A complete list of MSP and VMS best practices
30 August 2022

A Complete List of MSP and VMS Best Practices

4 min read

Managing a contingent workforce can be incredibly difficult. Unfortunately, most organizations are failing due to an over-reliance on manual processes and spreadsheets, combined with a lack of knowledge of the contingent workforce category and a lack of resources to implement an effective, strategic process. 

The result is fragmented information that is saved in different locations, across different hiring managers and different departments, giving the business no real visibility or control over contingent workers and the staffing agency management process.

This leads to overspending, management methods that are not compliant with employment regulations and poor quality talent. 

To address that complexity, and the risks that come with it, organizations typically turn to either technology to improve how they manage their contingent workforce in-house, or they outsource the management of their contingent workforce program to a third-party expert. 

While there are a number of solutions that organizations can use to improve their contingent workforce management program, in this blog we take a look at the two most common methods; 

  1. Vendor management system (VMS);
  2. and Managed service provider (MSP).

Whether you choose to invest in (or have already implemented) a managed service provider or vendor management system, it’s crucial that you optimize your ROI. To help, we’ve listed some key MSP and VMS best practices that will help you both choose, and work with, the right MSP or VMS. 

2022 Contingent Workforce Trends

Managed service provider best practices 

Partnering with an MSP means the success of your contingent workforce program comes down to the success and expertise of the managed service provider. There are a few MSP best practices that your business should look out for when selecting a partner.

  • Work with your MSP so they understand your unique requirements

An MSP should customize and implement a contingent workforce program that reflects your company’s specific needs and requirements. To ensure this is the case, work closely with your MSP so that they understand exactly what your company’s unique needs are. This will ensure they source the best staffing agencies to fulfill job requisitions and implement processes that work for your company’s workflow. This will also impact the services that they implement into your MSP program. 

  • An MSP should implement repeatable processes

The primary point of an MSP is to free up complex work from your internal team, allowing them to work on core tasks that truly grow your business. When building your program, a managed service provider should implement processes that are efficient, cost-effective, and repeatable. This makes it seamless for your internal team to complete tasks when necessary. An MSP should establish processes that complement, rather than conflict with, your established operations.

  • Share your workforce data with your MSP before building the program

For your managed service provider to deliver the best results to your organization, they need to see your existing workforce issues. Sharing data around your existing workforce and future forecasts will give your MSP insight into what they need to do to be successful. This should include data such as existing vacancies, current workforce numbers, the percentage of employees to contingent workers, and other existing metrics such as time-to-fill or turnover. When your MSP has this information before they start building your contingent workforce program, they’ll have the insights they need to quickly solve staffing issues and predict future needs.

  • An MSP should keep you updated with the latest contingent workforce trends

Staffing trends are continuously changing. To stay competitive within your industry and to manage contingent workers correctly, your business must stay up-to-date with what’s happening within the recruitment industry and the latest best practices for managing a contingent workforce. An MSP has expertise in the contingent workforce and staffing industry, and will be able to ensure your company is aligned with modern staffing practices.

Vendor management system best practices

If you have decided that managing your contingent workforce in-house is the best method for the needs of your business, then the implementation of a vendor management system is crucial. Here are some key VMS best practices to enhance the ROI you realize from your contingent workforce program.

  • Choose a VMS that works for your organization’s needs

To truly maximize the ROI your business realizes from a vendor management system, it’s important to implement a technology solution that works for the needs of your business. When choosing your VMS, keep in mind some important information like; the price of the VMS; what functionalities and features the technology has; whether you have the resources to operate it seamlessly (is it easy to use?); and how long it takes to be implemented into your processes.

  • Ensure all hiring managers are using the vendor management system

To prevent hiring managers from committing rogue spend and engaging staffing agencies on their own terms and at their own rates, it's important to ensure all departments and hiring managers are using your vendor management system to source and engage contingent workers. This will give your business visibility and control over where you might be overpaying vendors or mismanaging contingent workers.

  • Use your VMS to optimize the number of staffing agencies you use

Managing a wide number of staffing agencies can be incredibly complex without the use of technology. However, VMS software makes it easy. With a vendor management system, organizations can more easily cast a wide net to optimize a growing number of staffing agencies. By expanding the number of staffing agencies used, companies can use a blend of niche agencies that focus on the skills they need in the locations they need them - improving their talent acquisition process.

  • Replace all manual processes with VMS technology

Saving contingent workforce data on manual spreadsheets, emails and other locations across your network only leads to fragmented processes and rogue spend. To mitigate the lack of visibility that comes with manually saving information, all contingent workforce data should be saved on a vendor management system. By doing so, your organization will gain complete visibility and control over its contingent workforce program - with insight into how you can make continuous improvements that reduce cost and improve workforce quality. 

Are you looking for help implementing an effective contingent workforce program that both saves you money and improves your talent acquisition? Get in touch with contrax today. We have a range of services that can help you better manage your contingent workforce. 

Ready to learn more? Contact us today!

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