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Confidential Report – NOT for Distribution | ©2014 Crain Communications Inc. All rights reserved.
Europe
30 April 2014
3pm GMT/ 4pm CET
7am PST/ 10am EST
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The VMS Shuffle: How to match a VMS to your
contingent workforce programme requirements
Moderator:
John Nurthen, Executive Director Global Research
Speaker:
James Waite, Director Contingent Workforce Strategies & Research, Europe
The VMS Shuffle
©2014 by Crain Communications Inc. All rights reserved.
©2014 by Crain Communications Inc. All rights reserved.
The VMS Shuffle
How to match a VMS to your Contingent
Workforce Programme requirements and
move away from a VMS that has chosen a
different path
©2014 by Crain Communications Inc. All rights reserved.
Contingent Workforce Industry Macro Trends
2005 2012
11%16%
Contingent % of workforce
$2.0+ Trillion spent globally on contingent work
2012% of large companies
74% VMS
66% MSP
2014
18%
Source: Staffing Industry Analysts
©2014 by Crain Communications Inc. All rights reserved.
2013 VMS & MSP Customer Experience
Vendor
Management
Systems – not
everyone's “cup
of tea”…
n=number of individuals responding
m=number of companies represented among responses
Source: Staffing Industry Analysts
Overall Net Promoter Score
©2014 by Crain Communications Inc. All rights reserved.
The CW Optimization Roadmap
Source: Staffing Industry Analysts
• 6 contingent workforce solution elements to calibrate talent
management:
– Stakeholder Alignment
– Technology Architecture
– Supply Ecosystem
– Compliance Complexity
– Talent Sensitivity
– Aggregate Labour Market
• Together, the 6 elements create a holistic view of the
complex diversity within contingent workforce management
Internal
Elements
External
Elements
CW Solution Elements
©2014 by Crain Communications Inc. All rights reserved.
The Critical Role of a VMS
• A VMS has a critical role in managing what really matters in a
Contingent Workforce Program:
1. What are we paying for our contingent workforce and is it the right
amount?
2. Are my key stakeholders and internal customers satisfied with
contingent work talent, output and fit?
3. Is our CW programme able to scale to handle future growth and/or
contraction?
4. Who are the contingent workers on the premises and how long
have they been here?
5. Who supplies the talent and what is our legal relationship with
those companies?
6. What might someone sue us for and what are we doing to protect
ourselves?©2014 by Crain Communications Inc. All rights reserved.
The Key Issues of a VMS
• Cost of VMS participation
• VMS workflow or processes that do not encourage supplier
performance
• Poor communication & feedback on VMS quality
• Restrictions of an added technology layer
• Lack of VMS training and/or VMS skills & experience
• Talent quality issues due to badly formed sourcing model
• Unrealistically high expectations on ROI for a VMS
• Disgruntled stakeholders & Hiring Managers
©2014 by Crain Communications Inc. All rights reserved.
The ROI Drivers of a VMS
• Ability to measure Talent quality
• Cost savings through bill rate standardisation
• Visibility & cost control over rogue spend
• Business Intelligence & Data Analytics Tools
• Improved CWP process and greater automation
• Increased visibility and business intelligence
• Supplier Performance Metrics, SLAs & KPIs
• Mitigated risk through compliant fulfilment processes
• Comprehensive solutions spend management
• Consolidated Invoicing
©2014 by Crain Communications Inc. All rights reserved.
The Role of a VMS in Measuring Quality
©2014 by Crain Communications Inc. All rights reserved.Source: Staffing Industry Analysts
The Role of a VMS in Measuring Talent Quality
• A successful VMS should provide easy & reliable access to
key Talent Quality Metrics:
– Percentage of assignments that engagement managers would rehire
the contingent worker as a contingent worker if able
– Percentage of assignments terminated by engagement manager
prior to scheduled end date due to performance
– Percentage of assignments terminated by contingent workers prior
to scheduled end date
– Percentage of contingent workers converting to employee status
– Net Promoter Score (NPS) for engagement manager satisfaction with
contingent workers
©2014 by Crain Communications Inc. All rights reserved.
The Role of a VMS in Measuring Supplier Quality
• A successful VMS should provide easy & reliable access to
key Supplier Quality Metrics:
– Percentage of assignments on boarded after engagement
manager request date
– Percentage of submittals resulting in hires
– Percentage of assignments terminated by engagement
managers prior to scheduled end date due to
performance
– Percentage of contingent workers converting to employee
status
– Percentage of assignments terminated by contingent
workers prior to scheduled end date©2014 by Crain Communications Inc. All rights reserved.
