MSP / Contingent Labor

CEO’s Letter: Another Mystery Solved

At HRO Today, we are awash in research data. We receive data from our HRO Today Baker’s Dozen Customer Satisfaction surveys, our own sponsored or unsponsored research, and the research we publish for others. And, yet, one simple mystery eluded us for years. The question at hand is why have we historically seen—until last year—smaller MSP firms outperform some of the mega international staffing companies on the quality of contingent labor managed service districts. The answer was right under our noses, but we could not see. We added parameters to counterbalance for size and complexity of programs, but we still saw the gap in raw scores. We have not allowed for the ultimate explanation of why most of the smaller firms are better. And it’s simple: because they are smaller.

For those who get their exercise jumping to conclusions, do not begin to rail about how impersonal large companies are. The reason exists and we implore providers to continue or begin to make the changes necessary to improve their overall service. The key word is “overall.” This is NOT a blanket indictment of the large MSP providers. On many of the programs they provide exemplary service, and I believe they are deeply committed professionals. Each year we reviewed the data we collected from the 35 or so questions that make up the HRO Today Baker’s Dozen Customer Satisfaction Survey, but we could not see the clues. In reality, we began to just believe that in this category, service was best delivered in smaller packaged programs. However, it took two unrelated events to show us the real issue, problem or challenge.

first, we saw Pontoon lead the industry last year and they continue to be at the top of the list this year (see page 20). The second event was a conversation with the president of the MSP division of another global staffing firm. This executive, who I will not identify, explained that the company was concerned about being rated because this year because they were being reorganized globally. The key part of the conversation was the description of the reorganization of the MSP service delivery structure. The purpose of the reorganization is to actually develop a single global delivery organization. Up until now, the services were sold in the name of the professional services division, but was jointly owned and, in many countries, delivered by country organizations. As this executive explained, the delivery models varied by country and often more reflected the views of the local country organization or the local country executives about what MSP should or should be. The delivery program as a result could operate under a single brand, but the service envelope could be very different from the opinion of the central corporate strategic group.

Pontoon, which separated as a “professional services delivery” business from Adecco, broke free of this decentralized management model which may work well in core staffing services but is a nightmare for global deals. Pontoon’s MSP is now delivered by Pontoon itself around the world rather than individual country organizations. This may explain one reason why they are winning on our list. Pontoon is doing big complex deals with consistency and a single service philosophy that varies culturally based on the country but there is a single accountable leadership team.

What does this mean for the buyer? It means that you should ask if your provider has a global delivery system or if you will deal with different country organizations in different regions of the globe. Ask for the organization chart of the people involved with your deal to make sure that local leaders do not report to local country management. If the answer is they are a “de-centralized” MSP management structure, understand clearly how they will manage and warranty consistency in delivery and in service. Many of the providers are on the path of creating global MSP organizations and to them, I say, continue or get started.

To achieve the true potential of savings, efficiency, and hiring manager buy-in from global MSP, you need to have a truly global delivery platform with the proper technology and service organization. Another mystery solved and sorry it took us so long to figure it out, though, I have often been criticized for having a “keen sense of the obvious”…..

 

Elliot H. Clark, CEO

Tags: MSP / Contingent Labor

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