Tag

MSP

SOW/Services Procurement Spend Management | Market Insights™

By | Market Insights™

Procurement Outsourcing BPO vs MSP: Clash of the Titans

PO BPO vs. MSP: Clash of the Titans
Spend on third-party services is huge and growing, bringing attention to the need for better spend management capability.

Enter the titans of third-party services spend management – contingent workforce MSPs and Procurement Outsourcing BPOs. Given their history and expertise, these types of service providers are well-positioned to help manage this spend, but they have varying capabilities that are vital to understand when choosing between them.

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SOW/Services Procurement Spend Management | Market Insights™

By | Market Insights™, Procurement

PO BPO vs MSP Clash of the Titans

Spend on third-party services is huge and growing, bringing attention to the need for better spend management capability.

Enter the titans of third-party services spend management – contingent workforce MSPs and Procurement Outsourcing BPOs. Given their history and expertise, these types of service providers are well-positioned to help manage this spend, but they have varying capabilities that are vital to understand when choosing between them.

Visit the report page

Managed Service Provider Growth Due to US Expansion

By | In The News

US-based companies pushing to expand their MSP (managed service provider) roll-outs globally were the main drivers behind double-digit growth in the MSP global market in 2018.

In a statement sent to recruiter.co.uk, Vishal Gupta, practice director at Everest Group, concurred with Smith’s explanation for the growth in the market, before going on to outline some additional drivers. These included MSPs’ ability to source hard-to-find talent, and minimise non-compliance, “a significant surge in adoption of MSP by SME enterprises”, as well as an extension in categories of spend managed by MSPs or in services provided by them. Among the expanded services being offered by MSPs are services procurement.

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Enterprise Use of Contingent Labor Grows as Managed Service Providers Expand Scope, Capabilities | Press Release

By | Press Releases

In 2018, MSPs’ share of labor sourcing will continue to rise as MSPs employ more mature analytics applications and expand capabilities in services procurement, total talent management and consulting.

Everest Group reports that the use of contingent workers across the globe continues to grow at a steady pace—with 2017 ending with a projected growth in contingent workforce management spend of 9-11 percent over the previous year.

Managed service providers (MSPs) and the technology solutions they provide play key roles in bringing together employers and contingent workers, contributing to the steady growth in enterprise use of contingent labor worldwide. In fact, global MSP managed spend for 2017 is projected to be 11 to 13 percent higher than in 2016.

“The overall contingent workforce management industry continues to grow on the back of a strong demand for temporary labor and services procurement,” said Arkadev Basak, practice director at Everest Group. “Procurement outsourcing providers still constitute a majority of the overall contingent workforce management market —largely because a majority of enterprises assign services procurement to their PO providers—but MSPs have made rapid strides in growing their share and continue to significantly outpace PO service providers in the rate of growth.”

Everest Group forecasts that MSPs will further increase their share of contingent workforce sourcing spend in 2018. MSPs will drive this growth by investing in expanded scope and capabilities, such as:

  • Enhancing Statement of Work (SOW) offerings, targeting more strategic processes and leveraging SOW-specific technology
  • Implementing more mature applications of analytics, not only using descriptive analytics to gain useful insights but also applying predictive analytics to predict trends and recommend appropriate actions.
  • Expanding the scope of consulting and value-added services to include talent engagement, talent attraction, technology strategy and implementation, and process re-engineering.
  • Improving operational efficiency with an increased focus on offshoring, creating centers of excellence, applying robotic process automation and leveraging add-on tools for video interviewing, assessment, background screening and onboarding.
  • Offering total talent management—holistic management of all of the talent needs of an organization, including permanent employees.

