Why Do Clients Hate Their MSP and VMS? Part 1: The Problems

We all know (well at least the 15-25 of you that read this) that the use of an MSP and a VMS by an organization for contingent workforce (CW) management is more the norm than the outlier. Each year this number continues to grow. Yet despite this growth and majority usage, the general opinion and feedback of client-side users of these services tend to be negative.?Net Promoter Scores (NPS) continuously show limited positivity. And these scores have been trending downward the past several years according to SIA. Direct interviews and feedback from clients show unfavorable opinions as well, with clients thinking of insourcing their MSP, or switching providers for their MSP and/or VMS.

But why?

Strap on your negativity boots as we wade through some root causes behind the disdain.

Buyers: Their Own Worst Enemy

Yes, the buyers of CW services such as the MSP and VMS are part of the very reason that those services have a negative view. Organizations can’t get out of their own way to do the right things and prioritize effectively, thus not setting up service providers for success. Here are some great examples:

• Lack of CW prioritization – This is one of the common themes in my articles, but there is a reason: It matters! If you don’t prioritize your CW program with the funding and resources to support your VMS/MSP, you’re going to end up with poor results.?If key decision makers don’t prioritize CW strategy and enable the program to do great things, it’s hard to expect your outsourced partners to carry all the burden. CW operations require dedicated staff to get things done, even with external partners. ??
• CW isn’t part of your TA strategy – This seems like a no-brainer, but I’ve yet to see this done effectively. If anyone knows where, please let me know! Your talent strategy needs to be holistic and include your CWs. Help your MSP/VMS partners by letting them know what is coming and what to expect. Scale effectively using CWs to ramp up expanding business and new “big bets.” Don’t lay off 21,000 people because you don’t plan the right way. It’s difficult to have a positive opinion of a service that is always reactive to your inability to plan.
• Aggressive rate cards – When your rates are too aggressive for savings, you struggle to find talent. I’ve seen clients set the mid-point of a rate card as their not-to-exceed (NTE) rate, then wonder why they can’t find the talent they need. And guess who they blame – the MSP/VMS and the CW program as a whole.
• Too many policies or a lack of policies – Too much or too little can create difficulties for your managers, thus a negative opinion of the program and system meant to help keep those managers in line. Guardrails are great, but things like tight tenure policies, limitations on interactions with suppliers, and overly complex approval hierarchies make the process difficult.?Too loose guardrails make it hard for your MSP/VMS to enforce. Either way, your partners will get the brunt-end of it.

There are several more buyer-centric items, but for brevity, these are the key ones I want to call out. Remember, shit rolls downhill. Your MSP, VMS, and CW Program are at the bottom of it.

Set the Right Expectations – Buyers and Providers

While the client-side buyers bear a fair share of blame, in this section we’ll look at issues where both the buyers and providers are accountable.

• Limited program and system use from end users – In my experience, only 80% of CW program users use the tools/processes more than 2 times a year (beyond approving timecards). This means engaging with the MSP/PMO/VMS is a new experience every time. Complex processes and tools create frustration, and most managers don’t want to have to learn on the fly how to engage a CW.
• Misunderstanding of what CW even is – Most end users don’t care about classification, nor do they even understand it. With the nuance and intricacies around non-employee labor, it’s easy to be met with confusion, thus a negative view of those that support these processes.
• They need talent weeks ago – As stated earlier, poor planning by the buyer puts extra strain on the providers to move at a pace that will never make the end-user happy. The engagement process can be slow and redundant. If suppliers don’t get it right or move too slow, guess who’s held responsible?
• Lack of clarity and value – To end users, the MSP and VMS is just another service and tool. If not well articulated, they struggle to see what purpose the program brings.?There is difficulty to understand the value of having these tools when in the past they could call a vendor, sign a contract, and have someone the next day. When our needs aren’t met in a way that makes sense to us, frustration and resentment mounts – ignorance is not bliss.

MSP / VMS Problems

The MSP / VMS are often the scapegoats for the dissatisfaction in engagement CWs, even if it not their fault.?There is a shared responsibility between partners and the client to give the end users the best experience, and at times, they both fall short. Sometimes, it really is the fault of the MSP / VMS.

• Bad support from MSP / VMS – Plain and simple; whether it’s direct interaction with end users or with the client CW program, sometimes your partner teams just suck. It could be that they take too long to respond, have poor customer service, or just clearly don’t know what they’re talking about. Possibly they hired the wrong people/person to support the client. But no matter the reason, having any level of poor performance in a client facing role will drop your provider’s scores. Regardless of their industry reputation or how well their executives can schmooze the client, if the support team is terrible, so is the perception of them.
• Great salesperson, not a great service – I’m not trying to knock the salespeople as there are some great ones out there, but it can become very easy for the sales team to promise a lot of things that their support team and/or product can’t deliver.?Offering things that take years to achieve but making it sound like an instant ROI is a common example. Not getting what was promised will only lead to frustration and poor opinion.

• Rushed implementation / poor change management – This could fall under a mix of poor planning by the buyer and MSP/VMS, but as a service provider you need to come to the table with how to do things and what you need from your client to be successful. Not having a great implementation methodology or change plan will hurt you down the road. These require time and dedication and can’t be plowed through in order to turn on revenue. If that’s the plan, you’re just looking for trouble.
• Lack of innovation and stale strategy – Complacency from a provider is far more common than one would expect. There is continuous transaction support, but no strategy in terms of process improvement or pushes for innovations to help clients improve their CW program.?While there may be comfort in “the same old thing,” there needs to be continuous growth as the CW industry evolves quickly.

Debbie Downer

I hope your negativity boots aren’t too dirty. I apologize for a negative article, but I’ve had this one brewing for months and needed to get it out there.?I’ll admit that this is not an exhaustive list and there are numerous other reasons why there are negative feelings toward MSP and VMS providers.?At the same time, there are also lots of great things your MSP and VMS do. So don’t let this article deter from their use. I’ll have a future article to call out the leading practices that they bring!

Every program is (mostly) unique and the perception of these providers may vary greatly.?I’m sure there are some that disagree with a lot of what I’ve written because it hasn’t been their experience.?For those that can relate, the good news is that there are solutions for these problems. In Part 2, I’ll explore what those solutions are.

Need a shoulder to cry on or an outlet to process negative emotions around your CW Program? CWM Strategies is here for you. We have solutions, strategies, and lots of tissues for your issues.