The rise of the contingent workforce has made day-to-day workforce management increasingly complex for HR and procurement departments. Could working with a Managed Service Provider (MSP) be the answer?
Businesses across the globe are experiencing uncertainty. Whether it be increasing skills gaps, market pressure, or technological disruption, driving consistent business growth has never been so challenging. But one business trend that looks set to stay is the rise of a dynamic, flexible contingent workforce.
In Deloitte’s Global Human Capital Trends report, only 42% of 11,000 respondents reported that their business was primarily made up by permanent employees. Meanwhile, 50% were using a significant number of contracted workers, 23% were using a significant number of freelancers, and 13% of businesses using a significant amount of gig workers.
This new, flexible workforce is, of course, a double-edged sword – especially for HR leaders. While greater flexibility allows businesses to adapt to changing needs, it also vastly increases the complexity of managing an unstable, shifting workforce.
HR experts are employing a number of tactics. Some are utilising existing in-house technology services, some are seeking to increase collaboration between HR and procurement, but many are resigned to dealing with the increasing pressure head-on.
Adjacent to this, we are also seeing a significant increase in the utilisation of Managed Service Programmes. Market analysis by Statista indicates that the global managed services market is expected to grow to US$296 billion by 2023 – a 70% increase from 2018.
So what are the drivers behind the expected growth, and what are the fundamental business advantages of working with a Managed Service Provider?
Benefit 1: Time, resource and cost efficiencies
When a business outsources its contingent workforce management to a Managed Service Provider, HR teams find themselves with more time on their hands. While some senior managers may see a reduced workload in a negative light, the reality is HR finds that it is easier to focus their time and skills on activities which have greater value to their business.
Businesses that work with Managed Service Providers also experience significant cost efficiencies. With predictable pricing models, outcome-based pricing, reduced third-party recruitment fees and a more strategic approach to staffing, MSPs are proving to be hugely beneficial for organisations adapting to the new world of work.
Benefit 2: Workforce agility
Managed Service Providers not only enhance efficiencies, but they also facilitate greater agility within an organisation. With digital transformation coming in often unexpected waves, it’s important for all businesses, in almost every sector, to be able to react to a changing market. MSPs ensure that a business can attract the right talent, at the right time, even in highly competitive environments.
Benefit 3: Access to the latest recruitment tech
Implementing technology in an organisation is expensive, especially when it comes to recruitment tech. It’s not surprising to see that most businesses aren’t willing to invest millions of pounds in technology that only has one purpose. For most, they’re not commercially viable. But by engaging with a Managed Service Provider, a business can access the latest tech without making huge technology investments.
Why? Because a Managed Service Provider is able to focus all of their attention on technology that is only applicable within their specialisms. Though no two MSPs are the same – a business should look at multiple options when deciding on the MSP that is right for them – a Managed Services solution can enhance an organisation’s data analyses capabilities and ensure that their workforce is fully optimised.
Benefit 4: Global reach
For large organisations, accessing talent worldwide can be an issue – especially when expanding into new, unchartered territories. Managed Service Providers that operate on a global scale have the capabilities to attract, onboard and retain the best staff across multiple domains.
Another advantage is that global Managed Service Providers ensure that all contingent labour hired complies with local laws and cultural norms. Even the most developed businesses can struggle in this regard, so handing over to the experts can save an organisation time, money and potential legal damages.
Benefit 5: Industry knowledge, expertise and insight
As a business, you know your industry inside out. Unless your industry is workforce solutions, however, the chances are that your specialist knowledge doesn’t stretch to the complex working world. If you work in HR, you’ll likely have some knowledge, but working with a Managed Service Provider means you’ll be able to harness its years of experience working exclusively on attracting, hiring and retaining talent.
In addition, your Managed Service Provider will have accrued knowledge across multiple sectors while working with other clients. This deep, cross-sector intelligence allows an MSP to understand great swathes of the market, ensuring that they can build deep talent pools packed with contingent candidates who can enter your business and drive positive change – both culturally and economically.
To sum up
Working in partnership with a Managed Service Provider carries a whole host of benefits for a business – especially those that want to operate effectively in an increasingly complex talent market.
The world economy is in flux and the way people want to work is evolving, but by acquiring an MSP solution, you can ensure that you have all of the knowledge, technology and industry expertise in place to make sure that your business succeeds – even if the odds are stacked against it.