The Role of a VMS in Capturing Incentive &
Discount Data
0% 10% 20% 30% 40% 50% 60% 70% 80%
Revenue Share
Gain Share
Statutory Discounts
Fees at Risk
Tenure Discounts
Overtime Discount
Early Payment Discount
Volume Discount
Conversion Discount
Percent of Buyers Reporting Use of Selected
Discounts/Incentives with Suppliers/MSPs
Source: Staffing Industry Analysts, Buyers Survey ©2014 by Crain Communications Inc. All rights reserved.
Role of VMS in Supporting a Sourcing Framework
©2014 by Crain Communications Inc. All rights reserved.Source: Staffing Industry Analysts
Role of VMS in Supporting your Strategic Focus
©2014 by Crain Communications Inc. All rights reserved.Source: Staffing Industry Analysts
Evaluating VMS General Capabilities
©2014 by Crain Communications Inc. All rights reserved.Source: Staffing Industry Analysts – 2013 VMS MSP Service Differentiators
VM
S 1
VM
S 2
VM
S 3
VM
S 4
VM
S 5
VM
S 6
VM
S 7
VM
S 8
VM
S 9
VM
S 1
0
VM
S !
!
VMS Technical Stability & Agility
• The industry standard for VMS is SaaS
– Multi-tenant architecture
– Scalability through multiple machine installation
– Multi-version support for different clients
– Customisation (look & feel, parameters, functionality)
• Key benefit is Accelerated Feature Delivery:
– The VMS is hosted centrally, so an update is decided and executed by the
VMS provider, not by customers.
– The VMS application only has a single “root” configuration, making
development testing faster.
– The vendor has access to all customer data, expediting design and regression
testing.
– The VMS provider has access to user behaviour within the application
(usually via web analytics), making it easier to identify areas to enhance.
©2014 by Crain Communications Inc. All rights reserved.
VMS Technical Adoption Areas to Consider
• VMS SaaS latency (response times)
• Limits to customisation
• Limits to Workforce Analytics Tools
• Language, currency & new country support (and localisation)
• Data governance regulations
• Switching from one VMS SaaS vendor to another
• New version adoption
• Internet connection speeds
• Data Security & Data Escrow
©2014 by Crain Communications Inc. All rights reserved.
VMS Technical Adoption Areas to Consider
Rich Functionality
Complex Architecture
Bespoke 3rd Party SW
Custom Integrations
High Visibility
Specialised Training
Unique Data sets merges with Logic layers
Advanced Compliance
Solutions
Low VMS Fee
©2014 by Crain Communications Inc. All rights reserved.
VMS Migration Areas to Consider
• You may be migrating to a VMS SaaS:
– Consider why a VMS SaaS would be right for your CWP
– Are you clear on the benefits expected?
– Are business requirements, both strategic & tactical, considered?
– Do you understand the true cost of VMS SaaS adoption?
– Are you able to design solid SLA and enforce it with the VMS Vendor?
– Do you understand the implementation approach and stages?
– Are you aware of post-implementation work you may be required to
carry out?
– Are you aware of any storage capacity limits?
– Are licensing issues dealt with in the VMS contract?
– What Support is offered by the VMS Vendor?
– Are you aware of internet browser limitations?©2014 by Crain Communications Inc. All rights reserved.
Key Project Phases for VMS Adoption
• Each Phase should have a plan, budget, resources, scope,
quality criteria & risk assessment;
• Emphasis placed on: Stakeholder Alignment; Technology
Architecture; Supply Ecosystem; Compliance Complexity;
Talent Sensitivity; and Aggregate Labour Market.
VMS
Adoption
Programme
Initiation
VMS
Strategy
Definition
VMS
Programme
Award
VMS
Construct,
Implement
& Adoption
VMO/MSP
Programme
Delivery
VMS
Programme
Continuous
Improvement
©2014 by Crain Communications Inc. All rights reserved.Source: Staffing Industry Analysts
Changing the Way You Use the VMS
• A VMS does not replace sound process & practice
• See the VMS from your Supplier PoV:– We don’t always receive detailed job descriptions, required and desired skills, details on cultural fit
and specifics on compensation and benefits
– We don’t have access to the managers to whom the positions report to ask questions and discuss
important details
– The client does not always provide detailed feedback about submittals
– The client appears to be using the VMS system in a manner to increase labour intensity
– The customer changes the designed and communicated hiring process, using the VMS
– The hiring process does not appears to be fair, reasonable and workable, especially when
compared with how you normally do business outside of a VMS
– My recruiter activates required to do the work is not reasonable when compared to potential
profits
– The Supplier primary contact is not reliably responsive to calls and e-mails
– This business opportunity may not to be sustainable over the weeks, months and even years ahead
– The client is not open to feedback when their VMS process is not working effectively?
