A proven outcome resulting from comprehensively managing your entire contingent workforce, including your independent contractors, is a sizeable and measurable reduction in costs.
At a high level, a lack of visibility of your contingent workforce headcount and services procurement spend can translate into some significant challenges for an organization. To name just a few:
A thorough analysis of your total spend and vendor base, serves as a baseline to optimize current spend and identify savings opportunities. Managing the number of service providers and staffing vendors you deal with is the first step to enhancing your buying power. By consolidating your services procurement activities between a handful of best-of-breed vendors, you can more effectively negotiate margins, rate and long term (volume) discounts.
In addition, you can create a sense of partnership among your preferred suppliers and more effectively share information to support your sourcing objectives. In the medium to long-term, creating healthy competition within this pool of quality vendors will help drive down costs and simplify the management of your procure-to-pay process.
Perhaps the greatest challenge faced by most organizations using various forms of contingent workers is properly accounting these individual within your organization. Why? Because these resources are often sourced and retained directly by hiring managers; rogue hiring and spending that escapes traditional accounting and control.
Not only does the time-to-fill stretch out far beyond the acceptable norm, but the entire procure-to-pay process, from “procure-to-pay ” as the expression goes, becomes bogged down and convoluted.
Rogue recruitment and spend is by definition highly inefficient since hiring managers are generally venturing into unfamiliar territory. They are subject to information asymmetry, a lack of market information and often hire or pay for human capital in excess of 40% above competitive market rates.
Hiring managers are not to blame. Yet, how could a vehicle with real, historical and strategic information help them make more informed decisions? This all comes together with the help of a well planned workforce management solution. Furthermore, beyond the hiring decision, a poorly managed contingent workforce, is prone to costly (double) time sheet data entry, fraud and reporting errors, on top of a slow and cumbersome recruitment process. This is the kind of marketplace chaos that your organization can convert into tangible savings opportunities.
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A vendor management system (VMS) is an essential element of any successful contingent workforce management program, helping with every aspect of your company’s “non-permanent” workforce - from candidate selection, requisition distribution, onboarding, vendor management, vendor performance analysis, compliance, time management, payments and much more.
The implementation of a VMS will bring your company a wide range of benefits, such as total workforce visibility, improved efficiencies, the ability to gain control of contingent spending, a significant reduction in costs and the automation of...> Read More
Contingent workforce management programs are complex. With around 41.5 percent of the average enterprise’s workforce being made up of “non-employee” workers (Ardent Partners), large organizations need to implement strategic plans that make the management of this workforce more efficient and cost-effective.
Many companies, however, are failing to get this right. Contingent workforce management programs are highly strategic, time-consuming and require highly skilled professionals that have expertise in contingent workers and how to manage them.> Read More
Supplier performance management (SPM) is a business practice that is used to measure, analyze, and manage the performance of a supplier. Done successfully, this can help your company cut costs, alleviate compliance risks and drive efficiencies in your workforce management.
This important business function is associated with third-party management, and is often used in conjunction with an outsourced partner such as a managed services provider (MSP).
It can cover a wide range of areas in which your business uses suppliers, such as paper, IT or your phone provider. In this blog, however, we...> Read More