Services Procurement & Contingent Labor Content

Welcome to the April 2020 edition of Spend Matters Insider’s Hot List, a monthly look at the contingent workforce and services (CW/S) space that’s available to our PLUS and PRO subscribers. For those new to the Hot List, each edition covers the prior month’s important or interesting technology and innovation developments in the CW/S space.

In the last Hot List, we covered key events and developments that took place in February Among those were FY 2019 financial reports of three publicly traded online work/services platforms, various developments among a number of online work/services platforms and ongoing developments in financial services that cater to contingent workers and small businesses.

While this month’s Hot List will focus on what happened in the historic month of March 2020, it will try to give readers a respite from the bombardment of COVID-19 news and mostly focus on what may be workforce “hot spots,” but not in the epidemiological sense. (For help with coronavirus-related workforce issues, read our coverage of go-to solutions for finding workers in a crisis and how businesses can cope in the near term and other phases of the crisis.)

Turning now to the workforce developments in March 2020 ...

Now through April 2020, a Spend Matters' special PRO Expert Survival Pack is available to procurement practitioners only* at up to 50% off. The discount applies to PRO subscription content from our analysts and other services. — Learn more

Read all of Spend Matters’ coronavirus coverage here.

In this installment of our “Coronavirus Response” series, Spend Matters will focus on contingent workforce and services issues now that it’s not business as usual. In the COVID-19 crisis, the level of uncertainty in worker availability drives an increased need for workforce agility and, perhaps, new trade-offs between time, cost and risk. This may be a time when relying only on existing sourcing channels and suppliers will come up short.

External platforms or networks for remote and online workforce/services can be used to find and engage freelancers and small service providers across the globe who can perform activities totally online. Work can be managed, accepted and paid for online. In its basic form it can be up and running in a number of minutes with a credit card.

These new kinds of technology-based CW/S solutions from providers like Upwork, Fiverr and Topcoder may yield important benefits over and beyond what might be provided by a VMS. This is not to say a VMS solution is an unimportant contributor in the current crisis. On the contrary, it is critical.

The overall mission of this PRO series is to examine categories of relevant solutions (and example providers) that professionals in procurement, finance and supply chain organizations should investigate to reduce, and even mitigate, coronavirus supply risk. And even if the solutions are only addressing a subset of the issues, the ability to respond intelligently in the short term can also help set organizations up for the future when sanity returns to the world.

This article addresses the seventh category of the seven we currently have outlined:

1. Supply risk management solutions that include supply chain risk, CSR risk, supplier financial risk, etc.
2. Sourcing and commodity management, including advanced sourcing, direct sourcing, automated supplier discovery, and commodity management to help dynamically plan and source.
3. Advanced procurement analytics to enable direct procurement and/or to perform “spend planning” when demand drops out or spikes. (Its profile for this series is here.)
4. P2P that emphasizes working capital, dynamic discounting, payment control and related finance priorities to help inject cash into the P2P process — especially for many cash-starved suppliers. (This category is discussed in-depth here.)
5. Fraud, P2P and vendor management safeguards when new suppliers need to be set up quickly, and also when lowlife fraudsters try to use the pandemic as a way to steal money and IP.
6. Providers with deep contract analytics that can analyze a contract portfolio for affected contracts from suppliers (and customers) for not just force majeure clauses, but other related clauses that tie to the multiple risks popping up at once in the pandemic.
7. Contingent workforce and services solutions that are able to, at a minimum, help rapidly ramp up on-demand workers to deal with massive resource shortfalls. We are looking at four categories of solutions for sourcing remote/online work; solutions for sourcing and managing contract workers at geo-specific capabilities; solutions to “direct source” and manage contract workers; solutions for data management and analytics.

Owing to the magnitude of the crisis, Spend Matters recently made the series introduction available for free to all readers. PRO subscribers can see our follow-up pieces that profile the other categories and their solutions in that market. We will include a lot of information on each category PRO brief that readers can see without hitting a paywall, but since we also draw heavily from our existing deep-dive analysis of the providers from our SolutionMap database, some information will be available only to our PRO subscribers.

