It’s actually the complexity of SOW projects that make them ideal for vendor management systems.
By Peter Parks
Many organizations believe that vendor management systems (VMS) are only appropriate for the management of straight time-and-material engagements, and that statements of work (SOW) are just too complex for the software to handle.
SOWs are often viewed as in a different class, with many variables and higher fees
Pre-hire assessment tools that mine data
deliver true gold: the right candidate for the job.
By Ray Bixler
In today’s war for talent, finding qualified workers is becoming increasingly difficult. In fact, a recent study by Leadership IQ tracked 20,000 new hires and found that 46 percent failed within 18 months. The cost to replace an employee ranges from 50 to 150 percent of a position’s salary. Plus, these totals do not factor in the indirect costs of lost sales opportunities, lack of productivity, and lowered morale. It is clear: Make the wrong choice and your new employee will most likely impact the growth of your business, damage your team’s morale, and cause involuntarily turnover. On the other hand, make the right choice and your new employee has the potential to help your business grow, stay longer, and help the company succeed.
With so much riding on making the right hire, HR has had a recent increased interest in pre-hire performance assessments. A recent issue of Forbes listed evolving assessment science as one of the nine hottest trends in HR technology, and The Atlantic featured people analytics on its December cover, and how it is “already transforming how employers hire, fire, and promote.”
Most HR professionals would agree that past performance is the best predictor of future performance. According to the International Journal of Selection & Assessment, its peer- reviewed, published research shows that organizations that utilize pre-hire performance assessment data in their hiring process achieve clear benefits:
- Anticipate future performance. The higher the performance assessment rating, the better the supervisor performance review once on the job.
- Reduce turnover. Organizations have experience first- year turnover reductions as high as 69 percent.
- Improve satisfaction. By selecting employees with a track record of exceptional customer service, overall customer satisfaction scores increased by an average of 16 percent year-over-year. But there are some underlying issues with the traditional ways of conducting pre-hire assessments. Perhaps the most widespread bias in hiring today occurs subconsciously.
In a recent survey of some 500 hiring managers by The Corporate Executive Board, 74 percent of respondents reported that their most recent hire had a personality “similar to mine.” Lauren Rivera, a sociologist at Northwestern, spent parts of the three years from 2006 to 2008 interviewing professionals from elite investment banks, consultancies, and law firms about how they recruited, interviewed, and evaluated candidates. She concluded that among the most important factors driving their hiring recommendations were shared leisure interests.
What executives should be considering is data collected though a standardized assessment process. Reports that include skills the candidates have mastered, what traits and behaviors they positively display at work, and where they have developmental needs should be reviewed during the hiring process. Reference Checking Reinvented For decades, recruiters and hiring managers attempted to gather behavioral insights on candidates by calling references. But this practice is becoming extinct for a variety of reasons.
- References rarely provide any meaningful feedback. A few years ago, a SHRM study confirmed that because most organizations and individuals don’t want to be held liable for saying anything defamatory, they say nothing at all aside from verifying dates of employment.
- The process is extremely inefficient. “You’re it” telephone tag can take weeks to complete.
- The method is scientifically flawed. The data collection process is not standardized and produces inconsistent results, even when the references actually respond.
Organizations now have to the option to assess candidates’ past performance from references in a way that overcomes the legal, logistical, and scientific shortcomings of dealing with references by phone. Web-based pre-hire performance assessments can be initiated in minutes and completed in less than two days with no recruiter or hiring manager intervention. Research has shown that well-designed pre-hire assessments that gather and manage multi-rater feedback electronically deliver an 85 percent response rate while also mitigating legal risk inherent in phone-based referencing.
Using self-assessments in another path to improve or validate hiring decisions. They are designed to measure cognitive ability, personality traits, and technical, job-related skills. These solutions have the potential to provide valuable insight into candidates during the hiring process, yet shortcomings exist. One of the biggest and most common challenges of self-assessments is they only offers the candidate’s perspective, which, in the end, may be flawed.
Personality tests also have their strengths, but there are several weaknesses:
HRO Today’s Baker’s Dozen rankings are based solely on feedback from buyers of the rated services. The ratings are not based on the opinion of the HRO Today staff. We collect feedback annually through an online survey, which we distribute both directly to buyers through our own mailing lists and indirectly by sending service providers the link to send to their clients.
Once collected, response data are loaded into the HRO Today database for analysis to score each provider that has a statistically significant sample. For this survey, we required 10 responses from 7 companies, and we received feedback from more than 200 verified customers.
In order to determine an overall ranking, we analyze results across three subcategories: service breadth, deal sizes, and quality. Using a predetermined algorithm that weighs questions and categories based on importance, we calculate scores in all three subcategories as well as an overall score. The rankings are based on those scores. The numbers presented in the tables represent those calculated scores. We include them to demonstrate the relative differences among the ranked service providers.
