Podcast: Total Talent, Total Trust

Transcript:

Elliot Clark: Good morning, good afternoon or good evening and welcome to another HRO Today podcast. I'm Elliot Clark, the CEO of HRO Today. We publish HRO Today Magazine, HRO Today EMEA, HRO Today APAC. We’re the producers of the HRO Today forums and educational conferences held around the world and the managers of the HRO Today Association.

Today we're going to talk about managed service programs and this is an area where there is a lot to talk about. Managed service provider programs, or MSP for the management of contingent labor service providers, is far from a new service offering. However, this sector of HR services and technology is under new scrutiny as some TA departments even look at insourcing the function. There are a few reasons why, most notably the workforce and attitudes toward short-term or gig work as it's popularly known, are changing. And it's becoming more popular with younger workers, which means it'll probably grow as a segment of our workforces. But is the MSP service growing and evolving to meet the changing needs? That's a more interesting question. And what HR wants from its service providers is also growing and evolving. And we have a marvelous guest to help us unravel these very questions.

Anamarie DeVito is the vice president of MSP Client services for Sevenstep. She's been there for more than 12 years designing complex solutions for clients. Sevenstep is a provider of RPO, MSP and Total Workforce solutions as well as talent advisory services and data and analytics technology. They are one of the most highly rated providers for many years appearing on the HRO Today Baker's Dozen for RPO, MSP and Total Workforce solutions. They have a strong global presence and a great client portfolio. Anamarie, welcome to the podcast and is there anything you would like to add about Sevenstep for our audience?

Anamarie DeVito: Thank you, Elliot, and thank you so much for having me on your podcast today. Sevenstep is really invested in empowering talent leaders to solve unique challenges in their business. We're everything that you just said in terms of RPO, MSP and consulting, but we also go beyond that to advise and lead our clients to build creative solutions that really drive their internal direction and their business goals. I'm excited to talk through some of the ways we do that with you today.

Elliot Clark: All right. And talk you shall, because that's what podcasting is all about. So let's first address why this issue is an issue. What are the factors that lead clients to maybe not really trust their MSP providers to do more than what I'll call basic execution? What are many of the providers doing or not doing that causes this perception that they're primarily just sort of a sourcing and processing service offering?

Anamarie DeVito: Well, honestly, one of the biggest challenges in the MSP space today is earning a client's trust to go beyond just the basics, the core operational work. It might sound like that trust might be intangible, but in MSP we really truly view that as foundational because once we've earned that trust, we can then make a truly valuable impact for our clients that really goes beyond just filling the basic expectations of bringing requisitions to fulfilment and bringing in talent. It's a really common sentiment I would say that we hear amongst clients, especially first gen clients, to say things like we just want our MSP to handle the transactional stuff, right? And they don't always see their MSP provider as a more strategic partner. And that mindset, it doesn't come out of nowhere. It's a really limiting mindset. But especially in the case of more experienced buyers, there's real reasons behind that and why they might feel that way. There's several factors that impact that and really sort of limit those expectations and have those clients sort of keep their MSP partners in a box. And a lot of that comes down to what you just said, which is what MSP providers are doing or rather really what they aren't doing right that creates this type of dynamic with clients. So I'd like to start with one of the things that I think really is the most important and quickest ways even for clients to lose trust, which is a lot of providers fail to really, truly understand their client's business. So a lot of providers are great about diving into the type of labor or skill sets coming through the programme, which of course is really important because it helps them be more effective. But they don't always take a step back to kind of take into account the bigger picture of what their client really needs. I think that it's just so critical to have a deep understanding of the industry that your clients are in, their business goals, their unique challenges. And I think that when a provider lacks that investment in their client, that creates almost an immediate perception, Elliot, that they aren't knowledgeable enough to go beyond just those sort of core operational basics.

Elliot Clark: I need to ask you a quick question. Do you think that's because they don't interpret their job as being more than just making sure the contingent labor providers send candidates, fill jobs and send their invoice on a regular basis? Do you think there's a problem with the way those providers interpret the MSP service as being, you know, purely transactional?

