The year 2020 has changed our ways of working and made us reform our old ways. The expansion of digital transformation has changed the industry altogether. With the increase in remote work, the contingent workforce has become an integral part of most companies. With over 40% of the US workforce being contingent, efficient management has become the top priority for employers. The demand for MSPs has grown rapidly and as per reports, it has been growing at a steady rate of 12% since 2014.
However, with the constant evolution of technology and increased competition, MSPs are expected to take a more strategic approach towards contingent workforce management. So, what can you expect from the MSP industry this year?
Here is a rundown of all the latest MSP trends that will shape 2021.
Big data is the buzz word on the internet these days. MSPs can use big data to have a better approach to staffing demands. It will help them improve their decision-making, leading to better staffing solutions. So, what kind of data are we talking about?
- Cost, savings, and total expenditure data to analyze the overall usage.
- Factual skill analytics incorporated with geographical information to increase efficiency in staffing.
The benefits of using big data for staffing are many. It helps to find better candidates faster and more effectively because of the accurate data that will be based on the candidates’ skill tests and not on vague CVs. MSPs can also use big data to get almost instant feedback on the current talent pool.
But, collecting data is not enough if it cannot be interpreted correctly. Here is how collected data can be used productively.buzzword
1) Vetted Talent pool creation
No candidate data will be lost and all data will be leveraged. Even if 100 candidates were screened/ skill tested and only 10 were selected, the data from the rest of the 90 candidates are not wasted but stored in case more openings come up. When more openings are available, the recruiter will not have to source and screen candidates again but instead, have a ready pool of already vetted candidates to refer to and choose from.
2) Data-backed decision making
Data will enable staffing MSPs to create talent pools, have a pool of candidates by job type, skill set type, experience, geography, competency ranking. All this data will help staffing MSPs have access to more relevant talent pools for different open positions with candidates ranked as per their skill proficiency to allow for data-backed hiring of high-quality and skilled talent.
3) Predictive analytics
Predictive analytics is a valuable tool for MSPs. It uses data to find patterns and predict the future based on past patterns. It cannot tell what will happen exactly, but what may happen. Incorporating predictive analytics into an MSP program can help organizations better manage the contingent workforce and predict future needs.
4) Talent and cost benchmarking
MSPs can use analytics to create distinctions among assessments, worker skills, and job experience levels. It will provide a benchmark for negotiating all job placements. An MSP can also use big data to advise on labor costs and align the talent function with finance, production, marketing, supply chain, and other company activities.
Smarter Talent Productivity KPIs
Mergers and acquisitions in the MSP landscape will continue to trend strongly in 2021. MSPs are banding together with various VMS providers to expand their reach. MSPs are trying to bring more services under one roof, extending their offerings to new verticals and larger customers. As these mergers emphasize quality talent, better-managed services, and innovative approaches, smarter KPIs get developed.
Here is a list of all the smarter KPIs that MSPs must track:
- Profitability: MSPs should know the money-making sources and where they are losing them. One of the best ways to identify that is by reviewing the current revenue stream.
- Customer Satisfaction Score: Customer satisfaction score can give an insight into what’s working and what needs improvement.
- Resource Utilization: There are three main aspects to look at when measuring resource utilization: performance vs. projections, resource planning, and identification of costs.
- Contract Renewal: This information helps MSPs stay ahead on documentation for renewals and leaves time for potential negotiation.
- Project Status: Properly tracking projects will help MSPs avoid spending excess time on unproductive projects.
- Sales Pipeline: A sales pipeline helps simplify the sales role with the CRM component providing forecasting and pipeline information.
- Sales Conversions: The sales conversion rate helps identify the closed sales apart from the lost sales.
Automation and Data Security
MSPs will use automation to increase efficiency. As competition grows, the MSPs will need better management to satisfy the demands. Automation will also enhance the role of employees as it will help them perform higher-value tasks. With an increased focus on solution-based offerings, various forms of workflow automation will take place in the MSP sector such as operations, security, billing, etc. Automated sourcing can help the HR team build a strong base for any job search and find better quality candidates to create a stronger talent pool.
Focus on data security will increase due to the countless security breaches. With advancements, malicious attempts to steal sensitive data are on the rise. Data security will be one of the major trends in 2021. MSPs will have to protect the resources and block hacking attempts.
Unbiased and Diversity and Inclusion friendly hiring with AI
AI can help mitigate bias from the system and also removes removes human intervention from the recruiting process. The lesser the human intervention, the lesser will be the bias to influence decision-making.
One thing that has amped up in 2020 is the importance of workplace diversity and inclusion. Since the majority of the workforce are millennials and GenZ workers, their expectations of diversity in the workplace must be taken into account. As a result, MSPs are taking steps to address D&I challenges in the industry. Top talent can only be accessed when all the D&I guidelines are maintained.
