5 minute read
There are many types of partner relationship open to companies looking to source talent. The talent industry is awash with three letter acronymns to describe the various flavours—MSP, RPO, PPO, EoR…
Master Vendor is another option. But what is it, and why consider employing one?
Your external workforce is growing—you probably need more help managing it
At one time, hiring contractors and freelancers was something you did to cover maternity leave, or when you needed an expert on a topic that wasn’t core to your business and therefore you didn’t want to employ anyone for that particular skill.
Hiring THAT MUCH contingent labor requires solid process design, a few managers, and potentially more than a hundred staffing agencies! With that many suppliers, you probably don’t want to manage contingent labor hiring yourself.
Outsourcing your Contingent Workforce Management to one master vendor
A Master Vendor is nothing more complicated than an agency that takes overall responsibility for the hiring processes that provide your business with agency workers. Unlike a Managed Services Provider (MSP), they will also contribute their own recruitment team and talent pool into the mix–so you’re not starting with a blank page when it comes to finding the quality talent you need.
The scope of a Master Vendor solution can be narrow i.e. when a Master Vendor is just a large staffing supplier that takes full responsibility for delivering cost-effective contingent labor outcomes.
As mentioned, you should expect your Master Vendor partner to cover all of your contingent workforce requirements; manage the hiring process and furnish the suitable candidates you need–either recruiting using its own in-house resources or through a collection of supporting staffing agencies.
The Pros and Cons
Attitudes towards Master Vendor relationships polarize towards the very positive or the highly critical. Here, we’ve highlighted some of the arguments presented on both sides of the debate.
First, the cons
1. All your eggs in one basket
Critics of the Master Vendor model argue that the commercial risks of being tied to one vendor is too risky when it comes to a business-critical subject like workforce resourcing.
2. Limiting your talent reach
Another common concern about the model is that no vendor can ever hope to be the best source of all the talent an organization needs.
The talent industry has many specialist staffing agencies specializing in particular skill areas or industry disciplines of temporary workers. Those organizations exist for a reason.
Even with all of the modern technology tools and vehicles available to firms to reach out to the talent they need, it’s still not easy to fill vacancies, given a global talent shortage exists for scientific, technical and managerial roles.
3. New relationships can be hard, divorces painful
Sometimes, introducing a Master Vendor can derail good relationships with recruitment agencies that won’t appreciate having the work through another supplier.
In most cases though, the biggest risk firms take when employing a Master Vendor happens at the end of a contract.
When a Master Vendor has been in place for some time, the end of a contractual relationship requires procurement teams to start from scratch with a new partner (and quite possibly new systems, etc.).
Now, on the positive side
1. Fast access to methods and technology
Advocates of the Master Vendor solution to contingent workforce hiring argue that—for most organizations at least—Talent Management is not their core business. Choosing to move forward with a Master Vendor helps businesses to quickly cut costs by adopting the know-how and tools they need to maximize their talent opportunity, painlessly.
2. An instant-on talent pool
Many Master Vendors come armed with a large database of ready-to-employ candidates on their books that companies can instantly access to start filling vacancies.
3. When it works, it can work well
For organizations that have enjoyed a very positive Master Vendor relationship, the model can work extremely well. The quality of the cooking is in the eating.
Ultimately, there’s no reason why a ‘good’ Master Vendor can’t deliver great talent results for your business, provided they have the right blend of know-how, resources and technology at their disposal to meet your needs.
What does a Master Vendor solution mean to your organization in terms of benefits?
The simple answer is cost savings
The Master Vendor model has matured in the last decade. With companies seeking to blend a full-time workforce with on-demand resources (such as temporary staff, contractors and freelancers, etc.) having a single supplier to take accountability for making your talent-sourcing agenda work–and drive down costs–can be a blessing for hiring managers and increase your affordable supply of contingent labor.
Companies will also demand boilerplate best practice processes, access to a wider talent pool (and the development of a private talent pool for your business), etc.
And in the world today, their ability to govern issues like data privacy, compliance, and ensure your other recruitment agencies have the correct insurance (etc.) for their contributions to your contingent workforce will bring additional benefits (potentially cost savings) too.
Managing a Master Vendor solution provider these days is easier thanks to the technology they supply
It means you always have visibility of data insights to expose Master Vendor performance; the status of your hiring programs, how they are saving money, scorecards of the suppliers they are bringing on-stream, etc.
Expect the company you select to cut the cost of hiring by using the latest technologies and methods for talent sourcing and workforce management, with the traditional roles of staffing vendors.
In most cases, Master Vendors will offer Employer-of-Record and payroll, brand development, policy management, risk governance, procurement, legal and compliance skills in addition to their traditional recruitment and workforce management services.
Interested in exploring Master Vendor solutions and the cost savings you can achieve for your company? Check out our client success stories to discover how our team can help you to benefit from a Master Vendor solution.