OnTuesday,April 24th, Jeff Holmes (MSP Program Director) from Allegis Group Services presented a webinar co-sponsored with Sourcing Interests Group (SIG).  As stated by Casey Cheche (Assistant Director Member Programs) at SIG, “Jeff is remarkable and this presentation has generated the best attendance rate and the most questions from an audience to date!  I would love to hear him speak at a future SIG Summit.  The audience was fully engaged, so much so that they continued to send questions even after the presentation was over”.  Also from Dawn Evans (President & CEO) at SIG, “Excellent job today.  You were a great presenter, very grounded and never flustered. The webinar focused on the providers, the technologies, and how MSP Partnerships can help a business.

 Click Here Now to Listen to the On-Demand Recording

Don't miss the additional resources below the transcripion for more details. 

Webinar Transcription:

The M Word: The Revolution of the MSP, and its New Perception

Dawn Evans: Well, good morning, good afternoon, good evening. This is Dawn Evans from Sourcing Interest Group and I'm so excited to welcome you to our webinar series.

As you know, our webinar series is every Tuesday and each one does require a unique login. So, upcoming next week we have Tips and Tricks for Taming IT Spend, presented by A.T. Kearney. And, in May, Understanding Legal Discovery and Ways to Trim eDiscovery Costs. So, two wonderful webinars.

But, even more exciting, we have an amazing webinar for you today. Each webinar does require a unique login, so, please, make sure that you log in; register (excuse me) for each one to get a unique login for the webinar series.

Now, before we jump into the body of today's webinar, I want to go over a few other things with you. We endeavor, at all times, to take SIG out to our members. So, we just had our huge global summit. Met with resounding success. Tomorrow, we have our Silicon Valley Regional Roundtable. And then also open for registration is Seattle, Columbus, Atlanta, and Pittsburg.

And as exciting as that all sounds, we also have a group going to Changsha, China, and we'll be leaving the first week of June. So, if you're interested in exploring that region of the world, we encourage you to reach out to us immediately and we can make sure to get you an invitation and everything else. Once you get to Changsha, the entire event is hosted by the Chinese government, and we have a wonderful agenda put in place for you. So, please, look into joining us for Changsha, China as well.

We'll also be going to Nicaragua in July and more information will be coming out about that shortly.

So, a couple of other things to tell you is that our Global Leadership Summit is now open for registration for the fall. It's going to be in Scottsdale, Arizona at the Fairmont Scottsdale Princess. It's a fabulous property. I won't mention the golf, because I'm sure none of you will want to do that when you're there. But if you come early or stay late, you can golf. But in the meantime we're going to have an amazing agenda for you.

And, folks, we book our hotels a couple of years in advance so the hotel will sell out. I want you all to be at the host hotel. So please make sure you register today and get your hotel reservation right away. But it's going to be a wonderful agenda and we'll be announcing our keynote speakers next week, I'm hoping, at our webinar.

So, today, we're going to jump into Allegis Group Services, The M-Word!: The Revolution of Managed Service Provider, and its New Perception. And with us today is Jeff Holmes.

But before we do that, folks, on the lower right-hand corner of your screen there is a question mark. If you can click on that that will open up your q and a box. At any time during today's presentation, if you have any questions or issues or you don't understand an acronym or you want more clarification or you just have a bizarre question you want to submit to us, go ahead and send it to us. We will try to get to all the questions today. And if not, we will make sure that you can connect with Jeff Holmes after today's presentation.

Allegis Group Services is a wonderful, wonderful provider member of SIG and we're very proud to have them with us today.

And, folks, this webinar is recorded. It will be available for download and replay for three years. So, I know you're going to like what you hear today. So make sure you share this with other people in your organization. Or, if you want to re-listen to it at a later date, if you're a member of Sourcing Interest Group, you can go to our SIG Resource Center and you can download and replay it for three years. So, please, keep the conversation going.

It's also really important that you do send in questions during the webinar. It's always interesting to know what you're thinking, what you're getting, what isn't clear to you, so we can make sure you walk away crystal clear.

If you have any trouble with the sound today, in the upper left-hand corner you can turn up the volume on your computer, or you can also just check your computer itself, your speakers, and make sure they're turned up. If you have any other additional issues, please send us a chat and we'll give you an alternative dial-in number for today's webinar.

So, let's jump into the fun stuff, which is the meat of today's conversation. I have with me today Jeff Holmes, and Jeff is the program director at Allegis Group Services for the world's largest hotel group. He's a 12-year veteran of both staffing and corporate recruiting worlds. He has spent the past six years at Allegis Group in a variety of capacities.

Prior to joining AGS in 2010, he spent five years as a recruiting manager for MarketSource, which is an Allegis Group company as well, revamping the team by designing a scaleable recruiting structure and authoring their Go-To-Market recruiting processes and strategies as support of their Fortune 1000 clients all across North America.

So, Jeff is someone who comes to us with 12 years of staffing and recruiting experience, a fabulous phone presence; I think you'll really love today's webinar. And he's humble. He's someone who says, "Just ask me the questions. I'll explain it to you." He's going to make sure that we talk to you and bring you the information that you really need today.

So, I really enjoyed getting to know Jeff briefly; the brief amount of time I've known him, and I think you will, too. So, Jeff, I want to welcome you to the webinar series.

Jeff Holmes: Thank you very much, Dawn.

Dawn Evans: So, I was going to say, as you jump in, one of the things I'm going to ask you again and again and again is every time you have a three-letter acronym, I'm going to ask you to explain it to us. Is that a fair deal?

Jeff Holmes: Absolutely. Absolutely. Before we get into the three-letter acronyms, I'll explain a little bit about AGS; my first three-letter acronym. That's Allegis Group Services. That's the company that I work for. Allegis Group provides human capital management and workforce management solutions.

So, what does that mean? We have a division that's responsible for Managed Service Providers, or an MSP. And that's the division that I work with today. So, that's what we're gonna talk about throughout today's presentation. It's really a 101 about your Managed Service Provider and what the space today looks like.

We also have an RPO division, or Recruitment Process Outsourcing. We have an advisory and consulting division for Allegis Group Services, and finally we have retained executive search. My organization has over 70 clients in 67 countries across the globe.

So, that's a little more about AGS, to have the foundation there. And so let's get into these three three-letter acronyms that we're going to be discussing today for the most part.

As Dawn mentioned, it can get a little confusing, for those inside and outside the industry. So, again, the first is an MSP, or a Managed Service Provider. Organizations like Allegis Group Services, this is typically your program office.

So, at Allegis Group Services I run; as a Managed Service Provider I run a program office, or several program offices, for various clients. This would be your on-site or your remote program office running the day-to-day program. Of the VMS, or Vendor Management Solutions. A VMS is typically your software. That's going to be; I don't want to throw names out there, but that's going to be the technology partners that would be utilized throughout an MSP environment; throughout a VMS environment.