While we do not claim that our methodology is the only viable ratings program available, we do vouch for its statistical validity. We hope this ranking provides you some insight into your next RFP process.
The recruitment process outsourcing provider mergers with UK-based CPH.
With the growth of global enterprise comes the need for companies to have a global RPO partner with a central point of governance for streamlined multi-country delivery models. The merger accomplishes this and expands WilsonHCG and CPH’s global footprint across North and South America, EMEA and APAC. The combined organization has approximately 300 employees.
“Since 2012 we’ve been seeking a global partner that met our high expectations of quality and performance. Not only did CPH meet that criteria, but they are a natural culture fit for WilsonHCG. The decision to merge has been solidified during the last 18 months, as we learned more about each other’s values and ambitions,” said John Wilson, Founder and CEO of WilsonHCG and CEO of the combined organization. “Not only is the market dictating a need for global capabilities from a single vendor model, but our clients expressed a need for further on-site and in-market support around the world. Top talent is what powers companies across the globe, and our comprehensive human capital services and consultative recruitment delivery approach will provide an unparalleled talent acquisition solution for these organizations. Together, we will redefine human capital solutions by delivering high-touch, transformative recruitment services to our clients.”
Sourceright (Randstad), a global talent leader and an operating company of Randstad Holding nv, and Pinnacle Technical Resources (Pinnacle), a leading provider of workforce management solutions, announced that Comcast Cable has selected the companies to co-manage its managed services program (MSP). Randstad and Pinnacle will operate as one under the Comcast contingent solutions program to deliver a solution that combines diverse leadership, decades of experience, and a global reach
We all live in a world populated by brands. Your company is worried about your consumer or customer brand, your social responsibility brand, HR, specifically your “employer brand.” Would you bet your job and career on your provider’s brand? Whether you want to or not, you will.
I am not advocating only engaging the largest provider companies for your needs
Leading the Leaders
Earlier this month, I had the opportunity to steal some minutes of three veritable industry leaders who will be speaking at our HRO Today Forum in May. I posed the same questions to the trio around the main challenges HR faces today, and discovered a common thread in their answers: leading the leaders.
When I asked Joe Cabral, senior vice president and CHRO for North Shore-LIJ Health System, about what is driving his talent management strategy, he said investing in leadership: “We are working on helping leaders become better leaders
A new report outlines a roadmap for leveraging contract workers.
By Christopher Dwyer
With the newfound reliance on contingent labor now an accepted slice of a multi-tiered business plan, organizations have found that the simple “fill-and-run” contingent workforce strategy of choosing candidates when or where needed is not the ideal approach to this area. Contingent labor in 2013 was perhaps the most complex supply component that the modern organization leveraged, managed, and utilized. This thought is owed to the fact that that contract talent is split into three very intricate “layers” that each warrant their own specific set of capabilities, processes, strategies, services, and solutions (see sidebar: Contemporary Scope of the Non-Employee Workforce).
The need for contract talent is pressing and will continue to rise, but the components of this workforce are growing more complex and require better processes, strategies, and solutions to manage them. Ardent Partners research has determined that that the utilization of contingent labor will increase by nearly 30 percent over the next three years, further cementing the need for more robust capabilities within this arena.
It would be easy to dismiss the newfound complexities of contemporary contingent labor, if not for the current marketplace perception of contract talent and what it means for their business plans and achievement of corporate goals and objectives. Ardent Partners research has discovered that 62 percent of organizations cite contingent labor as a vital component in achieving their primary goals and objectives this upcoming year. In the five-plus years since the economic downturn, contract talent has become just as critical as other key components of the average enterprise.
There is now recognized value in leveraging a non-employee workforce across enterprise projects and other key internal roles. The contingent workforce is still actively driving corporate value for the modern enterprise and will continue to do so as this type of talent is linked to key organizational objectives.
It is no secret that the average workforce is becoming more blended, featuring a mix of traditional employees and contract talent working together for the common good of the greater group. Within this aspect is the rise of “total talent management,” a concept that 58 percent of companies in the State of Contingent Workforce Management research survey touted as the top industry-level change to come in the greater scope of contingent workforce management.
With contingent labor expected to increase significantly over the next few years, many organizations are focused on utilizing similar strategies and processes from their management of traditional full-time employees into their strategic plan for contract talent.
