MSP / Contingent Labor

Working in Tandem

tandemHarness the power of analytics delivered by a strong MSP and VMS relationship.

By Mary Martin

Managed service providers (MSPs) are expected to produce relevant program performance reporting for their clients. So, when you’re ready to choose an MSP to manage your contingent labor program, it’s important to understand how the MSP delivers metrics and analytics regarding your suppliers, temporary resources, and hiring manager behavior. These reports will offer full transparency into this segment of your organization.

Additionally, your MSP should supply expertise and staffing- related metrics that encompass a holistic view of all of 
its customers and programs. This will allow you, as the customer, to identify areas for improvement, cost saving strategies, and risk mitigation options.

It’s important to leverage your relationship with your MSP through this vital reporting function so you can ultimately drive efficiencies within your programs. For example, a manager may contact the MSP program office and indicate that he or she has never hired a temporary resource and needs to know when that resource may begin working.

To answer that question, the MSP coordinator will need information about the manager’s program cycle time.
 A vendor management system (VMS) can assist in this process -and many others -when it comes to getting the most out of your MSP.

Dashboard analytics. A program dashboard within the VMS system can outline cycle time based off how long the approvals take, or how long a supplier normally takes to submit a candidate through the system. To be able to explain to a manager, for example, that it will take approximately 10 business days to bring in a temporary resource based on average cycle times for approvals, submittals, and onboarding, is very powerful. This will provide managers with confidence. Having metrics readily available in the form of dashboards or scheduled reports designed specifically for MSPs, equips program teams to answer the simple, yet sometimes daunting questions that hiring managers often ask.

Consistent delivery. Be sure to have your VMS provider assign a relationship manager to each customer or program account. This individual will understand the service level agreements (SLAs) and program guidelines, including configuration, and can meet with the MSP or program operations team members who are using the VMS system most frequently. These team members serve as the liaison between the customer, the MSP, and the entire VMS organization. This helps ensure service delivery consistency from implementation, reporting, and development teams through customer support.

The team should look for proactive ways to address
 trends through root cause analysis and provide strategic consultation on the use of the firm’s VMS technology both existing and new functionalities. It is paramount to have a subject-matter expert from the VMS technology available
 to assist the MSP operations team to identify key reporting areas. Program reporting is only as good as the transactional data that is produced by the MSP and stored in the VMS.

Whether your contingent labor reporting focuses on quarterly business reviews, monthly operations reports, or daily questions from hiring managers, your VMS provider and MSP should have a reporting methodology to fit your needs.

Reporting. After go-live, reports should be available. And equally important, ensure that the reporting engine is simple to use, and report-writing sessions warranted for inexperienced users.

Also, when utilizing the ad-hoc reporting capabilities, be sure that users are able to quickly and easily create new reports that address specific needs. These reports and alerts should be scheduled when SLAs are in jeopardy of being met. Reports should be available for dispatch as 
flat files, PDFs, in any Microsoft Office® format and XML. Distribution should be to individuals, groups or permissions. Additionally, VMS customers should be able to feed data into the VMS business intelligence engine to complement the operational data and metrics collected in the course of the program.

Mary Martin is the business development manager at Provade.


BOX: MSP on Metrics

Beth Roekle, senior vice president, for Advantage xPO’s North America and global operations explains what metrics MSP programs offer that can identify areas for improvement, cost saving strategies and risk mitigation options. Says Roekle:

MSPs deliver weekly, monthly, and quarterly reporting that are customized to display the operational metrics that are of most importance to the customer. Some of these metrics include: time to submit, time to fill, percentage of assignments completed as expected, bill rate compliance, onboarding compliance, candidate slate diversity, and hiring manager satisfaction. During implementation, the MSP will typically outline the reporting dashboards available and determine what modifications are necessary to best meet the customer’s needs. The MSP is focused on continuous improvement and will work with the customer to implement process changes to improve the efficiency and cost-effectiveness of the program.

Another key metric for the MSP is to be able to quantify and report on cost savings. Cost savings can be complicated to calculate, but will include some of the following components: bill rate compliance, consolidated invoice savings, rate card reductions or reductions in markups, implementation of tenure discounts, volume discounts, and early pay discounts, and pay rate rationalization. It is important when measuring cost savings that the MSP and the customer reach agreement with respect to how to measure cost savings over the course of a multi-year contract.

With respect to risk mitigation, the MSP can assist the customer in outlining the key standard operating procedures (SOPs) with respect to tenure limitations, 1099 vetting and compliance, and onboarding compliance. Once the SOPs are designated, the MSP will assist the customer in tracking and reporting on the necessary information to manage risk from co-employment, worker classification, or regulatory compliance.

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