Case Study: A Global MSP Produces Significant Efficiencies and Savings

One of the largest telecommunications companies in the world wanted to consolidate its global contingent workforce management efforts to create greater visibility within its workforce, maximise efficiencies and realise significant cost reductions.

The process of streamlining multiple Managed Service Provider (MSP) programmes for an organisation of this size was going to be a challenge. For starters, their contingent headcount totalled 4,700 across 400 locations in nine countries, but there were a number of other technical and practical challenges to address.

Take the Vendor Management System (VMS) as an example: the company had seven separate instances of its VMS across multiple locations, but there wasn’t an efficient system to record whether workers were being classified appropriately or their rates were competitive. Around 250 suppliers were included in the previous programme and all the original suppliers needed to be included in the rollout. There was also a significant amount of spending by local hiring managers due to decentralisation – Statement of Work (SoW) arrangements in particular would have been better suited within the MSP. In addition, continuous deployment on a global scale was required, as the company continues to expand through acquisitions.

For a project of this size and complexity, the company needed an MSP partner with a global presence, extensive technical experience, a first-hand understanding of their corporate culture, as well as the experience to navigate local market conditions and stakeholder management needs. TAPFIN already had years of experience partnering with the client, providing solutions ranging from the US MSP and Recruitment Process Outsourcing, to executive coaching and strategic consulting, so were uniquely suited to delivering the global MSP implementation.

TAPFIN designed a holistic Global Workforce Solutions programme to meet the client’s extensive needs, enabling both the team and the client to leverage the capabilities of a large group of global specialists across the ManpowerGroup family of brands. 31 specialists in the global programme team provide on-site support in the US, EMEA and India, encompassing operational support for time, material and SoW engagements, strategic initiatives and business intelligence.

The TAPFIN team were first tasked with developing a comprehensive solution that focused on supplier optimisation. To drive higher quality across the board, best practice standards were introduced, including scorecards and rules of engagement. The new supplier rationalisation initiative has reduced the total volume of suppliers (partly by identifying the low engagement suppliers) and, in turn, cultivated a higher quality vendor pool. As well as creating a more manageable list of suppliers, the reduced total number has created cost savings and increased efficiencies and quality.

Aligning technology was the next core area to address in the integration, including vendor management and enterprise platforms, as well as sourcing and approval systems. In one example, the team used its deep expertise of existing VMS platforms to merge and consolidate seven instances of the client’s VMS technology. To improve invoice accuracy and standardisation efforts, four separate enterprise platforms were also aligned into one foundational feed. Making improvements to the authorisations that feed into the approval system resulted in tighter control over sourcing-related financial approvals. Lastly, the team created custom interfaces for the client’s contract sourcing module, to improve the efficiency of SoWs.

A range of cost-saving initiatives in the programme have successfully reduced overall expenditure, without sacrificing quality or productivity. To achieve this, the team systematically identified areas of potential savings, proactively implemented solutions and reviewed these on an ongoing basis. These measures are organised into three categories:

1. Soft savings. These include reductions in economic costs by modifying the maximum rates offered in requisitions, along with overtime or double-time factor savings, calculated through a reduced mark-up.
2. Hard savings, including reductions in the overall MSP implementation cost, programme-wide rate reductions and VMS rebates based on volume and economies of scale. They are also achieved by opening up certain service activities, such as payroll, to a competitive bidding process.
3. Cost avoidance can include creating efficiencies in accounts receivable systems and transferring screening costs to suppliers, so that they can carry out candidate background checks or test for illicit substances, for example.

The programme also involved the development of a formal process for SoWs and training sessions for relevant lines of the business, to help reduce the significant spending on unauthorised SoW engagements.

The final core area of focus is strategic consulting. The TAPFIN team provides ongoing insight into industry, market and competitive opportunities, as well as recommendations for recruiting and sourcing innovations. Alongside this ongoing support, the team also engages in speciality initiatives. One such example is a best-in-class fellowship programme: a pipeline of advertising and marketing talent was built in a short time period by exposing emerging talent in these disciplines to all of the company’s internal and external creative resources.

As a partner to the global telecoms company, TAPFIN has delivered the following results:

• Total cost savings of $62 million. This includes $33 million in soft savings, $25 million in hard savings and $4 million in cost avoidance.
• A 32% reduction in the total supplier pool.
• A request-to-job posting time of under two hours.
• Time-to-shortlist happens within two days, while time-to-fill averages 10–25 days.
• The retention rate for technical skills is more than 90%.

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