Time for MSP to up its game and be more than a sweety wrapper for the VMS:

There have been so many new developments within the MSP space:

1.    Workforce Diversity and changing expectations and profiles of contingent workforce

2.    Emergence of Integrated Talent Management models

3.    Tech enabled attracting, sourcing, selection solutions

4.    Predictive analytics, data driven insight

5.    Legislation

6.    Increasing Mature 2nd-3rd generation informed MSP clients

7.    Staffing and resourcing

• o  Demand for more vendor neutral models – yet increasing numbers of MSP avoiding Vendor Neutral models.
• o  Staffing entities demanding more wallet share from their owned MSP – challenging a client centric focus from the MSP

All of this context should be making MSP providers sit up and reassess their current MSP core offering, considering a new and refreshing look at how they see the MSP adding value to clients, justifying the % mark-up per worker. Yet we are still seeing the same traditional MSP proposals from MSP providers that were prevalent 4-5 years ago. Proudly claiming expertise in:

·      Visibility and transparency of contingent spend

·      Compliance and audit

·      Cost savings programmes

·      Supply Chain Management

·      Increased programme control

·      Process improvement

The above list is simply key elements of Transactional models underpinned with service matrix elements that are no more that the fundamentals in transacting contingent workers. I accept that these are critical in supporting contingent workforce management for any organisation and must be delivered correctly – but today client expectations from MSP are that these are the basics – not the USPs to try and justify a position as chosen MSP provider. If your MSP is promoting its ability and expertise as a smoothly oiled transactional MSP ask yourself this question – “what value add am I getting from my MSP that is truly transformational and an enabling arm of my talent management strategy”

I am a huge advocate of the value add an outsourced MSP can bring to an organisation – but it has to be more that a sweety wrapper for a VMS. Some thoughts below on 5 key additional transformational capabilities that should be mastered by any MSP in this quickly changing market.

1.    Ensuring the MSP is integrated within, or contributing to Total Talent Management culture within the organisation. It is essential that the MSP solution proposed is HR centric not procurement centric. Aspiration has to be a model that enables the optimum way to deploy contingent, temporary and permanent resources, in a blended way, across primary, secondary and tertiary workforce demands.  If the MSP is not already part of an ‘Integrated Talent Management’ model (MSP/RPO blended hybrid model) then the solution design needs to enable interface into all aspects of the organisations resourcing solutions – particularly within the areas of workforce planning, employer branding, governance, reporting, insight analytics and talent pooling.

2.    Optimising new digital capabilities into the core MSP solution – It must be clear that new digital tech is expected as an essential capability, not just ‘a nice to have’ with the MSP model. The changing global marketplace, with freelancers embracing the gig economy, continually emerging new tech offerings, has meant that to effectively attract, source and retain contingent workers, leading tech enabled MSP solutions must be proposed at implementation phase 1. This includes predictive analysis using data and insight to shape contingent resourcing and retention strategies. According to Capita Resourcing research paper ‘Human to Hybrid’ – 83% of HR and recruitment leaders regard data and insight as essential to develop both recruitment and talent acquisition approaches. Add to that AI candidate interaction tools, tools for on-line recruiting and network events, online recruitment community and assessment tools, gamification, CRM talent pooling, FMS, local visibility software platforms optimising on-demands of mobile workforces…the list is endless, the need imperative.

3.    Talent Pooling Contingent Workforce – The search for contingent talent in an increasingly talent scarce marketplace means it is essential that organisations are able to hire quickly, the right experience and expertise. Talk to any consumer business and they will always tell you new customer acquisition is more resource intensive than retention of existing customers – which is why so much investment is put into CRM solutions.   The MSP must be able to demonstrate how it proposes to Talent Pool; all contingent workers that have had contact with the organisation (completed an assignment or been a silver medallist) and contingent workers identified to be part of a ‘bench’. Free Lancer Management Systems – (FMS) are great enablers to this and therefore any MSP solution should be including this as its core offering. And let’s be clear – Talent Pooling is not just a data base of names – it is a proactive strategy of engagement and nurturing.

4.    Employer Branding niche for contingent workers – The MSP must show how it will use data driven insight to inform Employer Branding and Employee Value Proposition (EVP) for contingent workers. Freelancers have choice, changing generations have increasing expectations of Employer Brand and EVP– irrespective of employment status. Historically contingent workforce has often been considered as transient sometimes a mercenary resource, engaged by the highest bidder – I believe this why Contingent worker programmes have to date been primarily owned by procurement departments, a contingent worker being measured as a commodity by a buyer. To attract and retain the very best talent in the contingent space organisations will need to ensure the Employer Brand presented and EVP on offer connects to the uniqueness of the contingent worker profile / psyche. It is not always about re-defining the Employer Brand (although all Employer Branding should be sense checked for Diversity and Inclusion from a contingent worker perspective) but being clear which brand elements will be emphasised/leveraged in contingent attraction strategies. And with regards to EVP – data insight and analytics from the market can reduce unwanted turnover dramatically by ensuring contingent worker reward strategies are competitive and compelling for the worker.

5.    IR35 Optimisation not simply IR35 compliance – Whilst I recognise the IR35 challenge is still relatively new, MSP providers must be able to demonstrate how they will use the MSP to still enable dynamic, flexible deployment of contingent resources. Simple tracking and reporting of in scope / out of scope workers for IR35 is a transactional process task. The real expectation from the MSP should be the ongoing sourcing of contingent workers who are determined to only take roles that are ‘out of scope’ or will not accept any potential earnings fall by taking a role in scope. I accept that there will be increasing numbers of historic contingent roles that must be considered in scope, but I believe expertise in the MSP should create a contingent resourcing strategy to optimise IR35 constraints not just implement them. MSP should be showing, aligned to the overall resourcing plan, where roles can and should be left out of scope for IR35 (push the boundaries), how Statement of Work (SOW) could be complimented to enable this and where additional initiatives, such as Employed Consultant Model (ECM) could further mitigate potential impacts of IR35.

Some MSPs will already be highlighting the 5 points above in their solution proposal, but increasingly this is not as a core part of the basic service they provide, but as a future solution capability – to be discussed and priced sometime in the future of the programme.  It is time for MSP to up their game and realise that these capabilities are not ‘nice to have’ but essential for organisations in their search for talent in an increasingly scarce talent market.

 Its not too much to ask from an MSP for 3-4% of your annual contingent spend – is it??? So review those RFP responses with an informed critical eye from now on!