Demystifying The Marketing on Vendor Neutrality

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There has been a growing trend of having procurement and sourcing department oversight and/or involvement in the due diligence process of reviewing and selecting Recruitment Process Outsourcing companies. This presentation will focus on the importance for organizations to still involve key stakeholders and business users of recruitment process oursourcing versus simply “turning over the keys” to procurement, possibly resulting in a price-only focused process.

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  • JN introduce TW TW Introduce JN
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  • TW
  • TW with Question from JN on Why there would be a need for BpaaS vs. MSP providing the process management
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  • JN with TW on BPaaS definition in the model.
  • JN
  • TW TW Ask Poll Question: Do you think a staffing firm can be neutral in managing a program?
  • TW
  • JN Add TekSystems beside Aerotek
  • TW with JN colour commentary
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  • JN asking / prodding questions. JN thanking TW and attendees
  • Demystifying The Marketing on Vendor Neutrality

    1. 1. Contract Workforce & Talent Exchange Demystifying the Marketing on Vendor Neutrality
    2. 2. Today’s Presenters <ul><li>JEFF NUGENT, Founder & Managing Director </li></ul>TED WEYN, Co-Founder & Managing Partner
    3. 3. Agenda <ul><li>Overview: What is an MSP? </li></ul><ul><li>MSP Programs History & Evolution </li></ul><ul><li>MSP Programs </li></ul><ul><ul><li>Structure </li></ul></ul><ul><ul><li>Design </li></ul></ul><ul><ul><li>Pricing </li></ul></ul><ul><li>What is Vendor Neutrality? </li></ul><ul><ul><li>Definition </li></ul></ul><ul><ul><li>The Marketing of Vendor Neutrality </li></ul></ul><ul><li>Keys to Success </li></ul><ul><ul><li>What to Watch For </li></ul></ul><ul><ul><li>How to Drive Results </li></ul></ul>
    4. 4. What is an MSP? <ul><li>Managed Service Providers  take on responsibility for outsourced management of all facets of contingent labour program, including day-to-day operations including hiring, on-boarding, administration and off-boarding activities. </li></ul>
    5. 5. What is Vendor Neutrality? <ul><li>A vendor service that is not proprietary (e.g. not privately owned and controlled) by one of </li></ul><ul><li>the vendors. Vendor neutrality can be </li></ul><ul><li>of concern, especially in the enterprise  </li></ul><ul><li>where there is a need for processes to </li></ul><ul><li>integrate with others vendors or processes. The presumed advantage of choosing a vendor-neutral model is that the best solution can be chosen at any time, and without conflict of interest. </li></ul>
    6. 6. Staffing Industry History: Managed Services 1970s – American Express originally introduced the concept of Managed Services through their Travel Services Division. 1980s – “On-site” programs grew into Vendor on Premise Programs and were adopted by the staffing industry. 1990s – Vendor on Premise Programs migrated into full departmental/category outsourcing . 2000s – Vendor Management System (VMS) Technologies emerged for Staffing. 2003-2005 – Refined MSP , VMS, ICES 2010 – Programs are expanding into broader indirect goods and services with outsourced models evolving beyond typical MSP SOW, Legal, Marketing, Printing.
    7. 7. Future of Managed Services: Business Process as a Service (BPaaS) <ul><li>A combination of Business Process </li></ul><ul><li>Outsourcing (BPO) and Software as </li></ul><ul><li>a Service (SaaS) </li></ul><ul><li>Changes focuses from “Resources to </li></ul><ul><li> Results” </li></ul><ul><li>Provides total ownership to one outsource entity </li></ul><ul><li>Provides a process vehicle for greater scalability                  </li></ul>
    8. 8. Best In Class Solution Utilization Courtesy of: Complexities of the Contingent Labour Umbrella (June 2010), Aberdeen Group
    9. 9. Enterprise CWM Program Model CLIENT + ICES & Payrolling Vendor Vendor Management Software (VMS) Independent Contractors & Non Preferred Vendors Managed Service Provider (MSP) Vendor 1 Vendor 2 Vendor 3
    10. 10. Pricing Percentage of Spend / Invoice Margin Breakdown Note: MSP/VMS fee is paid by the Vendors MSP 2-5% VMS 1-2% Vendor 25%
    11. 11. Alternative Pricing Models <ul><li>Flat Management Fee </li></ul><ul><li>Incentive % Share of Savings </li></ul><ul><li>KPI / SLA Incentive </li></ul>
    12. 12. LinkedIn Poll Results
    13. 13. How it Works: The Marketing of Vendor Neutrality Companies provide various solutions which are branded differently to appear neutral. STAFFING MSP VMS PAYROLL
    14. 14. Key Components When Selecting an MSP Vendor Neutrality <ul><li>Does the organization have the depth of experience to provide the service? </li></ul><ul><li>What is the organization’s core business? </li></ul><ul><ul><li>Staffing? </li></ul></ul><ul><ul><li>Software? </li></ul></ul><ul><ul><li>Services? </li></ul></ul><ul><li>What is the structure of the commercial arrangements </li></ul><ul><li>Are the KPI’s reasonable </li></ul><ul><li>Do the KPI’s ensure a “level playing field” </li></ul>
    15. 15. Key Components When Managing MSP <ul><li>Keep the fox out of the henhouse! </li></ul>
    16. 16. Benefits to Vendor Neutrality <ul><li>Focus on program performance without fulfillment distractions or conflicts </li></ul><ul><li>Internal staffing program goals and strategies fully aligned and supported </li></ul><ul><li>Program support not tied to staffing industry economic cycles </li></ul><ul><li>Better overall supplier relationships </li></ul><ul><li>Protection of human capital assets </li></ul>
    17. 17. Keys to Success <ul><li>Ensure fill ratios and to keep users in the system </li></ul><ul><li>Flexibility to expand and contract with varying labour market and consumption needs </li></ul><ul><li>Period Review of Market Rates </li></ul>
    18. 18. Keys to Success <ul><li>Provide visibility and tracking </li></ul><ul><li>Flexibility to meet client requirements and changing needs </li></ul>
    19. 19. Keys to Success <ul><li>No association with a staffing company or vendor management application </li></ul><ul><li>Contracted to ensure service levels and savings </li></ul><ul><ul><li>Rewarded not only on percentage of spend </li></ul></ul><ul><li>Manage change management and communications initiatives </li></ul>
    20. 20. Other Keys to Success <ul><li>Policy Development </li></ul><ul><li>Executive endorsement and support </li></ul><ul><li>Identification of a neutral cost effective billing and payroll firm </li></ul><ul><ul><li>Firm not in the business of staffing </li></ul></ul><ul><ul><li>Protects your company’s IP assets </li></ul></ul>
    21. 21. Thank You!

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