Issue link: https://www.e-digitaleditions.com/i/131821
MSP will compel world-class organizations to seek out workforce solutions Siemens is still struggling with the problem, but the future looms providers to help develop their talent pool." brighter—Randstad Sourceright is currently building the infrastructure to assist Cutrell with the insight he seeks. "We have an existing The need for a total workforce solution is no longer just an HR application we own the license for, called Fieldglass, and we worked concern—it now commands the attention of the C-suite, says Rivera. "If with Sourceright to modify the tool to better procure and manage you go back a bit, MSP caught on pretty quickly as a way to outsource the contingent labor services that are arranged through SOW, as well management of clerical work, then light industrial, then more higher- as independent contractors and specialized talent pools. As our MSP level professional work," he explains. provider, Sourceright is responsible for the configuration of the app." Now this work is more and more strategic in nature, which has upped The upgraded tool is being slowly incorporated across the organization, the ante. "MSP was very transactional in the beginning and then as starting first with IT, then HR and engineering. Says Cutrell, "It's a pilot it became more strategic, it caught the interest of CXOs, particularly right now with custom demos. The ultimate goal is for me to have one the CFO, who recognized this growing spend that was going on in portal within Siemens to see all the statements of work going through procurement," Rivera explains. the system—both front end and back end reporting coming out of a single platform." He anticipates the tool will be fully rolled out across He calls this recognition an 'a-ha! moment' for finance. "Their strategic antennas went up—now that procurement was more involved, they wanted to know how to strategically manage this part of the workforce. They saw the risk of managers hiding headcount and spend in these SOW contracts. If procurement is spending all this money, were they leveraging it, too? That became the big question driving the call for improved management." the enterprise in two years. A Worldwide View? While SOW services on the domestic front are becoming more readily available, similar services and their utility across the globe are considered problematic. Although more companies are "talking about the need to capture the spend and mitigate the risks" associated with SOW globally, Creech says "We're just not there yet." Creech posits an array of other what-if risks that popped up on the radar at the C-suite. "What if procurement contracts with a company to produce some sort of work product, and the company is not financially viable?" she says. "Or what if this company, it turns out, is not able to indemnify the work it's performing? Or what if, for whatever reasons, procurement has not managed the contracting process to ensure that the company's intellectual property is truly protected?" There are also regulatory risks that must be considered. For example, under recent final rules to the Health Information Technology for Economic and Clinical Health (HITECH) Act governing data breaches, SOW companies are considered business associates, and are thereby required to comply with the requirements of the security and privacy rules of Health Insurance Portability and Accounting Act (HIPAA). She elaborates: "Imagine how hard it is right now to capture all this in a kind of `Wild West' place like the United States alone. Now imagine if you apply that same level of complexity across even a dozen countries— all with their own decision-making processes, sourcing mechanisms and varying talent and skill shortages that drive the work toward SOW labor in the first place." Nevertheless, Creech notes that there are "pockets" where this is occurring—in Western Europe, Australia, New Zealand and Singapore. "But, we're really talking about the adolescent stage of development," she quickly adds. "To say we as an industry have mastered the ability to procure every type of project or deliverable-based labor around the world is impossible." Rivera has a similar view. "Globally, things are slow, but picking up a Under the rules, external parties must implement "reasonable and bit in Europe," he says. "MSP in general has been a cultural shift for appropriate policies and procedures" that incorporate administrative, many countries—they really didn't understand a lot of what we were physical, and technical safeguards securing electronic medical records all providing. We seemed like some third party in the middle. … Some in transit and in storage. If such companies inadvertently or maliciously countries have had a hard time warming up to the idea of MSP, and this cause the release of personally identifiable information, the employer will probably slow down the adoption of SOW work." is liable. Further impeding a global view of the total workforce is the varying At the state level, regulators also "are much more active now in their contract and employment laws dotting the landscape and adding pursuit of wrongdoing, as related to worker classification," says Creech. woefully to the overall complexity. Browne, for instance, says she is "It used to be that companies in past only feared the IRS in this regard, "curious how one can drive global compliance in SOW work in a MSP but now the states all have these auditing bodies, are upgrading their tool. It's just so complicated." investigations and increasing enforcement." The stricter compliance has compelled companies like Siemens to quickly get a handle on just who is working for them. "In the past, had I asked the business units across the company who were our suppliers, Rivera remains optimistic, however. "When this does happen more, it will likely be on a country by country basis, with the MSP in Australia running it there and the MSP in India running it there," he says. "The world is always getting smaller." how did we pay them and what was the focus of their work, they couldn't tell me," Cutrell concedes. "You can't have a strategy around cost if you can't measure what the costs are." [12] HRO TODAY MAGAZINE | APRIL 2013 Russ Banham can be reached at www.russbanham.com