And, finally, the third acronym that we'll talk about toward the end of the presentation, is a VOP, or Vendor on Premise. And we're going to talk about the distinction between the two. Between and MSP and a VOP.

Today, we're going to go through, obviously, we've just done the introductions. We're going to talk a little bit about a classic MSP. We're gonna review what I call the MSP Revolution and talk about how the market's really changed and how managed service providers have changed with the market.

We're going to review today's service offerings. So, what's the added value that's being offered today? We're going to talk about avoiding pitfalls when you're choosing a Managed Service Provider. We're going to get into some closing comments and finally some questions.

So, Managed Service Providers. This is what I call the expletive screen. Ten years ago, if you spoke to a hiring manager or a staffing company, and you mentioned that your organization was choosing a Managed Service Provider, this was the response that you received. Having working in staffing during that time, I would say that this is absolutely the response that you would receive from me.

And a lot of people wonder why. A lot of the original MSPs did business differently than they do today. They created an unnecessary filter, creating a bridge between the hiring manager and the staffing supplier. They increased communication gaps, so areas where relationships were built and a manager and staffing provider were able to talk together about the profiles that not only the tangible needs of the business but also the intangible. Those communication gaps would essentially hurt talent. And, finally, they would drive rates too low in instances and place the overall talent at risk.

What I will say and what I'll say throughout the entire presentation is that people make companies. And in order to attract the best talent, your suppliers have to be motivated to be able to support the business and your hiring managers have to have that capacity to be able to draw in and attract the best talent.

So, why was I on the expletive bandwagon 10 years ago? Well, I had my personal MSP horror story. In 2004, I was a branch operations manager for a local staffing company in Atlanta, and I had a national account, and that national account was a valued partner of ours. And they made up about 35 percent of the revenues for my business. I had not only, you know, were the spend amounts high for my program, but I also had a lot of people that were out there working. We did a ton of business and I had a very close, personal relationship with the hiring managers out there.

So, when I was informed that this national account was moving to an MSP, I absolutely panicked. And why did I panic? Well, because organizations, especially staffing organizations, had that expletive view of an MSP. And back in the day, because of the unnecessary filter, because of the communication gaps and the way the processes were driven from top to bottom, it was very easy to jump on that bandwagon. It was very easy for folks to have an issue.

So, we're going to break it down and talk about, you know, why this horror story happened and how MSPs, in the past, could fail an organization.

So, MSPs, or the "classic MSP" overview is really simple. The old systems offered base-level value. They were strictly administratively focused. They were designed to manage the technology. So, the program office would manage the technology. They would manage the staffing providers. And they were there to provide a base level of cost savings.

So, to drive into this, we're going to take it piece by piece. So, the first and foremost is managing the technology. Well, the first question I had was, from a staffing perspective, is: How do you manage a technology? These were new vendor management systems. Not many people had a lot of experience with them. They offered limited functionality.

So, the system itself was designed and geared and set up to open positions, to submit candidates through there, and for the managers to be able to review them in the system. And, obviously, for the program office or the MSP, to help steer the process along.

The only problem of this was, obviously, the limited functionality in the technology. But in addition, the inexperience of those program offices back in the day. Unfortunately, a lot of the original MSPs didn't come from a staffing background. And those that did created unnecessary levels of competition, which we'll talk about as we proceed on. An inexperienced program office was really a huge piece and a huge downfall for those original MSPs. And managing the technology.

The second piece was managing the staffing providers. Again, if you have an inexperienced program office there, and you have staffing providers who have handled this business or managed the business day in and day out for years, there's an instant level of lack of respect that comes through that when you have someone who really doesn't understand the staffing and recruiting worlds coming in to manage a process and dictate the process.

And that leads to perception. So, right, wrong, or indifferent, the perception that would take place in the staffing industry were a definite barrier for the organization. The perception of the supplier being greedy, or trying to dictate the process. And then the other side of, you know, the MSP being ignorant to the process or ignorant to the client. And so those initial perceptions really hurt MSPs in the beginning.

And, finally, the last piece is the competitive program office. And, again, we'll talk much more about this as we go through. But program offices saw all those staffing providers as competition and vice-versa. And when those originals tried to manage that process from the beginning, if you're not really providing value back to your staffing provider and working as a true partner, that's where this classic MSP failed.

Last but not least, we'll talk a little bit about the classic MSP overview of providing cost savings. Cost savings are still, today, one of the greatest values of having an MSP and being able to manage costs. What I will say is, you have to balance out cost versus quality. And I'll explain that.

So, again, people make up an organization. People make up companies. And you have to be  able to attract the best. The original MSPs were designing the cost models or the not-to-exceed rates or putting people in mark-up models. And if cost is your number one focus, cost savings can obviously be achieved. You just have to manage it through cost management and not through cost savings.

The mark-up model is really kind of where this takes the highest turn and the highest toll. Imagine this: So, let's say you've got a mark-up model and it's 35 percent over what the pay rate is. Well, if there's not an experienced MSP in place from that classic MSP model, to be able to say what the rate should be to be able to put a rate card in place and have some cost guidance, then you can end up getting, you know, a $100-an-hour person in place of a $90-an-hour person.

And, obviously, the candidate itself is going to be making the same amount. So, in that instance, you're looking at a $20,000 difference that staffing supplier would be able to make. And these types of things happen. And they happen quite frequently, and you've started to see price-gouging through those mark-up models.

What I will say is that mark-up models can absolutely work. I would say that the mark-up model in the right industry can be successful. But it has to be managed by an experience Managed Service Provider.

Last but not least…

Dawn Evans: So, Jeff, would you tell us; when does a mark-up model work best. I mean, why would you say it works well in some industries than others?

Jeff Holmes: Absolutely. So, here's what I would say. I would say that mark-up models are not a best practice for an organization. In certain industries, where you have a supplier or a few key suppliers, and those suppliers have access to 100 percent of the business.

And what I mean by "a few" is I mean one, two, or three suppliers and you're giving them the bulk of your business. They can afford to take the hit. They can afford to balance the quantity versus the quality of compensation flowing through their organization. In other words, if you're giving them millions and millions of dollars worth of potential business, versus, you know, a little.

The mark-up model works best in industries for lower-level positions. So, what I would say is industries such as manufacturing. We see those processes going in place today. And there are still struggles. And it has to be managed and it has to managed efficiently and effectively. Once again, if you have a true partner or a staffing subject matter expert as your MSP that's there, designing process top to bottom, then you're at less risk.

