Many organisations spend millions of pounds on their contingent workforce solutions. An experienced Managed Service Provider (MSP) can identify significant efficiency and strategic cost savings opportunities – such as better control and visibility of your contingent workforce – and help with the implementation of these initiatives.
However, although you may know the pros of transitioning to a single supply MSP model, if this is your first time going out to market to implement this kind of solution, there are some key issues to consider when selecting your very first provider that don’t just include price and cost savings.
With this in mind, let’s assume that you’re going down the route of selecting your very first MSP and are happy that the providers bidding for your business are going to give you the level of cost saving you’re looking for, and that you’ve covered the legal and compliance elements of what you want.
So, what else do you need to consider?
Like anything you do for the first time, implementing your first MSP is going to involve a steep learning curve. Remember, most people in your business won’t have any experience of deploying an MSP solution.
That’s why whoever you select as your first MSP provider is going to have a key role to play in terms of how that solution is implemented and how it’s communicated across the wider business.
What you want is to select a provider who has the experience to essentially hold your hand, guide you, and take on the bulk of the workload throughout the implementation process.
A supplier who is both knowledgeable and skilled at first time MSP implementations.
A provider who has the understanding and knowhow to take the lead in more activities than would ordinarily be required if you were simply moving from one MSP provider to another.
This will not only give you peace of mind but will also ensure that you experience fewer hiccups along the way.
An MSP who can give you examples of processes and best practices they’ve used in other organisations and what the end outcomes of those were.
A provider who will challenge your thinking as an organisation and spell out any potential operational implications, giving you confidence that you’re in safe hands during this transition process.
(Already have an MSP and thinking about change? Read our blog 6 Key Considerations When Changing Your MSP Provider to find out more)
Focus on the implementation plan
Implementing an MSP solution for the first time is a significant change for you as a business. You are moving from a multi supplier arrangement to a single supplier arrangement.
The provider you select must develop an implementation plan that gives you confidence as a business that this change is going to work.
Ask yourself: Does the implementation plan make sense? Are you comfortable with the timescales they’re proposing?
For example, this could very well be the first time you’re going to have things like:
- A Vendor Management System (VMS), a cloud-based software platform that finds, engages, and manages your contingent workforce and supply chain
- A dedicated account team
- Some form of consolidated billing.
All these things will take you a bit longer to get to grips with, compared to a business that has already had an MSP solution in place. This is why any implementation programme might need to be prolonged more than usual.
Since you’ve never had an MSP solution before, it’s advisable to put greater weighting on the implementation process and to spend more time discussing it with prospective suppliers and exploring how they envision that playing out. Ask them how much time and resource they will need from your organisation during that process.
Ask for evidence
When you’re going out to tender for your first MSP you want to ask suppliers to provide case studies of where they’ve helped clients move from an ad hoc or Preferred Supplier List (PSL) arrangement to an MSP.
What were their key learnings from that experience?
What would they have done differently during that implementation if they had the chance and why?
How has that experience helped them for future first-time MSP implementations?
Implementing an MSP for the first time is different and there are things that you wouldn’t necessarily need to do if you were swapping from one MSP provider to another but that can become a major issue the first time you go down this route.
For example:
- You want a supplier that can help you do a lot of the due diligence
- That can help you review contractual agreements that you have with your existing suppliers
- That can help you understand if there are any restrictions or additional costs associated with migrating agency workers from those suppliers.
- That can help you understand where there are perhaps covenants that would stop you from doing that
- That can help you understand and explain where there are cost implications of doing that, and therefore agree a plan on what that migration may / may not look like.
Ask for a detailed breakdown
During the selection process, it’s imperative you get MSP suppliers to explain in detail how they plan to go through that implementation process.
You need to feel confident that you are partnering with a supplier that’s really going to focus on your interests during this time.
For example, what you don’t want is for your new MSP supplier to come in and insist that all existing contingent workers migrate over to them simply because they want to get as many agency fees going through their managed service as possible.
Instead, you want a supplier who, as part of their process, has built in a contractual review of your existing supply arrangements and will give you balanced advice that benefits you.
You want them to give you advice on what risks are associated with transitioning workers from those existing supply arrangements and what the risks are of not continuing with certain suppliers.
You also want them to let you know what, if any, opportunities there are for cost savings if you do migrate your workers across.
You then want a supplier who will look at all the information and determine where they can balance the two so that you’re getting the best deal.
