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Three ways a contingent workforce solution can save costs
A contingent workforce solution also known as an MSP (Managed Service Programme) could help you unlock cost savings, provide greater control and more visibility over spend on your flexible workforce. Find out how in this article.
1. Tangible cost savings over consecutive years
First things first, even if you already have one, a new Contingent Workforce Solution or Managed Service Programme (MSP) can deliver tangible, hard cost savings. Economies of scale, volume/spend discounts, tenure rate reductions, supplier negotiations & rationalisation and contractor migration/payroll are some of the typical cost savings initiatives your workforce solutions partner can explore. Beyond that, there are also more specialised solutions including ‘Furlough’ tracking and ‘contractor right skilling’ to create cost savings through replacing higher-cost with lower-cost resource.
If it’s a priority for your business, a good contingent workforce partner can work with you to continuously identify and deliver cost savings initiatives over the life of the contract; even being targeted with achieving a pre-agreed cost savings target. This is possible even after a flexible workforce solution has been in place for many years.
2. Full visibility of contingent workforce spend
Secondly, as well as cost savings, a contingent workforce solution should be able to provide you with much greater cost control and visibility. Engaging a single partner under a single contract, a single set of commercial terms and a single invoicing process, ensures you know with whom, where and how your business is spending money on your contingent workforce.
This data will be available on-demand through a technology platform and bespoke reporting at regular intervals, so you’re able to maintain continuous visibility of your contingent workforce spend profile.
3. Consistency on spend to enable forecasting
Finally, linked to both of the above, contingent workforce solutions often include rate card management; a way of setting a consistent, benchmarked figure against what you should be paying contractors depending on skill and location.
Given that the vast majority of contingent workforce spend is in the pay to contractors, rather than agency mark-up, this is a useful source of both cost savings and consistency. However, beyond that, rate card control is also key in enabling you to accurately forecast future spend, conduct workforce planning and quote for your services in bidding activities.
As you can see, there’s much more to cost control and savings for your contingent workforce than you might think. A contingent workforce partner can help you bring ‘soft cost’ efficiencies, compliance assurance, visibility and greater contractor quality.
Are you interested in finding out about how an Contingent Workforce Solution can improve visibility or compliance? If so, take a look at the articles below to learn more.
Do you want to review how good your current contingent workforce performance is? Why not take our free Flexible Workforce Health-Check to see how your business perfoms against the industry in terms of cost, visibility and compliance.
You can then benefit from downloading our 12 Key Pillars Of Flexible Workforce Management Guide that will help you improve some of these key metrics by developing your own fcontingent workforce strategy.
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