Based on Staffing Industry Analysts’ Lexicon of Global Workforce-Related Terms.
As with many industries, the workforce solutions industry uses a lot of terminology that can confuse even experienced contingent workforce and resourcing professionals. A lack of common definitions can make life difficult, particularly when it comes to communication between industry professionals, suppliers and clients. To help minimise these problems, we’ve outlined the top terms most commonly used across the workforce solutions ecosystem.
Whilst these terms can vary between sectors and countries, or have different definitions depending on who you speak to, we’ve referred directly to the definitions provided by Staffing Industry Analysts (SIA), the Global Advisor on Staffing and Workforce Solutions, meaning that the following terms are applicable across the board. This guide should be useful for both new and existing workforce management professionals, wherever you happen to be working across the globe.
Though this is no way a legal document, it should offer the guidance needed to traverse the world of workforce solutions with ease.
Definitions of the key workforce solutions industry terms
Applicant tracking system (ATS)
An ATS is a software application that enables the electronic handling of corporate recruitment needs. Most incorporate a company website, enabling companies to post jobs onto their own website, as a way to attract candidates. The ATS solutions store candidate data inside a database to enable effective searching, filtering and routing of applications. Certain vendors use a different description for ATS software, such as talent management software (TMS), candidate management system (CMS) or recruitment management system (RMS). ATS is often used to underpin a recruitment process outsourcing program. There is a separate type of ATS which acts as a module within a staffing firm front-office software solution. However, these products are normally sold by different vendors with functionality to meet the workflow requirements of staffing firms rather than corporate recruiters.
Work arrangements that differ from regular/permanent, direct wage and salary employment. Contingent work and workers are primarily distinguished by having an explicitly defined or limited tenure. Contingent workers include temporary employees provided by an outside staffing agency and independent contractors/consultants. Contingent workers may also include temporary workers from an internal pool, and others (such as summer interns, seasonal workers, freelancers, “crowd-sourced” workers, etc.) employed directly by an organisation for an intentionally limited time period. From an employer point of view, contingent work also includes statement-of-work (SOW) consultants who work for the company on a short-term basis. The “contingent worker” label applies to all workers of any skill type or experience level who meet this definition, including those in professional, blue-collar, or office/clerical roles.
Customer Relationship Management (CRM)
Software that enables users to track and manage customer or prospect contacts and information centrally. Ideally, all customer contacts are captured by the system and then made available to the organisation through pre-defined or ad-hoc reports.
Freelancer Management Systems (FMS)
A technology platform that enables users to access a defined (often private) pool of individual workers (not staffing vendors) and activate, manage, complete and pay for their work on the system. Vetting, curation, compliance, and creation of talent pools are typically core functions of the technology.
MSP (Managed Service Provider)
A service whereby a company takes on primary responsibility for managing an organisation’s contingent workforce program. Typical responsibilities of an MSP include overall program management, reporting and tracking, supplier selection and management, order distribution and often consolidated billing.
An individual who provides services/skills to an organisation but is not providing those services/skills in a permanent job/role. Example of non-employees can be temporary workers, independent contractors, consultants, outsourcing provider staff, SOW workers, etc.
The process of bringing a worker into a position with a goal of providing all necessary tools to be productive as soon as possible. On-boarding can apply to permanent hires as well as contingent workers. May include training, seat assignments, equipment requirements and other steps. Many Applicant Tracking Systems (ATSs) and Vendor Management Systems (VMSs) include on-boarding functionality.
RPO (Recruitment Process Outsourcing)
The partial or full outsourcing of the internal recruitment function to a third-party specialist provider, which serves to provide the necessary skills, activities, tools, technologies, related recruitment supply chain partners and process methodologies to assume the role of the client’s recruiting department.
SOW (Statement of Work)
A document that captures the work products and services, including, but not limited to: the work activities and deliverables to be supplied under a contract or as part of a project timeline. A SOW consultant is any consultant performing work on a project under a Statement-of-Work (SOW) arrangement.
Staffing or recruitment firms are referred to as suppliers by some contingent workforce buyers (whether hiring organisations or VMS/MSP entities).
Vendor Management System (VMS)
A service segment of the Talent Acquisition Technology Industry. A VMS is an Internet-enabled application that acts as a mechanism for business to manage and procure staffing services through third party staffing suppliers (temporary help as well as, in some cases, permanent placement services) as well as outside contract or contingent labor. VMS systems now often include the management of Statement of Work (SOW) consultants and outsourced services within their scope of coverage. Typical features of a VMS include supplier management, order distribution, consolidated billing, risk mitigation, headcount tracking and significant enhancements in reporting capability over manual systems and processes.
Passive and active sources of talent who are selected based on common interests, location or skills who are potential targets for the sourcing of future candidates.
Total Talent Acquisition: An emerging model of talent or workforce management that includes an organisation’s management of “permanently hired” workers as well as “contingent” workers.
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Alternatively, for more information and insight from Staffing Industry Analysts, including their global Lexicon of terms, please visit Staffing Industry Analysts.