Next-generation MSPs are evolving to meet theÂ demands of a changing workforce.
By Marta Chmielowicz
âWhen the wind of change blows, some people buildÂ walls and others build windmills.â
So goes a Chinese proverb, but the phrase could justÂ as easily have been written to describe the response ofÂ managed service program (MSPs) providers to todayâsÂ constantly changing workforce. As demographics shift,Â technology advances, and workplace norms evolve, MSPÂ providers are forced to adapt their capabilities or riskÂ getting left behind.
While historically the role of MSPs has been largelyÂ tactical and efficiency-driven, a new model is emerging.Â âNotably, there has been a growing recognition of, andÂ appetite for, the strategic value of the MSP,â says BrianÂ Salkowski, president of managed services at BartechÂ Group. âIn this role, the MSP acts as a trusted advisor asÂ well as process administrator. Our customers increasinglyÂ turn to ask us questions not just about what happenedÂ or transacted in their program, but why it happened andÂ what is likely to happen next. In order to answer theseÂ questions, we have continued to invest in advancedÂ analytics capabilities, market intelligence gathering, andÂ staff development.â
- widespread talent shortages;
- increased globalization;
- demographic shifts that are prompting changes inÂ workplace cultures;
- low unemployment rates; and
- the rise of the gig economy and alternate forms ofÂ work.
âHowever, the greatest change agent may be theÂ enhancement of talent-based technologies,â saysÂ Broadleafâs Executive Vice President Dave Savarise.Â âNot only are vendor management system (VMS)Â tools becoming more powerful in terms of dataÂ availability and real-time processing, they are also moreÂ regularly expected to contribute innovation. LeadingÂ organizations expect that technologies will manageÂ spend across productivity channels and even deliverÂ impactful AI and predictive forecasting linkages. AsÂ AI gains a foothold within our industry, all associatedÂ systems will be impacted.â
In a climate where talent is increasingly becomingÂ a strategic inhibitor for many employers, MSPsÂ are expanding their capabilities and delivering aÂ management framework that offers visibility andÂ insights into the entire non-employee workforce. âTheÂ reality is we know a lot about our full-time employeesÂ as employee surveys and job analytics have been aroundÂ and improving for 30 years. However, the contingentÂ population could be half of our workforce in over aÂ decade, and we know comparatively little about it. ThisÂ will change, and the MSPs have a crucial role to playÂ in providing the access, intelligence, benchmarks, andÂ insights to this growing slice of our workforce,â saysÂ Salkowski.
And this comes not a moment too soon, for theÂ contingent workforce is rapidly growing in size andÂ importance. In fact, according to Brandon Hall GroupâsÂ 2017 Contingent Workforce Study, 90 percent ofÂ surveyed organizations utilize contingent labor, andÂ more than 70 percent believe the use of contingentÂ labor is strategic to specific business functions or toÂ the business as a whole. Through workforce modeling,Â sourcing optimization, and supply base management,Â todayâs MSPs can empower business leaders to get theÂ most value from this new segment of the workforce.
So, what will the MSP of the future look like? HR canÂ anticipate the following capabilities:
- Expanded service offerings. âThe future of managedÂ service programs is total talent management. CurrentÂ MSP customers keen on expanding value will increaseÂ program scopes to encompass other resource typesÂ outside of contract labor. True partnerships will beÂ formed between MSPs and HR and talent acquisitionÂ teams, offering a unified approach to drawing resourcesÂ from all talent pools. Ultimately, customers will seekÂ partners able to effectively navigate all productivityÂ channels, viewing open requisitions not as defined byÂ resource silo, but as available for fulfillment by the best-matchedÂ talent, regardless of type,â Savarise says.
In addition to developing a more inclusive approachÂ to talent management, next-generation MSPs will alsoÂ expand the scope of their solution models. AccordingÂ to Dan White, president of AMN Healthcareâs strategicÂ workforce solutions, providers on the cutting-edge ofÂ this MSP evolution will increasingly offer âadvancedÂ solutions for other workforce challenges, helping clientsÂ achieve their long-range strategic plans and objectives.Â Some of these services may include: retention strategies,Â leadership development, spend analysis to maximize theÂ providerâs workforce investment, and the use of dataÂ and analytics to optimize workforce deployment.â
According to Savarise, companies that embrace a totalÂ talent management approach in their MSP process seeÂ a range of benefits, including âamplified cost savings,Â process unification, consolidated points of contact,Â increased compliance, and heightened economies ofÂ scale.â
- Strategic consultative services. MSPs are in theÂ process of transitioning their approach from a focusÂ on operations and the transactional execution ofÂ a program, to a focus on sourcing optimization andÂ providing decision support for hiring managers.Â âOrganizations today are looking for more than a vendorÂ arrangement. They want true partnersâcompanies thatÂ align with a commitment to helping achieve their goalsÂ and objectives together, and that will work with themÂ to optimize every aspect of their workforce recruitment,Â hiring, and management,â says White.
In order to meet these customer demands and becomeÂ strategic partners to the business, MSPs are developingÂ their capabilities to provide full workplace visibilityÂ and more insightful decision-making for their clients.Â â[In the future, the top MSPs will] provide consultativeÂ services that help customers obtain the absolute mostÂ from their contingent value chains. These providersÂ will not only manage the processes from requisitionÂ to payment, but will also aid companies in makingÂ smarter sourcing decisions that increase productivity andÂ savings,â Savarise explains.
- Predictive analytics and decision support tools. TheÂ transformation of MSPs would not be possible withoutÂ the rapid innovation present in the talent technologyÂ space. âUnderpinning all of this activity is the increasedÂ availability of data on external workers and increasedÂ capability within the VMSs and third-party tools to parseÂ data, analyze, correlate, and match,â says Salkowski.
According to AMN Healthcareâs White, the singleÂ greatest demand among todayâs MSP buyers is theÂ technology to predict, balance, and deploy workersÂ efficiently. And for those that are willing to take theÂ plunge into advanced analytics, the returns can beÂ massive, with predictive modeling and open shiftÂ management tools being shown to save organizationsÂ between four to seven percent of their total labor costs.
By using predictive analytics, White says thatÂ organizations can accurately forecast staffing needsÂ several months in advance. âThis capability allowsÂ organizations to save on labor costs and improve staffÂ satisfaction by eliminating last-minute schedulingÂ changes and reducing overtime and bonus pay,â he adds.
- Enhanced flexibility. In addition to providing analyticsÂ capabilities, MSPs are evolving their delivery modelsÂ with the help of cloud solutions and partnerships withÂ leading technology providers. According to CompTIAâsÂ fifth Annual Trends in Managed Services report, 54Â percent of MSPs offer cloud-based solutions and servicesÂ as a strategic part of their business, while another 44Â percent only support cloud services when requested by aÂ customer.
âWe anticipate a convergence of technologies thatÂ today underpin the talent ecosystem, for example, VMS,Â applicant tracking solutions (ATS), candidate relationshipÂ management (CRM) software, freelancer marketplaces,Â procurement tools, and more,â says Broadleafâs Savarise.Â âThis merging of technologies will ultimately deliver aÂ richer experience for customer stakeholders, providingÂ ready access to talent of all types and the tools necessaryÂ to effectively manage them.â
By embracing the new wave of MSP transformation,Â organizations can expect better outcomes. âEach ofÂ these developments offers the promise of both riskÂ and reward; some transactional responsibilities willÂ be automated or eliminated, but, in turn, this enablesÂ the MSP to pivot toward higher value-add work andÂ professional services,â Salkowski says.