How USC pioneered higher education’s use of MSP.
By Andrew P. Zarkadas
The University of Southern California enjoys a reputation as one of the world’s leading private research universities. Located in the heart of Los Angeles, USC educates approximately 33,500 students each year and employs 18,500 people, including 3,200 full-time faculty members, 6,800 student workers and a contingent staff of 8,500.
USC’s contingent labor requirements span a broad and diverse set of departments—with positions ranging from advanced-degree engineers to custodians. Due to the seasonality of a higher education institution, temporary labor needs fluctuate dramatically from month to month.
In December 2008, the university had contracts with more than 55 different firms to meet contingent staffing demands. In an effort to minimize time spent on workforce management and improve control over spending, the human resources department made a strategic decision to outsource contingent labor management to a third party. With this decision, USC became the first higher education organization in the United States to use a managed services model.
USC engaged Guidant Group to take over the primary responsibilities of sourcing, managing, and invoicing its contingent labor processes, while maintaining complex diversity requirements. Guidant Group’s primary goals were to enable USC to better track contingent labor spend and reduce the legal risks associated with using contingent workers.
MAKING CHANGE EASY
Though USC’s needs presented an array of challenges, none were unprecedented for Guidant Group. We used our methodology to bring greater simplicity and more manageability to this complex and diverse organization.
Our approach implemented changes through various means:
Powerful technology. Our vendor management system (VMS) became the primary software tool for meeting USC’s business objectives. This technology can capture and track a wide variety of data, including spending, headcount, and suppliers. It provides streamlined invoicing for all suppliers, and its reporting capabilities provide a new level of insight for every component of contingent labor management.
Streamlined processes. The most critical feature of the VMS is a user interface that is both intuitive and easy to learn. Ultimately, the simplicity of the VMS was a major key in the successful implementation and adoption of the program.
Skilled change management. Our client was particularly concerned about the adoption of the program by the university’s tenured staff. USC’s procurement group asked Guidant Group to provide best practices for change management and driving adoption.
Guidant Group worked with USC’s program sponsorship to develop a solution that was consistent with USC’s existing technology interfaces for communication and change management. Our team collaborated extensively with the USC IT team to develop the web interface, “Trojan Temps powered by Guidant Group.” The program is accessed through the campus intranet, providing end users with the feel of working with a colleague rather than an outsourced provider, thus reinforcing program adoption.
Strategic communication. To further their assimilation into the USC environment, the Guidant Group account team, from the very beginning, used client-hosted corporate e-mail accounts. Finally, to streamline the final 30 days of implementation, Guidant Group held weekly on-campus seminars to provide end users as well as USC’s executive sponsor and program initiative teams with an orientation to the new system. By the time the system launched, Trojan Temps was a familiar entity, working seamlessly with other operations.
EARLY ADOPTION, FUTURE GROWTH
Guidant Group successfully implemented the USC program in just over 60 days. Since the program’s inception, USC has been able to achieve 100 percent adoption levels among end users. In other words, no maverick spending has occurred outside of the program to date.
The success of the managed services program can be measured in a variety of metrics that include significant annual savings, risk mitigation, visibility into market rates, and greater controls over hiring processes. USC’s return on talent investment breaks down into these categories:
• USC is experiencing 17 percent annual savings over total spend;
• All stakeholders—human resources, procurement, hiring managers, legal, finance, and suppliers—are operating more efficiently and cost effectively;
• The program has achieved successful on-boarding of 95 percent of USC’s incumbent suppliers;
• Time-to-fill rates have been reduced by 37 percent;
• Consolidated invoices have reduced accounts payables from several thousand to 52;
• Diversity goals have been met, with 75 percent of spend flowing through Minority and Women-owned Business Enterprises; and
• 100 percent satisfaction among USC end users.
The engagement even transcended itself. In April 2009, USC added two hospitals to its balance sheet, bringing in entirely new categories of temporary staff. The managed services program developed by Guidant Group easily adapted to meet USC’s evolving contingent labor needs. Everyone had gone to school on it.