This document discusses the importance of managing a company's contingent workforce and connecting procurement and human resources strategies. It notes that global talent challenges are driving the need to re-examine workforce strategies to address a mismatch between the supply and demand of skills. An effective workforce strategy requires considering a mix of full-time employees, contract resources, project-based resources, and outsourced resources. Managing a contingent workforce through a managed service program (MSP) can provide visibility, cost savings, risk mitigation and other benefits. Developing a global workforce strategy requires addressing regional differences in legislation, workforce trends, and maturity of contingent labor programs.

1. Creating a Winning Talent Strategy
The Importance of Managing Your Contingent Workforce and
C ti th D t B t P t d HRConnecting the Dots Between Procurement and HR
Rich Grunenwald,,
Managing Director of Experis, a
ManpowerGroup Company
1

2. There is a global talent conversation ongoing that is creatingg g g g
challenges for companies…
Talent
Mismatch
Talent
Productivity
Talent
Globalization
2

3. World Economic Forum Survey Results 2011
Questions that >80% surveyed consider relevant / very relevant
y
How can large
organizations develop
innovators and
How can we ensure the
f l l i
H ill d hi
innovators and
entrepreneurs from
within?
successful leveraging
of human potential?*
How will demographic
and macro-economic
imbalances change the
future of globalization?
How can companies
and countries attract
the best and
b i ht t i d ?brightest minds?
Talent – Access, Attraction, Development - Tops Mindshare of
3
, , p p
WEF Participants

4. Structural changes are causing a fundamental shiftg g
requiring...
• The redesign of business models• The redesign of business models
• The redefinition of value propositionsThe redefinition of value propositions
• The reinvention of social systemsy
4

5. ManpowerGroup’s World of Work Trends:
Indicators of the Human Age
5
Source: ManpowerGroup Inc.

6. The Talent Mismatch Illustrated
Lack of resources
creates tensioncreates tension
on the high demand
skills market
Demand for skill
Oversupply of low or
wrongly skilled
resources generates
Supply of skill
under- employment
and unemployment
6
Source: Confronting the Talent Crunch: A Manpower White Paper

7. This means you need to re-examine your assumptionsy y
about:
Work
Models
People
P ti
Talent
Practices
Sources
7

8. World of Work Trends Driving Structural Changesg g
In an uncertain world, certain talent challenges are driving the need to re-examine
workforce strategies:workforce strategies:
Work Models People Practices Talent Sources
• Managing a diverse and
virtual workforce
• Developing nimble and
contemporary leadership
• Developing agile talent
strategies to attract selectvirtual workforce
• Injecting flexibility into the
workforce mix: contingent
and permanent
L i t h l f
contemporary leadership
• Connecting and collaborating
colleagues
• Embracing transparency and
filt d i ti
strategies to attract, select,
train and re-skill in new
ways
• Reaching under-tapped
and untapped talent pools:• Leveraging technology for
efficiency, productivity and
innovation
• Developing solutions to the
k t f t il
unfiltered communications
• Customizing the approach to
engaging and retaining the
multi-generational workforce
and untapped talent pools:
Consider talent migration,
women, older workers and
developing younger
workers
market faster, more agile,
differentiated, global
• Creating frameworks to
empower people to be
ambassadors of the brand
• Finding the “Teachable Fit”
8

9. Challenges in the Changing World of Work
• EVERYTHING from labor rates to capital expenditures
can be arbitraged based on country/locationArbitrage can be arbitraged based on country/location
• Underway and is here to stayWar for Talent y y
• Most organizations do not manage resource fulfillment
h li ti llLack of Framework holisticallyLack of Framework
• Do not effectively address competition for resourcesTraditional Approaches y p
and tomorrow’s resource channels
pp
Ineffective
9
And without control over all of your labor sources, you are only
managing one piece of the puzzle…

10. The Workforce of the FutureThe Workforce of the Future
10

11. A “Mix” of Varied Labor Sources…
Contract Resources
Benefits BenefitsBenefits
Project / Outsourced
Resources
Full-Time
Employees
• Quick to start
• Targeted duration
• Acquire unique skills
• Enables scalability
• Hire the experts
• Faster time to market
• Less Project Mgmt
required
• Knowledge retention
• Continuity
• Loyalty
• Fixed costs
Drawbacks
• Limited tenure
• Knowledge leaves with
contractor
Drawbacks
• Requires tight
requirements definition
• Dependency on third-
Drawbacks
• Difficult to address peaks and
valleys
• Difficult to address new skill
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• Supply/Demand swings parties
• Can be “blank check”
needs
• Greater long-term investment

