Note This article is refreshed to reflect current trends and best practices in contingent labor programs and MSP strategies by Kelly Boykin, Founder, Growth Curve

Most of us remember report cards in school. Some may recall an exciting experience, a chance to confirm greatness, a time to shine. Others might not want to remember them at all or repress that experience into a deep, dark part of the soul that is only shared with a best friend or puppy (and maybe those are one and the same?). Regardless of how we felt about report cards, their intent was simple: feedback equals improvement.

Now, those who know me wouldn’t necessarily call me a data nerd.   Book nerd? Sure.  Disney nerd? Without a doubt.  But when it comes to leveraging data – most of which we already have –  and using it to think differently about solutions, change the dynamic of a partnership and differentiate from everyone yes?  Absolutely. I am that kind of nerd.  By the way, I am Kelly Boykin, and this is one of the ways we support staffing firms at Growth Curve.   But let’s get back to the good stuff.

In the contingent labor space, the equivalent to the school report card is the Supplier Scorecard. Managed Service Providers (MSPs) produce these based on the Key Performance Indicators (KPIs) that are most important to the customer’s contingent labor program. They measure the supplier, share the data and provide feedback, all with that same, simple goal: feedback equals improvement. It is meaningful and can be very helpful. Unfortunately, it is also incomplete.

Since the data is one-directional, it only tells part of the story. And worse, it only facilitates improvement for one member of the partnership – the supplier.

Who Loses Out?

• MSP program teams. These teams are often staffed with tenured resources, many of whom ‘grow up’ with the program. This allows them to be experts and oftentimes know more about the customer’s organization than, well, the customer. But it can also cause them to live in a silo, with knowledge based on that single program. They revert to what they know, which makes it easy to miss what they don’t know.
• The client customer. This group also misses out. Business evolves, competitors change, and problems are solved with new innovation. The customer knows their own organization. The MSP knows the customer. But some suppliers work with a diverse cross-section of industries, companies, and MSPs and have significant knowledge to share. Lack of exposure to what’s happening on the ‘outside’ can create a limiting, myopic strategy.

What if the scorecard process was two-way? What if everyone came to the table with data, insights, and feedback with the goal of mutual improvement?

Implementing Reverse Scorecards

Gathering data about contingent labor programs is critical. Leading suppliers measure key metrics and roll them up to the most important categories. They use this data for internal purposes, such as resource allocation and account prioritization, and categorize programs based on their quality and issues.

Recognizing the need to share feedback, especially tough feedback, is essential. Implementing reverse scorecards involves creating a proprietary system to share data in a way that tells a story. In essence, comparing programs and identifying strengths and challenges helps propose solutions.

Addressing Concerns

Initially, there may be concerns about whether MSP program teams will care about supplier data, whether they will be offended, or if it might backfire. However, experience shows that MSP program teams, (made up of caring human beings who also want to help their customer), appreciate an invested partner who brings data, constructive feedback, and candor. This approach reframes the conversation and opens discussions about new solutions.

Common Program Challenges

When creating reverse scorecards, common program challenges often emerge for the supplier:

• Low volume in specific categories. This is usually combined with barriers to hiring manager engagement. Lack of adoption inside a program is challenging, especially if suppliers can’t be part of the solution.
• Low fill rates / inefficient order processes. Contributing factors include the number of suppliers in a category, the percentage of submittals shortlisted, and the speed of the order process. If filling roles is too hard in one program versus another, the best recruiters will allocate top talent elsewhere.
• Lack of meaningful relationships. Measuring program team responsiveness, advocacy for suppliers, and investment in supplier success is crucial. A partnership is a two-way street and needs investment from both sides. While harder to quantify, this is the most important contributor to success.

Results

So, did improvement occur after these candid conversations? Here is recent outcome one firm saw within the first two quarters

• Twenty-five programs improved in status (rank) because critical challenges were resolved.
• Exiting fifteen programs was necessary. If a program doesn’t make sense for all three stakeholders in the partnership, then a professional ‘break up’ is smart (It’s not you, it’s me!).
• New orders increased by 40%. Even with fewer programs, there was an increase in order volume as challenges were resolved and capabilities revisited.

The Bottom Line

To be a good partner, seek out, listen to, and act on feedback. To be a great partner, be willing to give feedback. Positive feedback reinforces good behavior and builds friendly relationships. Constructive feedback is essential for creating solutions.

Remember, no problem was ever solved with silence. Prepare your data and be generous with your feedback. You might even earn an A+ for effort!

If you want to learn more about how we can help, reach out!