The document summarizes strategies for managing a contingent workforce in 2010. It discusses trends in the contract labor market, traditional inefficient processes, and the benefits of implementing a centralized managed service program (MSP) with technology and governance. Key metrics and considerations for a contingent workforce program are also outlined.

1. April 21, 2010 Proactive Staffing Strategies for 2010 Managing A Contingent Workforce

2. Session Goals Enable you to walk away from this session with something of value for you and/or your organization Appeal to a broad audience – Will Focus on Key Points 1 more hour of re-certification complete! Allow some time for Q&A at the end

3. Session Overview Overview of the Contract Labor Market Trends Traditional Processes Centralized Process Management & Category Models Key Metrics Technology in the Contract Labor Market Co-employment How to Get Started Wrap-up and Q&A

4. Defining the Contingent Workforce Market “ Contract Labor” is often referred to as.… Contingent Labor Temp Labor Outside Labor Temp to Hire Consulting Agency recruiting 3 rd party Independent Contractors 1099’s

5. How are 3 rd party “Services” defined? Any type of work being performed by a non-employee that generates productivity and value for the organization How Performed – On-site, Off-site, with or without client direction How Delivered – T&E, Fixed Fee, Milestone or Deliverable based, Outsourced Typical Categories – Consulting, Contractors, Marketing, Legal, Print, Independents Today’s discussion is focused on the more traditional services spend (i.e. T&E)

6. Uses of Contingent Labor Contract Labor is used for… Seasonal variations in labor needs Finding Niche skills Hard to find skills Temporary projects Minimizing the impact of “regular” employees on the payroll and long-term costs Special projects Engaging talent quickly And now trending towards more strategic

7. Blue Collar & Light Industrial (T&M) White Collar Professional (T&M) Independent Contractors/1099’s Call/Contact Center representatives (T&M, by contact, by resolution, etc.) Outsourced projects (off-shore, near-shore, and on-shore) Managed Deliverables or Fixed Fee Other type Services such as marketing, print, legal, etc. Contingent Workforce Categories

8. 80% of the $200B U.S. Global Contract Labor Market is in Seven Key Geographies with the US and UK Consuming Over 50% of the Spend US 38% UK 16% France 9% Source – Bear Stearns Belgium 1% Canada 2% Spain 2% Italy 2% Netherlands 3% ROW 9% Other Europe 3% Germany 3% Australia 7%

9. Primary CWM Categories

10. The Market is Evolving 90% of all companies use staffing services 70%+ of the workers in this industry are working “full-time” The global market is now over $200B in revenues The staffing market is growing at a rate of 10+% per year! The professional services/staffing job market is at the top of the list for new job growth No clear market leader yet, services expansion, and more globalization.

11. The Supply Side of the Market Allows for greater skill training in a shorter period of time Compensation better aligned with skills and the market Mitigate the political factors of a “full-time” job Flexible working arrangements Provides a work option for those unemployed from “full-time” jobs Allows for a trial period with the organization before making a long term commitment Dan Pink – Free Agent Nation Dan Miller – 48 Days to the Work You Love

12. How are Contingent Workers Viewed in US Organizations? Manpower survey 6 months ago…..41,000 companies surveyed worldwide: 84% of US companies surveyed said they assimilate contingent workers just like they do regular FT workers 48% of US companies surveyed said that the contingent worker was key to the overall workforce strategy of the company

13. What do Business Leaders Think about Contingent Workers? “ The truth is that this surge in temporary workers is not only good news for the economy, it's the future of the 21st century labor market.” “ Permanent Employment is cooked….” Tom Peters Jody Miller, Wall Street Journal – Nov. 30, 2009

14. Top 10 Industries & Expected Growth through 2016

15. Why Use Contingent Workers?

17. Emerging Trends in the Industry Increased usage of contingent workers to meet labor needs Convergence of ATS and VMS technology Consortium Purchasing eAuctions VMS/MSP Providers HR and Procurement BPO Providers Dis-intermediate the Supply Chain Off-Shoring

18. Traditional Contingent Labor Buying Process Not Centralized Disparate Processes, if any Unleveraged Contracts with no Buying Power Lack of Technology Enablement No Objectivity in Contractor Selection Unmanaged/Undetermined Workforce Strategy No Performance Tracking or Measurement No Clearly Defined SOW or Deliverable

19. Inefficiencies and Unleveraged Buying Challenges No Demand Channel No standard buying policy Rogue spending No Catalog data to leverage Lack of workforce mgt policy Governance No MSA for protection Lack of leveraged pricing No SLA requirements Supplier Program Process Complex buying Lack of technology enablement Inability to fill roles timely Costs to manage internally Inability to track spend trends Inability to connect buyers/sellers Lack of electronic AP processing Inability to do T&E audits Inability to get relevant and timely data Technology

20. Typical Components of a Managed Program Governance Technology Key Suppliers Managed Process Leveraged Contracts Market competitive rates Managed SLA’s & Audits Supplier Management Ongoing market analysis Multi-skill fulfillment eAuctions Digital Platform ERP Integration Electronic Invoicing Desktop Self-Service Reporting and Metrics Rate and Skill Catalog Resume/CV Review Budget Approval Data Intelligence Supplier Performance Policy Driven Demand Management Approval Authorizations Early Engagement Continual Education Identify New Savings Oppty. Spend Analytics Benchmarking Efforts Integrated Process Desktop Self-Service Ongoing Feedback Oversight and Management Dashboard Metrics & KPI’s Savings Methodologies

21. Key Levers Program Strategy – Proper & Effective Implementation of MSP Solution Cost Savings Process Effectiveness & Efficiency – Leverage technology when/where appropriate Successful “ Just in Time ” Delivery of Contract/Temporary Resources Effective Control & Management of Contractor/Temporary Resources Risk Mitigation Key SLA’s & KPI’s in place to ensure program effectiveness Effective Supplier Management & Contract Administration Reporting Simplified Process Program Compliance and Governance

22. VMS Technology Features & Benefits Features: Single buying platform Consolidates spend Integrates to HRIS platform Robust reporting Time and Expense capture Automated invoicing Automates requirements distribution Audit capability Workforce Management Contractor satisfaction survey Benefits: Aggregates demand Leverage costs Track contractors Simplifies the transaction Automates the process Fewer administrative errors Reduces the need for paper invoices Cost savings Cost center tracking Real time view of labor spend

23. Key Metrics to Consider for the Contingent Workforce Category Key Metrics for CWM: Effective Workforce Utilization Risk Mitigation Cost Savings On-time Delivery Spend Under Management Contract Risk Addressable Spend Supplier Scorecard Metrics for CWM: Fill Rate Attrition/Termination Rate & Reason Submit to Hire Target Rate ratio Contract compliance Project Completion Ratio

24. Co-employment Risks Things to consider in the “co-employment” realm… IRS 20 Question Test (Darden) Who directs and controls the work Who sets the hours of work and job assignments Who provides the pay/benefits and what is the payment cycle Who handles work related performance issues (counseling, etc.) Who hires the worker and processes the employment paperwork What is the length of the engagement

25. Getting Started…….. Assess your overall services spend Identify an executive champion Engage key stakeholders (internal & external) Formulate your strategy Build the business case Communicate the objectives Execute

26. Q & A QUESTIONS?

27. Contact Information Steven Scott, PHR Principal Contact: Phone: 214-403-5754 cell Email: [email_address] 972-208-6850 office