Let’s talk spend. Traditionally a concern of procurement teams, spend is a consideration that many people would not associate with HR. But within today’s data-driven marketplace, it’s all numbers…all of the time. In procurement and HR, managers are increasingly pushed to provide the best contingent workforce outcomes at the lowest prices.
It seems simple, but when compounding other HR compliance concerns atop opaque and bloated cost containment processes, the results often inhibit success. And to make matters even worse, aggressively or otherwise ill-applied cost savings strategies can actually increase costs by increasing turnover rates and reducing the quality of the workforce and, ultimately, productivity.
Signal the managed service program (MSP).
Contract labor MSPs can be an HR leader’s life raft in an ocean of rising and falling pay rates, supplier markup rates, and employment regulations. The reductions in complexity and administrative burdens alleviate challenges by creating a hub of highly visible and efficient processes that handle all elements of the lifecycle. According to analysts, companies that employ MSPs experience—on average—a 44% increase in productivity over those that do not employ the programs.
What are the other perks of an MSP?
Cost savings – When it’s all about the numbers, an MSP’s proven track record of reducing costs comes into its own. Reducing operating costs is often an MSP’s primary directive. When the C-suite sees that costs have gone down while productivity is at an all-time high, this is counted as a win.
Compliance – A well-functioning MSP will ensure not only that you know who is on-site at your location, but also that they have passed the proper screenings. More, the processes associated with approving time, expenses, assignment extensions and other contingent labor variables are often automated within an accompanying vendor management system (VMS), further bolstering compliance efforts.
Business intelligence – Nothing in the current business world sounds better to the C-suite than rich data analytics. An good MSP offers full visibility into spend, trends and performance data, enabling you and your MSP partner to analyze and track project milestones and supplier performance.
Culture control – Your company has a culture, and hiring managers spend a great deal of time focused on hiring employees that fit well within your organization. Seeing as many companies are comprised of 25% or more contingent workers, an MSP helps to make sure that the job is done right.
Workforces are only going to get bigger as the economy recovers, and with growth comes complexity—nowhere is this more evident than with contingent workforces. When partnered with an experienced MSP provider, HR and procurement can maximize the abilities of their contingent workforces and gain confidence from the C-suite…all while keeping a firm handle on the numbers.