After reading the recent Staffing Stream post titled “The Pros and Cons of Implementing Vendor Management Systems,” I felt compelled to provide a VMS provider’s perspective on some of statements the author made as, in my opinion, they were both too general and promote what I believe are some common misconceptions. As the author says (referencing Staffing Industry Analysts), VMS and MSP spend is on the rise and will continue to rise in the coming years, so it’s important to have a balanced perspective.
VMS-enabled programs should be configured to enable the client to meet stated business goals and objectives. These goals include things like cost savings and a vendor neutral competitive environment but also include (in no particular order) control/compliance, quality, visibility, and process efficiency. Clients often have different goals and requirements or different types of spend – what they want to achieve with their IT spend will differ from what they’re looking to do with high volume light industrial workers. Since the most important goal is for the client to meet stated business objectives, a well-implemented program will use input from all stakeholders, the client, the VMS and/or MSP, and suppliers, to influence its business process. Such an implementation approach will allow clients to achieve their business goals and should actually help suppliers from feeling that they are being mistreated or treated the same as all other firms.
One common technique that programs use to lower costs, increase competitiveness, and enforce vendor neutrality is limiting contact between its hiring managers and supplier account managers (as well as using VMS functionality to hide supplier names and contact information during the candidate selection process). While this particular technique can result in the perception of a supplier being treated unfairly, in my view, which is backed up by real client experiences and savings, this approach can achieve the aforementioned goals and still result in quality fills that take into account both quantitative requirements and culture. In such cases a good VMS will be configured to ensure that job descriptions are accurate and thorough and that the manager is selecting the right job level and skills for their needs. The VMS will be used to effectively and fairly communicate details about the job to ALL suppliers and the program (whether run by an MSP or by an internal program office). Techniques such as supplier forums and conference calls are then put in place to ensure supplier questions are answered in a fair way.
Process steps and VMS configurations like these will allow companies to engage quality workers in situations where intangibles and soft skills matter more and to use numbers driven inclusion-based recruiting approaches when needed. I don’t believe there is any situation where a company who is considering using a VMS or MSP should be discouraged from doing so due to a worry that the process and program won’t be able to be designed in such a way as to allow it to meet its needs!
VMS companies and staffing companies are both in the business of helping their clients meet their overall business objectives. It’s understandable that the switch from a relationship-oriented approach to a more systematic process may result in some frustration, but if these process changes are handled correctly the goals of the client can be achieved in a faster, more efficient way that fully harmonizes the value of both a supplier and a VMS. The bottom line is that when the client succeeds, we all succeed.