Crowdsourcing is a word that almost everyone has heard, but few know the meaning of it. It doesn’t help that the meaning is quite fuzzy around the edges and is still evolving even among those that practice it. Yet when brought into sharper focus and spelled out in the context of services procurement, just exactly why crowdsourcing is of importance to enterprises and service and contingent workforce buyers should become more clear. If ever there was a case for procurement to get smart on a topic fast, this is it. This Spend Matters Plus research brief defines crowdsourcing and explores contingent and services procurement examples. It also outlines why we should all pay more attention to crowdsourcing and how best to educate our teams about how to take advantage of it.
Spend Matters Premium Content:
Though maybe not that apparent to most practitioners at the moment, the procurement of the contingent workforce is going to become more complicated in coming years. Here’s the good news: Most contingent workforce management programs are currently in the early stage of ramping up and moving up the program maturity ladder. They’re getting organizational buy-in and alignment, expanding program scope and reach, instituting processes and technologies and establishing disciplines for supplier, spend and compliance management for staffing and statement of work (SOW) labor. But the rub is that a tremendous amount is starting to happen outside of procurement and the 4 walls of the program office work site, where practitioners have their heads down doing their thing. In short: Despite some progress in evolving programs away from just the management of staffing resources and SOW models, the non-employee genie is working his magic and making his way out of the bottle. Call this little wizard “Uber” if you will – a nice name for this genie in more ways than one.
Work Intermediation Platforms – Transformation Engines of the Modern Labor Procurement Supply Chain (Part 2 – What Did We Catch?) [PRO]
In Part I of this series, we introduced the fast emerging phenomenon of Work Intermediation Platforms (WIPs) that have been developing and mutating – largely outside the protective membrane of the established staffing industry supply chain – and demonstrating the potential for the emergence of radical ways of organizing and accessing contingent labor (many of which could not be managed through established staffing supply chain and contingent workforce management channels). Across the whole global economy, platform-based businesses are already establishing themselves as an “invasive species,” increasingly found transforming or disrupting business-as-usual in many sectors. Contingent workforce sourcing and procurement is no exception, and the prognosis encompasses increasing challenges and opportunities for sourcing and engagement of hard-to-find labor/talent through new digital channels (platforms and ecosystems) – often in new modalities (e.g., on-demand, crowdsourcing, et al). Today in Part 2 of this PRO series on WIPs, we cover the important topics of what WIPs actually are, what varieties exist and what they are capable of.
Today we conclude our analysis of Work Market by examining both the customer experience (from a user perspective) and final recommendations for those companies considering a freelancer management system (FMS) either alongside or separate from a vendor management system (VMS). In recent discussions with Work Market and other services procurement customers, we have been hearing some consistent patterns. It seems companies are hiring more non-affiliated freelancers and independent consultants, and the decision to use an “out-tasking” service or marketplace versus a mode that allows greater control and compliance from a FMS standpoint – for onsite ICs or otherwise – is often based on the category and strategic importance of the activity. Additionally, traditional e-procurement, VMS and MSP solutions are typically not up to the task or purpose-built for the effort. But the question remains: Will Work Market (independently or in a competitive environment) be a key provider to fill the void?
Earlier today Field Nation announced it was acquiring Field Solutions for an undisclosed sum. The transaction represents the most recent M&A activity to hit the freelancer management system (FMS) and work intermediation platform (WIP) markets, related sectors still in their relative infancy. Even though, as one proxy, we estimate the combined size of Field Nation and Field Solution on an annualized volume/revenue basis is well below what most Fortune 100 companies spend on IT each year, there is an undeniable trend in the IT area (as well as marketing/creative services, media and related segments) toward hiring a larger numbers of freelancers or independent contractors that will only accelerate on a global basis. This Spend Matters PRO analysis provides both context and additional analysis exploring the combination of Field Nation and Field Solution and discusses expected market and consolidation trends in the various sub-sectors of the services procurement market – and what it all means for procurement and HR organizations alike. We ask, "What does the acquisition tell us about the emergence of 'platforms' in the contingent workforce supply chain?" Read the full article for more.
