New Drivers for Global MSP

ThinkstockPhotos-174101590Recent projections indicate that the managed services program (MSP) market is growing at a robust pace – and isn’t likely to slow down anytime soon. In fact, global spending under management by MSPs increased by 19 percent in 2014 alone. And, there’s good reason for this growth – more companies are turning to MSPs because they can help reduce costs, enhance visibility into expenses and workforces, and manage compliance challenges.

But an emerging trend is also fueling this growth in MSP: the need to manage the increasing number of “independent workers” companies are hiring to fill strategic holes in their workforces. With around 45 percent of companies now willing to consider all types of employee classifications to fulfill their labor requirements, the rise of the contingent workforce is creating a greater need for organizations to find smart, agile solutions that can help them keep their contingent labor spending under control.

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Beyond cost savings, companies are also turning to MSPs to help manage the additional complexities that occur with more flexible staffing arrangements. With the rise in online freelancer sites like Elance-oDesk, OnForce and Work Market, many organizations want MSPs to play a larger role in finding, selecting and managing freelance and scope-of-work talent. Now, this level of service from MSPs also includes ensuring that companies are protected from the inherent risk of worker misclassifications, which can result in costly fines if any noncompliance with regulations is discovered.

For employers, there is tremendous value to be had in developing a close relationship with an MSP that can deliver sophisticated, compliant solutions that result in access to higher quality talent. By following a few fundamental guidelines, you can ensure that you are getting the most out of your MSP program. Here’s how:

  1. Plan ahead: An MSP program can only go so far in helping your company if you don’t know where you want to go in the long-term. Take a holistic view of your talent strategy and workforce plan. Identify current gaps and future goals. Then, ensure your MSP program is geared toward meeting those talent objectives.
  2. Take a collaborative approach: Don’t get stuck looking at your MSP provider solely as a vendor. If you consider the provider a valued partner, then you can be assured that you are all working toward building a workforce that will help achieve your company’s performance goals. Regular check-ins with the MSP to course-correct as needed will keep everyone moving in the right direction.
  3. Examine the data: Keep in mind that the role of MSPs is evolving and expanding. Take advantage of your provider’s access to information and data, not only about areas where you can cut costs, but also about where your greatest needs and opportunities are. By taking a deep analytic dive into your contingent workforce data, you can improve your talent-planning efforts.
  4. Conduct a supplier analysis: Sure, supply chain management is included in the services of your MSP, but you can gain even more strategic value from your MSP program. Ensure that you are getting the greatest bang for your buck by requesting that your MSP provider conduct a thorough analysis of your existing talent suppliers.
  5. Optimize the program: What’s effective for one part of your organization might very well be applicable to other departments as well. Consider expanding the scope of your existing MSP program to maximize its cost savings, program visibility and governance across other areas of the business.

While many MSP buyers can quickly spout the primary reasons for the solution’s use – typically, cost reductions and enhanced visibility into spending – more companies are turning to MSPs to help source and manage their growing number of contingent laborers. Organizations can gain greater value from their MSP program by ensuring they work in tandem with their provider to take a holistic talent strategy approach, establish mutual goals, analyze contingent workforce data, identify best practices and expand successful programs across the organization.

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Kevin Moran

Kevin Moran
Kevin Moran is vice president, external operations, Randstad Sourceright.

Kevin Moran
Kevin Moran is vice president, external operations, Randstad Sourceright.

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