Anamarie DeVito: I do think so. And I think that that's been a shift that we've been sort of watching evolve over the past few years. Where we've seen providers have traditionally offered service in that way where it's very transactional and it's very basic and focused on kind of those core responsibilities. And we've started to see that evolve into something much more meaningful and impactful to clients they really need, which is offering more consultative support and really helping businesses get to where they need to be in terms of alignment with their internal goals. That actually sort of leads into the next thing that I was going to talk about nicely, which is that providers can really fall into that trap of just being purely transactional. Even if your MSP provider is fulfilling roles quickly or managing supplier relationships effectively, it's this missed opportunity, like I just talked about, for clients to have a more strategic partner who can really contribute to workforce planning or cost optimization or sort of more long-term talent strategies. Because we know that with our clients, these things change really quickly, right? Talent cost shift and flow. And clients need a provider that can give them strategic responses and more advisory support that really is key to getting through some of those market changes.

For example, if an MSP is only providing sort of basic reporting like spend, resource cost, head count compliant, that sort of thing, the client may understand their value as a service provider, but not necessarily as a thought leader or advisor for proactive strategies, not just reactive ideas. It's that sort of transactional role that then leads to the lack of trust in their provider and might even prevent clients from considering them for more strategic things like direct sourcing programmes or total talent management.

Elliot Clark: To paraphrase the old joke about football players, those MSP providers think the clients like them big and stupid.

Anamarie DeVito: That's exactly it.

Elliot Clark: Lots of muscle, no brain.

Anamarie DeVito: That's exactly it. The last thing that I wanted to talk through in terms of why sometimes there's a lack of trust in MSP provider is around data. Data is a huge topic right now. It really has been for quite some time. Specifically in MSP, data is not just reporting and providing limited data, for example, sort of just reporting out of the VMS, not bringing anything consultative or strategic that contributes to limiting a client's trust around what their MSP is capable of. It contributes to building a partnership that does not have that kind of foundational trust and true advisory relationship, but robust data that really brings value to the client, gives them the opportunity to then explore various scenarios, create strategies for what we know is always a fluctuating market. I really think that all of these trust issues can be brought together and they sort of all stem from a disconnect between what clients need and want and what those providers are actually delivering.

Elliot Clark: Now that we understand what's causing the problem of trust, you know, if the providers are just big and stupid, they just provide that muscle. Then there's really not a downside for particularly larger, you know, whether it's healthcare systems or corporations saying we can replicate it. Let's talk about the alternative universe where it's, you know, different. We know what's causing the problem of trust. I like using that word and the unwillingness to rely upon some MSP providers for that more evolved solution. How do we solve the problem now? Sevenstep clearly believes it knows how to build trust, provides clients a more comprehensive and thoughtful approach. How do you ensure, and I know this is your job because you're the VP of MSP client services, how do you ensure that your clients trust you with the more complex workforce challenges? And what can clients learn about what to expect and other providers learn about what to provide from the example that you believe you guys are setting?

Anamarie Devito: Let's start off with where we just left with data. It's huge, it's important, it's a big topic right now, so I'd like to start there. Why we think it's important? What do we see changing about that and how does that help us build trust? First off, without data, it's just not possible to provide a precise forecast for your workforce. Whether that's trying to figure out, you know, how much time is needed to fill a requisition or resource cost availability. You can sort of make educated guests, right You can bring that internal, sometimes you can make very educated guests, but those are near term solutions only and they really just provide the basic information. But if you're looking for more sophisticated planning for different types of talent, maybe different types of talent types or skill sets, those intuitive guesses aren't going to help you with a long-term strategy. And that's really where you need a consultative provider. That's where that more advisory relationship comes into play.

For example, we recently helped one of our clients that was looking to solve this really complex challenge. They needed to bring on both contingent and perm talent, and we were able to help them solve their challenges using our proprietary data analytics tools, Sevayo® Insights. We solved that in part by gathering geographic information around pay, availability of talent and we could really help advise them on where and when, what types of talent, whether it was this percentage of perm, this percentage of contingent to hire, which then led to them successfully building out a new hub for some of their business critical operations. That was really important to helping them plan and it was also a big part of building this foundational trust in our ability to take on more of that advisory role.

This second part around data is management of your people. Without data, you can't manage your people. If your procurement and talent leaders don't have that data, it's really difficult to get the business on board with bringing all of your contingent spend through your MSP programme. And that's often where rogue spend comes into play, right? Data sort of helps to fence in that spend and prevent the business from going outside. You should have a provider looking to bring in prescriptive analytics to the business because again, it's about helping them drive those goals internally and helping them make decisions that align with those goals. And then the last thing I want to say about data here is if you just have sort of that in house, sort of basic run-of-the-mill data, you don't have the ability to prepare for what I like to call the what if, right? Planning through problems, you don't really have the ability to reach outside of your boundaries, boundaries for more creative solutions.

