Over the past five years or so, we have seen an increased volume of two things: U.S.-based programs expanding to Europe and other regions and RFPs for first- and second-generation programs that include multiple countries in the INITIAL scope. This is a far cry from the early years of the VMS/MSP industry where programs often were relegated to one department, location, country or service category.
Why? There’s no one answer, but some of the reasons include:
- The proliferation of VMS/MSP programs and the natural organic growth thereof into new geographies
- The downturn in the global economy and the increased need to focus on costs and risk
- The elevation of the program sponsorship towards the “C” level of organizations
- The desire to gain enterprise visibility into spend categories
So what do you do to go global? As Jason Ezratty and Teresa Creech pointed out in a September 2012 Staffing Industry Analysts webinar, the answer to how you build your program (and thus your MSP) is to think hybrid. Shades of grey rather than absolutes are essential to the success of a comprehensive global solution. In a previous life, I saw an example of this at a Fortune 1000 global client with a large VMS and vendor-neutral MSP. Encompassing several dozen countries, the provider and the client took the approach of creating a “traditional” outsourced MSP in the United States, while utilizing a more insourced approach for certain countries (i.e with very low headcount), and blending the two approaches by task in India and Israel. In general, variation between insourced and outsourced tasks based upon geography is going to be a critical success factor for you. Focus on what you’re trying to achieve and tailor a solution specifically for those needs.
How do you accomplish this? Well, first you need to understand the scope. Get good data. Headcount, suppliers, rates, countries, job titles, etc. Also, you really need to understand the laws and cultures of each country. Not ALL of them, just the ones specific to continent workforce management programs. Maybe certain types of assignments are illegal, maybe you have to pay certain minimums or bonuses, maybe you have to store data in certain places or maybe billing in challenging. Know what you’re getting into. The most common reason for failure of a global expansion is assuming that EVERYTHING can be done the exact same way in every country.
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Most people think that localization is just language and taxes. That doesn’t even scratch the surface. Here are some things to think about, broken down by major grouping:
Labor & Employment Laws
- AWR/AWD
- TUPE
- Probationary Periods
- Overtime rules
- Phases and Phase Changes
- Work week duration
- Holidays
- Notice Periods
- Collective Bargaining / Labour Agreements
- Pensions
- National Insurance
Personal and Data Privacy
- Safe Harbor & EU Data Privacy Directive
- Data Protection Act
- Cookie Law
- What is the definition of Personal or Sensitive data?
- What data is being captured?
- How secure is it?
Data Storage and Retention
- For how long must invoice data be stored?
- For how long can candidate data be stored?
- Where must invoice data be stored?
- Where must not candidate data be stored?
Tax Application and Invoicing
- Who is creating the invoice of record? Is invoicing on behalf of suppliers allowed?
- How is tax (i.e. VAT/BTW) being applied?
- Reverse Charge Mechanism
- Official Tax Invoice
- Frequency
- Language
- Invoice Numbering
- Invoice Currency
- Tax Currency (often VAT must be reflected in local currency irrespective of transaction currency)
- Data Elements
- Invoice Labeling (i.e. Credit/Debit)
- Pro Forma Invoicing… When? Why? How?
Cultural Differences
- Vocabulary
- Norms and practices
- Rate Types
- Bonuses and incentives
- Recruitment methods
- Direct vs. Indirectness
- Man vs. Woman
- Superior vs. Subordinate
- … many more
Still want to go global? Look before you leap:
- KNOW the Goals and Scope
- UNDERSTAND the Countries and Laws
- ACCEPT that one-size doesn’t fit all
- ASK for help
- ATTACK the rollout methodically
And remember… Rome wasn’t built in a day.
MORE: RFP 101: Are you asking the right questions?
