moving your contingent workforce program from tactical to strategic

© PeopleFluent 2014

Presented by John Moore, CCWPJohn.moore@peoplefluent.comwww.peoplefluent.com

PeopleFluent

Moving Your Contingent Workforce Program from Tactical to Strategic

© 2014 PeopleFluent

• Leader Human Capital Management• In over 5,200 organizations• 214 countries and territories• 80% of the Fortune 100• 170 VMS customers• $7B managed spend

About PeopleFluent

© 2014 PeopleFluent

• CW program maturity• Diagnosing where you are• Strategies to address issues• Building a program roadmap• Identifying cost savings

Agenda

© 2014 PeopleFluent

CW Program Maturity

Ad hocManualNo processNo SLAsToo many suppliersNot enough suppliersNot repeatable

TacticalAutomatedTransactionalProcess Focus on efficiencySupplier rationalizationFocus on costFocus on hourly workers

Managed

IntegratedHigh use of metricsFocus on complianceFocus on qualitySuppliers are rotatedProgram SLAsServices Procurement*

Strategic

EmbeddedBusiness FocusEnterprise SLAsAnalyticsTotal VisibilityTotal Workforce

QUALITY – COST SAVINGS – EFFICIENCY – COMPLIANCE

© 2014 PeopleFluent

CW Program Maturity Paths

Ad hoc

Tactical

Managed

Strategic

VMS IMPLEMENTATION

SOW

EXPANSION

INTEGRATION

WORKFORCE MANAGEMENT

TIME

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• Skillset• Technology• Process• Finance• Staffing industry• Market prices• Procurement• Contracts• Excellent people skills

CW Program Management

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• Identify the issues• You might already know some of them• Survey• Executives• Hiring managers• Suppliers• Functional areas

Diagnosing Your Program

QUALITY – COST SAVINGS – EFFICIENCY – COMPLIANCE

© 2014 PeopleFluent

• First, look outside of the technology• Organizational structure• Lack of support• Executives• Business managers• Hiring managers• Functional areas

• Entrenched suppliers

Diagnosing Your Program

QUALITY – COST SAVINGS – EFFICIENCY – COMPLIANCE

© 2014 PeopleFluent

Diagnosing Your Program

Issue Cause Possible Solutions

Candidate Quality Suppliers ScorecardsRationalization

Candidate Quality Non-specific requisitions Detailed templates

Hiring mangers don’t use the VMS

Too difficult Training

Hiring mangers don’t use the VMS

Takes too long Workflow

Hiring mangers don’t use the VMS

No internal policy Executive, management support

Create an Issue Log

© 2014 PeopleFluent

Requisition Management• Templates• Workflow• Approval

Offboard & Evaluate• Facilities & Logistics• Notifications• Worker Evaluation

Source• Vendor Distribution• Rate card

Billing and Invoice• Consolidated invoice• Adjustments• Financial Integrations

Payment Management• Time, Expense• Approvals/ notifications Compliance/Onboarding

• Facilities & Logistics• Compliance Items• Electronic Notifications

Engage• Cost Allocations• Tenure Control• Budget Management

Select• Qualification• Candidate Ranking• Interview Scheduling• DNR / Duplicate

Screening

Analytics

Program Workflow

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Diagnosing Issues

Quality of Candidates

SupplierTraining

Scorecards / SLAs

Rationalization

RequisitionTraining the HMs

Build templates

Screening Who’s responsible?Adjust the process

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Diagnosing Issues

Efficiency

SystemIntegrations

Workflow

Notifications

ProcessExceptions

End-to-end

Common

Training Hiring managersSuppliers

A

B

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Diagnosing Issues

Compliance

SystemNotifications

Reporting

Workflow stops?

ProcessPolicies

Who’s responsible?

