VMS: A Foundation for the Future of Work & Business Agility

For many organizations, one of the most important strategic questions being asked is, “How does work get done?” This question is prompting businesses of all sizes to proactively enhance and optimize various attributes of work, talent, labor, and enterprise operations.

As the workplace and the way we work continues to evolve, the future of work will be designed based on two key foundational elements:

  1. The mindset behind how talent is engaged, sourced, and managed, and
  2. The technology that supports, enhances, and optimizes those processes and business operations.

But let’s back up a bit. What are the trends and observations that are driving the journey to a new way of thinking about work? From my observations, research, and conversations with several subject-matter experts, I think there are a few noteworthy drivers:

  • Many mission-critical and key business projects and initiatives are being addressed in an on-demand manner. This leads to a consumerization of business via on-demand enablement of processes, intelligence, and talent.
  • New innovations (AI, machine learning, blockchain, etc.) shepherding in a new era of work optimization and digital transformation.
  • The integration of systems that help businesses gather full visibility and real-time operational execution.
  • Large volumes of talent are transitioning to adopt a flexible workstyle, including contingent work, freelancing, consulting, and non-conventional work models, evident by the increasing proportion of workforces utilizing non-employee talent.
  • The continued evolution of traditional contingent workforce management (CWM) technologies, including vendor management systems (VMS).

This last point, in particular, is of significance. As we continue to progress towards a new work paradigm that is dependent on talent-led shifts in the market, the supporting foundation of technology that supports the extended workforce becomes critical to business strategy. Historically, VMS technology has been a driving force behind contingent workforce management advancements, and as these solutions transform into platforms that integrate with other systems and technologies, they continue to innovate towards the future of work.

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As we’re all well aware, the focus of executive leadership has shifted to agility and talent, as opposed to the cost savings from yesteryears. Similarly, contingent workforce management programs, once hyper-focused on cost reduction, now value business agility. This business agility refers to the ability to react dynamically to real-time business challenges, and in many scenarios, talent is a key measure of this ability. When it comes to the sourcing and management of an extended workforce, a VMS plays a key role by enabling both agility and innovation. Here are just a few examples:

  • Analytics in today’s VMS platforms have evolved where true machine learning augments the depth of data and information, providing prescriptive insight and intelligence for real-time decision making
  • AI, though still experiencing relatively low adoption, have the ability to enhance optimization via automation
  • Statement of work (SOW) management is often a sizable, if not the largest, portion of CWM spend, and has a large impact on a company’s ability to be agile on mission-critical projects
  • Since a VMS is less legacy burdened than most HR systems but more mature than up and coming FMS solutions, and because it naturally plays in the space between the siloed solutions offered by narrower-focused HCM tools and procurement systems, it is able to function as a toolkit integrator to power total talent sourcing/management strategies and present a unified total talent management technology stack .

In my opinion, one of the reasons that the VMS is foundational towards helping to usher in a new way of getting work done is because it’s no longer a simple point solution. Rather, the modern VMS acts as a platform, and via aggressive product roadmaps and the ability to integrate through open APIs, is able to harness innovative functionality to provide enhanced process optimization, real-time intelligence, and guide on-demand decision making; which, in turn, supports the broader goal of business agility.

Neha Goel

Neha Goel
Neha Goel is VP of marketing at Utmost. Connect with her on Linkedin.

Neha Goel

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