What is a Managed Service Provider (MSP)?
A managed service provider (MSP) or contingent workforce solution (CWS), manages the temporary worker recruitment for an organisation and is responsible for the end-to-end management of the contingent workforce — from supplier management and strategic workforce planning to contractor care and offboarding.
One of the most effective ways a business can successfully manage its contingent workforce is by calling on the expertise of a third-party solutions provider — particularly one with a dedicated account management team, an optimised vendor management system (VMS), and a focus on control and cost savings.
In the recruitment industry, the term ‘MSP’ can refer to either a managed service programme OR a managed service provider. The difference between the two is that a managed service programme is a contingent workforce solution (CWS), while a managed service provider is a specialist who delivers this solution.
In other words, ‘managed service programme’ and ‘contingent workforce solution’ can be used interchangeably to describe the service offered by a managed service provider like SRG. To avoid further confusion, we’ll stick to full terms from here on out.
What are the core pillars of a managed service programme or contingent workforce solution?
By using a vendor management system, a robust managed service programme provides complete oversight into the status of each contingent worker at your company — optimising contingent workforce management and driving performance through people, processes, and technology. The core components of a managed service programme include:
- Management of the non-permanent workforce (timesheets, payroll, etc.)
- Qualified pools of talented candidates
- An efficient recruitment process
- Supplier management
- Contract management
- Candidate selection
- Data-driven analysis
- Invoice management
- Frequent progress reports
- Business reviews
- HR management
- Metrics dashboard
What are the benefits of a managed service provider or contingent workforce solution?
In an increasingly competitive contingent talent market, turning to a managed service programme brings several key benefits to a business.
- Control. Hiring managers can easily acquire strong talent thanks to streamlined, standardised processes across all suppliers — driving down time-to-hire.
- Visibility. You’ll gain oversight of the entire contingent workforce via a tailored VMS that provides regular reporting and a clear audit trail.
- Compliance and risk mitigation. With external experts managing all legislative and governance requirements, you’ll be brought up to speed on compliance best practices and ensure your business is fully compliant.
- Supply chain efficiency. By running all contractor and supplier engagement through a single trusted provider, you’ll significantly reduce administrative burden.
- Agility. With the experience of a managed service provider to call upon, you can better respond to market shifts and improve efficiencies — making your organisation more agile in the process.
- Cost savings. A managed service provider will secure substantial cost savings through exercises such as supply base reduction and staffing benchmarking.
- Scalability. Working with an extensive supplier base, a managed service provider can find you alternative sources of talent when your supply chain fails to deliver — enabling you to scale your programme up or down according to your immediate business needs.
- Governance. Ensuring internal mandating of rates, compliance, and processes.
Utilising a managed service provider is a win-win for any business with a sizeable temporary workforce. By building relationships with your business users to understand the ins and outs of your organisation, a dedicated team of industry experts manages your suppliers, sources top talent, and drives best practices on your behalf.
Is an MSP solution right for my business?
While contingent working has grown at a phenomenal pace in recent years, finding top contingent talent with the most critical skills is an increasingly costly and time-consuming process. With contingent workers (ie. non-employees) making up 40% of the workforce, being able to attract the best talent is crucial.
If your organisation has a medium-to-large contingent workforce, a managed service programme is the ideal solution. Whether you’re looking to improve visibility, compliance, or control, or simply want a fresh recruitment strategy with a new partner, we can build a solution that works for your business.
Managed service provider solutions don’t work for every business,
— particularly those without sizeable contingent workforces. If you’re a scaleup or a startup with a smaller contingent workforce, one of our other recruitment services may prove a better fit.