For many years, companies have enjoyed a steady partnership with their traditional staffing agencies to help reduce temporary labor costs.
However, a new type of agency entered the market, known as Managed Service Providers (MSPs), and it’s reported that as much as 86% of “best-in-class” contingent labor management programs now use an MSP program.
The subsequent results of using an MSP have been impressive. Companies using an MSP have achieved as much as a 67% higher rate of cost savings on contingent labor spend, and 60% higher frequency of temporary workers meeting or exceeding objectives.
While cost savings can be a great advantage to companies that deploy an MSP solution, many clients report that other key benefits include having greater access to talent, improved quality of workers, mitigation of risk and that these are more critical drivers in their long-term business strategies.
The first generation of MSP programs focused on cost savings and optimizing the supply base primarily in the IT sector.
More recently, with the advancement of contingent labor management, MSP programs started to expand beyond temporary employees to include other types of outsourced talent, such as Independent Contractors, statement–of-work (SOW) providers, alumni, retirees, and other specialist areas. As well, there was less concern for cost savings and more focus on access to talent.
Cost savings can be a great advantage to companies that deploy an MSP solution, but there are other benefits to take into account. Companies want a more holistic view of their talent supply and demand, and a view of how that aligns with their ability to meet bigger business objectives.
As the usage of a broader group of contract labor is increasing, more and more companies are using contingent workers for outsourced project work, and Independent Contractors (ICs) to fill critical roles for added flexibility, scalability, and to remain competitive.
MSP programs are now evolving, once again, shifting towards the proactive management and optimization of the overall workforce talent supply in order to meet the talent demands and achieve the strategic goals of companies.
And now, MSPs focus on the management and optimization of talent.
Basically, companies are looking for access to quality talent in a timely manner, optimally managed with minimized cost and risks, and they’re willing to use all forms of talent to achieve their business strategies.
We are a contingent workforce service provider helping organizations gain better access to talent through the use of independent contractors, consultants, temporary workers, freelancers and other non-payrolled employees. We provide the expertise, the technology, and processes to help you reduce your workforce costs, mitigate against misclassification and co-employment risks, and increase the efficiency and timeliness of your contingent recruitment process. Read more about what our clients say about us here.