Dawn Evan: So then, how does it, if you're not doing a mark-up model, then how are they setting the pricing for these people? Is it on the overall contract value; the millions of dollars? Or is it; it's still some kind of mark-up on what they pay them, is it not?

Jeff Holmes: Absolutely. So, what I would say is I can't speak for every Managed Service Provider in the field today. But we have an entire team that manages that process that's led up by an economist.

They go in and they look at labor market analytics throughout the region. So, they're not setting the costs across the U.S. They're literally looking at costs per region per city. They're balancing things like unemployment rates for those levels of positions and they're taking true market data and labor market analysis to be able to develop what we call a "not to exceed rate card." And that not to exceed rate card would be the costs associated with whatever type of contractor that would come in from that.

So, you're looking at pay rate, a staffing company's burden, and, obviously, their ability to make profits on top and still be able to attract the right level of talent.

Dawn Evans: OK. Thank you.

Jeff Holmes: Absolutely. So; and those types of things can directly affect time to fill. Time to fill is absolutely critical. Can you attract the right level of talent in the right amount of time? Because, obviously, if you have positions that are open, that's costing your business as well.

So, what I'm saying is, the higher the cost, of course, typically, the quicker the time to fill. But you want to be able to find that balance. And in a classic MSP profile, sometimes cost savings was too much of a factor and those times to fill began to slip.

So, all these things took place, in my experience, with my account. And I had lunch one day with my client. We had gone over our relationship and how long we had done business together and how successful we were. And we took a look at all of the struggles that we had had. We took a look at an antiquated model that was providing a base level of value. We were essentially navigating the chaos every single day.

He wasn't happy. Obviously, I wasn't happy. His talent level had decreased. My revenues had decreased. There was a lack of communication. There was no; there was essentially no communication. It's what we call the "black hole," where you submit a candidate into a system and you receive no feedback and it stays that way.

And, obviously, there was a lack of communication but there was also a lack of quality candidates. So, when you eliminate that level of communication, that's a huge risk to an organization.

And, really, the question became: How much value is an MSP providing today? And we determined that the old model, that's the classic MSP model that was there, really didn't. So, he and I made a pact. And that pact was to do everything we could to work around the system.

So, the value of the MSP became business as usual. So, they were on-site. The organization was paying technology fees. They were essentially paying for the MSP, and we were doing everything we could to work around the system. So, their costs had increased and we were doing business as usual.

It was very unfortunate. And then, obviously, being a program director at an MSP today, I was able to see that side of the business and I thought it was great. Because 10 years later, when we look at home times are changing, when we look at the abilities for MSPs today, it's dramatic what's happened.

But 10 years ago, that antiqued model of base-level value and, again, navigating the chaos, was a risk to his organization and it was a risk to mine.

But today we talk about the revolution of the MSP, and that's really what the presentation's about today. We're going to talk about, obviously, what happened in the old model and where the failures were. We're going to talk about how a few select MSPs have really come into the industry today; Managed Service Providers that are doing it the right way. And we're going to talk about why they're successful.

We're going to talk about the offerings that they have, and really get into the nuts and bolts of what a true MSP is and how the revolution has people excited about it. We're also going to talk about how many organizations today are adding MSPs.

So, if you're a staffing partner, if you're a hiring manager, if you're an organization, this is really the nature of the business. And it's not necessarily a bad thing anymore. So, my perception has absolutely changed and today has really helped steer some of those perceptions back to: It's not as bad as it used to be.

So, the MSP revolution. It all starts as one thing. The old model, again, was administratively focused. The new model; it's all about talent consulting. And we're gonna break that down into three different divisions that we're going to talk about today.

We're going to talk about the providers. We're going to talk about the partnership. And we're going to talk about the technology, or the VMS.

So, we're about 20 minutes into the conversation. So, just to kind of reiterate, for those who joined the call late, what we're discussing today is the MSP; the revolution of the MSP and how things have changed.

But we're also going to talk about the three three-letter acronyms that we're going to use in the second part of the presentation that we used in the first part of our presentation.

The first, again, is MSP, which is a Managed Service Provider. That's typically your program office or the organization that's running the process from top to bottom. The second is your VMS, or your Vendor Management Solution. That refers to the technology; the technology partners. So, that's the system similar to an HR applicant tracking system. However, this is focused primarily for contingent labor.

And last but not least, we're going to talk about VOPs, or Vendors on Premise. And we're going to talk about the distinction between a Vendor on Premise and a Managed Service Provider.

So, let's start with the MSP revolution and let's start with the providers. What's really changed, as I mentioned, is the new MSPs today and the folks who are doing it right are true consultants. They're staffing subject matter experts. They know talent. They understand processes. They know data trends.

As we mentioned, they just provide an additional level of value; an additional layer. Instead of just being administratively focused, these are your go-to people. If you have a question about talent, they should be able to steer you down the right path. They should be able to really hold your hand and walk you through making the right decisions for your organization.

Now, these; most MSPs don't make the decisions for their organizations. They're there to give options and guide best practices for your organization. So, ultimately, they're going to give you options to make the right decisions for your company. To make the right decisions for your market. And that's obviously going to be dependent on the different business units.

They're experienced. And, finally, again, there's that strategic level of having somebody on site who's worked in either the staffing or the recruiting world who understands this business, or an organization that's large enough, that has enough clients to be able to support and give you the feedback that you need to make those right decisions.

And this is really where the MSP has evolved, and where the revolution has come in. Because it's not just the days of somebody off the street coming in and we've built this company and we're gonna call it an MSP and we're gonna try to drive change throughout the organization. The providers today, the ones who are leading the space, really understand that in order to provide value and in order for the industry; for an MSP to provide true value, you have to be experienced and you have to be strategic.

The second piece, and, probably, I would say the most important, since we've got these MSPs now who are subject matter experts is there has to be a partnership. And that partnership has to come from the staffing providers as well as a partnership with the hiring managers.

A Managed Service Provider is the liaison between the two. They work hand-in-hand in tandem, designing processes and working through between the hiring managers and the organization, funneling that information to the suppliers and back and forth. It's all about empowerment.

When you're setting not-to-exceed rates, when you're setting processes, are you setting processes that are beneficial for the organization or are you considering the partnership that you have with your staffing suppliers? It's absolutely critical. There has to be reciprocation. It has to be reciprocation on every level, so a supplier is motivated to send you their best talent day in and day out.

Now, obviously, that's within reason. And that's what the MSP is there to do. It's there to balance that out and ensure that both parties are getting what's expected out of the situation.

Obviously, as a MSP, I work for my client. I don't work for the staffing providers. However, we want them to have a positive experience so they continue to send us the best talent day in and day out.

The second piece is that the MSP revolutions are really steered more toward a non-competitive environment. In the old, perceptions really steered folks down a path and there was a lot of head-butting between the two. The best thing about the MSP revolution today, and about this partnership of empowerment and reciprocation, is building a non-competitive environment.