For workforce management, organizations should rely on their VMS solutions to manage the sourcing and management of temporary staffing suppliers and workers as well as SOW/services, as existing suppliers will be important sources of flexible workers (for example, to fill gaps in administrative or customer-facing jobs when regular workers must take a PTO day or just don’t show up). Perhaps organizations could use their trusted staffing suppliers as employers of record and payrollers to allow specific laid-off workers to return to work on a temporary basis. These are substantial channels of supply that should be maintained/sustained. A VMS can help with that.

Organizations should also collaborate with their VMS providers to find or optimize applications of solution capabilities unique to the crisis environment. For example, exploiting supplier management capabilities and increasing frequency of monitoring could be important, as staffing and SOW supplier capacities and performance may change quickly in a crisis environment.

Indeed, organizations that are not using a VMS today should perhaps be thinking about it, if they anticipate using more contingent workforce or having a more unpredictable contingent workforce requirements going forward. Spend Matters’ SolutionMap rankings cover enterprise solutions for Temp Staffing (and Contracted Services/SOW) and can provide an accelerated research path for zeroing in on appropriate solutions (e.g., VMS solutions that can be put in gear rapidly and so on).

In this Coronavirus Response series, the CW/S category has four types of solutions that need to be explored:

1. External platforms/networks for remote or online workforce/services (such as Upwork and many others) can be used to find and engage freelancers and small service providers across the globe who can perform activities totally online. For example, if an organization required a data analyst with R skills to analyze a large date set tomorrow. Work can be managed, accepted and paid for online. In its basic form it can be up and running in a number of minutes with a credit card.
2. External platforms/networks for geo-specific, locational workforce/services (such as Field Nation and others) can be used to deploy mobile technology-enabled field contractors on demand across wide geographies (individually or a groups). For example, if a company’s employee field technician must care for a family member and can no longer leave the house to make onsite repairs in a particular geographical area, contract field technicians can be engaged through such a platform. Workers can be sourced and work product accepted and paid for online.
3. Direct Sourcing solutions for workforce/specialized, small service providers (SSPs) such as (ShortList and others) can be used to directly engage a company’s contract workers such as consultants already in use, alumni or directly sourced fresh. For example, alumni with crucial knowledge/skills may be built up in reserve in a private talent pool, ready to activate at any time (this is something that healthcare systems are doing with retired personnel). The SaaS solution enables much of the Source-to-Invoice cycle for workers and service providers and is typically integrated with a company’s invoice/payments system. These solutions are typically subscription fee-based.
4. Data Management/Analytics solutions for workforce/services (such as Brightfield TDX and others) can be used to optimize contingent/extended workforce costs through market rate benchmarking, existing workforce configuration and market/trends analysis. If an organization will need to substitute contingent workers for a particular segment of its full-time employed workers (or simply augment them) a Data/Analytics can help to establish accurate contingent workforce rate benchmarking to ensure market prices are being paid. These solutions can be subscription or unit fee-based.

In this PRO brief, we focus on how external platforms/networks for remote or online workforce/services — which are not yet widely adopted by larger enterprises — may be leveraged to open up new pathways to needed labor/talent and services and to enable workforce flexibility and agility. All of which will be important in navigating the current crisis as its stages unfold.

This issue, like each category-specific PRO piece in this series, will be discussed in three sections:

1. Problems and Use Cases. In this section, we’ll highlight the problems in force (which will vary through different phases of the crisis) and the various scenarios where solutions can provide deeper insights, intelligence and scalable workflows.
2. Solution Rationale and Value. In this section, we’ll outline how various solutions can help solve the problems and list what value they can add to your business.
3. Example Providers. In this last section, we’ll highlight the solution providers that can address the problems and deliver some value.

OK, let's dive into workforce solutions that can help.

