Are you ready for a Managed Service Program (MSP)?
Joel Forrester

4 minutes

Are you ready for a Managed Service Program (MSP)?

If you’re to invest time and money into sourcing a contingent workforce solution, you need to know that your business will realise the benefits of an MSP.

In recent years, we have seen huge growth in the number of flexible workers in the global marketplace. That trend is unlikely to change, especially as businesses seek to increase their agility in light of an ever-changing, ever-unstable economic outlook. Likewise, Generation Z and millennials are more likely to demand flexible, contingent work than previous generations.

With a bigger, more complex contingent workforce, it’s little wonder that businesses are considering an MSP as a viable option.

Indeed, for large organisations, MSP makes complete sense. Having experts to focus on attracting difficult to find talent, managing legislative complexity while simultaneously saving costs is clearly beneficial. But for smaller organisations or those with a predominantly permanent workforce, an MSP is unlikely to be the best solution.

An MSP manages your contingent workforce

In our industry, acronyms are equally comprehensive and confusing, particularly for the unaware. The term MSP is even more confusing in that it’s also an outsourced solution (though different in makeup) in the IT industry. But the MSP we’re talking about here is specifically a recruitment outsourcing solution that manages your temporary workforce.

What is MSP? | Take a closer look at managed services 

Managed service programs suit businesses with a large temporary workforce best

An outsourced workforce solution is a significant commitment. Even for billion-dollar global enterprises, it can take upwards of a year to confirm your requirements, engage potential providers, choose a suitable partner and implement the program. For this reason, it can lead to HR and procurement professionals questioning whether an MSP is the best solution. But the business value which can be unlocked — both operational and financial — is significant.

For some businesses, however, an MSP may be the wrong choice. If you don’t use a significant number of contingent workers (and we're talking about dozens in a key location or hundreds/thousands across your wider business) you might achieve better value sooner with a smaller-scale solution.

Before deciding to pursue an MSP, you should ask yourself the following questions:

  • Is your contingent workforce becoming more complex?
  • Are you using more contingent labour than you have done previously?
  • Do you have concerns about the compliance of your temporary workforce?
  • Is having visibility of contingent workforce spend throughout your business a challenge?
  • Are you struggling to find the talent you need to drive business success?
  • Does recruiting and managing contingent workers distract your managers from their core priorities?

If your answers to any of these questions are a firm ‘yes’, then the chances are, an MSP solution could be the right one for you. If not, it may be worth considering other options.

You need buy-in from senior stakeholders if MSP is going to be a success

For MSP to be successful, you will need the support of senior stakeholders to help drive the initial implementation of the MSP solution. If you listen, understand their problems and present an effective potential solution, getting the buy-in for an MSP solution should be relatively seamless. But you should always get buy-in before going to market either with an RFP or a more informal evaluation process.

Is an RFP always the best option? | Read our latest insight to find out

An MSP is not just cost-savings, it needs to align with your company culture

As with any key strategic investment, deciding whether to partner with a managed service provider (yet another use of the MSP acronym!) should not be a decision taken lightly. For it to be worthwhile, it needs to provide a business with measurable impact. Though in years past, only assumed to only bring cost savings, a well-designed, well-implemented MSP can produce a number of other significant benefits. 

Procuring an MSP solution isn’t always about saving money, it’s often about building partnerships that help to grow your business long-term — saving money, or spending it better, should be a given if your program and partner are in sync. It’s also about working with a partner that closely aligns with your core company values, that understands your business, and becomes an extension of your existing teams.

A hands-off supplier management approach is, of course, an option. But if you want to attract, retain and engage your contingent talent, the partner managing them needs to be closely aligned with what you believe in as a business. Without this, the friction between your permanent and contingent talent could lead to high attrition rates and low productivity — the two scourges of modern business.

There are also an increasing number of workforce solutions providers who build their business on a tech-focused approach, where the tech does the work, and the human element is forgotten. For some, the attraction of AI and machine learning will be enough. But for others, a relationship will need to be built on honest conversations, and face-to-face feedback.


An MSP is more than just a solution, it’s a partnership


When you’re assessing potential MSP partners, make sure that it’s one you, your senior leadership team, your procurement and your HR functions will all want to work with. These relationships lead to greater understanding and honest conversations, ultimately driving long-term success for your business.


And finally, lean on your chosen partner's expertise to help build your business case. If you answered 'yes' to some of those questions above then there's clearly a case to be made for an MSP. But to make sure that your decision lands correctly with each stakeholder group, utilise the knowledge and experience of your partner.


To find out more about how an MSP provider could benefit your business, download our handbook



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