MSPs make the use of contingent labor attractive to enterprises by providing these benefits:

  • Reduced costs: MSPs offer cost savings through process efficiencies, economies of scale, quality assurance, enhanced visibility of spend throughout the organization, and knowledge of wage rates in the market.
  • Compliance: MSPs manage regulatory requirements, minimize non-compliance risks, and help the enterprise enforce its own corporate policies across divisions by centralizing all requests for temporary labor.
  • Access to talent: MSPs use branding, communication, direct sourcing services, and access to suppliers to help enterprises source hard-to-find talent. They also play a key role in the candidate experience, ensuring that potential workers have a smooth and easy hiring experience.
  • Technology: Enterprises typically have limited technology to support the hiring of contingent labor, so MSPs provide access to cutting-edge technologies such as advanced predictive and prescriptive analytics for staffing and artificial intelligence (AI), machine learning (ML) and natural language processing (NLP) for generating best matches in the shortest possible time.

These findings are discussed in more detail in “Managed Service Provider (MSP) – Annual Report 2018: Towards the Next Frontier – Boldly Going Where Few Have Gone Before.”  The report includes an overview of the temporary labor market, including market size and adoption; an analysis of the evolving market situation; key themes of future development; and buyer adoption trends.

 

***Download the complimentary report abstract.***

Contingent Labor Service Providers: The Winning Capabilities in 2017 | Sherpas in Blue Shirts

By | Blog, Outsourcing

There’s no denying that the contingent workforce market is being disrupted by multiple forces – the emergence of statements of work (SoW) and independent contractors (IC) as significant new spend categories, the rapid evolution of analytics and supporting technologies, and rising buyer demand for total talent acquisition, to name just a few. Navigating through the maze of disruptions to rise to the top of the market is no easy feat for service providers in the space, but several have done so in 2017.

Following are the differentiating qualities and capabilities that earned a handful of providers their rightful spot as  Leaders in Everest Group’s Managed Service Provider (MSP) PEAK Matrix™ in 2017.

  • Fast, proactive responses to market trends: With SoW and IC emerging as new spend categories, the Leaders have differentiated themselves by taking early action in acquiring the capabilities needed to manage them. After starting out with the low hanging fruits such as payments, compliance, etc., these Leaders are now moving on to strategic areas of the value chain such as sourcing, category expertise, and negotiation. The Leaders are also making considerable headway in the emerging area of Total Talent Acquisition (TTA) by developing the requisite capabilities and leveraging their existing expertise in RPO and/or as an Managed Service Provider.
  • Technology ecosystem versus discrete technologies: The Leaders understand the need for and benefits of a talent ecosystem, which means offering an integrated set of tools that can help provide visibility and control over the entire talent acquisition function. These service providers have either developed or are in the final stages of developing a holistic technology architecture to serve the entire talent acquisition landscape. A prime example of this is the addition of SoW and IC management capabilities to the existing Vendor Management System (VMS) itself.
  • Next-gen analytics capabilities: While reporting and descriptive analytics have been around for a while, the true business potential of analytics technology can only be unleashed through predictive and prescriptive analytics. When you couple these with natural language programming (NLP) and artificial intelligence (AI)/machine learning (ML), you create an easy-to-use, intuitive system that can greatly reduce the costs and spend associated with contingent labor. While the technology is still in nascent stages, the Leaders have started taking a few tentative steps down the road to acquiring these capabilities.
  • Capability to serve the entire market: the Managed Service Provider market is no longer restricted to certain geographies or large enterprises. Buyers from developing markets and mid-sized firms are starting to embrace and realize the benefits of an outsourced contingent workforce management program. The Leaders have introduced specialized offerings, such as evaluating the need for a contingent workforce management program and advising in the technology implementation stage, that make it practical for these first generation buyers to outsource their contingent workforce management.
  • Value-added services and customized solutions for experienced buyers: With a significant portion of their portfolio now consisting of second-and third-generation buyers, the Leaders have begun offering value-added services such as contingent talent branding and talent community management, which helps improve the candidate experience and results in better fill rates and acceptance ratios. They are also offering innovative payment models such as gainsharing or risk sharing programs, such as indemnification of contingent workforce management services.

While the Leaders in our 2017 Managed Service Provider PEAK Matrix™ have taken considerable steps to gain the title, the market is still wide open for innovative and proactive providers. Investing in new technologies and capabilities, and quickly addressing market trends will help other providers emerge victorious.