MSPs offer new strategies to land top performers that are choosing to be temporary
By Debbie Bolla
Joe Lentz, vice president of HR for Duke Energy, understands the value of a managed service program (MSP). From business analysts to engineers, the sustainable electric and gas company places more than 3,000 workers annually. Lentz’s vendor neutral program helps the organization find high quality candidates at a competitive price. It also eases staffing through the means of a sole source, resulting in a simplified billing process as well. But much of the value that contingent labor brings to the organization is due to the nature of work: project based.
“We always have lots of projects going on,” says Lentz. “Some projects take several months to years.” And it is here that Lentz experiences contingent labor on a strategic level -through project managers. These highly skilled workers bring leadership to both IT and non-IT projects.
This is becoming more and more common as the appeal of the on-demand economy increases for both organizations and employees. In fact, Emergent Research finds that the on-demand labor market is expected to grow by 18.5 percent per year over the next five years. Plus MBO Partners’ report, State of Independence in America, finds that 30 million people classify themselves as independent workers, and it’s projected to grow to 40 million by 2019.
“There are several market-based pressures that are driving clients toward contingent engagements for highly skilled talent,” says Andrew Zarkadas, VP of client solutions, North America for Guidant Group. “On the candidate side, many of these workers are looking to capitalize on opportunities to leverage their highly valuable, sometimes scarce skill sets to engage with multiple companies, enhancing both their resume and financial position. From the client perspective, pure competition between companies forces them to evaluate variable sourcing strategies.”
Companies are facing challenges finding highly-skilled, contingent talent, says Beth Roekle, president, North America, for Advantage xPO. Certain sectors where workers are in top demand, like healthcare, IT, and engineering, force organizations to go outside their intended budgets in order to secure talent. Plus, Roekle says unemployment rates for highly skilled workers can be half of the national average, and these candidates tend to prefer temporary assignments for optimal work- life balance.
“In the current labor market, efficiency in the hiring cycle is critical to the ability to access specialized talent,” says George Lanzano, executive director of business solutions for global MSP programs for Staff Management | SMX. And MSPs can reduce the stress around these staffing situations since they have access to both highly-qualified talent with in demand skills and to niche talent pools that meet specific skill shortages.
Talent pools have grown in popularity on the permanent side of staffing in recent years, and they have started gaining traction on the contingent side. Organizations are seeing the value in re-engaging with previous placements that were efficient and effective. MSPs have the ability to track alumni and retiree contractors and bring them back to a project. “With some of our clients, we have built customized and even client-branded portals, which allow us to aggregate and market to these workers promoting a positive candidate experience while still remaining cost effective,” says Zarkadas. “Since the MSP has a complete view into each contingent worker’s profile and history of engagement, we can provide our clients with the intelligence to make smarter hiring decisions when they look to hire a contingent worker as a full-time employee.”
Leveraging data and analytics to make better-informed decisions is a significant way MSPs are becoming more strategic. “By providing organizations with valuable insights into their contingent labor force, an MSP allows companies to better manage their supply base and make more informed decisions on temporary extensions or conversions to full-time,” says Roekle.
In some case, it makes business sense to convert a temp position into a full-time role. Roekle advises organizations look at a variety of metrics, which can be provided by an MSP, when making the decision. Some include:
Duke Energy’s Lentz says they are starting to dip their toes into the pond of full-time conversions -when it makes sense. Their current process still includes posting the job as a full-time position, and having the contractor apply for the job. If the worker meets the qualifications, the time to hire and productivity will inevitably be reduced due to their familiarity and experience. It’s just another way working with contingent labor provides Duke Energy a competitive edge.
What can an organization expect from an MSP? Andrew Zarkadas, VP of client solutions of North America for Guidant Group, says an MSP allows companies to gain a 360-degree view of available contingent sourcing options. “This includes real-time market intelligence on candidate availability, rates of pay, and guidance on the right type of engagement for the business demand. Additionally, once the candidate is selected, the MSP ensures that the engagement is conducted compliantly and efficiently within the client organization.”