If you have a staffing company that is, what we talked about, a VOP or a Vendor On Premise, and they're essentially taking business today; so, when your requirements go live, the staffing company disguises themselves as an MSP and they begin to work on the positions. They begin to filter the jobs first. And then they farm what else is left to the remainder of the supply base. So, the remainder of those partners.

This type of competitive environment, when someone disguises themselves as an MSP, can be absolutely detrimental. It happened  a lot in the beginning. It still happens a lot with certain organizations today. What I would say is, the best way that an MSP can evolve, that the MSP market has evolved, is less and less of this business today, where you have true MSPs that are in there that are managing the service, they're managing the providers, they're managing the supply base, they're distinguishing it within a vendor-neutral model to be able to push a non-competitive environment.

And when that happens, when there's reciprocation and empowerment between managers, between the suppliers, all filtering through the MSP, it's highly successful.

Last but not least, what's really changed in this revolution is the technology or the vendor management solutions. The systems of yesterday, again, were antiquated. It was very difficult to get information when a resume was in the system and you went to view the resume it was usually in some sort of html format. It was very difficult to see and very difficult to navigate the process, even with a Managed Service Provider steering that process through.

The technology providers, and because of competition in that space today, have really come a long way. The technologies are ever-evolving. We see increased functionality through these. What we find is in today's VMS, or Vendor Management Solutions, you can open a requirement. You can have resumes submitted to that. You can score those resumes. There's auto-messaging that takes place in the system whenever different tasks are made.

You can hire the person in the system. You can, after hiring the person in the system, obviously, it's going to handle all of your invoicing. It's going to handle all of the time cards and those pieces. And your MSP is going to help manage that process from top to bottom.

And you can take that individual all the way through off-boarding. And you've got a candidate file of your contract workforce. That's phenomenal. And that level of transparency and visibility is absolutely critical to any business.

Finally, about transparency and visibility through the technology is the ability to report. So, most of new VMS solutions that are pushing through process today; all fields are reportable.

And when you have a program office of an MSP on site who knows how to use that data correctly and knows how to pump that information back through the organization to change process, to formulate best practices, to calculate true savings, versus cost avoidance. To look at the ability to uncover market trends and trends in your business as a whole. To maximize your budget and really use data correctly.

That's really the transition of where MSP technology has really become much more forward-thinking. Much more progressive. And reaping the benefits of that partnership with the MSP through this.

Now, what I will say is that a VMS still has an opportunity to be a black hole today. In other words, a resume goes in the system and there's no feedback. That's where the MSP fills the void.

And so when we talk about the MSP revolution and we talk about how far the technology providers have come, what I will say is it is ultimately the responsibility of your program office, of an MSP, to bridge that gap to make sure that communication is flowing seamlessly between the technology and between the hiring managers. And if your MSP can't provide that value today, you should probably begin to look for other solutions.

I believe someone had a question?

Dawn Evans: So, Jeff, yeah, there's a couple of questions that came in and some of these are clarifying questions. So, the MSP, the Managed Service Provider, typically partners with a VMS technology solution. Is it ever their own solution, or do they partner with other people's solutions?

Jeff Holmes: What I would say is that there are absolutely Vendor Management Solutions that do run their own process and say that they have an MSP. And in some regards they do, and in other regards, they don't. And, again, this is just me, personally: What I would say is there are providers out there that also provide an MSP solution.

I think when you're managing the entire process and there's no level of oversight, I think there's added risks that can go there. So, it takes a true provider and a true partner to be able to manage that process. It wouldn't be the first solution that I would go with. I would absolutely shop around. But absolutely, there are instances where the technology manages itself.

There are also instances where you could purchase a VMS technology and you could run it yourself in-house. That happens as well. What I will say is that those can be successful, but you have to have the right team. And to hire a company that's experienced, that has the clients and the foundation and has been in the market for awhile to really steer your process, you're putting yourself at much less risk, and you're really getting more for what you pay for.

Dawn Evans: So, would you say best practice is; the question was, "I'm launching a program. What do I do first? Choose a technology or choose an MSP?" So, which; what would the best practice be?

Jeff Holmes: Absolutely. What I would say is an MSP can lead you to the right technology. So, a good Managed Service Provider is going to help you make that decision. But the first thing that I would do is I would reach out to an MSP partner. I would reach out to someone who's, again, a staffing subject matter expert who understands contingent labor, who understands procurement services, and can really help you design your program.

Again, they're offering options and they're offering best practices. They're not making decisions for you. So, if a partner begins to make decisions for you, that's where I would begin to question that partnership. Again, it needs to be reciprocal throughout the entire process.

So, I would say choose the MSP first and they will help you find the right technology partner for your needs.

Dawn Evans: OK, so then, I choose an MSP. Jointly, the MSP and I decide on our VMS technology. So, now we've got technology and somebody to oversee the entire program from top to bottom. How do I determine the appropriate number of suppliers that are capable of submitting resources, then, for open positions?

And this question came in from a company and they said: If we have, for example, over 30,000 employees, how do you know how many people should be allowed to submit resumes for open positions?

Jeff Holmes: So, the first half of that question was: How many suppliers per head count? Or, how many suppliers do I need?

Dawn Evans: Yeah. What's an appropriate number of suppliers capable of submitting resumes? Is it open to all? Do you limit, and do you choose?

Jeff Holmes: So, there is no magic number. So, I'll speak to my programs and I'll speak a little high level to best practices. So, one of my programs has $40 million in IT spend. They're all very senior-level positions. They spend a lot of money on IT services.

When our program went live, they had roughly, I believe, 40 or 50 overall suppliers through the program. Now, with that level of spend and the amount of just head count that's there, what you want to do is you want to make sure that you have the right solution; that you have the right partners who can support all of your business. And if that's five, fantastic. If that's 10, fantastic. If that's 20, that's fine.

What I would say is creating partnerships with your suppliers is key. So, you want to make sure that you have individuals who all have different delivery models, who can recruit in different markets, and everyone's not farming from the same job boards over and over again. And your right MSP is gonna help you vet those suppliers.

So, one thing that most true MSPs do, and we'll get into this a little bit later as well, is supply-base management. They help you manage that process to determine how many specifically.

So, there is no right number or wrong number. It really depends on their model. It depends on the different delivery models. It depends on their ability to support your business.

What I will say is, if you currently work with 50 today, all 50 shouldn't be rolled into your program. That all 50, I would assume, should keep their head count. Those individuals should be able to be legacy suppliers in the business. But I would say a best practice would be to then choose the folks who support the breadth of the business, and then filter in.

