The decision to centralize your contingent labor spend is a big one. And often, it’s not at the top of a company’s executive’s list of things to do. Why? Because we’re talking about temporary employees, right?
Well that’s certainly true, but if you or someone in your company is managing all of those temporary workers, you probably know there’s a lot more permanent work that goes into utilizing those resources.
If you are in HR or procurement, and you don’t have a managed staffing program, or a managed service provider (MSP), then your quandary becomes: How do you sell it to your boss? Fear not.
5 Tips to Optimize Contingent Labor tips for selling a centralized contingent labor program, managed by an MSP partner (or even yourself if you are very brave).
- Engagement – I start with this one because it’s the most overlooked. Analysts report that as much as 25% of a company’s workforce is now temporary. Can you afford to not engage these workers and ensure you are getting the most from them? What if you want to hire them later? What is their experience working at your company and would they take a permanent job? Think about it. An efficient hiring process and a good experience (or better than your competitors) might attract top temporary and permanent talent.
- Compliance/Risk – Before I get to cost, which is inevitable, a hidden cost is the risk associated with non-compliance in a variety of areas. From proper and consistent screening to appropriate employment relationships (as in, they are not your employees and should not be treated as such). An MSP can provide a barrier and reinforce the employee-worker relationship with separate processes and communications that are specific to temporary workers. Also, if you have any independent contractors working for you – are they really independent in the eyes of the IRS? Do you know for sure? How about the affordable care act (ACA)? Are you ready for that?
- Cost – OK, cost had to be one of them. When you find that you are paying different rates for the same skills in different parts of your organization, or certain suppliers are raking you over the coals, it might be time for an MSP. The cost can be a compelling factor, but don’t oversell it. If cutting costs is the only goal, then quality may suffer. The conversation should revolve around getting the proper value for what you are receiving.
- Quality – I did put cost first, but only because it usually gets more attention. Hopefully your key executives will also be concerned with getting quality resources into your organization. An MSP can be on point to ensure that. From the performance of the suppliers in the program to manager satisfaction with the service from the MSP and the suppliers, a centralized program can streamline processes, save money and yes, improve quality if done correctly.
- Visibility – Lastly, but as important as the others, is the ability to see into your usage and costs. I always chuckle when we talk to potential customers and they say things like, “we have about $25 million in spend.” Then, as we start to implement we find $30 million or more. When they quote a round number, you know they really have no idea. By providing visibility, you can get control over what’s going on. You might even be able to plan for next year!
There are a ton of reasons why a managed staffing program managed by an MSP makes sense. If you don’t have an attentive executive, try looking at the areas above for the hook that will make him or her sit up and notice. It’s worth it. And the experience you gain by bringing a program into your organization can also help advance your career. Good luck!