Issue link: https://www.e-digitaleditions.com/i/149047
Contingent Labor Many MSPs have greatly expanded their benchmarking services to address quality and efficiency. In these regards, they developed an array of performance metrics, from how quickly a supplier provided job candidates to how quickly the hired contractors finish their assignments. others. The process seeks to identify best practices that can then be leveraged to improve performance. "Think of benchmarking as a quality improvement tool to better understand what you're doing, how you're doing it, how other organizations go about their business, how well you're doing compared to these other organizations, and where improvements can be made," says Elliot Owens, vice president of business analytics at Volt Consulting Group in New York. "The managed service world has for so long been laser focused on cost and risk efficiencies—today these are expected," explains Andrew P. Zarkadas, managing director of strategic client solutions for Guidant Group. "Quality of hire metrics would include time to fill, replacement ratios, and most importantly, performance feedback driven through our customer satisfaction surveys. The increased focus on quality indicates that HR and talent acquisition executives are paying attention which is a critical lever to the long term success of a managed service program." Most organizations were doing just that until a little more than a decade ago, when the concept of managed services gathered steam, and providers came on the scene to watch the store. Initially, the focus was on the rates charged for hiring contractors—the bill rate, pay rate, or markup. "An organization hiring light industrial workers in Boise, for instance, would want to know whether it was paying above or below average rates," Owens says. "They'd want to know if the rate was fair, was there room to negotiate it downwards, and were there other suppliers that could provide a better rate. That's where clients started off." For companies like IMS Health, the benchmarking services are crucial. "We're part of TPG Capital and are among the more than 30 other companies in their portfolio, and we benchmark each other to be sure we have the right talent at the right pay on the ground in the right locations," says John Ure, director of strategic sourcing at the Parsippany, NJ-based healthcare analytics company. Finding the best suppliers of this talent and managing them is not even remotely easy, he adds. "That's why we rely on Yoh to manage all the different relationships from the lower levels to high levels," Ure says. "There is great strategic value in this—they help us look out 18 to 24 months to understand how we should be evolving according to the market's evolution. With the Affordable Care Act, for instance, this service has been particularly helpful. We have a strong sense now of what this will do to our rates, the mobility of our workers, and the strategic changes necessary with regard to our hiring practices for both variable and fixed labor." No Splinters on the Bench Benchmarking, of course, is simply the comparison of one organization's practices and performance against those of [44] HRO TODAY MAGAZINE | JULY/AUGUST 2013 If an organization is not benchmarking, he adds, "You can't measure what you're doing and compare it to something, which then makes it very difficult to understand where you need to make necessary adjustments to improve your program. If you don't have that data, you can't begin to address performance improvements. You're flying by the seat of your pants." Since then, many MSPs have greatly expanded their benchmarking services to address not just bottom line costs but also quality and efficiency. In these regards, they developed an array of performance metrics, running the gamut from how quickly a supplier provided job candidates to how quickly the hired contractors finish their assignments. "We benchmark metrics like resume submittals to interview, resume submittals to engagement, manager ratings of a contractor's work, and end of assignment factors—was the person terminated because the contract was over, there was no more money in the budget, the performance was sub par, and so on," Owens says. For Guidant Group, the purpose of the firm's benchmarking services is to discern a client's talent needs and to create future pipelines in the various geographic locations in which they operate. "We used benchmark services to allow our clients to make educated decisions on how they operate their businesses," notes Zarkadas. "Too often, benchmarking services have been associated with cost savings initiatives. However, we are seeing them used in more strategic ways. The top reason