Often when a talent solution team comes in to implement a Managed Services Provider (MSP) program, they shock the client by exposing major gaps in their process and systems. It's not a conversation the client is ever prepared for, but its' one that is vital to address for managing the growing contingent population. Having discrepancies in your contingent workforce (CW) program is not uncommon - because managing a contingent workforce is complicated. And, not having the right expertise to know the proper way to manage that program can cause significant damage to an organization. If your organization is considering implementing an MSP program, I'm here to prepare you for the possibilities by exposing some of those holes and misconceptions.
The First Step is Admitting You Have a Problem
As your contingent workforce grows and expands, CW managers feel the pressure mount. Typically, the decision to hire an experienced MSP to take over the CW program is not because your team hasn’t tried, but it’s because they realize they are in over their heads.
Whenever talent providers are getting ready to launch an MSP program, they start by pairing an experienced implementation team with the key players within the client's organization to evaluate the client's current process of procuring contingent workers, reporting, tracking and systems. It's their job to design a streamlined process and gather data that will be used to outsource the MSP.
The Second Step is Recognizing There's More to the Problem Than You Think
Even after you’ve identified what you thought was the problem, once you bring on an MSP, more hidden problems typically arise.
It’s the job of the MSP to continually identify any current or future issues that you will encounter. Often not operating on all cylinders, an internally managed contingent workforce program is sluggish and in desperate need of a tune-up.
Here are some of the top misconceptions clients often face during the implementation process. Use these as discussion points to identify how much of a handle you have on your CW program before you begin to establish a relationship with an MSP Program.
Widespread Workforce Misclassification
If the contingent workers are on the company’s payroll, many times they are not classified correctly. The HR department would then have to go through all of these positions and develop job descriptions and review them. Then, based on the FLSA standards, go through and reclassify the jobs so they are compliant and meeting all guidelines. Get ahead of these issues and solve them now before they get bigger.
Misclassification of Employees as Independent Contractors
There are IRS guidelines and definitions for Independent Contractors (ICs). Are you following them? Did you know that if there was an audit, YOU would be on the hook for all of the taxes? Make sure your HR department is well educated on the IRS guidelines for your Independent Contractors, or better yet, an expert MSP provider can ensure everything is running smoothly for you.
In order to set a program off on the right foot, there is a lot of preparation that you as the client need to do in order to make sure the transition is smooth and 100% successful. Data collection, process review, reporting, and analyzation - it takes a lot of effort on both the MSP side and on your internal team. It’s an important first step, and once you work through it together with your talent partner, the MSP's operations team can hit the ground running.
Ouch! That hurts to hear, I know there is a lot of complexity and work that goes into implementing an MSP program. As you can see from some of the examples mentioned above, sometimes the issues that you see in your program are just the tip of the iceberg.
You have to be prepared for that, and give your program enough time to launch. Working collaboratively to set attainable goals is important. Keep your expectations realistic, and listen to experts that are spearheading the efforts.
There’s a way to set up an MSP for your company, and then there is a way to do it right. Sometimes unexpected things may pop up while we are getting the program on its feet, but with years of experience setting up these processes and timelines, know that the implementation team's top priority is your organization's success.