Is Your Contingent Workforce Program Keeping Up With Your Talent Acquisition Strategy?

CW Management MSP staffing

There have been significant changes in the contingent workforce landscape, but one established thing is that a defined contingent workforce management (CWM) program (third-party MSP or internally run) combined with VMS technology is the best practice for management of all contingent labor (staff augmentation and SOW/professional services). However, the struggle to build a more comprehensive talent acquisition process has gone largely unanswered.

Over the last two years, many enterprises have reached a breaking point with regard to the disconnected processes, strategy and sources of talent. And while the MSP or internal CWM program has been the foundation of the CWM solution, people and talent acquisition strategy in most program teams struggle to align with a broader talent strategy (often referred to as “total talent management”).

What Is Different and What Has Stayed the Same?

Finding necessary talent to meet business and project needs has become a significant part of the overall talent and business strategy. Using a mix of full-time talent and contingent talent is now the norm, whereas as recently as 10 years ago, many companies still viewed their contingent labor program as a necessary cost of doing business. Whether it is finding niche skills or developing a solution for cyclical talent demands, contract work has become a thoughtful component of the overall talent strategy versus a short-term stopgap to help the business.

In the past, there was little planning and strategy around contract labor. Managers would budget for use of contractors, but rarely was contract labor included in the talent acquisition strategy. Talent acquisition leaders now see the value of the contract workforce and are asking for a seat at the table with program owners and key stakeholders. The majority of MSPs, staffing suppliers and other providers are not prepared for the shift from a purely procurement-driven process to a holistic talent acquisition strategy that leverages established procurement processes and suppliers.

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How Has the MSP Evolved and Where Is it Falling Short?

Most MSPs and contingent workforce programs were owned and led by procurement and/or HR. The majority of MSPs created operational and delivery models to satisfy these key stakeholders’ goals with a focus entirely on supply chain management, pricing and visibility. Now, though, workers and companies are finding it more necessary to be agile and talent-focused to keep pace with evolving technology innovations, investment in process automation, digital transformation and increased customer expectations.

Building out a contingent talent approach as part of a larger talent acquisition strategy requires a different approach than in the past for the MSP. It requires more proactive critical thinking, changes to supply chain design and a new approach to overall talent recruitment. All of these factors have created a shift from a traditional, transaction-focused vendor management workforce program to a more talent-centric strategy for contract labor, leaving many MSPs and their clients struggling to address their talent needs.

Is Your Program Ready for a Talent-Driven MSP 4.0? 

Leading organizations have seen the positive impacts of a broader approach that aligns both full-time and contingent talent. The MSP 4.0 solution has evolved to operate as a strategic partner to business leaders when considering the right type of talent, where the talent should be sourced, how the work should be priced and how the resources will be engaged. Finding and building talent communities, proactively building out talent pipelines and working with business stakeholders on planning are critically important to create a broader talent strategy for contingent workers. Overall, client readiness is one of the most important factors when shifting from a purely procurement-focused to a more talent-focused contingent workforce program. Building out talent acquisition playbooks will enable the MSP to communicate a thoughtful talent acquisition strategy to staffing partners with a greater focus on talent metrics versus the historical supply chain and vendor management metrics found in the more transactional MSP vendor management services.

The shift to a more talent-centric solution is a significant undertaking that will require change in how the MSP model operates, how suppliers partner with the MSP and, ultimately, how enterprises view their contingent workforce as part of a larger approach to achieve their business goals.