On my program today, we have 10 preferred suppliers. That number's still probably high based on the amount of spend that we have. But we're going into year two of our program and we're vetting to ensure that we have the right suppliers.

Also, unemployment for IT in Atlanta, Georgia is astronomically low. It's less than 4 percent; closer to 3 percent today. So, what I will say is, we also have to make sure that we have enough variant delivery models to be able to support the breadth of the business. So. . .

Dawn Evans: OK, so; I'm sorry; I didn't meant to cut you off. Go ahead.

Jeff Holmes: No, I was going to say, it's really an MSP's responsibility to come in and be your partner and help steer through those best practices to help you decide what supply base fits your organization.

Dawn Evans: OK, so, is an MSP ever also the staffing firm that may serve as one of the staffing arms. So, let me get the language right: We've got the MSP managing the program top to bottom. Then we have a bunch of suppliers, or, I don't know what you want to call them; staffing firms, who are going to submit resumes.

Is there a problem with ever the MSP also being a staffing firm, and isn't that like the fox in the henhouse in that case?

Jeff Holmes: So, what I will say is that is absolutely a risk. So, when I talk to the suppliers that we currently have on our program today, and they talk about other programs here locally, one of their biggest frustrations is a situation where the staffing provider in on site. They are the MSP and there's what's called the supply-base distribution is off.

So, in other words, I'm an MSP but I'm also filling the position, so I'm competing, or that competitive environment, with the other suppliers. That's absolutely a risk, and it's absolutely a risk because if they can't support the business or if they don't support the business who, then, does it go to?

So, even with the backup supply base; so, let's say I am a staffing company and I'm also an MSP. And for first seven days I'm going to take all the business. I'm going to fill whatever I can, and I'm going to farm out whatever else I have left to the remainder of my supply base. Well, who's going to want to work on the leftovers, from a supply? I mean, you're essentially devaluing your suppliers. You're devaluing those individuals.

So, I would say it's absolutely a risk. What I would say is that as long as an MSP is not actually doing the recruiting, then they can manage that process. So, there are lots of instances where you might have multiple suppliers and those suppliers might have a relationship with an MSP. As long as the relationships are truly vendor-neutral, and their requirements are going out competitively to the market all at the same time, that's the most important piece.

So, in other words, when Job A comes open for a Director of Operations, that job would go to all of the suppliers on the preferred base at the same time to create that competition. That competition's going to help drive your costs down and that competition's going to help increase the quality; the overall quality.

And if the MSP has done a great job of vetting and ensuring that suppliers are there from different delivery models who have different networks and different candidate pools to be able to draw the best in, then the MSP's doing their job. If there are struggles, then the MSP better be proactive about filling those gaps.

Dawn Evans: OK. So, now, this question; I did go back some; we've got a couple of responses and I'm not it's sure something you can answer off the top of your head. But they asked for, "What is the typical. . ." (Where is the original question?) "What is a typical USD (U.S. dollar; one U.S. dollar) breakup for contract staffing revenue?" And the explanation was, the typical breakup of $1 in terms of staff pay, taxes, and other cost profit; is there a typical break down of a dollar when you're talking about staffing models?

Jeff Holmes: What I would say is it depends on every staffing company. So, I think that's a question that a lot folks try to; that's the purple squirrel that people try to get to so often. It's very unique. And every staffing company has a different what we call "burden." Or, their cost of business is different. Do they offer benefits? What are their benefits costs? Obviously, the cost per state can be different. So, there is no. . .

Dawn Evans: Hey, Jeff? Jeff? Excuse me. Something happened to your microphone. You're very, very, very faint suddenly.

Jeff Holmes: I'm not exactly sure what happened. Can you hear me now?

Dawn Evans: Now I can! So, whatever that little shift was, stay right there. That's perfect.

Jeff Holmes: Absolutely. So, what I was saying is, there is absolutely no singular model to do a breakdown there. Every staffing company has a different cost of business. They have a different cost of business. One might offer benefits, the other might not. So, what they call a "burden" is different.

What I would say is, you know, when I was in staffing my office's burden was 19 percent. And that's relatively high for the market. They can go as low as 15 percent. Depending on the size of the organization, some can go as high as maybe, you know, 20, 21 percent.

So, with that being said, I would say that there's not; if that individual wants to converse with me directly after the call, obviously, I'd be more than happy to answer any follow-up questions they have to help kind of define a structure.

But, again, any good MSP is going to be able to go in and assist you with a not-to-exceed rate card. And they're going to be able to really go through; again, our economist is phenomenal about looking at the rates, looking at unemployment, and setting an environment that allows for cost savings and what we call "cost avoidance."

So, just because a not-to-exceed rate card is there, if every supplier is coming in at the max not-to-exceed rate time and time again, I mean, is your MSP really doing their job? They need to look for cost savings throughout. Unless a recommendation was made for a not-to-exceed rate card and those numbers were dropped dramatically.

Again, with the market turning, especially in certain industries, that would be where I would see the change or the challenge.

Dawn Evans: OK, perfect. So, then, this question is more around choosing the VMS solution. It says, "To shop around for a Vendor Management Solution, the technology, it's typical to lean on your Managed Service Provider to help navigate the market and get the right fit for the tool. But why, then, do most MSP markets, or market players, typically only recommend the same two to three VMS vendors when there are dozens out there?" Is that just because you have favorites; you have people you enjoy working with, people that you trust, or are there really only two to three best-in-class and the rest are just out there?

Jeff Holmes: So, I'm going to answer from my personal experience. I have been on the staffing side of the business and I have been on the corporate recruiting side of the business. I have worked with applicant tracking systems as well. And what I would say is it's the same in the applicant tracking space. There are a handful of providers that are best-in-class, that really do things the right way and they're progressive. They're highly configurable. Maybe not customizable but highly configurable, and they allow you to do business. And they allow you to report in certain ways.

What I would say is most of the MSPs from baker's dozen would definitely give you a handful of, you know, three or four names. And the reason being is because those technologies absolutely lead the space.

And while there might be bells and whistles on some of the up-and-comers that are extremely attractive to an organization, what I would say is the two to three best providers absolutely do things the right way much more consistently. They're easier to work with. They have less technical, or technology, breakdowns, so there's less downtime.

And, obviously, if your technology is managing, or your MSP is managing the technology, if the technology breaks, you know, you're back to a situation where there's chaos there.

So, I think the reason that two to three consistently go is because of each of use, because of configurability, and, obviously, customer service as well as, you know, strength of their actual technology platforms.

Dawn Evans: OK, very good. So, interesting question: "For a global organization, does an MSP or should an MSP also incorporate management of off-shore suppliers and/or resources?"