– Having carefully thought about and answered these questions, we are not excited about this VMS
opportunity…
©2014 by Crain Communications Inc. All rights reserved.
Considerations When Going Global with a VMS
©2014 by Crain Communications Inc. All rights reserved.
The VMS Request For Proposal (RFP)
• A well written RFP for VMS Vendor proposals:
– Enables VMS respondents to clearly understand the technical &
functional requirements and needs of your CWP
– Allows VMS respondents to more accurately price their proposal and
submit higher-quality proposals
– Can help minimise proposal ambiguity, which can delay the VMS
initiative or cause you to select the wrong Vendor
– Contains specific CW programme information, goals and
requirements that will enable bidders to respond with contextual
responses
– Will contain clear unambiguous mandatory requirements from the
VMS Vendor
©2014 by Crain Communications Inc. All rights reserved.
The VMS RFP – Mandatory Requirements
• VMS Vendor financial Stability
• Ability to execute all VMS Vendor Services
• Information on 3rd Party Relationships may requested
• VMS must be accessible via the internet & reside on secure
servers, a clear x-browser support matrix must be provided
• Website encryption must be provided and specified
• VMS Vendor must agree to convert all existing historic data
in the current VMS
• Contingent labour will not be provided to the Client by the
VMS Vendor or by a staffing company owned by the VMS
Vendor
• VMS Vendor offers hosted software (SaaS)©2014 by Crain Communications Inc. All rights reserved.
The VMS RFP – Technical Features (Examples)
• Provide a High-level diagram illustrating how the VMS is
architected – specifically object relationships
• What platform/language is the system code written in?
• What type of database(s) does the VMS support (include
versions)?
• How does the system architecture promote performance?
• How slow is the slowest page you have running in
production?
• How are errors handled within the application?
• Which elements of your application’s design best
exemplify its ease-of-use qualities?
• What ease-of-use issues do users complain about most?
©2014 by Crain Communications Inc. All rights reserved.
The VMS RFP – Technical Features (Examples)
• When do you foresee this application’s next major re-
architecture initiative beginning and ending?
• Describe your software development lifecycle (SDLC)
• How are users added to the system and who has access
to perform this function?
• Can users be de-activated and re-activated?
• How are roles and permissions defined in your system?
• Provide a list of permissions and a description of their
enabling capacity
• How are access rights and permissions assigned to a
user role? Who typically performs this function?
• Can Client users have access to user management
tools? ©2014 by Crain Communications Inc. All rights reserved.
The VMS RFP – Focus Areas for Selection
• Project based Requisitioning (SOW)
• Does the VMS have the ability to electronically
create, submit, and respond to requests for project-
based (SOW-based) engagements?
• Can the VMS issue project-based requisitions?
• Can the VMS handle other types of services
procurement?
• Does the VMS allow for payment terms based on
milestones or deliverables?
• Does the VMS have the ability to track consultant
replacements?
©2014 by Crain Communications Inc. All rights reserved.
The VMS RFP – Focus Areas for Selection
• Other Focus areas to concentrate on when selecting a VMS:
• Purchase Order Functionality
• Approvals & Notifications
• On & Off-Boarding functionality
• Timekeeping & Expense handling
• Invoicing & Payment
• Reporting
• Interfaces & System Integration opportunities
• VMS Hosting Specifications
• Implementation & Post-Implementation Support
• Costs & Pricing Model
The quality, completeness and specificity of your VMS RFP often
determines the success of the entire procurement process ©2014 by Crain Communications Inc. All rights reserved.
Next Webinar
Sponsored by
Big data…Bigger decisions
Wednesday 28 May 2014
7am PST/ 10am EST/ 3pm GMT/ 4pm CET
Contingent Workforce Strategies Summit
13-14 May 2014 | Lancaster Hotel | London
www.cwssummitwe.eu
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