Vendor Management System (VMS)
Part of your MSP implementation will involve the implementation of technology to manage your contingent workforce and supply chain.
Because this is your first MSP solution, let’s assume that no one in your organisation has ever implemented a VMS platform before.
You want to be confident that any incoming MSP provider can take the lead in that VMS implementation and that they can help you design the workflows for it.
This has nothing to do with the VMS being the right technical product. Nor does it have anything to do with how the product works and what happens in the background. All that is a given.
As a first-generation MSP client, you might try and overengineer your VMS product from the get-go. You might think you want an all singing, all dancing product, with layers and layers of approval processes put in place. You might even have good reason for it.
But consider the impact on your operational managers if you’ve got an approval process that is potentially taking weeks to get through? They will become really frustrated because they can't get the talent they want.
Instead, what you need is an MSP who will work with your organisation to get the right workflows and approval processes in place that work for you. A supplier who will also flag where some of your thinking has the potential to cause future problems.
If you’ve had a VMS platform in the past, then you have a better understanding of what you did before and what you wouldn’t want to do again.
You understand that there are things you agreed to and workflows that you put in place that, in hindsight, you wish you hadn’t because it doesn’t quite work for your business.
This usually comes about after working with an MSP provider who has agreed to put everything you’ve requested in place, without challenging your reasoning.
Ask lots of questions
Ask your MSPs how they support the implementation of the VMS?
Have they got business analysts who will work with the project team during the implementation process?
Will they challenge you as a customer to ensure you get the best streamlined and automated process?
Will they highlight any potential operational implications of some of your requirements?
If you’re implementing an MSP solution for the first time, look for a supplier that advises you to go live with the most straightforward VMS product you can get, and then build on it from there.
Remember, you’ve never had a VMS before, so it’s highly likely you will make some bad decisions if you try to fix every single problem with the VMS from day one.
Find a supplier who is comfortable taking the lead on this and can give you examples of where they have done that.
A supplier who has the experience to guide you through the process and to make recommendations and give advice where necessary.
Good advice is priceless
You want an MSP provider who will draw out the implications of decisions that are being made and to spell out the operational impact of doing certain things.
For example, imagine that one of the instigators for going down the MSP route is that your Heads of HR and Finance feel that the way the business is hiring contingent resource is a bit of a free for all. And they view the introduction of a VMS as an opportunity to get more control by getting all new hires signed off by them. This immediately introduces a two-person dependency on anything getting signed off.
On the face it, this isn’t a problem. But what happens when the Head of HR and/or Finance is away? Although the functionality to set a delegate in their absence exists, no matter the best intentions, in practise, this never happens .
You might even want your hiring managers to be responsible for and to take the lead in extending contingent workers’ assignments. You can do this by asking your MSP provider to set up workflows within your VMS that sends alerts and reminders to your hiring managers that their workers’ assignments are due to finish.
What tends to happen, however, is that these alerts end up being ignored until the last minute which results in unnecessary panic and angst for everyone involved, not to mention the worker, who doesn’t know whether s/he is supposed to turn up for work on Monday. To circumvent this, you can leverage your account team and get them to have a conversation with the hiring managers, understand if the worker is likely to be extended, and then they can fill in the necessary extension information on the VMS instead. They can then just send it to your hiring managers for them to confirm whether they approve it. In our experience, this is the way you can ensure it will get done.
That’s why you need to be working with an MSP provider who has the experience and the courage to articulate this to you clearly.
During the tender process ask them to cite where they’ve said no to something a client has requested because they knew there would be an operational impact to that request.
Winning over your hiring managers
When introducing an MSP solution for the first time, it’s normal to experience some scepticism within your hiring manager community around this change. Some will embrace it, and others will feel you should have continued with the status quo. Some may even have preferred suppliers that they’ve worked with for a long time and want to keep working with them.
You must ensure that you instil confidence across the business that the supplier you have selected, and the supply chain they’re going to bring with them, is aligned to the needs of your business.
In your tender ask detailed questions about suppliers’ capabilities of fulfilling your roles and how they plan to give your hiring managers confidence in their abilities.
Explore how knowledgeable their account teams are of your industry and sector, and request bios of the team they are intending to deploy that includes their experience of working in your sector.
How is your new MSP provider going to help communicate their account team’s level of experience to the rest of the business?
As part of your questions around the implementation process, explore if they plan on holding workshops / meet and greets / one-to-one meetings with hiring managers.
