If you're responsible for procuring or managing your organization's contingent workforce, chances are you have considered or previously implemented a Managed Service Provider (MSP) program. Managing contingent labor through an MSP is common, but it’s not always easy to know where to start.
The procurement of contingent labor is extremely complex. Regardless if you currently maintain this function in-house or are considering outsourcing it to an Managed Serivce Provider, there are several factors that influence the success of your organization's contingent workforce program. From the VMS technology it operates, to staffing supplier management, to legal and compliance measures, the list goes on and on.
What is a Managed Service Provider Provider?
Before diving into MSP program pricing, let's touch base on what a Managed Service Provider (MSP) is. In essence, the MSP manages contingent labor processes, reporting and invoicing for a client company. Generally, all other temporary/contingent labor suppliers go through the MSP to provide temporary resources to the company. This provides a single point-of-contact for the client. The MSP is then responsible for dealing with the supplier, requisition workflow, time management and invoicing.
Managed Service Provider Pricing Guide for Contingent Staffing
There are a number of benefits to be had when migrating your internal contingent workforce program to an outsourced provider. Depending on the size and scope of your contingent labor budget, you can expect to see a return in cost-savings from streamlining these operations under a single provider. Moving past year one, many companies evolve their MSP program to include other contingent labor management services like payrolling or SOW management.
While there isn't a uniform price as each program varies, there is a guide you can follow when collecting prices for managed services. Follow the outline below, or for an in-depth guide, including helpful infographics and access to a sample business case template, check out Yoh's complete MSP Buyer's Guide.
How to Prepare
You'll want to start by identifying the need within your organization. Remember to start with problems or initiatives that are top of mind or on-going. Package the need so it's relevant and not easily overlooked by senior management or your executive team.
Who To Engage
You'll want to determine who has the most to gain from implementing a MSP program. Who are the key stake holders within your organization? Once you've pinpointed these individuals (think CEO, CIO, etc.), you can start to frame the next steps around their pain points and program goals.
What Questions to Ask
This is really the point where you want to set the stage for the RFP, or Request for Proposal. It's vital at this point to have a firm understanding of how your organization makes decisions; i.e. cost-focused, operations-based, etc.
What to Expect
Often individuals will get so caught up in the planning, that too few fully explore what to expect if they gain approval to move forward. Know what the implementation of an MSP program will look like. Understand who will need to be involved. And, be prepared to propose how the program will demonstrate ROI.
There's no single path to pricing out managed services, but by understanding what goes into the planning, consideration and implementation of an MSP program, you'll be in a better position to make informed decisions at each stage of the journey.