what is MSP staffing?
A managed services program is a highly effective way for employers to manage their contingent workforces. An MSP provider can deliver a host of benefits, including:
- market expertise
- process efficiencies
- technology expertise
- program scalability
- compliant practices
- spend visibility and cost savings
The MSP can act as an integral part of your company’s procurement, HR or other human capital function. It will manage the entire contingent talent life cycle from requisition through invoicing and payment. Using a vendor management system (VMS), the managed service program gives you complete visibility into the status of each contingent worker at your organization.
With a rigorously designed and consistent process, an MSP can also help you stay compliant with all labor regulations and governance requirements. Through talent analytics, your program can also drive improved decision-making around your contingent workforce.
is an MSP right for my organization?
An MSP often requires that employers have a minimum amount of contingent talent spend. A volume threshold is typically necessary for the program to be self-sufficient.
Here are some other pivotal questions you should ask:
- Does our internal contingent workforce program adequately control costs and mitigate risks?
- Do we have a rigorous process in place for vetting and reviewing talent suppliers?
- How are we — or aren’t we — ensuring compliance with spend policies?
- Has our organization deployed a robust VMS to gain reporting capabilities and achieve spend visibility?
Internal contingent workforce programs that lack any of these are likely to benefit from adopting an MSP. Determining your need will depend on your organization’s goals and whether your current internal program can achieve those objectives on budget and on time.
what are the benefits of MSPs?
Companies with significant flexible talent spend often find they don’t have full visibility of and compliance within their contingent workforce practices. Hiring managers may source and acquire resources on their own, leaving procurement or HR unaware of who and how many workers are coming and going.
If this describes your company, you may be at risk in a number of ways. You need to keep an eye on regulatory adherence, physical and cyber security, high labor costs, fraud and other problems that can occur without the right controls.
An MSP delivers processes that help you:
- enhance access to talent
- reduce process complexity
- get greater visibility of spend
- lower talent costs
- improve regulatory compliance
how does an MSP work?
An MSP is typically administered as part of an organization’s contingent workforce program. It may encompass most (if not all) flexible work arrangements, including temporary staffing, independent contractors, freelance and gig workers, payrolled talent and statement of work (SOW) suppliers. The solution is managed by a PMO overseen by the service provider. The PMO works in conjunction with the client’s contingent workforce team.
The MSP is responsible for day-to-day management of the program. It will facilitate tasks such as requisition processing, supply chain management, transactional reporting, analytics and market insights, and more. In conjunction with clients and using teams of talent advisors, providers are increasingly working on resource planning to optimize deployment.
what does an MSP cost?
Two prevailing models currently dominate the market: supplier-funded and client-funded. Under a supplier-funded model, a percentage of invoices billed by a supplier is held back to cover program costs. As a result, there are no direct costs to the client. In markets where mark-up is low, however, some suppliers may be unwilling to participate in such a program or hold back their best talent for other clients.
In a client-funded program, the client pays a fee to their MSP partner. Depending on the agreement, the charge can be fixed or variable. While it may appear more costly, a client-funded model may ultimately be more beneficial because it ensures suppliers deliver a higher quality of talent more quickly.
calculate nowready to learn how MSP advances contingent workforce management?
From rogue spend, compliance requirements to workforce visibility, there are many challenges associated with contingent talent. How can you gain greater efficiency and agility without making significant investments in time, expertise and spend to manage your growing contingent workforce?
Get your MSP Playbook for insights on effective and powerful contingent workforce management through a managed services program. Learn how you can secure buy-in and build a strong change management strategy to ensure success of your program.