Jeff Holmes: Absolutely. And this is really getting into the end of the presentation, which is great. So, we talk a lot about what we're doing today and how MSPs are changing; what's in the future. What we're seeing is we're seeing many more global expansions. For my organization, almost every new client that we're hiring; excuse me: that we're partnering with, has a global expansion in mind.

They're expanding to multiple business units, where an MSP might have just been for this level of spend or this industry. You know, and now it might be sales and marketing and IT and administrative and professional.

And we definitely see more project-based work coming through as well, for the future of the MSP. So, I would say that if you have offshore resources, if you have projects based, an MSP can manage that. And one of the huge values is just, again, in the transparency and the visibility that it provides.

There's no more hollow feeling for an organization to not know where all of their contract labor is. They don't know where it's at. And you'd be surprised how many leading organizations today don't have a grasp on how many head count they have, where they're located, what the pay rates are, and why is there no consistency in this market; why is there no consistency in that market?

One of the biggest values of an MSP is really to bring order to that chaos. And the technology partner alone can't do it. It can give you visibility into it. But having somebody really steer those best practices, not only from a North American standpoint, but from a global standpoint.

But, again, you have to make sure that you're partnering with someone that truly does have a global footprint and has the resources globally to be able to support your business.

Dawn Evans: You mean from a VMS technology perspective?

Jeff Holmes: I was referring much more from, yes, the VMS technology, but definitely the MSP as well.

Dawn Evans: Oh, all right. So, then help me with that question then. So, if I have an MSP and I have a Vendor Management Solution; so I have my technology and MSP, do they both have to have known how to move into certain countries, or do I have to have the technology there before I can move my MSP to that country? Or does the MSP bring the VMS provider?

Jeff Holmes: Um, what I would say is, the MSP should have some sort of foundation there currently. The technology providers, you know, in drafting things in various languages, I would say, again, the top two are very forward-thinking on there. The top two to four have plans, you know, to make sure that that's happening.

So, I would say that you definitely need a foundation of both. But let your MSP help steer that process for you, and help make sure that the foundation is there before you move into that market.

Dawn Evans: OK, so then, so, if we had a group of 30,000 employees, would that company typically fill the role of MSP internally, or do they typically outsource to an MSP?

Jeff Holmes: So, you're saying that. . .

Dawn Evans: Is there, I guess, a magic number of employees? At what point do people do the Managed Service Provider office themselves? Or is there not a secret number; it's just really the company itself?

Jeff Holmes: Yeah, it really varies on the company itself. What I would say is managing a project that big and trying to hire internal resources who have no experience in the industry as a whole is a huge risk to your organization.

The value of an MSP, the value of a true MSP, again, is much more than just managing the process. It's being that subject matter expert for all things. It's having the economists team, it's having the supply base management team, it's having the ability at a moment's notice to get on the phone with someone and pull different data and statistics versus having to try to crunch through and do it yourself.

The other value of using an MSP is, you know, we talk about the technology partners is that most MSPs have relationships with multiple technology partners and they have multiple relationships; the larger MSPs do. So the value is there.

OK, I'm a client, something's going wrong with my technology, there is a glitch. I need to get on the phone and open a ticket. Well, when you have a provider as well that has multiple relationships, those resolutions to get those things fixed happen a lot faster. It's sad, but it is true.

Dawn Evans: That brings up a really good point. So, no, I think everything you said, from the economists to the access to information, it seems like you would get so much more by having an MSP, and so much more efficiency and effectiveness.

So, I have a question. They said, Are there ever situations where the same candidate comes in from multiple suppliers or providers, staffing companies, at different rates, and if so, what's the best practice to handle that situation?

Jeff Holmes: Absolutely. So, this happens consistently. So, many of the technologies will inform you when that's happened. And there's a few ways to handle it. One of the things that we've done with one of the programs is we have what's called a "right to represent." And there's a time signature on that right to represent and that time signature takes place.

If the candidate is shopping multiple companies, and a candidate gets through the system, and there are certain instances where we choose not to work with those candidates in that stage of the game, just because they've jeopardized the relationship between multiple suppliers.

I mean, if you give one person a true right to represent you and then you give someone else, I mean, obviously do you have the morals and the ethics to be a part of the organization.

Dawn Evans: But your right to represent is coming from the person that's being staffed. So, they assign a true right to represent; they typically do it just one agency, is that what you're saying?

Jeff Holmes: Absolutely. Just to one agency. But it does happen, and it does happen, you know, on a semi-regular basis. Obviously, the supplier who submitted first that had the right to represent first is who you'd go with.

Now, if their rate is dramatically different from the rate of the other, that's when you begin to ask questions. Did the other supplier truly have the right to represent? Did they truly vet the individual? And you know that you want to hire this person. That's when that competition helps you drive the rate down. And a good MSP's going to help you do that as well.

Obviously, the cost of business is different, so you can't expect one to match the other. But if they are significantly different, the supplier who submitted at the higher rate, even if they were the first, is just going to need to be prepared to be much more flexible.

Dawn Evans: OK, good. So, the questions are flying in on this board right now. I know you have a couple more slides, so why don't we try and go through those and, folks, keep your questions coming, because this has been an amazing conversation.

And, Jeff, you are amazing. You haven't stumbled once. So, thank you. But I'm going to let you go through your slides for a minute.

Jeff Holmes: Absolutely. So, just to pick back up where we left off, and I'll rush through this to leave as much time for questions as possible. What's really changed about MSPs today are today's service offerings. It's not just staff augmentation offerings anymore, or just your contingent labor. Obviously, that's a huge piece. But the second piece is around services procurement solutions, or your SOW; Statement of Work business.

The portals in business today are allowing you to manage this as well. When you couple the two together, and you have your contingent workforce management, and you have your services procurement solutions, you're able to have one platform that can report on all of your head count, all of your business, and it's tracking everything for contingent labor.

So, let's say today I'm only in IT. Well, then I grow into sales and marketing, and then I grow into professional, and then I grow into administrative. Now I really have a repository of a process that's being managed and I have that full visibility into those types of environments. And with a true MSP and a true partner, it's really a huge value-add to have that.

Again, today's service offerings and how they changed from yesterday, again, is around that supply-base management. Yes, it's being a partner with the supplier, but it's also holding them accountable and vetting them out and ensuring that you have the right supply base, as we mentioned before.

And then last but not least, let's talk about compliance. And that's the other great thing about an MSP. We stay ahead of the curve on all issues about compliance. And, obviously, internal contractor and 1099 compliances are a huge risk for an organization today.

I don't know that every company offers this, however, Allegis Group Services does offer a lot of protection from those types of organizations in steering best practices and really shielding processes that really help support that business as a whole.

So, today's service offerings, again, I used the words before, but they're progressive, they're forward-thinking. And it's all about reaping the benefit of a true partner and a true expert from a staffing perspective.

