Sourcing and securing specialised skills in the contingent market has become a specialist skill on its own. Today we have a talent-scarce market that is compounded in South Africa by international trends of remote work where contingent workers can work anywhere and for any company around the world. Working with an experienced Managed Service Provider (MSP) ensures that you can access quality skills at speed and in volumes if required, in a more cost-effective way.
How an Managed Service Provider (MSP) can assist your company with cost-saving initiatives:
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Total Transparency: Unmasking Rogue Spend
By pulling various levers such as supplier bill rate management, rogue spend can be highlighted and managed. Suppliers are engaged on specific procurement policies with regards to what parameters they can bill for a specialised skill or if additional control is needed MSP’s can manage the actual bill rate structure in terms of management fees and percentages. An experienced managed service provider will ensure that within the Vendor Management System (VMS) these rates are prepopulated for specific roles and if required per supplier. The MSP provider should also be completing regular up-to-date market research on what the market rates are and benchmarking these to what your suppliers are providing you skills at. Managing rates is an important part of any Contingent Workforce Program (CWP) as it ensures you are competitive, your offering continues to be compelling to Talent, and ensures your suppliers are not unnecessarily inflating their margins at your expense.
By utilising technology MSPs implement controls to avoid unnecessary spend on bill rates and overtime. If the trend shows elevated levels of overtime, it can for example indicate to a specific business unit/department that additional resources are required to manage the workload, or it could show abuse of overtime. It is especially important to have this measured and track where you are paying double or even triple time for overtime hours.
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Streamlined Process: Accurate Invoicing.
Using various suppliers means your invoicing and calculations can be different across each supplier. Suppliers use different formats, fields, and sometimes even calculations when it comes to regular hours and overtime hours. Your MSP provider will implement a best practice invoicing process with standardised templates and implement a streamlined and consistent process across all suppliers.
Often managing multiple invoices across various suppliers can also be very admin intensive. A simple, consistent, and compliant process ensures easy sign-off and simplifies the approval process ensuring that each invoice is thoroughly scrutinised and treated in the same manner. Without a solid framework in place, costly errors on invoicing can occur and cause slippage. MSPs are managed on metrics aimed at accuracies with a less than 1% error rate for a professionally managed invoice process.
Resolving errors with suppliers can also take time. Your MSP brings specialised finance officers to the team which ensures errors are identified and resolved quickly.
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Operational Efficiency: Implementing Process Improvements
Ensuring your hiring process and contract management is operating at maximum efficiency is what the MSP brings best to the partnership. An MSP is measured on a set of SLAs and KPIs that incentivise the MSP to ensure the process is optimal. MSPs are experts in managing and delivering effective attraction campaigns together with your supplier base. They will collaborate closely with suppliers to assist them in finding talent. A mature MSP model can also offer an add-on solution of Direct Sourcing which can drive recruitment campaigns to assist you in understanding your current skills available within your organisation and what skills shortage you may have.
Your Contingent Workforce Program (CWP) should include metrics that drive your key success criteria, which in turn ensures that continuous innovation is a key deliverable from your MSP.
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Cost Savings: Sourcing Talent Cost Effectively
MSPs ensure that your contingent resourcing process is faster, cheaper, and more effective. In some CWPs, the MSP can implement a Direct Sourcing solution for those typical skills that can be sourced “in-house” which can further assist in reducing supplier spend. This also assists to drive down rates being charged for specific roles and builds a talent pool of skilled resources that can be tapped into quickly.
MSPs ensure your contingent hiring and sourcing processes are faster, more cost-effective, and overall, create a better and consistent hiring experience. If they can offset any of your supplier workforce without detriment to the programme, that is typically what they will do. In some instances, an MSP will identify several roles to take away from the supply chain and source ‘in-house.’ With a robust and well-managed contingent workforce program, your MSP partner can deliver savings from 5% to 15% from year 2.
To understand more on how to benefit from a Direct Sourcing solution click here for the Why-choose-direct-sourcing series.
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Programme Efficiency: Running An Efficient Contingent Workforce Program (Cwp) Office.
Your experienced MSP takes on the burden of those time-consuming workforce management duties that your internal teams are burdened with; the duties that detract them from performing their core, strategic value. The program office managed by your MSP partner will continually respond timeously and adjust accordingly with changes to your business as well as within the market ensuring that you are getting the best value for your investment in a contingent workforce.
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End-To-End Cwp Cost Savings: Realising Cost Savings On Contingent Workforce
If your contingent workforce program is correctly managed by an experienced MSP provider as outlined above, you can achieve significant cost savings across various areas within the business. Other items can be seen as beneficial other than cost efficiencies, such as compliance with Labour Regulations. Partnering with your MSP provider ensures collaboration on understanding the cost savings you wish to achieve and in which business areas, all while ensuring your skills are not compromised.
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Empowering Your Stakeholders: Enabling Hiring And Line Managers
Many of the processes and policies in organisations are developed to support permanent employees and their experiences don’t necessarily apply to contingent workers. To ensure that your CW is engaged and productive it is important that activities to onboard these workers are seamless and the candidate experience is maintained and uniform. In addition to managing perm workers, most managers don’t have the time and training to manage a contingent workforce. Your MSP partner will be able to advise and guide you around legislative requirements especially related to performance management as well as provide guidance to managers on the best value for their budget when it comes to rates to be paid.
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Empowering Your Stakeholders: Enablement Of Procurement
In many organisations, there is no singular department accountable for the contingent workforce. The hiring of contingent workers is often done haphazardly, with no unified or consistent approach to how they should be handled – it’s, for this reason, a large majority of companies have no visibility or control over how much they spend on the contingent workforce.
Managing contingent workers is complex, and requires Procurement, HR, and Managers to work together. With an MSP partner in place building the links between all departments by enforcing and maintaining policies on behalf of each department becomes a key driver to success. The MSP partner assists in enabling procurement teams to create significant savings by managing vendors on key performance metrics. In addition, the MSP partner enforces rate cards and specific agreed-upon management fees, providing data and insights to ensure that the organisations stays ahead of their competitors with regard to ensuring the right skills are secured at the right price.
Contact us to discuss your CWP needs, and to discuss some of the ways that we can assist you in getting better value for your contingent workforce spend.