12. Creating a Winning Workforce Strategyg g gy
Business Need Skill Sets
Duration &
Timing
Cost/Other
Full-Time • Default hire type • Common skill sets • Extended tenure (i.e.,
not short term
• Consider cost of hire vs.
cost of contingent labor
Employees • Critical business
function
• Core competency
• Key alignment with
business
goals/objectives
• Freely available in
market
• Professional
development
opportunities exist
not short term
assignment)
• Sufficient lead time to
recruit for resource
cost of contingent labor
• Group does not
experience significantly
high turn-over
goals/objectives
Contract
Resources
• Non-core business
functions
• Supplements business
objectives
Use in high turn over
• Unique skill sets
• Scarce availability or
difficult to recruit skills
in market
• Shorter duration (i.e.,
less than 18 months)
• Longer duration may
still qualify depending
on business objective
• Consider cost of hire vs.
total cost of ownership
(TCO)
• Use when existing full
time resources have
• Use in high turn-over
groups and skills
categories
j
• Limited lead time for
recruitment
expertise and bandwidth
to directly manage
activities
Project Based • Critical AND time
d d t ti it
• Market expertise
i d
• Definable duration • Best value vs. lowest costj
Resources
(SOW)
dependent activity required
• Short to medium
duration activities
• Time critical activities
• Consider opportunity cost
or other gained
efficiencies
Outsourced
Resources
• Non-core business
activities
• Activities where
efficiencies can be
i d th h
• Ongoing business
functions
• Evaluate TCO to include
efficiencies gained by
t i id
12
Resources
(SLA)
• Core activities where
business has been
unable to support
gained through
aggregation and/or
leverage
outsourcing provider
• Consider additional value
gained from outsourcer

13. Contingent Workforce Managementg g
Increasingly, businesses are leveraging Contingent Workforce
Management (CWM) programs to gain visibility and control around
contractor usage
• Usage Of VMS
contractor usage…
– Increased to just over 63% in the
US in 2009
– And is projected to increase to 66%
by the end of 2010, 81% by the end
of 2011of 2011
• Usage of MSPs
– MSP usage has continued to
increase
Projected to reach 64% by the end I d t i Skill– Projected to reach 64% by the end
of 2011
– 19% of respondents indicated they
were looking into implement an
MSP within the next two years
Industries
Technology / Telecom 74%
Pharma / Biotech/Med 60%
Energy / Chemical 55%
Finance / Insurance 45%
Skills
Information Technology 52%
Industrial / Logistics 47%
Engineering / Design 47%
Office / Clerical 25%
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MSP within the next two years
Sources: SIA 2009 Staffing Industry Sourcebook;
SIA “Staffing Supplier Mgmt Strategies” report (11/09)
Finance / Insurance 45%
Business Services 40%
Manufacturing 38%
Retail/Consumer 29%
Office / Clerical 25%

14. And It’s Not Just to Manage Temps…
% of respondents incorporating SOW into VMS/MSP
g p
• SOW Management
– A significant # (81%) of CW users
Yes
32%
A significant # (81%) of CW users
are planning or considering to
incorporate SOW into program in
next two years
Forrester and Gartner estimate SOW
Don’t
know
6%
– Forrester and Gartner estimate SOW
spend could be 10x that of traditional
staffing services
Maybe,
next 2 yrs
49%No
13%
• Workforce Planning
– Similarly, a large % (85%) are using
info from CW program in Workforce
planning
Workforce Planning- % using CW info for Workforce Planning
Yes
38%
planning
– By integrating CW into workforce
planning, the focus shifts towards
demand management and sourcing
strategies
Maybe,
next
2 yrs
Don’t
know
14
strategies y
47%No
10%
know
5%
Source: SIA “Staffing Supplier Mgmt Strategies” report (11/09)

15. Managed Service Programs (MSPs)Managed Service Programs (MSPs)
15

16. Defining MSPg
Program Management
• MSP takes primary responsibility for managing an
organization’s contingent workforce program
• Responsibilities of MSP typically include overall program
management, tracking and reporting, vendor selection
and management, order distribution, and payment
management
• Majority of MSP programs provide clients with a vendor
management system (VMS)
16