So, avoiding pitfalls. It's really the next piece of the puzzle and what you want to avoid when you're looking for a staffing company. So, I'm just going to talk about this very briefly.

So, talked about an MSP versus a VOP, and since we already covered this, what I will say is, just be wary. The organization that you're coming into should be prepared to be supplier distribution centric. It needs to be a vendor-neutral model. There needs to be multiple suppliers competing for the business. That level of neutrality helps support the business. It helps drive costs down. It's supply and demand.

What I will say is on this last bullet: The dedicated supplier model can absolutely work. So, depending on the amount of spend, depending on the partnership with that supplier, having one central, dedicated supplier can absolutely work, especially if that organization has been a partner for years.

I would say that you would want to vet that process out. But it can only work if it's truly managed by an MSP. So, if someone's on site, again, if I'm the MSP but I'm also filling jobs alongside of the competition. That's not a true MSP. That's a Vendor On Premise. That's a staffing company that's sitting in your ranks and managing your processes, filling whatever business they can and then farming the remainder out.

Now, a dedicated supplier model is completely different. And that dedicated supplier model is absolutely set up where you can have one supplier, one trusted partner, for whatever region, for whatever business unit, and they're filling all of the requirements. But they're being managed by the MSP. They're reviewing their statistics. They're reviewing the costs. They're ensuring that the speed is there and that the quality is there.

And that's the piece, obviously, where you want to avoid the pitfall. If you're not getting that, you know, if you're not getting an MSP service then you might have a VOP.

Dawn Evans: OK, so. . .

Jeff Holmes: And, just, obviously, closing comments real quick. What to look for: You want to look for an experienced partner. You want to look for someone who's building a symbiotic relationship between the staffing partners and the company. You want an expert.

And what to avoid? You want to avoid everything we talked about from that classic model. You want to avoid an inexperienced or administratively focused program. And, last but not least, you want to avoid the VOP model. Because I promise you it doesn't do anything to save costs. It doesn't do anything to drive quality. It's giving everyone a hundred percent of your business with no oversight.

Dawn Evans: OK, so now you need to move into your last slide, because we do have some of these questions, and they're not silly.

So, you're doing a tremendous job helping us understand the whole marketplace better. So, let's talk about a couple of things. One, you talked about; let me go back to the question here. You talked about having someone represented by just one service, or one staffing firm. Is that typically a legal agreement, or is that just an email?

Jeff Holmes: I would say that that would probably be a contract that you would have with your organization; with the organization. If was going to give somebody a hundred percent of my business, I'm pretty sure I would want some sort of contract in place and not just an email.

Dawn Evans: OK, and then, this is very interesting. Do you recommend that the MSP contract directly with the VMS, or does the VMS supplier always contract with the company you're representing as an MSP?

Jeff Holmes: So, there's different models that work. And so what I will say is I have the pleasure of being on both sides of the coin. So, there are situations where as an MSP I hold contracts with our staffing providers, and there are situations with another client of mine where the client holds those contracts.

What I will say is there are advantages to both. There are absolute advantages to both. Having the freedom to be able to navigate those relationships and really hold suppliers accountable and make changes is a huge value to an organization. At the same time, you know, having more consistency of building a stronger relationship with multiple suppliers that we have, and really having those relationships on a national basis and being able to leverage that.

So, yes, we're talking about this particular account. However, we work with you on multiple aspects of business in being able to leverage that to really hold suppliers accountable is great. So, I think I answered the question. I hope I did.

Dawn Evans: Well, actually, you answered it about the staffing firm, but what about the VMS technology? Do you contract, as an MSP, with the VMS or does the VMS contract with your client?

Jeff Holmes: So (and this is my recommendation), again, it goes both ways, and, again, on the two programs that I currently manage today, it's different. So, what I will say is on the one where the client holds the contract with the VMS partner, the technology partner can be a little slow to respond. And we're always leveraging our relationship, and I would say the Allegis Group Services relationship, with that supplier. Or, I'm sorry; with the technology partner. And the reason we do that is because we can get them to act, you know; typically if there's an issue we can get them to act pretty quickly.

So, from a VMS perspective, my recommendation would be that you have the MSP hold the relationship, as long as your MSP is a trusted provider in the market.

Dawn Evans: Interesting. OK, so do you get more; because you do so many more deals with the VMS technology supplier, they're more apt to pick up the phone and answer your questions quicker than a single client.

Jeff Holmes: Absolutely. And they're also, obviously, you know, from a cost perspective, I think that leveraging that relationship also helps really have an added benefit of managing the overall costs of the technology.

Dawn Evans: OK. So, here's one. They say, "Companies that have already picked their VMS technology but don't have an MSP in place and then they start choosing their vendor suppliers. Are they really doing a disservice to their company, doing it that way?

Jeff Holmes: I would say they're not doing a disservice to their company doing it that way. What I will say is that they will probably have some more struggles throughout the overall process.

If you don't have an MSP and it's something you are trying to do yourself, what I would say is I would go out and I would look at the baker's dozen and I would look at names on the top of the MSP baker's dozen, and I would, you know, start to vet the process through to make sure that you're going to be given a program director or a program manager to manage that program office who really understands what they're doing; who really understands the process.

So, I don't say that you're necessarily doing yourself a disservice. However, what I would say is I would want to be very proactive about ensuring that I had the right processes in place should there be issues down the road.

Dawn Evans: OK. So, folks, we just had a box come up on your screen that is to push the slide back to you. You should have received a PDF version before we started today. And this is another way you can save it right to your hard drive.

Once again, this is going to be housed and retained on our website for three years. I encourage you to go download and replay it. But, because I try and respect your calendars, it is right at the 3 o'clock hour on the East Coast. So, we are going to end today's presentation.

And we have at least five to 10 more questions in the queue. So, what I'm going to do  is make sure Jeff gets these questions. And, Jeff, will you follow up directly with people and get the questions answered?

Jeff Holmes: Absolutely.

Dawn Evans: And will you come back and do another one on this? Because you generated more questions than I've seen in a long time.

Jeff Holmes: Absolutely. Thank you very much, Dawn. I really appreciate y'all for having us. Thank you.

Dawn Evans: Well, good. The "y'all"; that's the southern in you. I can hear it.

Jeff Holmes: That's the Atlanta, Georgia.

Dawn Evans: So, folks, I want to welcome you to the webinar series, if you're new today, but please join us again. Week after week we bring you the most exciting topics, from, obviously, fabulous presenters. So, make sure you join us for other webinars. Join us at a regional meeting. If you're in the Silicon Valley tomorrow, make sure you join us there.

If you're interested in going to Changsha, China with us in June, please let me know. All you have to do is get your flight over to China and everything else is covered. And we have a wonderful agenda.

