Contingent labor programs that treat suppliers as untrustworthy enemies ultimately fail. Where suppliers are engaged as a valuable extension of the program, ALL the good things can happen.

We’ve all seen them—old school, “no hiring manager contact” contingent labor programs. Suppliers scramble to upload candidates into a vendor management system (VMS) job order to hit an arbitrary speed-to-submittal metric, crossing their fingers that their awesome candidate matches their best guess about what the hiring manager wants and needs (by the way, managers don’t always know what they want and need, so they might be guessing too). And listen, we understand the original intent. These ‘no touch’ programs were designed back in the day to promote vendor neutrality. For those of you who are new, vendor neutrality is supposed to mean a level playing field for all suppliers but has somehow been hijacked to mean nobody can talk to anybody. There was supposed to be the added benefit of protecting companies from an onslaught of suppliers, wandering the halls, disrupting hiring managers, and schlepping their wares (does anyone say schlepping anymore?). But here is the problem: they rarely work. And for niche or highly skilled roles, they work even less. The worst part is that there are unintended consequences that could be costing you.

“Vendor neutrality is supposed to mean a level playing field for all suppliers but has somehow been hijacked to mean nobody can talk to anybody.”

These days, job requisitions are increasingly complex. Managers require a recruiter who speaks their language, asks good questions, consults with them, and then quickly adjusts candidate submittals based on evolving needs (so, like customer service?). In a blind, no-touch program, this isn’t allowed to happen, and hiring managers become frustrated. They find alternative ways to engage talent, and they work around the program. The category spend is smaller, suppliers stop putting their best recruiters on programs, MSPs miss out on revenue, the customer opens themselves to potential compliance risk…and a zombie apocalypse ensues (okay, maybe not, but stick with us for a moment; we’re on a roll).

So, here’s the deal: when your program is designed to include some level of hiring manager contact—you will win. Your best suppliers will engage and help drive volume through the category. If you are an MSP, your program revenue grows, your fees increase, your customer is happy, and they keep you. If you are a client sponsor, you manage spend, mitigate risk and realize cost savings for your organization. Either way, you save the day from the staffing version of a zombie apocalypse. Everyone wins.

This is probably making total sense so far, but you may be asking for some proof. (thank you for asking!)

We have collected substantial data from hundreds of programs, through many MSP channel partners globally, measuring dozens of key metrics, including hiring manager engagement. That’s a lot of data.

You might assume that the larger programs had greater success with more hiring manager contact, and you are (mostly) right. We observed that the average program with unrestricted hiring manager contact was 14 times larger than strict no-touch programs. The key contributor to this was the dramatic increase in order volume in those programs. Take a look:

Hiring manager engagement, by the numbers

• 15% of the programs fell into the strict no-touch category. These programs averaged less than one order per month in most categories. Guess what happens when a staffing firm gets one order per month? You got it—that program doesn’t get the best recruiters. And because staffing firms can’t predict volume or role type, they also don’t get the best talent. The staffing firm disengages, the hiring manager loses and the MSP looks bad (again with the zombies).

 • 73% of the programs had modified contact. This vague description applies to programs that range from some hiring manager contact to significant relationship building. The order volume more than tripled with even minimal hiring manager engagement. For one firm this equated to 25 additional orders in their category, generating $2.9M in incremental category revenue, and $74,000 in additional MSP fees. That’s per program. Multiplied by dozens and dozens of programs. (starting to see the impact now, are we?). But wait, there’s more…

 • 12% of the programs had unrestricted contact. These were still vendor-neutral programs with all submittals going through the VMS tool, but the staffing firms had the ability to communicate with the hiring manager, understand the projects and challenges and discuss solutions. In these programs, the order volume going through the program (and to ALL suppliers) was EIGHT TIMES that of a no-touch program. We’re not even going to do that math for you but trust us—it’s a lot.

In vendor neutral programs where firms can talk to hiring managers the order volume is 8x larger, helping all suppliers.

This probably sounds great, right? I mean, who can argue with all three entities winning by rethinking hiring manager engagement? So, what are some simple ways a contingent labor program can test these results?

How to Save the Day

1. Ask this simple question: Do you believe there are contingent workers being engaged outside of the program?
   If the answer is NO – congratulations! You are in an exceptionally small group. (Or possibly in a state of denial, we aren’t here to judge.)
   If the answer is YES – read on (hint, the answer is probably yes. Trust us).
2. Learn more. Speaking of trust, it must be earned, and unfortunately, not every supplier will behave. So, engage your best suppliers in meaningful dialogue about how to grow the program. Leading suppliers have very sophisticated ways of predicting spend opportunities in their space and can provide tremendous insight.
3. Try it. Open your program to some level of hiring manager engagement. You can set goals and ground rules, and you can even start small. But don’t miss out. In a recent program, one staffing firm was able to triple the size of the creative category in 18 months (feel free to reread that if you like, it will still say TRIPLE).

There you have it. You’ve let go of the past, and your contingent labor program can now thrive and grow. All that’s left is for you to revel in the fame and glory that you will receive for being modern, smart, and forward-thinking. And you really deserve it—after all, you DID just save the day!