Skip page header and navigation

Buckle up: CW trends promise an exciting ride

CWS 3.0 - Contingent Workforce Strategies

Buckle up: CW trends promise an exciting ride

Bryan Peña, CCWP
| January 30, 2019
Close-up of male hands fastening security belt

Main Article

As an industry, we have seen changes in our global economy that kept many a program manager up at night, rapidly emerging technological advancements that brought fresh opportunities but also risk and uncertainty, new supplier entrants and increased investment in workforce solutions that gave options to forward-thinking managers to take their programs to the next level. We have seen significant changes in how MSPs approach business to better leverage the enterprise, and VMS companies retrenching and focusing on talent and quality management, as opposed to cost control and process efficiency.

That being said there were definitely some developments in 2018 that warrant further attention. Here are a few that promise to yield big results in 2019 and beyond.

Here’s your data. Now what? If 2018 was anything, it was the year data came to win. Throughout the year, we interviewed a number of VMS and MSP providers to understand how they were utilizing data as well as what sorts of innovations suppliers can expect to bring. To a one, they leveraged data aggregation strategies to provide benchmarks and analytics. New computing power and the rise of sophisticated algorithms enable true machine learning to provide amazing insights that can help enterprises make the most of their total workforce.

But before we pop the cork and declare victory, we need to acknowledge the real insight of 2018: Simply having these data tools isn’t all that big of a deal unless you know what you want to do with them. Despite the most sophisticated analytical platforms that have ever been brought to bear in our industry, some of the same questions remain vexing to the most advanced programs: How may providers should I have in my program? What bill rate strategy should we consider for our program? Even the Affordable Care Act reared its head once again. The point is that while advances in technology can provide unheard of insight and perspective, many buyers still don’t know how to use these insights to create change.

Direct sourcing may be for real. Some of the earliest forms of contingent labor - the 18th century union halls - in many ways were the direct sourcing solutions of their time.  Today, organizations have leveraged their own employment brands to curate a distinct talent group for generations. But the difference is in the combination of advances in technology and buyer sophistication that takes these notions and stands them on their heads. Almost every provider in our space is developing either a direct sourcing solution of their own or partnering with existing providers to offer one through a joint venture. We are seeing these strategies with great effect, while early successes with companies like Southwest Airlines, Microsoft and Thomson Reuters create program blueprints for other companies to emulate. In 2018, direct sourcing and internal talent pools moved from cutting-edge, nice-to-have solutions to a recognized best practice.

The European way. In the US, the managed program model - whether internally run or via a partner - has rapidly evolved around a cost savings and process efficiency value lever. Elsewhere, especially in Europe, while these solutions have grown more slowly, they were primarily predicated on improving talent quality and the candidate experience. It is no secret that while the former is important, it is the latter that guarantees long-term program success. In 2018 we began to see Europe-based MSPs challenge the US players in their own turf. And as talent became scarcer, more and more companies will look to leverage MSPs to improve the overall program talent quality. This will be a difficult pivot for some. I would expect many European and UK-based providers to have success with their talent-based solutions at scale in 2019.