And make sure that when you come to our next summit, you look for Allegis and you have a conversation and pick up the phone and talk to them in the meantime. It's a great group.

So, Jeff, thank you so much for your time, and thank you everybody else for joining us today.

Jeff Holmes: Thank you.

Dawn Evans; Thanks. Have a great day, everybody. We'll see you next week on our webinar series. Bye-bye.

Additional Resources:

Jeff's Article: The M-Word! The Revolution of the MSP and Its New Perception

Allegis Group Service's Blog

‘None of these resumes are a fit.  Are they even listening to what I’m asking for?’

‘I just extended an offer, and the agency’s candidate declined to take a different job.  This is totally unprofessional!’

‘Why is this search taking so long?’

For over a decade in staffing/recruiting I have heard these statements and more.  As days and weeks pass during a candidate search, the frustration mounts.  As the lack of quality submittals grows, your faith in your 3rd party staffing vendors begins to grow with it.  Yes, the relationships between agency and client can be challenging at times.  Working in both the 3rd party and corporate recruiting worlds I have been on both sides of this coin, and have garnered a unique perspective on these trials and tribulations.

As we all know, there are always two sides to every story.  Let’s look back at these questions again from a supplier’s point of view.

Manager: ‘None of these resumes are a fit. Are they even listening to what I’m asking for?’

Supplier’s Response: ‘All I received to begin the search was a general job description from the manager.  I sent over the candidates based on that format.  I have repeatedly asked the manager for feedback to see where/why we are missing to refine my search.  I still haven’t heard back on any of the resumes.’ 

Manager: ‘I just extended an offer, and the agency’s candidate declined to take a different job.  This is totally unprofessional!’

Supplier’s Response:  ‘The candidate was interviewing with the company for weeks.  By the time they finally extended the offer one month later, the candidate had received an offer from another company.  The process took so long that the candidate became unengaged.  We didn’t submit him to any other opportunities, and now we’re out of a placement.’

Manager: ‘Why is this search taking so long?’ 

Supplier: ‘I haven’t sent any new candidates because I never received feedback on the first ones I sent.  We are too busy to be a “resume shop” to our clients.’

The common theme in each of these scenarios is that both parties’ feel like they are not getting what they need to be successful.  In speaking with my clients, and our vendor partners in the past, these issues are the most trying for any organization today.  Every company says that they want the best talent, but are they prepared to do what it takes to ensure that they get it each and every time?  The formula for success is easy, but the path to get there changes the mindset on how business has been done in the past.

The best Third Party Recruiting Agencies are experts.  When fully engaged, they have the ability to empower their clients with the top talent the industry has to offer.  So what’s the secret to being awarded premium talent from your 3rd party vendors?  … Highest bill rate?  … Nope.  … Length of contract?  … Not even close.  The organizations that benefit from their industry’s best talent and best supplier experience all understand one key item; Reciprocation. 

Dictionary.com defines Reciprocation as ‘a mutual giving and receiving’.  As with any successful relationship, business or personal, reciprocity is critical for long term success. If one party puts in less effort than the other consistently the relationship can, and will, fail.  This is the most common breakdown between any partnership; especially those between third party recruiter and hiring manager.  

There are three easy tips to ensuring a successful allegiance between manager and agency that each company should consider before engaging in any search.

1. Your time is not more important than the candidates’ or agencies’ time.  Surprised?  Long gone are the days of the elitist attitude in hiring.  The approach of ‘I have the power, because I have the job’ is a sure way to ensure that the agency will not send you their best.  You might get lucky a time or two, especially in the beginning or depending on the search, but long term if your company has this approach most established vendors will stop supporting them. 
   
   As a third party recruiter, my best candidates always went to my most engaged client’s.  This practice made us both look good to the candidates, and ultimately to each other.  A professional hiring process also ensured that I would receive referrals for both jobs and people.  Referrals are manna in recruiting and are vital to ensuring successful long term business growth for any agency/recruiter. 
2. Communication isn’t just key, it’s critical.The second biggest threat to a successful recruiting process is a failure in developing a successful communication plan between manager and agency.  Nothing frustrates a vendor more than daily calls requesting feedback from their candidates on an interview, and they can say nothing because they themselves still do not have feedback.  This makes the client look bad, and the vendor look worse.  If a client cannot offer regular, detailed feedback on agency submittals/ interviews, suppliers will stop supporting them.  A vendor’s time and reputation in the industry are too valuable to jeopardize their business on a client who would not afford the decency to provide feedback after they had invested time and effort on their work; regardless of who that client is.  Remember most agencies work on a contingent basis and only get paid once a placement is made.  What is their motivation to stick it out with a manager or company who can’t communicate in a timely manner, or at all?
3. Streamline your interview process. With the economy taking a turn for the better, job opportunities are increasing in many markets across the globe; creating more competition for the available passive and active talent pools.  Delaying the interview process, or indecisiveness on who to hire, can be detrimental to a manager’s ability to fill his/her job by creating an environment where a candidate becomes unengaged or even accepts another opportunity.  Any reputable third party agency will not create an environment of competition for their candidates between their clients, but ultimately they have no control over the candidate, or another agency, pursuing other opportunities during your interview process.
   
   Keep your process clearly defined from the beginning so that the agency can share this with the candidate before interviewing to set the stage, and lay out expectations.  Stick to this process whenever possible, and make sure that you keep lines of communication open during the interviews to avoid fall off.  Do this and your supplier’s will break their backs to ensure that the candidate stays with you and doesn’t take another opportunity.   

In my experience the companies who follow these steps consistently receive the best service, lowest prices, and highest candidate quality across the board.  When a supplier feels engaged and informed they will do what it takes to win for their clients time and time again.  It seems simple enough, but I’m continually amazed at how infrequently this level of partnership takes place in business today. 

‘I don’t have the time to hand-hold my vendors.  I thought they were the experts’.

Allowing consistent communication flow and establishing defined processes/timelines will eventually save the manager even more time by streamlining the practice of hiring.  This will only empower the experts to be successful on your behalf.   It’s your business, and if you want the best you have to build a partnership with your suppliers.  Reciprocation is the simple secret to ensuring your company consistently obtains the best talent from your staffing partners; every time.

 Considering a Managed Service Provider (MSP) is a great avenue for companies to help establish best practices, build efficiencies, and hold both manager and supplier accountable to the service level agreements established with their talent model.  As the liaison between supplier and client company, the policies and practices that are put in place allow an environment where each side feels empowered to be successful without feeling overwhelmed or over worked. 

Jeff Holmes works with Allegis Group Services as an MSP Program Director for the world’s largest hotel group.  An 11 year veteran of both the staffing and corporate recruiting worlds, he has spent the past 6 years with Allegis Group in a variety of capacities. Click here to find out more about Jeff.