Case in point, we had a client that was managing through a surge growth. They had increased M&A activity and our team was able to use Sevayo to draw on both the data from the client and market intel to develop strategies based on both the current market and process intelligence. And we were able to help them hire a mix of both types of talent to support this increased growth while still keeping costs in line with their expectations because again, right, it's about aligning on their internal goals and making sure that we can work towards those together. So data management and analytics, they really are the backbone of building trust and a more meaningful relationship with our clients.

Elliot Clark: Sevayo is your proprietary data and analytics platform. For organizations, providers that maybe don't have Sevayo, there are other tools available. I'm sure you would agree yours is the best. But from that perspective, that's really what you're using to develop this data-driven approach to be able to consult not only on, you know, outcomes, but also help with planning and projection. Am I correct?

Anamarie Devito: Yes, that's accurate. And part of why our tool is so important to do that is because it's sort of marries the data that comes internally from our clients with data that we're getting externally in the marketplace, market data and intelligence. It brings those two things together and that's how we're able to create more unique solutions that are tailored specifically for the challenges that our clients are seeing.

Elliot Clark: It's very interesting. And, and do you find that the clients that are willing to trust you with that kind of, you know, thoughtful approach are ones where you have a deeper relationship. They're more likely to renew with you because they're not going to get it elsewhere. They're more likely to engage in a long-term relationship because that's one of the things that we're seeing in this trend of where companies are looking at, Hey, can I do this internally? They don't have much of a deep relationship.

Anamarie DeVito: I think that's really true, Elliot. And I think that it kind of goes back to the idea of what we talked about earlier, which is around a trusted advisor, right? It's a term that we've mentioned a couple times now and it's really kind of everything that we're talking about in this conversation. And in each client relationship that we have, we sort of build in practical ways to kind of structure that trust and develop that into a true trusted advisor relationship. We kind of look at it in three different parts.

The first is around expertise. We've already talked today a little bit about how incredibly complex the talent landscape is as the economy changes, the elections, all of it, it impacts talent strategies and we internally constantly have our pulse on the market to help our clients face both the knowns and the unknowns. I just talked about the ‘what if’ planning. That's super critical to our clients because we look at these challenges holistically and we help them solve these challenges with a wide range of solutions that's always sort of underpinned by that Sevayo Insights, our data analytics tool.

The second part of that is our breadth of capability. What we have done is wherever possible, we build an access to additional services in our contracts. So again, planning for the unplanned. This could mean our client needs workforce tech support or research into markets and supply and demand. Employer branding, yes, that applies to contingent labor also, could be direct sourcing or anything of that nature. It's built in so that it's ready to be deployed when and if needed.

And then the last part of that I just want to talk about is around shared accountability, which to us it's more than just a final touch or a detail that truly is the difference between transactional relationships and one that can really flex and change and help keep you on track for your goals. If a provider that you have is not the cheapest option, but they bring more to the table than just the basics, that means they're more invested in making the partnership work and they're more willing to bring more things like resources, technology and expertise. And then like you said, in our case, all of this is what then adds up to long-lasting reciprocal client relationships. Often times after our clients receive that initial bump of savings that you see often with an MSP provider in the first few years, they then continue to stay with us for 10/12+ years because we continue to deliver improvement in really strategic ways. And that is something that our clients have build trust around with us. And I would say it's certainly worth investing in.

Elliot Clark: Well, it's certainly an important way to engage with the clients and to provide a value add. But it's also sort of intuitive that it's the way it should be that if they're spending, you know, all this money for fees, if they're running all this payroll spend through you, that you do more than just make sure the cheques are issued on time and that the time sheets are received.

We could keep going. We're actually, unfortunately, Anamarie, we're out of time. But this is very interesting and I think very topical and important conversation to have. So I want to thank you for taking part in the podcast and giving us, you know, sort of your view on where that market of MSP needs to evolve. Once again, Anamarie DeVito is the vice president for MSP client services for Sevenstep. Thanks, Anamarie for taking part. We'll have you back to talk some more.

Anamarie Devito: It was great to speak with you, Elliot. Thanks for having me on today and thank you in the audience for your time and attention.

Elliot Clark: I'm Elliot Clark and we look forward to having you join us on a future HRO Today educational podcast. Thank you and join us again.