There’s an incumbent ecosystem in the services procurement universe that has made a business out of delivering the bare minimum to keep customers satisfied and maintain the status quo. No, we’re not referring to the “tools” providers, but the sad fact is that within the more capable vendor management system (VMS) tool sets today, much of the more advanced capability in these solutions goes untapped or is only partially used. Who is to blame? It’s easy to “shoot” the messenger – staffing firms and the incumbent MSP, but the blame rests with numerous other parties as well, including consultancies, outsourcing firms, staffing researchers and, perhaps most serious of all, procurement itself. In this 2-part Spend Matters PRO analysis, Founder and Managing Director Jason Busch highlights the contributing factors to how and why the staffing and contingent market is failing procurement.
Fueled by liquidity from Parthenon Capital Partners, Periscope Holdings recently announced it acquired BidSync. Both companies have a core focus on procurement in the public sector (state and local government – not federal), as well as in higher education. BidSync is headquartered in Utah with more than 1,000 e-procurement customers (presumably derived from umbrella deals with groups bringing multiple parties to the table). This Spend Matters PRO analysis, authored by Thomas Kase, vice president of research, provides initial background and analysis on the 2 providers and the acquisition, with a focus on the acquiring company and its strategy.
In a world where everything is becoming a service, including manufacturing itself and other core value chain processes, you’d hope that managing those services would be a core competency – even if many or most of those processes are increasingly outsourced. You would also hope that managing a portfolio of critical third-party service relationships with strategic advisory firms, BPO providers, third-party logistics firms, value-added distributors, managed service providers for temporary labor, and so on, would be coordinated just as rigorously as critical direct material suppliers in the supply chain. But, as you may have expected, it’s not. We find that while product supply chains are managed at Six Sigma levels, “services supply chains” for contingent labor (in the broadest sense) managed at about two sigma levels.
Earlier this week, two members of the Spend Matters research team, Pierre Mitchell, chief research officer, and Jason Busch, founder and managing director, spent a couple of days down in Amelia Island, Florida, at Zycus’ annual customer and prospect conference, speaking directly with dozens of Zycus customers and prospective clients. This two-part Spend Matters PRO brief provides a perspective on Zycus’ position in the market today – the good and the bad – and what types of procurement organizations are an ideal fit for what the provider has to offer.
In our discussions with Beeline and their customers earlier this summer, we learned about and explored a number of emerging priorities in global services procurement. A number of these customer requirements are already being partially or fully supported by Beeline and other leading VMS providers – other requirements are still on the roadmap or in their early days on the product release schedule. In the first installment in this series, we considered the increased scrutiny that companies are giving to specific geographies where they will or will not host technology, as well as related access permission issues. In the second installment of this Spend Matters PRO series, Jason Busch, Spend Matters founder and managing director, and Thomas Kase, VP of research, turn their attention to the following areas of emerging interest in global services procurement efforts: deeper technical integration between VMS and others systems; security in a mobile world; emerging audited processes and control mechanisms; regional requirements; and cultural observations.
Earlier this summer, vendor management system (VMS) provider Beeline updated Spend Matters on trends they were seeing in the global services procurement markets. This briefing came immediately after the Beeline customer conference, in which Spend Matters founder and managing director Jason Busch had the time to speak to numerous Beeline customers and partners tackling both local and global services procurement challenges. In this Spend Matters PRO analysis, we consider key lessons learned from the conversations, such as issues of VMS data security/integrity (including which countries organizations are comfortable having data hosted in – and which, like the US, are typically not preferred by non-North-American-based companies) and a range of other topics.
Reinvigorate Your Services Procurement and Contingent Workforce Program: A 10-Step How-To Guide [PRO]
To say that services procurement is becoming a top procurement initiative would be an understatement in most organizations. In fact for some companies, services procurement is procurement if you consider either the absolute dollars spent on it or the strategic value to the business. Some companies (e.g., Accenture) have even helped refine their core business model in certain markets based on their ability to look at the management of non-permanent labor from a buy/sell, almost trading-company-like perspective.
Here at Spend Matters, we often get mired in the weeds of services procurement – how does one VMS differentiate from another, what do specialized category solutions look like, what is inherently incorrect about the way typical MSP ecosystems look at the broader opportunity, and so forth. But in this Spend Matters PRO research brief, Jason Busch, founder and managing director of Spend Matters, takes things up at least one level, introducing 10 overall strategies that companies can take to reinvigorate their services procurement and contingent workforce programs. Today, we consider the first five strategies.