What you want is for them to win the hearts and minds of your hiring manager community very early on.
Having a clear communication plan is crucial
As this is your first MSP implementation you may have hiring managers who have never experienced workers migrating from one supplier to another. This can cause apprehension in your hiring manager community that they will lose key workers which will impact the delivery of their projects.
What processes will your new MSP build in to communicate with those hiring managers to alleviate their fears?
How will your MSP explain to your hiring managers what the process is for migrations?
What are they going to do to ensure your hiring managers don’t lose key workers?
How will they help hiring managers understand what to do and where to direct their workers if they come to them with questions / concerns about their payrates and assignments?
People from your MSP provider must be extremely visible very early in the process at key hiring sites, with named contacts, so that people within your organisation know who to reach out to if they’ve got any questions or concerns. The idea is to support and give confidence that they’re in capable hands.
Ask suppliers in what ways will your hiring community see an improvement in service because of your MSP?
How are they going to reduce your time to hire?
How are they going to ensure you continue to get the quality of candidates that you want?
Get Operations involved
As this is your first MSP, get as many key people from Operations involved in the tender process as you feel are necessary as you want their buy-in.
For example, if you’ve got five different business units, make sure you get a representative from each of those involved as part of the tender evaluation process. Someone senior in operations, who hires contingent workers on a regular basis.
Their feedback about the suppliers you’re seeing is critical to the success of your MSP as you want them to feel confident the supplier you select can find the talent that they want.
Building strong relationships
Building relationships is important as part of any MSP implementation process but perhaps more so if it’s your first because you don’t know what to expect at any point in the process.
That’s why your MSP will need to utilise more resource than usual to concentrate on building those relationships.
You want your new supplier to conduct 1-2-1 meetings with all migrating agency workers because that builds that level of contact, trust, and understanding with those workers.
You want them to feel confident that when the MSP goes live, the service improves.
Cultural alignment
Cultural alignment can be tricky to measure during the tender process.
Do the people you meet during the tender process speak the same language as your organisation?
Do the values of your MSP provider align with your values as a business?
Because this is an important change for your business, you need to make sure that culturally you're well aligned with this change.
That’s why having a presentation is important. It gives you a feel for a supplier’s cultural fit.
Although one can argue scoring a presentation is highly subjective, what you want is to ask to see the account team. You want to see the individuals who will be involved in your account day-to-day and to get a feel for what they’re like, their experience, whether they’re going to build strong relationships with your hiring community, and whether they’re going to resonate with your business.
If you want, it’s your prerogative to request to go on a site visit and to meet the people who work in the payroll teams and invoicing teams. Get your finance teams to meet with them so that they get a feel of what the process looks like behind the scenes.
Are they going to be able to work together in terms of improving the invoicing process and if there are any issues, how well are they going to work together?
Also, when you’re looking at the scoring process, give yourself the ability after those presentations and onsite meetings to go back and rescore any of the technical evaluations you might have done as part of the bid process, because you might feel differently about those original scores depending on what you’ve heard / seen.
Make sure these are people that you want to be doing business with and that the personality of the MSP you’re selecting seamlessly slots into your organisation.
To recap
Selecting an MSP for the first time involves a different approach in terms of implementation than if you were moving from one provider to another.
You want to be confident that whoever you’re selecting has implemented several first time MSPs, and that they will allocate sufficient resource to your implementation process. And you want them to help you structure your first MSP solution and VMS platform in a way that best serves your business’ interests not theirs.
Don’t forget to spend time assessing their experience or the supply chain that they bring with them, and their ability to seamlessly step into your business from day one to start fulfilling roles and delivering a much better service to your hiring manager community.
You want a supplier that is prepared to be extremely visible during the implementation process. A supplier that will commit time towards building solid relationships and guide everyone involved through the change, including your line managers, your finance team, your HR team, and your existing contingent workers.
Get evidence of how they plan to do that.
Yes, price is important. Yes, technically they’ve got to be able to deliver. Yes, you need to get the legal context right. Yes, you they need to ensure they understand compliance.
But these are a given and what you’d expect from any MSP solution.
However, it is different the first time you implement an MSP. It’s a lot more hands on. It's a lot more face to face. It’s a lot more about giving people the confidence that this is a change for the good, rather than simply just a change because it's cheaper. That’s where the big differences are.
Already have an MSP and thinking about change? Read our blog 6 Key Considerations When Changing Your MSP Provider to find out more.
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