17. Key DriversKey Drivers
Risk Quality
Cost Efficiency
17

18. MSP Industry EvolutionMSP Industry Evolution
Major Milestones
Creation of a U.S.
contingent program
Globalization
What’s2004 Today
Technology
Expansion
next?
Expanded
Scope
1990’s 2008
Integrated Resource
Fulfillment
“V d N t lit ”
MANAGED SERVICE PROVIDER (MSP)
Regional Global
Scope
OUTSOURCED WORKFORCE SOLUTIONS
 1099 and SOW/deliverables management
“Vendor Neutrality”
Regional Global
Varied Skill Categories All Skill Categories
Fundamental Technology Advanced VMS
Select Industries All Industries
Basic Reporting Analytics & BI
1099 and SOW/deliverables management
 Inclusion of RPO or BPO
 Alternative contingent labor sourcing models
 Complete enterprise-wide workforce visibility
 Total cost of ownership savings
18

19. Program Maturity Frameworkg y
19

20. The Global LandscapeThe Global Landscape
20

21. Going Globalg
“With a few modifications to comply with
local labour laws, the MSP provides similar,
and sometimes superior value”
“Let’s roll-out a
centralized workforce
management program
“Onboarding and IC
compliance have
“The vendor rationalization is very
valuable, but the administrative
processes are not as simple”
management program
to accelerate time to
hire and reduce
administrative time
and expense.”
compliance have
never been so easy.”
“We need to operate
differently to avoid double
taxation of suppliers.”
“Finally a way to mitigate risk of
non-compliance.”
“This doesn’t address our
primary challenges at all.”
21

22. Overview of Global Workforce Planning Considerationsg
Workforce Cost Legislation
Global
Productivity,
Participation, &
Performance are
rebounding and
expected to increase
While emerging economies have
added to some reduced average
wage estimates, the cost of non-
wage compensation continues to
rise globally
There is an indication that
contingent labor laws may
become more consistent
in the future
Regional
•ME shows consistent
performance
•LatAm demonstrates
highest quality growth
•Increased Parity requirements in
Europe with AWR
•APAC continues to set
additional burdens on contingent
•LatAm continues to
evaluate less rigid
legislation
•Many markets with broadg
•EU and US continue to
be most developed
In markets with growing
employment
•LatAm has tight legislation, but
often, less impact on cost
Managing disparate financial
legislation, including ME,
are developing more
specific laws for
contingent labor
There are few regions that
Local
In markets with growing
contingent workforce,
standardization of
supply chain process
and quality is imperative
to mitigate risk or
Managing disparate financial
policies and processes across
country borders within regions
requires increased visibility into
supply chain and internal process
g
have enough consistent
legislation to allow for a
regional approach to local
workforce programs – see
slide 5 for an overview of
l ti ki b
22
business disruption relative rankings by
country

23. Our Approach to Global Programs
Scaled Delivery with Global and Local Expertise
pp g
GlobalGlobal
• Global expertise
• Single point of contact
• Framework built on equivalent
d i d t id
RegionalRegional
N ti lN ti l
processes designed to provide
visibility
• Regional management driving
execution compliance and
NationalNational
LocalLocal
execution, compliance, and
innovation
• Country level management ensuring
consistency in execution and
MarketMarket compliance
• Day to day management
• Local market expertise
23

24. Who Can Benefit fromWho Can Benefit from
Contingent Labor Management
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25. Who Benefits from MSP?
R• Requisitions filled promptly
• Best available talent
Procurement
Cost savings, supplier consolidation,
HR
• Turnover reduction
• Automated and efficient staffing
processes
• Tracking capabilities to know who’s
g , pp ,
rate rationalization, efficient processes,
accurate consolidated billing,
performance metrics, tracking and
reporting capabilities, worldwide clients
on board and where
• Satisfied end users
• Smooth transition to new process
• Security
• Support
• Implementation requirements
Integration capabilities
IT
Functional Users
• Productivity
E f
• Reduced co-employment and
liability risk
• Risk management controls
egal
• Integration capabilities
• Ease of use
• Maintaining necessary supplier
relationships
• Reasonable cost for talent
• Risk management controls
• Onboarding/offboarding
management
• Standard Ts & Cs
• Process controls
Risk/Le
25
• Clear responsibilities
R

26. Key Takeawaysy y
• The talent mismatch gap is widening.
D i ith l i t ti i th f t• Doing more with less is not an option in the future.
• The hardest jobs to fill are vital to your success.
• A workforce strategy is key.
Is Your Organization
Ready?Ready?
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