VMS and MSP Market Size/Competitive Market Share: Staffing Industry Analysts’ 2011 Take (Part 1)

Earlier in October, Staffing Industry Analysts led a webinar for their CWS Council that included some great details on the overall size and trends in the contingent VMS and SOW market (not to mention broader MSP data as well. The analysis, while not 100% complete because numerous firms and providers declined to participate and because providers offered self-given data that was not validated, nonetheless provides the best take we have available today in terms of overall market sizing and trends. SIA's ever-personable Bryan Pena, who oversees the CWS Council, presented the information. For those who are interested, SIA positions their council as "designed exclusively for executives who have responsibilities related to their company's use of contingent/contractor/temporary workers and related solutions (such as VMS or MSPs). Typically, CWS Council participants are Supply Management/Procurement or Human Resource, or IT professionals from global 1000 companies with large contingent workforce programs."

The bottom line: if you value information like that in this post, then sign up for the CWS Council. Now, back to the subject at hand. SIA's 2011 study featured 30 VMS providers and 32 MSP participants (up from 23 and 28, respectively, the year before). The top VMS providers in this order were Fieldglass, IQNavigator and Beeline (with $9.1 billion, $7.5 billion and $4.1 billion in contingent spend going through their platforms). What's curious about this number is that it's not exactly a proxy for revenue, despite the typical VMS situation where suppliers (i.e., staffing firms) pay a fee to the VMS based on overall volume. Spend Matters has spoken with Beeline customers, for example, who are engaged in fixed fee arrangements (Fieldglass and IQNavigator tend to be more pure in focusing on the supplier-paid volume model).

When it comes to SOW spend, Fieldglass also came out first, with $4.3 billion in spend gong through their system (PeopleFluent was second with $4.1 billion and Emptoris third with $3.3 billion). It's important to remember that SOW spend throughput has nothing to do with overall SOW capability, however. Anyone looking to manage SOW spend through a VMS toolset (with extended capabilities specific to SOW and project-based engagements) would be well advised to consider providers based on absolute capability first. And this would necessitate adding folks like IQNavigator to the top of the list (not to mention others, where, based on the back-end and P2P environment, should also be added like Ariba -- in the case of Ariba shops -- and Provade, in the case of PeopleSoft shops). Consol, Beeline and others are also worthy of consideration in the SOW areas well.

- Jason Busch

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