SI Review: July 2013

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Power Seller

Embrace It; It’s Here to Stay

Insights to help you succeed in a vendor-neutral VMS/MSP program

By Andrew Popler

With an estimated $100 billion in contingent labor spend being managed globally through managed service and vendor management programs, the model is not likely to go away anytime soon. Despite the criticisms and often prevailing negative attitudes to these programs, staffing firms can succeed within them. Here are some insights to guide you.

Don’t fight it. Opt-in or opt-out. Recognizing your client has gone to great lengths to implement its MSP/ VMS program, there is little chance that the client will change direction. Instead, determine if the particular program is right for you, and if it is, then embrace and fully leverage the program as an efficient and profitable sales channel. Remember, the client’s objective is to capture the highest quality talent at the most competitive market rates. Use the time you’ll be saving from no longer having to sell or market to the client and focus on recruiting and presenting top-tier candidates.

Take the time to understand fully the economics of the supplier-funded program. Suppliers working through our program tell us that the reduced sales and marketing efforts, faster pay, visibility, time and bill tracking, and increased opportunity have outweighed the small fee withheld to finance the program. In most cases, this is true, but if it’s a rare case where your rates will not support the new fees, don’t be afraid to opt out and focus your efforts elsewhere, keeping your margins and reputation intact.

Align well and grow. Establish a solid working relationship with the MSP/ VMS provider — build a partnership that will promote growth and opportunity. The neutral MSP/VMS relies on its suppliers to identify and recruit the talent. If your firm delivers above the competition, it will be welcome into other programs operated by that MSP/ VMS. We can cite many examples of small and midsized suppliers who’ve outperformed their competition and were quickly introduced to new clients, through the neutral MSP/VMS. Align well with the MSP/VMS and you’ll grow your market-share.

Excel in your niche. Rather than trying to be responsive to every requisition, regardless of the category, focus on standing out within a specific segment of talent. Delivering against only those requisitions that match with your firm’s expertise is an effective strategy for achieving the highest level of recognition within the program. These programs have regular score-carding and service-level measurements. If you aren’t performing adequately because you’re attempting to play in too many disciplines, you’ll only hurt yourself. Find your niche and excel in that category.

Furthermore, establishing an identity with the MSP/VMS provider as a trusted subject-matter expert will ensure that the MSP/VMS will recommend your firm for consideration across other client programs. So be sure you know not only the candidates in your chosen category, but also the trends affecting that talent, its availability and its future. Sharing this kind of information with the MSP team can only serve to solidify your position as a subject-matter expert.

Play by the rules. Attempting to circumvent a well-run program will only hurt you in the long run. As mentioned previously, the client went through a significant effort to choose the right model and supplier to manage its contingent workforce. Circumventing the program suggests that you think you know what’s better for them, and that they made a mistake by implementing the model. Such behavior often leads to clients cutting these suppliers from their lists, so the short-term gains will be followed by the loss of a customer over the long term.

The neutral MSP/VMS is here to stay and has proven to be a win for all parties involved if approached with the right mindset. But if you don’t have the right attitudes as you service the MSP and the customer, it’s going to show. It sounds simple and it is — but it’s all about the approach. The right approach pays off for all the parties in this ecosystem — the client (quality of labor at market driven rates), the suppliers (allowing focus on recruitment and removing administrative burdens) and the MSP (profitable business). Welcome the model and enjoy the benefits that come with it!

Andrew Popler is vice president of business development at PRO Unlimited. He can be reached at apoplar@prounlimited.com

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