This SolutionMap scoring summary analyzes a select group of temp staffing solution providers. It is part of our Spring 2020 SolutionMap report series, also with coverage Direct Sourcing of Workforce/Services and Contract Services/Statement of Work providers.

This SolutionMap scoring summary analyzes a select group of Contract Services/Statement of Work solution providers. It is part of our Spring 2020 SolutionMap report series, also with coverage Direct Sourcing of Workforce/Services and Temp Staffing solution providers.

This SolutionMap scoring summary analyzes a select group of solution providers for Direct Sourcing of Workforce/Services. It is part of our Spring 2020 SolutionMap report series, also with coverage of Temp Staffing and Contract Services/Statement of Work providers.

The Spring/Q1 2020 SolutionMap release marks the seventh research cycle for Spend Matters’ Contingent Workforce & Services (CW/S) “enterprise technology” SolutionMap, the sourcing and management of three underlying spend categories: Temp Staffing, Contract Services/Statement of Work and Direct Sourcing of Workforce/Services (formerly Independent Contract Workers, or ICW).

This release note updates SolutionMap Insider subscribers on the changes since the last release. Also, SolutionMap is shifting from quarterly updates to spring and fall updates. This is the last quarterly release and the first spring release, so you’ll see it labeled “Spring/Q1.”

Changes to Spring/Q1 2020 Contingent Workforce & Services (CW/S) SolutionMap

Full List of Providers in Contingent Workforce & Services (CW/S)

Spend Matters today has updated its free SolutionMap benchmark rankings for the new Spring/Q1 2020 release. The latest SolutionMap compares 69 procurement technology providers across 13 categories — which includes a new ranking map for Accounts Payable (AP) Automation vendors.

Six providers are featured in the first AP Automation category, which reflects the growing importance that vendors are placing on payments.

SolutionMap began in 2017 and has become the definitive procurement technology benchmark. It will now be updated in the spring and fall instead of each quarter.

Click on the headline above to find out which vendors are in the new AP Automation category — and to learn about new vendors to SolutionMap.

First, I wanted to congratulate SAP and its Intelligent Spend team for making Wednesday’s online event happen so soon after its coronavirus-driven decision to cancel its annual event in Las Vegas. Kudos, too, for the professional and informative presentations and very usable infrastructure, which included immediately available recordings.

Now for my conference report: I spent a good part of the morning “attending” virtual sessions (with my services procurement filters turned on, of course). I had expected to hear a more specific update on the SAP Fieldglass solution suite. However, solution migration and integration seemed to be the main themes of the day, as the SAP Intelligent Spend movement continues its process of integrating solutions, like SAP Ariba and SAP Fieldglass, onto a single cloud platform, through CIG (Cloud Integration Gateway) on top of HANA (an application appliance in-memory database).

Note: This Spend Matters PRO brief about the coronavirus and issues related to the contingent workforce and services (CW/S) space has been unlocked from the paywall to inform all of our readers. Subsequent briefs in this series may be for PRO subscribers only.

Among all of the coronavirus outbreak’s severe, extraordinary effects on people and the economy, the impact on work has been one of the most visible. Businesses have been scrambling to sort out adjustments they can make to keep their workers safe, contain the virus’ spread and continue operating.

Technology has played a significant role in sourcing and managing CW/S for three decades (think of VMS, job boards, etc.). And, in the past 10 years, new technology (the cloud, mobile, AI) and applications (external workforce/services platforms/networks, intelligent data analytics solutions or solution capabilities, etc.) have given rise to new offerings that may not have had adequate attention from top management levels in past years.

How CW/S can be leveraged to mitigate problems and advance new solutions over the different stages of this crisis will likely be an important topic of executive team brainstorming and discussion in the coming weeks and months. There is an opportunity for businesses to question status quo ways of doing things and look beyond them. In doing so, the use of technology as an enabler may come into sharper focus.

In this multi-part series, we will look at how, what and where businesses executives can consider technology-enabled solutions for sourcing and managing contingent workforce and services.