Auditing

Training Functional areasSuppliers

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Diagnosing Issues

Cost Savings

SystemRate card

Markups

Market rates

SupplierScorecards

Contracts

Comparison rate data

ProcessNegotiationExceptionsPre-identified

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Cost Savings AreasCategory Detail

Benchmark rate cost savings

Compares a defined benchmark rate / mark-up vs. the actual engaged rate / mark-up over a defined period of time to show the reduction

Negotiated Savings • Requisition-by-requisition negotiated rate savings • Conversion savings / discounts (i.e., right hire savings)• Volume discounts based on ascending spend thresholds• Prompt pay / early pay discounts• Tenure discounts• Payrolling savings• Renegotiations • Rebates to client• Reduced OT rates• Decreased per diems

© 2014 PeopleFluent

Cost Savings AreasCategory Detail

Hard Cost Savings • Tangible bottom line reductions • Saved money from budgets • Target reduced supplier count per category and region• Capture rogue spend due to lack of global visibility• Automate financial approvals / provide governance• Rationalize job descriptions to establish rate cards

• Total cost management• Pay rate band usage• Combination mark-up and bill rates• True market comparison

• Normalize rates based on third party benchmarking• Introduce competition though supplier neutrality / manage

bid processMetrics • Track cost savings (clearly defined and standardized)

• Improve processes (measurable cost reductions)

© 2014 PeopleFluent

Cost Savings AreasCategory Detail

Reduced SG&A expenses

• Operational efficiencies improved (decreased costs to manage contingent labor)

Decreased cost of ownership

• Shared Managed Services / VMS allow managers to focus on your business• Consolidated invoice

© 2014 PeopleFluent

Soft Cost Savings AreasCategory Detail

Mitigate Risk • Mitigate risk through co-employment management • Reduce financial exposure due to worker misclassification;

manage on a per country basis• Track licensing and certifications for expirations• Establish tenure rules across various worker types and in

accordance with local regulations• Reduce invoicing / payment errors• Periodic audits to identify risks and opportunities for

corrective action Administrative Cost Savings

• Invoice processing• PO processing• Payment processing• Time savings (e.g., invoice processing time) • AP invoice audit savings based on the avoidance or credits

on overpayments to supplier

© 2014 PeopleFluent

Soft Cost Savings AreasCategory Detail

Process Improvements

• Cycle time improvements• Candidate quality improvements• Reduced reporting administration• Consolidated invoice and payment process• Elimination of invoice errors

Soft Cost Avoidance Savings

• Reduce cycle time to fill• Outsource process (invoice / payment, contracts admin,

onboarding) to free procurement, AP resources• MSP or SMS governance programs reduce HR, legal and

procurement resources• Comprehensive reporting to drive continuous program

improvement

© 2014 PeopleFluent

Diagnosing Issues

Other Areas

Program Adoption

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• A roadmap is a process to aid in integrating business and technology

• A dynamic plan• It describes where you want to be and how

you are going to get there

The Strategic Roadmap

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• Characteristics• Goals• Timelines• Actionable steps• Interdependencies• Alternate routes

Creating Your Roadmap

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• Goals need to be• Specific• Measurable• Realistic• Time-bound

• “Expand VMS to capture 90 percent of Admin category within corporate by end of year.”

Creating Your Roadmap

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• How to Begin• High-level sponsor with a vision• Leadership support• Identification of stakeholders• Analyze gaps• Set goals• Build a plan

Creating Your Roadmap

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• Identify who you need• IT• Procurement• Human Resources• Legal• Business managers• Functional managers• Executives• VMS/MSP/SMS

(optional)

Creating Your Roadmap

© 2014 PeopleFluent

Discovery

Business Objectives

Functional Needs

Business Processes

Improvements

Drivers

Governance

Recommendations

Targets

Guidelines

Initiatives

Organizational

Functional

Communication

Process

Technology

Execution

Prioritize

Set Timelines

Create Projects

Creating Your Roadmap

© 2014 PeopleFluent

Creating Your Roadmap

© 2014 PeopleFluent

• Put the issues, solutions and roadmap into a business case

• Present to the stakeholder committee• Work the roadmap• Rebrand and relaunch• Start the road show

Begin Your Journey

© 2014 PeopleFluent

Contact Me

John Moore, CCWPJohn.moore@peoplefluent.com

Thank You