. It is like asking the question whether we are doing things right or not.


Productivity refers to the value added by a process when you divide it with the value of labor and the capital consumed.


Quality refers to the degree with the product and/or service meets the requirements as well as the expectations of the customers.


Timeliness measures if the unit of work conducted is correct and on time. There are specific criteria that must be established to determine what will make a work timely. Customer requirements are one of the criteria that must be considered in establishing timeliness.

Working out conflicts with Contractors

In every relationship, conflicts will arise. This is normal. Conflicts include work performance, work availability and personality clashes. Make sure your contractor has a chance to explain the problem as he or she sees it. Allow the kind of communication that is open and transparent so that your contractors can have their say without feeling interrupted, rushed, mocked or intimidated.

What a Prominent Corporate President Says

I asked the President of a Multimillion Dollar Company what she does to when she considers hiring contractors. Susie Carder is the President of Motivating the Masses. She has dealt with dozens of contractors over her years of running several successful businesses. She focuses on the key factors when managing contractors:

  1. Contractors should share the same belief system as you.  Your core values must match. For Example: For Motivating the Masses, that means they love to serve and outperform and are willing to communicate when they will miss deadlines and be accountable.
  2. Two: Do they know your “by when” for task completion?
  3. Three: Do you (as a Project Manager) have time to manage the follow up?

These three guidelines help insure a harmonious work relationship that is beneficial to both parties.

Who is Responsible?

As the Project Manager, you always have to keep in mind your leadership role. At the outset, you need to build your followers’ sense of ownership. At the onset, you must be accountable for the results of the team. It is your responsibility to drive your people to produce the desired results. It is also your responsibility to make your team members responsible in meeting the goals and solving problems as they arise.


You must learn to become an effective Project Manager. Doing so will save you money, reduce conflicts, and keep the best workers happily working for you. It can take years to find and build a good team. Many may come and go. Your effective leadership will help ensure that the committed ones stay and rise to the top as your business grows.