According to SIA’s Workforce Solutions Buyer Survey, 58% among companies with 1,000 employees or more engage a third-party firm to manage their staffing providers. These managed service providers, or MSPs, are evolving rapidly, driven by the increasing complexity of workforce management in today’s business environment.

As a strong proponent of MSP services, I appreciate their value in managing the extensive knowledge required to run a complex workforce program. With the rise of remote work and the subsequent challenges it introduces, outsourcing through MSPs is a solid option. Artificial intelligence and various other software solutions have become integral to MSP offerings, enabling these programs to adapt swiftly to the latest technological advancements.

The management of workforce solutions is more complex than ever, raising the question: How much should be outsourced, and how much should remain in-house? Managing and mitigating risks, ensuring compliance, controlling costs, optimizing workforce mix and sourcing a diverse array of skill sets are no easy tasks. What began as a way to centralize vendor management for temporary hiring has evolved into a complex solution of administrative services, now supported by both human expertise and advanced technologies to deliver higher quality at a lower cost.

The recently released MSP Global Landscape and Differentiators 2024 report, available to CWS Council members, outlines what contingent workforce programs should expect from their MSPs. Core drivers for engaging an MSP include:

• Cost management. Typically achieved through rate negotiations and volume purchasing contract terms within supplier contracts.
• Job fulfillment automation. Leveraging VMS technology to distribute jobs and manage the fulfillment process efficiently.
• Worker onboarding and offboarding. Including comprehensive worker classification management.
• Engaging alternative sourcing channels. Such as direct sourcing solutions, skills-based hiring, freelancer management and statement of work (SOW) solutions.
• Managing workforce peaks and valleys. By filling temporary positions to meet fluctuating demands.

While the availability of advanced technology has added complexity to MSP solutions, it also requires a deeper partnership with client organizations. In addition to the standard services, MSPs are increasingly responsible for technology implementation and integration support. This involves working closely with a company’s IT department to ensure seamless integrations between the VMS and the organization’s HR information system (HRIS). Such integrations eliminate the need for duplicate data entry and provide real-time access to program data.

Accurate data collection enables MSPs to offer powerful analytics, which in turn enhances workforce planning capabilities. MSPs are also expanding their focus beyond supplier diversity to include diversity hiring, which supports a culture of inclusivity that has proven to drive company performance. Through direct sourcing programs, MSPs can increase the redeployment of temporary workers, further reducing the cost of acquiring talent by leveraging individuals who are already familiar with the company.

Other areas where your MSP can support your efforts could include:

• Cybersecurity and data protection
• Sustainability initiatives
• Globalization

All of this is just the tip of the iceberg in terms of what your MSP can do for you. For a more comprehensive understanding, CWS Council members can access SIA’s MSP Global Landscape and Differentiators 2024 report online.