Tuesday, Nov 13 2012

End User Feedback on VMS/MSP Implementations in the Enterprise

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Many large enterprises and nearly 60% of the Fortune 1000 have turned to VMS (Vendor Management Systems) implementations with a Managed Service Provider (MSP), usually a large national or global staffing firm, to help manage their contingent workforce and supplier base.   While the “cost savings” pitched by the MSP are appealing on the surface, the hidden costs of the implementation are rarely taken into consideration prior to the system being implemented. While these systems can help companies with many aspects of managing their contingent workforce, 63% of companies report a negative or at best neutral experience with the implementation. As most of these VMS programs run by third-party MSP’s, these systems do not have the capability of sorting qualified candidates from unqualified ones to fill the company’s specific requirements. This means hiring managers experience a dramatically increased workload sorting through an abundance of resumes, and dramatically increased time to fill critical requirements. Frequently compounding the problem, many MSP’s rules of engagement don’t allow suppliers to communicate with the hiring managers, leaving suppliers in the dark about valuable feedback necessary to fill the role, and end users continue to be inundated with unqualified candidates.

From wasting managers’ time sorting through unqualified resumes, projects being put on-hold due to talent constraints, to increased administrative burden placed on high value personnel, the hidden cost of this inefficiency is substantial, quickly diminishing the cost benefit to the company. When calculating the cost of wasted management personnel’s time and increased fill time for critical roles, cost savings can quickly dissolve. Once you take into account other these other key factors, VMS implementation can become a hidden profit drain, especially considering that longer recruiting cycles result in long hours worked, increased administrative burden, and less work: life balance of your key personnel leading to higher turnover rates, decreased productivity, and less employee engagement.