The external workforce program as a solid foundation of the organization
When renovating your house, you need several craftsmen, and you need to reserve the budget needed. Maybe that craftsman needs to have a specific skill as well. Especially at this moment with personnel shortages it can be difficult to find that specific electrician or plumber with the experience you need at an affordable price.
In business, this is a similar challenge but on a bigger scale. You need that specific financial controller or that specific IT architect. They need to have a certain background and relevant experience. And you want to pay a competitive rate.
Since running a business is a bit different from your home situation, as your approach to hiring labor needs to apply to processes and platforms, all of this can be managed by a program. A program is usually initiated when the underlying business case to implement a vendor management system is approved.
The importance of a program
Deploying an external workforce can be complex. Managing this workforce properly is done through a program.
But what is a program in this context? A program is a combination of processes, people, and platforms (such as SAP Fieldglass) that helps create and maintain the efficiency needed for running a business.
Having a program that is not set up properly, can lead to an inability to source the needed external workforce or against too much cost. Another consequence can be that the entire recruitment process is too lengthy, which will cause frustration within the organisation.
Goal of a program
While the renovation of your house is in progress, there are several goals to consider. You want to hire people who get the job done properly. What you don’t want, is having a short circuit when turning on the lights or a leaking faucet.
Can the craftsmen provide reference cases to indicate their quality? Or do they hold relevant certifications? All of this should lead to a good and honest rate.
From a business perspective, you also have certain goals. When an organization determines that they need a program to govern external worker procurement, they usually target one or more of the five business-driven objectives as a goal:
Cost - Procure workers at the best possible rate
Quality - Ensure hiring top talent
Visibility - Have data standards and transaction analysis for reporting purposes
Efficiency - Process open positions with the right caliber of workers
Compliance - Monitor policies and ensure suppliers adhere to their contract
The program team
Renovating your entire house is not something you usually do by yourself. You might hire a builder who oversees all activities or perhaps a specialist for a certain activity. You need to secure the budget and make sure that you and the builder are aligned on the activities to be performed.
In contrast to your DIY project at home, managing an external workforce project in an organization is not a one-man show. The latter is done via a Project Management Office (PMO).
There are also many factors a buyer should consider when embarking on the process of establishing a PMO team:
Are the procurement processes and procedures defined?
How many transactions are made?
How many suppliers need to be managed?
Will the program be self-service (internal) or a shared service (external)?
How many automated vs non-automated processes are included?
What is the invoicing process?
Program models
There is no one-size-fits-all regarding a program. Basically, there are three types of program models. Each having their own benefits.
Self-managed. The PMO contains only own employees. They will manage all tasks and liaise with suppliers to source the required workers.
MSP-led. A managed service provider (MSP) is a third-party vendor that acts as a PMO and drives the program strategy. An MSP can provide additional insights, skills, and knowledge to the organization.
Hybrid. The hybrid model consists of an internal PMO and an external MSP. The respective duties will depend on the organization’s needs, goals, and competencies.
Need help with renovating your organization’s foundation?
Are you thinking about setting up an external workforce program, but not sure where to start, or need assistance in getting everything in place? Consider us as your trusted builder who knows what he’s talking about and get in touch with us.
Our ‘chief builder’ Ronald Versteijnen (+31 6 300 51 570) and ‘construction builder’ Timo Scholten (+31 6 302 16 145) are ready to help you out.