The ADA has enumerated a list of standards called Web Content Accessibility Guidelines (WCAG). As per these guidelines, MSP websites should be:
Here are a few tips to ensure compliance:
- MSPs must include a usability statement in the footer of the website to show that compliance issues are being resolved.
- The accessibility options should be known to all the team members of the MSP. If someone with disabilities has any doubt, then it must be cleared to avoid any lawsuit.
- MSP teams must have trained individuals who understand about maintaining compliance standards.
Ethical use of Data and Data Confidentiality
Ethical workforce management includes questions of privacy, legality, consent, and fairness. There are instances where workforce management can invade the privacy of workers, e.g., log-in details, access software, check-ins, etc. This is why ethical usage of data and data confidentiality is to be prioritized.
Ethical use of data means data practices aimed at gaining the trust of users. This ensures mitigation of data misuse and nullified security breaches.
Here are a few ways in which MSPs can ensure ethical usage of data:
- Collect and share the data with due diligence.
- Ensure there are penalties for misuse of data.
- Include simplified privacy policies.
- Clarify the use and importance of data.
- Implement a backup plan in case of a security breach.
An ATS attracts, identifies, and recruits the top talent. An ATS digitalizes all the candidate data into a single platform for it to be completely vetted. It creates a further road map for the recruitment process, creating a pool of talent that can be used as and when needed.
An enhanced ATS will ensure maximum productivity. It will help in the creation of customized reports on KPIs, integrate with the existing ATS, and improve efficiency.
Here are some of the benefits that an enhanced ATS will bring:
1. Reduce the time spent on repetitive tasks
An enhanced ATS will speed up the whole recruitment process and reduce all the time-taking tasks. It will enable the automated publishing of job listings and send follow-up emails.
2. Fast-pace the screening process
The screening will get much faster as an enhanced ATS will use an automated approach. It will use algorithms to find job matches, reducing manual exertion. As a result, the candidate pool will also be better as it will be based on qualification indicators.
3. Facilitate Collaboration
HR teams can easily share feedback on candidates and zero in on a collaborative decision.
4. Improve the Quality of Hire
The quality of hire will get improved as recruiters will only engage with the best candidates in the applicant pool. They are offered automated information, relieving them of arduous tasks. Recruiters can focus on the engagement with candidates that will help in assessing them better.
Blockchain and Workforce Solutions
MSPs can use blockchain to keep databases of talent pools. Blockchain will deal with a high volume of data. It can be used to transfer secure data that cannot be hacked or corrupted. It will also eliminate the tedious tasks of vetting potential candidates, saving precious time for the recruiters.
Blockchain can slash transaction times between stakeholders from days to minutes. MSPs will not have to verify all the transactions as most of the processes will get automated. All in all, blockchain will optimize the whole process, saving time, money, and manpower.
Workforce Solutions will create an amalgamation of contingent and full-time workers. It will enable MSPs to address relevant questions such as:
- What will be the cost of different workers?
- What type of workers, based on productivity, will be more cost-effective?
- Which workers will be most effective?
Workforce Solutions will create a structure for MSPs to integrate the workers into a single platform. It will also provide a way for contingent workers to move to full-time positions.
Advanced VMS Solutions
An advanced VMS will provide complete visibility on contingent workforce management. It will enhance automation, resulting in better workforce management. MSPs can meet their KPIs within the stipulated time frame.
Advanced VMS solutions will improve the effectiveness of MSPs in:
- Sourcing candidates.
- Project management.
- Onboarding and off-boarding of employees.
- Acknowledging new opportunities.
- Administering expenditures.
- Extending contracts of employees.
Compliance and Risk Management
Cyberthreats will evolve in the new year as well. MSPs will need to challenge these threats, keeping in compliance with the privacy laws such as
Moreover, MSPs will be adopting innovative governance, risk, and compliance (GRC) tools to enhance operational efficiency, provide better risk management, and facilitate decision-making. These solutions will create an accurate risk assessment that will enable better risk management and create an all-compliant system.
New Talent Marketplace Platforms
As per Spend Matters,
“The managed services provider (MSP) model, which started 20 years ago as the “go-to” for contingent workforce management, is losing relevancy and the voice of the customer is confirming they want changes. Today, clients want a strategic business partner, true vendor neutrality, effective benchmarking and reporting, best practices, and expanded supply chain options with digital platforms. They want to go beyond the current MSP “command and control” of cost control, process, and visibility.”
MSPs of the new age must have planned such as:
- A growth strategy.
- An end-to-end support system.
- Better predictability.
- Performance metrics.
- Financial visibility.
MSPs must have a more strategic approach towards contingent workforce management. Simple expansion is not the goal anymore. MSPs should create a system that serves as a guide for the clients.