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© 2015 Cra in Communications Inc. All rights reserved. October 21-22, 2015 n Omni Dallas Hotel

Concurrent Session: Technology

Thought Leadership — PeopleFluent:Demystify SOW Adoption — Build yourRoadmap to Implementation Success

Speaker:

John Moore, Senior Solutions Consultant, PeopleFluent

WEDNESDAY 1:30 – 2:30 PM DALLAS F

Sponsored by:

© PeopleFluent 2015

Demystify SOW AdoptionBuild your Roadmap to Implementation Success

October 2015

© 2015 PeopleFluent

• Leader Human Capital Management

• In over 5,200 organizations

• 214 countries and territories

• 80% of the Fortune 100

• 190 VMS customers

• Over $7B managed

About PeopleFluent

4© 2015 PeopleFluent | Confidential Services Procurement

• Services Procurement / SOW

• SOW deconstructed

• How to assess what you have

• Creating a foundation for your program

• Build a winning team

• Executing your roadmap

Agenda


• Within VMS industry, SOW spend under management has grown 74% since 2012*

• Savings potential for SOW-based spend is 10 to 20 times higher than staff augmentation

The Growth of VMS/SOW

*Staffing Industry Analysts, 2014 VMS and MSP Landscape


• It’s where the money is

• 3 to 5 times larger than staff augmentation

• Significant cost savings

• Visibility

• Where is the money going?

• Who spent it?

• Did we get what we contracted for?

• Was it budgeted and/or approved?

Why the Interest in SOW


SOW-based

Skill-based

Medium to high risk

Spend management

Services

Consultants

Specific expertise

High risk

Compliance management

Independent Contractors

Staff Augmentation

Transactional

Low risk

Supplier management

Temporary

Broad View of Contingent Workforce


SOW Landscape

SUPPLIERS

$

10 to 15% of spendLargest number of transactions

15 to 30% of spend

Strategic/Consulting ServicesIBM, Big 4, ERP

Tactical ServicesSupport & Operational Contracts

Discretionary ProjectsIT, Niche Suppliers, ICs


• Consolidated Invoice Processing

• No invoice reconciliation

• In-system proposal review

• Release invoice within VMS

• Project visibility

• % vs. budget• Resource visibility

• Current & Future spend

• Supplier performance

• Resource onboarding/offboarding

• IC deliverables

• Tenure management• Approval management

• Audit ability

• Pre-negotiated rates

• Competitive bidding

• Fixed price vs T&M

• View hourly effective rates• Manage to budget

Cost Savings

Compliance

EfficiencyVisibility

Value of SOW through a VMS


Assess

Map the Process

Take Inventory

Categorize

Define

Goals

Categories

Standards

Compliance

Build

Committee

PMO

New Process

Execute

RFI/RFP

VMS/MSP

Change Management

Create a Foundation


• Initial request to payment

• Note the system interactions

• Note the manual steps

• Approval steps

• Documents

• Variations

Map the Process


Current Process Flow

Pay workers

Candidate

interviews

coordinated

via email

Submit top three

candidates and

pricing

Receive requisition

Submit time and

expenses through

vendor systems

Candidate

becomes engaged

Hiring

Manager

Vendors

Candidate

Manager

Identifies need,

Candidate is

vendor sourced

Candidate

engaged

Send requisition to

vendors via email,

sorted by category

MSP confirms

position, job

description, funding

(HRIS)

MSP manually

forwards the three

required forms via

email

Manually approve

time and expenses

Manager manually

fills out

three required

forms

Create

requisition in

multiple

systems

Payment to

multiple

vendors

Generate

invoice and

reporting

Timesheets

generated

Distribute

requisition to

vendors by

email

Obtain cost

center/budget

information

Manager reviews

candidates,

determines

interviews via email

Interviews

conducted

Candidate

selected

Candidates

screened and

ranked

Multiple emails per

order

Candidates

selected for

interviewsResume review

Candidate

engaged/pre-

engagement items

completed

Candidate begins

work

MSP

MSP follows up

with manager via

email


Independents

• IC (1099)

• Small supplier

Projects

• Fixed price

• Milestone

Services

• SLAs

• Fixed length

Categorizing SOW Spend


Offshore

• Projects and/or labor

• SLAs

Business Process Outsourcing

• Entire functional areas

• Category

Corporate Consulting

• C Level

• Large dollar transactions

Categorizing SOW Spend


• Active projects, ICs and service contracts

• Sort into groups

• Identify your categories

• Examine contracts

• Examine SOWs

• Look for SLAs

• Inventory the suppliers

• Sort and categorize

Taking Inventory

TIPGet Accounts Payable to create a report for all of the payments under GL codes associated with Consulting, Professional Services, Third Part Labor, Staff Augmentation, Contracting, etc.