Visibility into overall contingent workforce management is an area that needs improvement for the typical enterprise. Analytics has become one of the more powerful tools in the modern executive’s arsenal over the years as the non-employee workforce has evolved. In fact, analytics and reporting rank as critical components of a successful contingent workforce management program as more and more enterprises realize the value of linking contingent workforce data to greater business planning and budgeting. As contract talent continues to be utilized in high-leverage enterprise projects, data and intelligence related to these initiatives becomes more useful in helping understanding total corporate performance.
Organizations in this research study echo the vitality of contingent workforce: 51 percent of enterprises believe contingent labor will be relied upon even more in the future as more and more critical enterprise projects utilize this type of talent.
As the contingent workforce industry continues to evolve, it becomes critical for enterprises across the globe to build and develop a proper program that can effectively address all layers of contract talent and support the overarching capabilities that link these layers together under a cohesive umbrella and improve performance and corporate value.
The contemporary scope of contract talent is rapidly evolving and forcing organizations to institute more complex measures to drive ultimate value from their non-employee workforce. Ardent Partners recommends the following strategies and approaches for those enterprises seeking to improve their contingent workforce performance:
- Understand the ramifications of contract talent. Where is contingent labor currently being utilized? Which projects are tied to contract talent? What are the milestones and delivery items attached to those projects? Is there a clear picture of the contract workforce? These are all valuable questions to ask; those organizations that cannot answer these inquiries are the ones that do not have the capability to drive value from their contract talent and properly align these workers with the enterprise projects that require their skillsets.
- A little “help” goes a long way. Solutions such as MSPs and VMS offerings are designed specifically for the contract workforce industry and offer veritable value in managing contract talent. MSPs are well-known experts in managing day- to-day operations for all contingent workforce management processes, while VMS technology is the ideal solution for driving efficiencies within complex contingent labor management.
- Compliance initiatives need to be top-of-mind. In the pursuit of top-shelf talent, enterprises are turning to independent contractors. It is imperative to implement robust compliance measurement strategies to ensure that independent contractors are properly classified and managed.
- Analytics is the key to an intelligence goldmine. Many enterprises sit on a goldmine of contingent workforce data, most of which can be leveraged to improve the greater contingent worker management program and gauge the performance of key contingent workers. Agile analytics represent the next wave of business intelligence within this industry and will help enterprises drive multi-functional value out of contingent workforce data. Procurement can utilize spend and supplier data, while HR will benefit from talent management intelligence.
- Identity management capabilities must be streamlined and enhanced to avoid the loss of intellectual property and sensitive information. Too many contractors and temporary workers walk off-site with continued access to enterprise systems. A well- thought offboarding process can go a long way in securing IP and sensitive financial data/information.
For the Future
The recommendations below can help organizations best prepare for what’s ahead in the contingent workforce industry.
- The “blended” workforce is real, and total talent management is an ideal strategy to manage this talent mix. The lines are becoming blurred between traditional and contract talent, as more and more enterprises blend these two very different workforces together for the greater good of the organization. Recruitment process outsourcing will arise as an important offering in the pursuit of total talent management, as its engagement functionalities will prove to be a positive force in managing the modern blended workforce.
- The pressure to find, engage, and retain top-tier talent will intensify. The talent wars will continue to rage, and enterprises across the globe will see their need for unique skillsets increase as the months pass by. Social sourcing and social networking will be ideal strategies in the next generation of contract talent acquisition.
- eWaaS will throw a wrinkle into contingent workforce management. Enterprise-workforce-as-a-service (eWaaS) is the freshest tactic in the contingent worker management toolbox, and organizations will seek to source more contract talent from online labor marketplaces. However, executives must be able to effectively balance cost, compliance risks, and talent.
Contemporary Scope of the Non-Employee Workforce
Ardent Partners defines the contemporary contingent workforce as falling into three main buckets, each of which has evolved significantly over the past half-decade:
New research from The Hackett Group examines HR’s top priorities.
By Natalie Bression, Harry Osle, and Lynne Schneider
The pressure is mounting on HR to change the balance of the services it offers while keeping costs and headcount in check. The Hackett Group’s 2014 Key Issues Study reflects how HR organizations are attempting to successfully shift their service mix and the required enabling capabilities
Human capital management industry leader Allegis Group announced this week that it is formally combining the recruitment process outsourcing (RPO), managed services provider (MSP), and integrated talent operations of its subsidiary Allegis Group Services with the MSP and RPO operations of Australian-based Talent2 under the name Allegis Global Solutions. This continues the integration of the two businesses that has been underway since late 2012 when Allegis Group entered into a joint venture to take Talent2 private.
The combined businesses (www.allegisglobalsolutions.com) create one of the largest human capital solutions management firms in the world.
In Asia, Australia and New Zealand, the recruitment managed services division of Talent2 will continue to operate as part of Talent2 while the transition to the new organization, Allegis Global Solutions, takes place.
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