Part 1 of the series is a general introduction that provides a view on how different types of solutions are applicable in four crisis/post-crisis stages.

UPDATED Sunday, March 22: Spend Matters analysts have updated this PRO Coronavirus Response piece to include two additional categories and related providers, in addition to our five original categories. All of our recommended vendors are now listed in each category. Last week, this post was unlocked from behind the paywall so all Spend Matters readers could see the types of procurement technology solutions that can be helpful for businesses during the COVID-19 crisis. These solutions can only do so much, but we’re seeing some creative uses for their tools. And the providers are also responding with specialized programs and free/freemium offers to help out.

If you are a practitioner, consulting firm or a provider that has found novel ways to help cope with the disruption from the coronavirus pandemic, we’d very much like to hear from you and share your lessons and capabilities. We’ll also update our coronavirus resource page, which lists all of our COVID-19 coverage.

As this series continues, individual vendor profiles will be included in category-specific briefs for PRO subscribers — but, as always, the excerpts on the PRO briefs will be updated with helpful information that is free for all readers.

The genesis of this series is that the Spend Matters analyst team got together virtually in an emergency brainstorming session about the coronavirus outbreak. The purpose was to review our existing research and identify the most critical groups of procurement solution types and example providers that could be potentially useful to procurement organizations managing through the COVID-19 pandemic. We decided during this session to publish a comprehensive series to inform our subscribers.

As such, this PRO series will initially explore seven types of providers. And it will detail multiple providers in each category*, including how each specifically can address COVID-19 procurement challenges. We will add to this list as more practitioners, consulting firms and solution providers come forward to share their learnings and their relevant capabilities. If you are a member of one of these groups, and you are addressing the pandemic in a way that others can learn from that you can share, please contact us here and let us know more!

These are the seven categories of providers that we will profile in this series:

1. Supply risk management (e.g., riskmethods, resilinc, EcoVadis, Resilience360, RapidRatings, etc.) See the riskmethods profile for this series here.)

2. Sourcing and commodity management, including advanced sourcing, direct sourcing and commodity management to help dynamically plan and source (e.g., Allocation Network, Jaggaer, Synertrade, Tealbook, etc.)

3. Advanced procurement analytics to enable direct procurement and/or to perform “spend planning” when demand drops out or spikes (e.g., Sievo, LevaData, Suplari, and others.)

4. P2P that emphasizes working capital, dynamic discounting, payment control and related finance priorities (e.g., Basware, Coupa, Tradeshift, Taulia, etc.) to help inject cash into the P2P process — especially for harder-hit suppliers who are more than happy to trade discounts for mission-critical cash.

5. Fraud, P2P and vendor management safeguards (e.g., APEX Analytix, AppZen, ConnXus and others) when new suppliers need to be set up quickly, and also when lowlife fraudsters try to use the pandemic as a way to steal money and IP.

6. Providers with deep Contract Analytics that can analyze a contract portfolio for affected contracts from affected suppliers (and customers) for not just force majeure clauses, but other related clauses that tie to the multiple risks popping up at once in the pandemic. Sample providers include specialists such as Seal Software (now DocuSign), Conga (which acquired Counselytics), LegalSifter, and Kira Systems — as well as AI-capable CLM providers such as Icertis, Agiloft, SirionLabs, Exari (now part of Coupa), and a few others.

7. Contingent Workforce and Services solutions that are able to, at a minimum, help rapidly ramp up on-demand workers to deal with massive resource shortfalls caused by the pandemic — especially within healthcare (e.g., see this Reuters article calling out staffing agencies that are paying $3,000-4,000 per week for fill-in travel nurses). We are looking at four categories of solutions for sourcing remote/online work; solutions for sourcing and managing contract workers at geo-specific capabilities; solutions to “direct source” and manage contract workers; solutions for data management and analytics. Some existing providers that we cover include Upwork, Shiftgig, Field Nation, Fiverr, Shortlist and others. But we expect many more use cases and providers to emerge given that the pandemic inherently affects people way more than it impacts widgets (other than critical medical supplies/equipment).