• Current active vendors

• Categorize

• Services

• Projects

• Consulting

• Assess

• Spend levels

• Agreements/Contracts/Pricing

• Performance

Assess Vendors


Categories

HRFINANCE

MARKETING

LEGAL

IT SERVICESAUDIT

TRAINING FACILITIES ?????


Cost Savings

Rate Standards

Supplier Rationalization

Competitive Bidding

Discounts

Efficiency

Process

Payments

Project Management

Compliance

Budgetary

Approval

Policy

Risk Mitigation

Visibility

Reporting

Analytics

Internal policy compliance

Management controls

Setting Goals


Categories

HRFINANCE

MARKETING

LEGAL

IT SERVICESAUDIT

TRAINING FACILITIES ?????


PROGRAM

• Categories

• Budgetary

• Approval authority

• Workflow

• Payment terms

• Pricing

PROJECT

• Requirements

• Milestones

• Time & Materials

• Change control

• Deliverables

• Governance

Develop Standards


• Is it really a project?

• SOW cost computed in hours

• Named resources

• Only deliverable is the hours on the project

• No milestones

• No acceptance points

• No terms

• No governance

Staff Augmentation or Project?


• Internal

• Budgets

• Approvals

• Approved suppliers

• External

• Suppliers

• Onboarding / Offboarding

• Audit

Compliance

TIPCompliance management will comprise several questions within your RFI / RFP.


• Build a committee and educate/enlighten

• Procurement – SOWs

• Finance – accruals, reconciliation, invoicing and payment process

• Legal – SOW standards mean less disputes

• HR – tracking, compliance, quality

• IT – both client and service provider

• Business units – identify power users

• Executive sponsorship

Stakeholder Committee


• Defines and maintains project management standards

• Documents process

• Develops and maintains metrics

• Pick your flavor

• Supportive – offering consultation

• Controlling – requiring compliance

• Directive – managing projects

Project Management Office (PMO)


1. Create SOW

• Role/Permission Based

• Configurable Approvals

• Create SOW

• Attach RFP & Support Docs

8. Off-Board Contractors

• Finish Notifications

• Reporting & Analytics

• Security Badge Deactivation

• System Logon Deactivation

2. Source Bids

• Provider Distribution Controls

• Budget / P.O. Controls

• Time & Date Stamp

7. Billing and Invoicing

• Pay Provider

• ERP Feeds & Extracts

• Audit & Adjustment Support

4. Engagement Management

• Milestone/Deliverable Management

• Cost Center, G/L, Project Code Support

• Manage Change Requests

• Manage Budgets / Burn Rate

3. Award Project

• Review/Rank/Score Bids

• Select Provider

• Finalize Milestones

• Create Payment Schedule

• Define Payment Schedule

Analytics

6. Time & Expenses

• Time & Expense Capture

• Milestone Capture

• Invoice Approval

5. On-Board Consultants

• On-Board Consultants

• Compliance Manager

• Security Badges

• System Provisioning

New Process Flow


Future State

Pay workers

Candidate

interviews

coordinated

Submit top three

candidates and

pricing

Receive requisition

Submit time and

expenses

Candidate

becomes engaged

Hiring

Manager

MSP

VMS

Vendors

Candidate

Manager

Identifies need,

Candidate is

vendor sourced

Candidate

engaged

See Onboarding

Send requisition to

vendors

MSP confirms

position, job

description, funding

(HRIS)

MSP forwards the

three required

forms

Approve time and

expenses

Manager fills out

three required

forms

Pay invoice to

Peoplefluent

Create

requisition

Payment to

vendors

Generate

invoice and

reporting

Timesheets

generated

Interview

scheduler

Distribute

requisition to

vendors

Obtain cost

center/budget

information

Manager reviews

candidates,

determines

interviews

Interviews

conducted

Candidate

selected

Candidates

screened and

ranked

Candidates

selected for

interviews

Candidate

consolidation,

ranking,

comparison

Candidate

engaged/pre-

engagement items

completed

Candidate starts

engagement

Candidate begins

work

VMS


• RFI / RFP

• Select technology

• VMS/SOW

• MSP

• Outsource SOW management

• Begin change management

• Enterprise wide

• PMO

Execute


• What are your costs?

• % spend of SOW to staff augmentation

• Average cost per SOW (normalized, per hour)

• Cost Index (actual / awarded = index)

• Spend per SOW vendor

• Soft costs

• What is the process today?

• How much management time does it take?

Set the Baseline


Contact Me

John Moore, [email protected]

Questions?

© 2015 Cra in Communications Inc. All rights reserved. October 21-22, 2015 n Omni Dallas Hotel

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Demystify SOW Adoption — Build your Roadmap to Implementation Success

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