How, and why, HR should utilise MSP Solutions to better align contingent workforces with business objectives.
Many businesses, during the economic downturn, dramatically reduced their departments and staff—operating at the bare minimum to save on labour costs. Managed Services Programmes (MSP) and Recruitment Process Outsourcing (RPO) have become more prevalent, as businesses look to expand their workforce, as the economy regains strength. HR Magazine met with Steven Hinckley, President & COO, Global Adecco Solutions (MSP & RPO) and Neil Jones, Managing Director, RPO and Corporate, APAC Adecco Solutions (MSP & RPO), to discuss how MSP solutions can assist HR in enhancing the alignment of their contingent workforce to business objectives.
Global consistency
A recently published survey by the International Bar Association (IBA) states that 71% of HR directors worry about ‘new human resources issues’ in transnational company operations such as restructuring, outsourcing and insourcing. While meeting with clients throughout Asia, Hinckley and Jones noticed multiple similarities. Jones summarised, “One of the big challenges for us is to get the right balance between, for example, recruitment outsourcing between global standardisation and customisation—that is a constant theme and discussion that we have been having with HR directors and leaders across the region…It is not a one size fits all model.”
Hinckley noted that many companies are now starting to ask themselves: do we take the talent to the work, or do we take the work to the talent? He further explained, “We are seeing more and more of a focus of organisations wanting transparency; alignment in terms of compliance; an understanding of where their resources are and where they are not; and knowledge of what type of work they are doing on a global basis—so that they can make an overall better decision around labour inside their organisation.”
What are MSP solutions?
Hinckley clarified that MSP Solutions in their simplest form are ‘outsourced business processes focused on temporary labour’. MSP solutions can help maximise value from a company’s contingent workforce programme by managing multiple staffing vendors, billing/invoicing, recruiting, training and retaining staff. Jones described five consistent themes and outputs that most commonly emerge as business needs:
Cost—reducing management expenses.
Speed—increasing the speed of hire.
Risk— reducing risks relating to employee legislation and ensuring internal compliance.
Quality—enhancing staff professional skills-sets and finding smarter and more creative ways to source talent.
Business intelligence—providing senior executives with information on how much they are spending, where they are spending it, and what the output is from that spending.
Jones concluded, “For a lot of these programmes, the big output is transparent management information.”
MSP operating models
Hinckley believes that more and more organisations in Asia are starting to look at how MSP solutions can assist them with temporary staffing components of their business. “They want credible staffing suppliers who can fulfil demand and a third-party objective opinion to manage the overall programme. At the same time they also want someone to work alongside their existing permanent-staffing component enabling a holistic view of their entire business.”
MSP Solutions like those provided by Adecco include both vendor-neutral and hybrid options. Under a vendor-neutral programme the MSP will work with only the top tier staffing suppliers in a given region or industry—which may or may not include Adecco Group. Conversely, under a hybrid model, the MSP will manage the overall programme while working directly with Adecco Group as a primary supplier to fulfil the overall staffing requirements of the client.
Hybrid programmes blend vendor-neutral and master supplier programmes allowing, for example, one provider to act as the master supplier for clerical and light industrial positions, while IT positions are competitively bid on using a vendor-neutral programme across a range of suppliers. Hinckley advised that whether a company uses the hybrid system will depend on their strategies and needs. Such hybrid systems are likely to be more prevalent in Asia, versus vendor-neutral systems, because of challenges of obtaining sufficient expertise and volume.
How can MSPs help HR?
MSP solutions bring a host of advantages for HR including subject matter expertise in critical areas, scalability and flexibility. Jones explained, “An HR generalist might have difficulty in trying to analyse risk within an organisation versus someone with more experience who has worked on different programmes to identify risk within a contingent workforce—bringing subject matter expertise to the table that may not currently exist in a generalist department.” He added that if an employee is tasked with these types of duties, and cannot cope, outsourcing may help alleviate them from this burden.
MSP solutions can also help bridge the gap that often exists between procurement and HR. Hinckley remarked, “I think the biggest shift we’ve seen is that typically inside procurement this [contingent labour] is not assigned to any specific ‘category’, but, historically, inside HR contingent labour has not been seen as strategic labour. That’s what we do—we focus on this 100% of our time from an MSP perspective, as well as an RPO perspective, and…we help procurement managers to identify a suitable ‘category’. Then we go to a much lower level of granularity to understand the challenges and what the improvement opportunities are.”
In regards to the HR side, he added, “We are now seeing a big shift where HR no longer sees temporary staff as contingent labour, but rather as strategic labour, and just as important as their permanent labour pool. Our focus is in bringing the two together in a much deeper way.”
Analysing his company’s global client base, Hinckley revealed the number one reason that clients utilise their services is due to the global depth and breadth of the overall Adecco Group. He stated, “We manage multiple clients and programmes across Asia, EMEA and North America so we are able to track and develop leading practices which allows us to understand how they relate to the core fundamental elements of an overall MSP solution.” The second advantage is that, where allowable, we align our clients with each another so that they can share first-hand knowledge and what they have learnt with one another.
MSP implementation
During the initial meeting with a company and their HR Department, Hinckley revealed that the first question he normally asks is: what problem are you trying to solve? He explained that although this may seem simple, it does take some time to recognise the exact nature of current problems and how they link to the company’s overall objectives and their bottom line.
In order to manage this timeframe efficiently, Jones advised, “This is most effective when clients have a very clearly stated problem, have stakeholders that are engaged across the organisation, and have a solid business case in terms of what they want to achieve and the timeframe in which they want to achieve it in.” In regards to selecting a contingent labour outsourcing provider, Jones cautioned, “I think less is more, so pick two or three organisations and spend a lot of time with them to give them a feel for the business and get to know the culture and then select the kind of supplier of choice from there.”
The timeframe for the implementation of MSP solutions can vary quite dramatically dependant on a company’s reach and specific needs. For a company based in Hong Kong with staff stationed in four or five countries, Hinckley estimated it would take anywhere from three to nine months to fully implement an MSP solution.
Future of MSP solutions
With talent shortages on the minds of many in HR, an increasing number of companies are beginning to educate themselves on MSP solutions and how they can effectively operate alongside their existing HR department to enhance hiring practices for contingent labour. Hinckley noted, “In all regions, including APAC, buyers are getting much more educated and have become much better at talking to each other and learning from each other.” He concluded, “HR and procurement are talking to each other: three years ago they were on different sides of the fence.”
Paul Arkwright
Publisher