We can’t profile every provider in this quick-hit series, especially those that have not gone through a formal briefing, demonstration and fact-check process. And we’ll almost certainly be adding more providers and use cases as the situation unfolds. For example, supply chain planning and execution systems are getting tested right now as dynamic re-planning needs to occur (e.g., how to reschedule truck loads when drivers call in sick or have nowhere to rest/eat when the truck stops are closed).

Please note, this series will not duplicate past coverage. It is meant to build on existing research and share, specifically, how solutions can address the challenges caused by the COVID-19 pandemic (and those challenges that will emerge during it). Our approach is one of not just about throwing tech at the problem, but more of “the art of the possible” and tapping supply markets for innovation and capabilities (which is what procurement is increasingly tapped for itself). And we also want to state emphatically that this isn’t an opportunistic effort to capitalize on mass death. It’s a critical time for empathy, leadership and goodwill to try to help each other however we can.

Finally, our guidance does not focus on technologies to support “the basics,” such as listening to your major customers who are sending you guidance on risk mitigation (for example, a major retailer is advising suppliers to turn up the heat in warehouses, if possible, to reduce the likelihood of transmission). Nor other foundational work streams such as doubling down on janitorial support to disinfect surfaces, checking in with critical suppliers and getting feedback, evaluating the most critical contracts to get out of (and/or amend), understanding if you can get additional allocation if needed (with your hard-earned “customer of choice” status, right?), adjusting savings targets, reducing budgets (generally), etc. Some of this can seem like “supply risk motherhood and apple pie.” But, to borrow another cliche, you still need to “Just do it”!

Yet, some opportunities are not as obvious. So, in this PRO series of research briefs, we will focus on sharing specific use cases and example vendors that can make the difference beyond the basics, and put you, ideally, in a better situation than your peers — rather than simply treading water (or worse).

In this first installment, we will begin by framing each area in terms of the specific business issues that targeted technologies solutions can address. We’ll also give a preview of some providers in each area (i.e., vendors we will explore in greater detail in our category-specific drill-downs that we’ll be publishing soon within these “early” weeks of the global COVID-19 pandemic). Let’s begin.

* We’ll start the series with providers that have briefed Spend Matters about their solution, including going through detailed product demonstrations and research fact-checks in the past (resulting in PRO coverage and, if applicable, SolutionMap ratings). We may opt to add additional providers beyond these depending on the length of the crisis. Please note, owing to the fluidity of the situation and “need for speed” we may not provide fact-checks to the vendors mentioned if time does not permit, as we are basing our write-ups on our working knowledge of the solutions already, as demonstrated and validated previously.

Companies globally have substantially accelerated the use of contingent contract workers as part of their business expansion plans or as an alternative or supplement to their full-time internal workforces. Many economists are referring to this trend as the “Fourth Industrial Revolution” — with some projecting that 30% to 50% of the average corporate workforce will be classified as “contingent or flexible” (independent contractor, corp. to corp, freelancer, temporary or robotics) by 2025.

The risk of worker misclassification can have serious tax and business operations consequences on the company and contractor. This can lead to business interruptions and risk the right to conduct business in a country or economic treaty zone. CXC — the leading global contractor management company for the past 28 years providing compliant solutions to corporations, contingent workforce providers and recruitment firms — has automated and digitized our proprietary contractor vetting and validation process in the 60-plus countries where we operate.

Find out more in this post and in an upcoming webinar.

The Associated Press has another report about China and the use of forced labor from thousands of people from the Uighurs ethnic group, many of which are Muslim. The AP reports that forced labor is used in Nanchang, China, to make computer screens, cameras and fingerprint readers for tech companies like Lenovo, Apple, Dell and others. In other news, Toptal and Guidant Global partner up to take on the talent shortage. Also, get more news on the economic impact of the coronavirus. Afternoon Coffee: Procurement and supply chain news.