IQNavigator sail on in the growing VMS and MSP markets (part 2)

In part 1 (here), we looked at the recent Staffing Industry Analysts survey of the VMS and MSP markets, and featured news of IQNavigator’s growth via my interview with John Martin.  Since we published that last week, the firm announced that he has been promoted to Chief Executive Officer of Emerging Markets – many congratulations to him. (It was obviously our interview that clinched it...)  Emerging Markets in this context includes, I believe, Europe. I find that quite amusing!  But it also includes product expansions, as well as geographic development, so it’s a huge and key role.

And a big issue, in Europe at least, is the Agency Worker’s Directive which came into force last month. After 12 weeks employment, a contractor has the right to the same employment terms as a permanent member of staff.  Does Martin see organisations making big changes – or instance, are they restricting assignments to 12 weeks?

“Not really that specifically. Organisations are getting more interested though in tracking and recording staff, which is obviously likely to drive more growth in the market for VMS platforms. Getting visibility, having a system of record for the contingent workforce and a defendable position  will be important. But the vast majority of the contingent workforce are on no worse terms than permanent staff anyway. So we haven’t seen major changes yet, but it may be as organisations get a better picture of their workforce, they may need to make some adjustments”.

I also asked Martin how he sees the respective roles of the HR and Procurement functions in the management of contingent labour, particularly given the growth of the area. (I’m always interested in organisational dynamics, and in my personal time as a CPO I saw various power struggles in this spend category!)

“I don’t think there’s any doubt HR should be involved – I certainly don’t see any point in procurement trying to exclude them. HR will have responsibility for talent management, and increasingly they have an “arbitrage” role – looking at the balance between permanent staff, contingent or other options. That seems an HR rather than a procurement role”.

But procurement has a role to play in the commercial side of things?

“Yes, but we’re also finding that Finance functions are taking much more interest in this area. Issues like compliance, cost predictability for budgeting and accruals, and tracking commitments. Finance are realising that there’s a lot of money being spent on contingent labour, and much of it hasn’t been very visible historically”.

So we may see a three way carve up of responsibility or power in this spend category – all the more reason, we’d suggest, for procurement people to develop knowledge and awareness of the issues, processes, tools and technology that apply here.

And as we started by saying in part 1, this is a huge and growing category in most organisations, with very significant scope for savings – but they have to be gained by intelligent action, not just simple supplier bashing.

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  1. Christine Morton:

    Couldn’t agree more, Peter. I have always advocated that contingent labour be considered as part of an overall workforce planning strategy – so that the short-term benefits of using agency workers do not become long-term issues!

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