You’re not alone. We’ve been talking to customers and partners regarding external workforce programmes, which has highlighted that many organisations don’t have a Services Procurement Strategy.

Some common themes we are hearing include:

• Procurement are guessing on how many SOWs are operating in the business under which workers perform.  No centrally housed MSAs or the granular detail per SOW being delivered is available centrally, including: the people delivering, negotiated rates, volume rates per supplier, etc…

• The Contracts are not housed centrally; OR, the contracts ARE housed centrally, but in finance or Procurement ERP tools that do not identify individual workers, leaving the organisation open to compliance issues, access/security risk, health and safety risk, unvetted suppliers, poor negotiation ability due to lack of visibility, etc.

• The black book: There are often a large number of categories or subcategories to buy Services for: “but my category is different”! – hmmmm…I don’t think so! Having had a lot of experience engaging with large organisations where “the black book” is king, we have found most have similar issues: black books filled with the same individuals or suppliers across the entire business, but lacking the linking visibility between the categories / departments / territories etc.  Consolidating this can bring huge cost benefits and process efficiencies for engagement and skills sharing, plus the visibility of real time reporting and better negotiations, bidding activities, rate benchmarks and fraud identification / avoidance.

• Services purchased at a department level – even harder to trace if the supplier is vetted; or if the timelines, milestones and deliverables are appropriate or indeed are being met. What if there is a new budget required? What if there is a dispute about the milestones and deliverables and we run over time and budget?  Where is the MSA?  (We need a cup of tea and a KitKat just thinking about that!)

• The workers could be an individual OBS (Outsourced Business Service), or Independent Contractor (IC) under an SOW, or part of a wider team under a SOW.  What are you doing as a bare minimum to track the workers? Are you tracking them? What did you give them access to? Is it switched off once they depart?

• Workers are hard to appropriately classify. Are they in/out of scope of local tax legislation (IR35 for example)? Time for Triage!  Do you have any sort of triage in place to help you?

• Got a VMS? If there is a VMS (Vendor Management Solution), workers may end up under an inappropriate module, as there is not one (or not one present) to capture the OBS / IC. Even if there is an SOW module, adoption is difficult, as there is pushback to use “the HR tool” (a total misconception). There are enormous benefits to utilising a VMS for Services Procurement: Visibility, Cost optimisation, access to bidding scenarios, better rate negotiation capability, speed of process, improved security, Compliance to regulations, etc

• My Outsource provider (MSP/RPO) is dealing with the SOWs – some are better than others. Some have invested in this space and others are reactionary to a client’s need or request. How do you know? This will become an extension of procurement, so vetting is essential.

• Governance and Exec Sponsorship: There is no/little governance or at least not one specific executive owner to help fulfil my strategy. Sounds very familiar!

Don’t be a ‘Blind Tiger’! Avoid the chop of the Farmer’s wife’s axe and start the unveiling. Once you can see, you can plan and pivot.

@workforcetiger #workforcetiger